Policy Clean Transportation System

Published on February 5th, 2016 | by Steve Hanley


The Oil Tax! Obama Wants To Invest In Clean Transportation

February 5th, 2016 by  

President Obama will send a budget to Congress next week that proposes significant investments in clean energy technology. Called the 21st Century Clean Transportation System, the proposal would increase funding for public transportation, help America lower its carbon footprint, and create “hundreds of thousands of good-paying, middle-class jobs each year,” the White House press office says. The major priority of the proposal would be to significantly reduce greenhouse gas emissions from the transportation sector, which is responsible for about one third of all emissions in the US. House Republicans have labeled the Obama plan “The Worst Idea Ever.”

Obama proposed oil fee

How would we pay for all this? The Obama proposal calls for a $10 per barrel fee on oil. According to Quartz, that would raise approximately $180 million a day if applied to all the oil sent to US refineries daily. For motorists, the fee would add about 22 cents to every gallon of gas or diesel. Opponents characterize this as an “oil tax.” Of course, everyone is opposed to taxes. It’s an article of faith in the political world that the surest way to kill an idea is to label it a tax. But it really is a mechanism to level the playing field and force oil companies to help pay for the incalculable harm they have done to billions of human beings and the environment for the past 100 years or more.

The Clean Transportation System

What would the plan do? According to Think Progress, the Obama plan would add money to the Highway Trust Fund to help maintain the nations roads, bridges and tunnels. It would fund clean energy research, add electric charging infrastructure for EVs, and promote the development of autonomous driving solutions. “This proposal, if enacted, would generate substantial and sustainable new revenue to transform our transportation sector and cut carbon pollution,” said Greg Dotson, vice president for energy policy at the Center for American Progress.

Americans waste an average of 7 billion hours a year while stuck in traffic. The plan boosts funding for public transit options, including upgrades to the nation’s railway system. It would add $10 billion per year for state and local governments to to cut carbon pollution, “by encouraging better land use planning, investing in clean vehicle fueling infrastructure or increasing use of public transportation.”

Response to the plan

Not surprisingly, environmental groups applaud the plan. Sierra Club executive director Michael Brune points out that the plan is in line with commitments made by the United States at the Paris climate summit in December. “President Obama laid out more of his vision of how we can meet this agreement by challenging Big Oil’s stranglehold on how America powers its transportation sector,” Briune says.

Also not surprisingly, Congressional Republicans and oil industry executives dismiss the plan as unworkable. Oil billionaire T. Boone Pickens tweeted, “Dumbest idea ever?” House Speaker Paul Ryan issued a statement saying the “president should be proposing policies to grow our economy instead of sacrificing it to appease progressive climate activists,” and said it was an “election year distraction” that “this lame-duck president knows” is “dead on arrival in Congress.”

Economic Benefits From Investing In Infrastruture

Let’s examine those claims by Paul Ryan. I am no economist, but I am generally aware that the interstate highway system started in the 50’s and completed in the 60’s has been one of the greatest engines for economic growth in the history of America. According to the website Public Purpose, “It is not an exaggeration, but a simple statement of fact, that the interstate highway system is an engine that has driven 40 years of unprecedented prosperity and positioned the United States to remain the world’s pre-eminent power into the 21st century. [T]he nation as a whole…..has reaped a gain of at least $6 in benefit for each $1 spent in construction. And that’s just the beginning. There are additional benefits such as higher employment rates and greater economic opportunity that are simply beyond quantification.”

This leads me to question just what “policies to grow our economy” Paul Ryan is referring to? Reasonable people may have different ideas about exactly what infrastructure improvements will result in the greatest economic good, but is Ryan suggesting the President’s proposals will have no positive economic benefits? Such a claim seems patently absurd on its face.

What about oil subsidies?

The complaints of Ryan and Pickens conveniently ignore the massive subsidies the oil industry gets from taxpayers in America and around the world every year, a number the International Monetary Fund puts at $5.3 trillion dollars. That figure includes the massive health costs imposed upon society by the emissions resulting from burning fossil fuels.

Those who bemoan the cost of transitioning to a fossil fuel free economy fail to address the costs of not transitioning away from fossil fuels. They seem to believe that we can continue with business as usual for ever and a day and never have to pay the piper. As long as selected individuals can fatten their wallets at the expense of others and continue to buy malleable politicians who will say anything to keep their jobs, we are all at risk from rising sea levels, shrinking agricultural production, hotter temperatures, and poisonous air.

Should I write a letter?

YIP Harburg, the noted songwriter who composed Over The Rainbow, was also the author of a collection of satirical poems entitled Rhymes For The Irreverent. One of them attempts to answer whether writing a letter to a Congressman is a worthwhile endeavor. It goes like this: “Each Congressman has two ends — a sitting and a thinking end. And since his whole career depends upon his seat……why bother, friend?” An excellent question if there ever was one. Perhaps the “dumbest idea ever” is not the President’s Clean Transportation System plan, it is continuing to elect ignorant people like Paul Ryan to Congress.

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About the Author

I have been a car nut since the days when Rob Walker and Henry N. Manney, III graced the pages of Road & Track. Today, I use my trusty Miata for TSD rallies and occasional track days at Lime Rock and Watkins Glen. If it moves on wheels, I'm interested in it. Please follow me on Google + and Twitter.

  • zn

    My guess is Obama knows this will tank in Congress, but in a way it doesn’t matter. This bill is the first major salvo fired at big oil, and though it might fail, it certainly shows the intent to reign in fossil fuels subsidies is definitely present.

    Sure, it’s an easy win for the Republicans to label this an ‘oil tax’ and sink it before it even hits the water, but the public will at least have the chance to ponder the pros and cons of a transportation system that is largely based on technology conceived over a century ago.

    • Steve Hanley

      Not sure the idea of the electorat pondering is very comforting to me. These days, it seems “the electorate” is made up mostly of reactionary know nothings who think “progress” is a dirty word. I hope I am proven wrong.

  • It sounds like you’re not 100% clear on how social security works. That is largely funded by tax dollars … so, if you’re on social security, you have your fingers in everyone else’s pockets, even if you did pay in. Additionally, fiat currency isn’t a finite resource, so taxation is one of the means used to ensure it has value. Taxation is the primary reason American dollars have any value, in fact … so, yeah. I guess that’s new? 🙂

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