"Members of the Journal’s CEO Council tasked with discussing priorities for the U.S. economy and finance offered several fairly uncontroversial suggestions to the incoming administration: implement a fiscal stimulus plan without worsening the long-term deficit, appoint a panel to address financial regulation, create an economic vision.
Tucked away in the proposal, in the category of long-term tax policy, was this political grenade: “consider raising taxes on gasoline.”
“We decided not to self-censor,” Time Warner CEO Jeffrey Bewkes said in presenting the proposal. He acknowledged that members of the group believed neither party would support the prospect.
“It’s been talked about but not done for years,” he said. “We thought that maybe this was a time when this could be raised.”
Raising the gas tax has been seen for years as one solution to discourage gasoline consumption, a move that could benefit the nation through lower imports, a cleaner environment and a stronger push toward fuel efficiency. Some economists have even suggested offering rebates to lower-income consumers so they’re not disproportionately hit by the tax hike.
Mr. Bewkes said the group’s members, who focused on the U.S. economy and finance, generally agreed that carbon taxes are likely to be more effective than a cap-and-trade approach to dealing with carbon emissions.
Members raised the issue along with a call to lower corporate income taxes while making it more broadly based. At the same time, they acknowledged that “somewhat higher personal tax rates” would be necessary given the economic troubles, Mr. Bewkes said.
The only comment from assembled CEOs came from UPS chief executive Scott Davis. And he didn’t even oppose the idea of a gas tax. “The principle is fine,” he said, but the concern is where the revenue goes. “We’d like to see it reinvested in the infrastructure, the highways, the airports.” The revenue from the current gas goes largely toward infrastructure.
Joining the CEOs in a larger group to comment on the proposals was Sen. Maria Cantwell, a Washington Democrat. Her response was fairly limited, indicating her recognition of the political peril around the prospect of the government raising gasoline prices: “I applaud you for your boldness.” – Sudeep Reddy
Here's my comment:
Comment by - November 18, 2008 at 5:43 pm"Now from Greg Mankiw:
Allan Sloan joins the Pigou Club:
Having permanently high gas prices would let the market, rather than incomprehensible, loophole-ridden Corporate Average Fuel Economy regulations, make the decisions on what kind of vehicles Americans get to drive. As part of my plan, I'd scrap these CAFÉ standards, abandon the current attempts to force automakers to spend tens of billions of dollars to meet higher fuel-economy standards. Instead, the market, guided by a high gas tax, would rule.
Members of the Journal’s CEO Council tasked with discussing priorities for the U.S. economy and finance offered several fairly uncontroversial suggestions to the incoming administration: implement a fiscal stimulus plan without worsening the long-term deficit, appoint a panel to address financial regulation, create an economic vision.
Tucked away in the proposal, in the category of long-term tax policy, was this political grenade: “consider raising taxes on gasoline.”
Can I join the Pigou Club? And can you get me into the Drones Club?
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“consider raising taxes on gasoline.”
This seems like a good time to try it with gas being so low, except that would negate the stimulus effect of the decrease in the price of gas. Was that problem or issue discussed? I suppose not since everyone agrees it’s going nowhere.