Fuel Consumption Down 11%

I can see the next Congressional bill, 11% increase in fuel tax for 2014.

 

The US government is currently spending about $0.31/gallon on infrastructure but collecting $0.186, and simply running a deficit for the difference. Raising the tax to $0.31/gallon would be lower adjusted for inflation per person than it was in 1993 when instituted.

 

“The decline of 11% since 2004........."

A decline of 11% in 9 years is pretty good, and if we keep up a 1% or better annual reduction in fuel use, we use NO foreign oil by 2030 (not even from Canada) and will be a significant oil/refined products exporter by 2050.

There are a few trends to watch out for, though:

(1) 90 million more Americans are on the way, set to be added to our population by 2050
(2) CAFE standards of 54.5mpg by 2025 will work their way through the fleet by 2040, but unless a new standard is set, declines in fuel use will plateau out
(3) As the cost-per-mile of driving falls, VMT may once again rise, the so-called "rebound affect". It probably won't be significant enough to reverse the decline, but it could stall it.
(4) Another thing that could increase VMT is new technologies such as 'smart' highways and driverless cars. These could potentially eliminate traffic as we know it, and significantly increase average vehicle speed (and fuel use). We must remember that cost-per-mile is not the only factor affecting VMT.....time spent commuting is too, and probably a larger one. Reduce this, and VMT goes way, way up.
(5) One of the reasons for reduced VMT in recent years wasn't just the price of gas (and certainly not broad concern for the environment or energy security, save for a small sub-set of the population) but rather the tough economy. Americas were looking to save money and cut their budget, and reducing unnecessary driving was one way to do so. If the economy improves -which hopefully, it will- then that combined with (3) and (4) will raise VMT even more, as well as encourage more licensed drivers, a trend that has up till now been declining, especially among the young

1-5 would be trends that could reverse the decline in oil use, but there are a couple that could keep it going, or even accelerate it, namely:
(1) a carbon tax (or a dramatically higher gasoline tax for other purposes, such as infrastructure)
(2) a massive war or crisis in the Middle East (even if we don't import a drop of oil, current law allows American refineries to export finished product, so motorists here would be competing with China and India for our own gasoline, once they can't get oil from the Persian Gulf)
U.S. Refiners Export More Fuel Than Ever - WSJ.com
(3) Some sort of hydrogen, bio-fuels, or battery breakthrough, making these cheaper than oil-based fuels absent (1) and (2)

 

I see no objection to using foreign oil. It helps raise third-world and second-world peoples to a higher standard of living. (Similarly I have no objection to more-and-more factories being built in China, and raising those poor persons above subsistence level.) People who insist "don't buy foreign goods" don't seem to realize they are harming other humans beings (depriving them to improve their standard of living).

 

BTW I support raising gas taxes, in order to repair bridges that are literally crumbling (concrete flaking off). While we're at it, let's also add a tax to train tickets in order to cover the rising costs of rail maintenance & electricity/diesel used by the locomotives. Plus to fund improvements to increase rail speeds from 70 to 300 miles an hour (high speed rail).

 

You're going to have to wait until Hillary is elected to go tinkering with the gas tax....and even THEN you'll have to wait for term 2.0.
Granted...a 12 centavo gas tax increase won't sting as much when it's going for $2.89...but my former boss has spent just about all of his political capitol on the ACA, and bolting a gas tax on top of that would be just about enough to flip the Senate in 11 months.
He just doesn't have the grunt to try it now...and besides...remember?
The Constitution?

Congress Critters authorize spending and collecting taxes.
They'll be sprinkling salt on the sidewalks from where HELL has frozen over before the House signs off on a gas tax hike.

 

Re: ethnaol issue - The drop in gaso demand explains the problem EPA just resolved...for the 2007 Renewable Fuels Standard law, Congress assumed gasoline demand would keep going up and up. So Congress mandated a large increase gallons of ethanol to be blended in, essentially to hold ethanol at 10%. Instead gaso demand went down and there is no place to put all the ethanol Congress mandated.

Virginia saw the revenue decline and decided the answer was to tax hybrids, but I think we will probably kill that provision soon. The big thing VA did to solve declining revenue, was we lowered gasoline tax and substituted sales tax increase as a more reliable funding source. There is an argument that gaso tax is regressive (hurts lower incomes) so *possibly* makes some sense. With the decline of pump prices, VA's gaso tax is approaching 8 cents a gallon (we are now 3.5% of wholesale) which means we are neck-in-neck with Alaska for the lowest state gasoline tax in the USA. Geez this has to be hurting our state tax revenue...they should have kept the 17.4 cent gaso tax we had.

You should read some of the books by Robert Bryce such as Power Hungry, and also Jerry Taylor of Cato Inst. You are basically voicing the libertarian view that political rhetoric about the need to reduce foreign imports of oil makes no fundamental sense other than it's a politically popular notion. But we run our country mostly on political notions. If we instead ran our country on boring facts, we'd have more scientists and engineers in office (like other countries).

 

I don't want to go down a political rat hole with you here, but Reagan raised the gas tax the highest percentage, and the economy soared, instead of sank. Politicians seem to be keyed on this issue, and riling up anger, for their own selfish purposes.

There has been a great deal of dishonesty from both sides on the ACA. If some of these guys would just tell the truth, things would go much easier, but I guess that is too much to ask from Washington. Bush didn't get rid of cheany or rummy when they had failed him miserably, and I guess Sebelius's job is safe too, as corruption and incompetence is a guaranty of a career in our government. Only the american public have to suffer never the politicians.

But wouldn't it be nice if we could actually have tax reform in this country, close loopholes, raise oil and coal taxes, drop payroll tax and corporate tax rates? But that might be bad for the PAC of the day, the campaign donor, that even though they lack competence gets a government contract, and when they are late with a shoddy product, they get paid more.

I do, and their is nothing unconstitutional about raising fuel taxes.

That is no reason to excuse them. And I would think many would like a compromise where fuel taxes were raised and payroll taxes lowered. Raise the heat on your congress critter if their aim is to a) say ACA is working fine, b) fuel taxes are too high, c) health care was working fine before ACA. All are big fat lies.

 

I think gas taxes should be raised too. But it's a political hot potato no one wants to touch. I think it should be raised 30 to 50 cents per gallon immediately but lobbyists will be all over that. How about something more gradual like raising it 1.5x the rate of inflation annually to not only keep up with inflation but catch up on the badly underfunded highway funds to repair roads and bridges.

 

AND raise the tax on train tickets. We need high speed rail but we also need funding... that is an obvious source.

Also Detroit shouldn't worry. With all the new technologies being added to cars (turbos, ultra-high-pressure injectors, variable cams, lean burn via direct injection), engines have more things that will go wrong & end their lives before they reach 200,000 miles.

 

That was then.
This is now.
Cars got 20mpg back in then 80s.
I was 15 pounds lighter and had more hair.

I'm a unionized employee, so I'm insulated from the ACA until it impacts the general economy or I get laid off. I only mentioned it because right now there is ZERO interest on Pennsylvania Ave for adding an unpopular new tax onto the pile.

Don't look at me.
If I were king for a day, I'd eliminate ALL tax loopholes, carve-outs, exclusions, exemptions, deductions, etc....from the tax code before lunch.
We could negotiate about energy taxes before supper....but the resulting tax code could be written on the back of one piece of paper.

It's not unconstitutional.....just unpopular.

Hey....I'm holding up MY end of the log.
I voted against my incumbent Congress Critter.
I'll do it again.
FWIW I think that taxes are going to have to be raised....AND spending is going to have to be cut.

Now.....
Find me somebody who will agree to do both.
You're going to have to look long and hard, because usually it's JUST one or the other.

 

Ummmm........I take it you've never been to Dubai.


I was there in 2011. I suggest you go. Skyscrapers, shopping malls, freeways, condos.......all sprouting like flowers in the desert. Your Oil Money at work!!

"Helping 2nd and 3rd world countries to a higher standard of living?" What planet are you living on, exactly? Qatar has the world's highest per-capita income, over $100k/person. Education, health care, retirement.......all free. Your Oil Money at work!
It amazes me that as the rest of the world develops the fastest trains, highest skyscrapers and largest sovereign wealth funds, America's infrastructure crumbles, its education fails, its debts soar, yet somehow Americans still think they're "#1". That is soooooo 20th century.

Also, a lot of the oil exporters don't share their wealth with the population, but enrich a small, corrupt ruling elite who use it to arm themselves to the teeth. Russia, Venezuela, Texas, Iran.......the list goes on on and on.

Umm.......no. That's not how the global economy works. You are right that China's living standards go up, but in terms of 'harming other human beings' you are missing the link between those factories and the increasing joblessness of Americans at the bottom of the skills ladder.
iPhones made in China enriches working class Chinese and wealthy shareholders here in the U.S. For most middle and working class Americans, the gains from this type of trade are a net-negative.

 

a. Given that the average person wants to travel the same distance on a daily basis...anyone who understand math can see that as efficiency increases, eventually you reach a point where further gains are not really possible. Think of it this way. If cars are now 26% efficient and we make them all 52% efficient, that is doubling their efficiency. Now tell me how we are going to ever double it again?
b. The 54.5 mpg is a fake number that isn't the real mpg that cars get.
c. A lot of the cars can move to EV or other technology

Yeah, eliminate traffic as we know it. Maybe just to some other traffic that we don't know about yet. First, this makes zero sense. It makes no sense to have a lot more throughput available than is typically being used -- it is just extra lanes paved for now reason. If all cars were driverless and had perfect software and 10-20 years went by then building on new roads to new areas would have fewer lanes, etc.

Mike

 

Or the US being deep in recession.

 

Gains are always possible, until consumption is zero.

Say it takes x gallons per mile to move a car today.
x/2 uses half as much fuel for the next mile
x/4 uses one half as much fuel for a future mile as we used at the x/2 stage
... ...

 

maybe you should reread what you quoted

 

Anyone have a link to the report this article was based on? I'd be interested in seeing the figures on declining mileage driven. Anecdotally, I don't see it on the roads (even though my own driving has come down in the past year); and we all know how much anecdotal evidence is worth.

 

Here is a source for vmt per capita
» Per capita VMT ticks down for eighth straight year SSTI


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