Freedom of Speech

America's sudden change in car-buying habits makes suitable mockery of that absurd debate Congress put on last December on fuel efficiency standards. At stake was precisely what miles-per-gallon average would every car company's fleet have to meet by precisely what date.

It was one out-of-a-hat number (35 mpg) compounded by another (by 2020). It involved, as always, dozens of regulations, loopholes and throws at a dartboard. And we already knew from past history what the fleet average number does. When oil is cheap and everybody wants a gas guzzler, fuel efficiency standards force manufacturers to make cars that nobody wants to buy. When gas prices go through the roof, this agent of inefficiency becomes an utter redundancy.

At $4 a gallon, the fleet composition is changing spontaneously and overnight, not over the 13 years mandated by Congress. (Even Stalin had the modesty to restrict himself to five-year plans.) Just Tuesday, GM announced that it would shutter four SUV and truck plants, add a third shift to its compact and midsize sedan plants in Ohio and Michigan, and green-light for 2010 the Chevy Volt, an electric hybrid.

Some things, like renal physiology, are difficult. Some things, like Arab-Israeli peace, are impossible. And some things are preternaturally simple. You want more fuel-efficient cars? Don't regulate. Don't mandate. Don't scold. Don't appeal to the better angels of our nature. Do one thing: Hike the cost of gas until you find the price point.

Unfortunately, instead of hiking the price ourselves by means of a gasoline tax that could be instantly refunded to the American people in the form of lower payroll taxes, we let the Saudis, Venezuelans, Russians and Iranians do the taxing for us -- and pocket the money that the tax would have recycled back to the American worker.

This is insanity. For 25 years and with utter futility (starting with "The Oil-Bust Panic," the New Republic, February 1983), I have been advocating the cure: a U.S. energy tax as a way to curtail consumption and keep the money at home. On this page in May 2004 (and again in November 2005), I called for "the government -- through a tax -- to establish a new floor for gasoline," by fully taxing any drop in price below a certain benchmark. The point was to suppress demand and to keep the savings (from any subsequent world price drop) at home in the U.S. Treasury rather than going abroad. At the time, oil was $41 a barrel. It is now $123.

But instead of doing the obvious -- tax the damn thing -- we go through spasms of destructive alternatives, such as efficiency standards, ethanol mandates and now a crazy carbon cap-and-trade system the Senate is debating this week. These are infinitely complex mandates for inefficiency and invitations to corruption. But they have a singular virtue: They hide the cost to the American consumer.

Want to wean us off oil? Be open and honest. The British are paying $8 a gallon for petrol. Goldman Sachs is predicting we will be paying $6 by next year. Why have the extra $2 (above the current $4) go abroad? Have it go to the U.S. Treasury as a gasoline tax and be recycled back into lower payroll taxes.

Announce a schedule of gas tax hikes of 50 cents every six months for the next two years. And put a tax floor under $4 gasoline, so that as high gas prices transform the U.S. auto fleet, change driving habits and thus hugely reduce U.S. demand -- and bring down world crude oil prices -- the American consumer and the American economy reap all of the benefit.

Herewith concludes my annual exercise in futility. By the time I write next year's edition, you'll be paying for gas in bullion.

lol, anthing to do with congress and the government is an excercise in futility. I have been recommending a gas tax that took us to 5 dollars a gallon back when it was under 2 dollars a gallon also. Lol i am seeing suv's disapearing off the roads overnight. amzing isn't it.

Yes, it all happened all of a sudden, and it did not happen for the three years gas was around $3. $4 did the trick.

And the May sales numbers were unbelievable, the F150 did not just slip from no. 1 to no. 2 but to no. 5 (!), and sold more than 10,000 units less than the top three Civic, Corolla and Camry.

Now the big 3 believe this will continue, it is not a passing spike.

I am still driving my SUV and will continue to do so. Of all the people I know that also drive an SUV not one has traded vehicles. I see just as many on the roads as I saw last year and the year before that.

"I am still driving my SUV and will continue to do so. "

Unless you tow a boat on a daily basis or take it off road daily too, it was thw wrong decision to get the StupidUglyzVehicle when prices were $1 a gallon, and it is 4 times as wrong now that they are $4. But I hope youy keep driving it, so gas goes at $6 and EVERYBODY gest sober and dumps the automotive atrocities breavans on Stilts.

"Of all the people I know that also drive an SUV not one has traded vehicles. "

That is NOT because they love them... LOL. It is because their resale value vs last year has gone down by $20,000 in many cases, and it makes ZERO sense to sell it and get a Prius, or, better, a modern DIESEL. Too late for that now.

"I see just as many on the roads as I saw last year and the year before that."

This is ABSOLUTELY NOT THE CASE where I live (Ann Arbor MI, they have virtually disappeared, and I can walk to the office with far less smog in my face. Our students and low paid staff can no longer afford to commute in these POS and have switched to bikes, scooters, smaller older Hondas and TOyota compacts, and mass transit. Already.

HOw do you propose that poor working people pay this gas hike. Public transit is on the rise for those near to it. What about those folks who cannot access public transit and need their cars to go to work? Have a heart, why don't you? Have you ever taken you kids to the babysitter on the bus? Get real. Throw your money in the salvation army pot and leave the price of gas alone.

Since we cannot count on the "do nothing" congress to do even the obvious things to help solve the energy crisis (in fact IMHO they are consciously moving to push up the gas prices to assure Obama's election), Americans can do things to help reduce oil consumption. I would not go out and buy a SUV if I were in line to buy a new car, but a lot of people who own them aren't in a position to buy an efficient car that meets their families needs.

What people can do is drive less. Join car pools, shop once or twice a week, not everyday, think out your day to make your necessary trips more efficient. Drive at the speed limit and use cruise control where possible - the less you accelerate and brake, the more mileage you will get from any car. For some, public transportation is available, use it if you can. All of these take some sacrifice either in time or convenience, but they do save gas and save money. Best of all, we don't have to wait for the government to get off their dead a**** and provide solutions.

Maybe you are not as Wellinformed as you say. I simply stated the facts as they pertain to me and people I know well. People can drive whatever they want, I really don't care if the car next to me is a BMW or a V W. No, my friends are not keeping their SUV's because they can't sell them, we keep them because we like them. I will not drive a small car as I feel they are not safe. These are my thoughts and opinions and I am entitled to them as you are to yours. You have no idea how many miles I put on my vehicle in any given week, maybe it's 50 or maybe it's 500. I pay for my fuel, it could be that some people that are complaining about the SUV's on the road are using too much electricity in their home or using energy in a way that I don't.

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Sorry I hit the key twice, there I go wasting electricity. LOL it really was a mistake :~)