It is finally starting to feel like spring around my parts. Warm weather means a lot of things; the beach, going topless in my Wrangler, and cringing every time I pull up to a gas pump. Gas has been fluctuating in recent weeks, but here in Connecticut it is only a few cents away from $3 a gallon. I wouldn’t be surprised to see it hit $3.50 in some places. Sounds expensive, but it wasn’t too long ago some of us were paying almost $4 a gallon or more. Remember that?
Now researchers at the Harvard Belfer Center for Science and International Studies report that, in order to meet the Obama Administration’s goals for cutting greenhouse gas emissions, gasoline would have to cost $7 a gallon. I’d have to sell my Jeep and buy a scooter at those prices. And I hate scooters.
I long ago came to realize that the government (no matter the administration) always seems overly ambitious in their goals. The EPA, under President Obama, wants to reduce greenhouse gases from the transportation sector by 14% of 2005 levels. They want to do this by 2020, a mere ten years from now. To do so, Harvard researchers say that gas prices need to reach $7 a gallon. That means to fill your average, 15 gallon tank would cost over $100. Keep in mind that many Europeans pay that much on a daily basis—part of the reason they have such a bigger selection of fuel efficient cars.
For their part, Americans have been driving less and less, and cars are getting more fuel efficient, but still that isn’t enough. According to the researchers, gas needs to cost so much that it would be prohibitively expensive to be practical for most people. Some of the models the researchers used assumed a CO2 tax of between $30 and $60 a ton that would be placed on every part of the economy. For a Prius driver, that would mean an extra $200 t0 $400 or so per year in taxes (according to fueleconomy.gov, an average 2010 Prius puts out 3.7 tons of CO2 annually by driving 15,000 miles).
Since the Hummer brand is dead, the Prius needs a new nemisis. I propose the Rolls Royce Phantom. Why not? For someone who drives, say, a Rolls Royce Phantom, which puts out 13.1 tons of CO2 annually and gets an average of 14 mpg, it would cost about an extra $780 to about $1,500 a year. Not that bad.
Higher gas prices would cost a lot more. A lot, lot more. If gas prices were at $7 a gallon, the estimated annual fuel cost of a Prius would go from $810 to over $2,100. The Phantom requires premium fuel, but for the sake of simplification (I suck at math) we’ll say it can still fill up at $7 a gallon. The annual fuel cost for the Phantom would go from $3,149 to over $7,500. Yikes! (although a Phantom owner would likely not even notice the difference in his bank account).
$7 a gallon gas would also likely cripple our slowly recovering economy and drive many small business owners into liquidation. But even Bob Lutz has said that a higher gas tax is needed. I myself have slowly come around to the idea, but with one catch; we need more options first. Once electric cars are more affordable and practical en masse, a higher gas tax could accelerate the transition from petrol-to-proton powered cars. It could also compel more people to use public transportation. But until we have other choices, a higher gas tax won’t do much more than line the pockets of the government and impoverish the masses.
One day this country will be ready to have a serious discussion about the gas tax. Just not tomorrow.