A Gas Tax Holiday Meets $5 A Gallon Gas

Forget four dollars a gallon for gas. Some places are already there. The new price to watch out for is 5$ a gallon. And don’t expect it to stop there.

What I find interesting about all this is the panic surrounding the prices. Hillary Clinton and John McCain pushing for a gas tax “holiday.” Barack Obama pushing for a new “Apollo project.” How much more expensive is gas these days? I found a nifty site that calculates how much gas prices have risen relative to economic indicators like CPI or GDP. It’s about three times as much as it was 30 years ago. Additionally, while crude oil prices have skyrocketed since 2003, they are not much higher than they were during the late 70’s.

Per capita oil spending right now is only 1,400 dollars a year, about 6 percent of total consumer spending.

I agree that gas prices have shot up a lot recently, and that it would be really nice if they hadn’t. But they are not going to drop anytime soon; in fact, they are probably going to continue to increase for the foreseeable future. The longer we deny this fact, the harder this transition will be. I’ve been advocating a higher gas tax since the Clinton years. Yes, it sucks to pay more at the pump. But if we want to start consuming less gas as a nation, and we are going to need to, the boldest thing Clinton, McCain, or Obama could do to lower gas prices in 2012 would be to raise the gas tax in 2009.