Saving fuel? BAH!

[Subdude]

Does the government really make more in taxes from the sale of a gallon of gasoline than the oil companies do?

link

Even if it doesn't, isn't it a shame that it's even close enough to debate? I understand the taxes are used for infrastructure, yes? But were it not for porkbarreling, couldn't the govt lower their tax rate and in return give us considerably cheaper gas?

The argument can be made that lowering gas taxes is the last thing that should be done, and that gas taxes should instead be strongly increased. If the public and investors knew that fuel prices were going to stay high, then there would be a strong inducement to spend money and make serious efforts at reducing oil consumption. Incentives are weak if people think that prices are in a bubble and are likely to fall back soon (which is probably somewhat the case).

One way I've read it could be done would be to raise federal taxes on gas to where the average nationwide price before state taxes would be, say $5/gallon. That would be periodically inflation-adjusted. The $5 would be a floor, so that even if wholesale oil prices fell enough to drop the price of gasoline, the tax bite would increase to keep the retail price at the floor. Of course, all of this would be about as popular as ants at a picnic, but the point would be similar to that of high taxes on cigarettes - to change behavior.

There, I've said it. Fire away.

[TheNiche]

Could poorer and lower middle class families start demanding denser housing? If this trend in rising gas prices continues, how long will it be before the tradeoff for good schools and nice neighborhoods start to be less of a factor?

This dense housing doesn't need to be inside the loop. It can be in lesser desired areas (but not necessarily undesirable areas), which hopefully will keep rental rates and condo/townhome prices down.

Blue-collar and service sector jobs are pretty well spread out throughout our region, so for the majority of our poor, convenience to work and inner-city housing don't necessarily go hand-in-hand. And also, because the poor tend to lack specialized skills, it is often just as easy to move to Pasadena and find a job locally as it is to move to Stafford or Spring.

Those of the poor that do work in the inner city still have plenty of options to choose from (although people that aren't poor typically only ever bother to drive through poor neighborhoods that are transitioning, and seem to forget that there are plenty of other poor neighborhoods that are off the radar and still totally stagnant).

[RedScare]

It appears that Houston has its first $4.00 gasoline, a station located at Sw Freeway and Chimney Rock.

Gas Buddy.com

Enjoy your holiday travels.

[houstonmacbro]

It appears that Houston has its first $4.00 gasoline, a station located at Sw Freeway and Chimney Rock.

Gas Buddy.com

Enjoy your holiday travels.

I just filled up for $3.69 at the Sam's Club on I45 @ Richey Road.

[N Judah]

One way I've read it could be done would be to raise federal taxes on gas to where the average nationwide price before state taxes would be, say $5/gallon. That would be periodically inflation-adjusted. The $5 would be a floor, so that even if wholesale oil prices fell enough to drop the price of gasoline, the tax bite would increase to keep the retail price at the floor. Of course, all of this would be about as popular as ants at a picnic, but the point would be similar to that of high taxes on cigarettes - to change behavior.

I raised the idea on another thread that taxes should be increased to the point at which gas prices are expected to roughly level off (I'd guess about on par with gas prices in Europe). That way, people would only have to make the adjustment once. The price should be kept level, but the amount of tax should decrease as the price of gas went up. The trick would be guessing the eventual price of gas. So if we were pretty sure gas prices would level off at about, say, $8.50/gal then the price of gas + amount of tax would always = $8.50 no matter what. We could use the tax revenue to ease the transition for commuters who may have a hard time finding other ways to go about their daily due to more expensive oil.

[ricco67]

I just filled up for $3.69 at the Sam's Club on I45 @ Richey Road.

pft.

Interesting thing on the slower driving. I found myself driving 60 for the hell of it and I wasn't passed all that often. Do you think EVERYONE is slowing down?

On a slightly related note: I found this CNN article very interesting and not that surprising as I've slowly been seeing SUV's disappearing from some neighborhoods.

[Subdude]

I raised the idea on another thread that taxes should be increased to the point at which gas prices are expected to roughly level off (I'd guess about on par with gas prices in Europe). That way, people would only have to make the adjustment once. The price should be kept level, but the amount of tax should decrease as the price of gas went up. The trick would be guessing the eventual price of gas. So if we were pretty sure gas prices would level off at about, say, $8.50/gal then the price of gas + amount of tax would always = $8.50 no matter what. We could use the tax revenue to ease the transition for commuters who may have a hard time finding other ways to go about their daily due to more expensive oil.

The problem is that there is no way to judge where prices might stabilize. If gas costs that much in Europe it is due to taxes, not the underlying commodity price. If for whatever reason the commodity price exceeded the benchmark you would still have to increase the retail price above the benchmark.

[houstonmacbro]

I am seeing more and more trucks and SUVs in the dealers going unsold.

I also thought I heard GM is quitting production of the Yukon because they simply aren't selling.

[RedScare]

The number of obvious speeders does seem to have dropped just in the last 2 weeks. And tailgaters have disappeared. Much less stress driving slow these days. I'll bet if TxDOT put some gas message on their message boards like, "Drive 62, Save 15%", or something equally simple and true, it would drop even more.

[musicman]

the europeans and asians are buying used ones and shipping them back home. they had a story on this yesterday on 13.

The number of obvious speeders does seem to have dropped just in the last 2 weeks. And tailgaters have disappeared. Much less stress driving slow these days. I'll bet if TxDOT put some gas message on their message boards like, "Drive 62, Save 15%", or something equally simple and true, it would drop even more.

i haven't noticed any difference on the gulf freeway. this week i used cruise once to limit myself to 65 and i was being passed repeatedly.

[lockmat]

the europeans and asians are buying used ones and shipping them back home. they had a story on this yesterday on 13.

They're buying suvs? I've been wondering that even if people are going to sell off their truck and suvs, sure there might be a few buyers, who is buying the bulk of them?

It appears that Houston has its first $4.00 gasoline, a station located at Sw Freeway and Chimney Rock.

yippeeeee

[BryanS]

I am seeing wide variations in the price of diesel. I've seen 4.45, 4.50, 4.67 - within a one mile radius. I would hate to be a truck driver these days. I think I saw on CNBC that for the first time, since 1979, per capita, we are driving less in the US. Yet it is still to the moon with oil, demand from other countries. Over the past 3 years, world oil production has held steady at around 85 million... and the Shell Oil CEO said getting the easy stuff is getting more and more difficult... peak oil is right around the corner.

On CNBC in the mornings, there is this old guy, in a suit, who looks like he's just on the verge of a heart attack. He probably didn't plan out his retirement very well, because it looks like the poor guy has to work. Next to him, is this young FOX-News looking bimbo. She said, in the 1990's the price oil tripled - and stocks doubled - so what's the problem? The old man said... "If you put a frog in a cold pot of water and then slowly turn up the heat..." he'll be boiled alive before he knows it.

[lockmat]

I am seeing wide variations in the price of diesel. I've seen 4.45, 4.50, 4.67 - within a one mile radius.

In HOUSTON? yikes mama!

[musicman]

They're buying suvs? I've been wondering that even if people are going to sell off their truck and suvs, sure there might be a few buyers, who is buying the bulk of them?

individuals from what the story said. one of the ones interviewed was from germany. and i believe they said shipping was 1000 and insurance 500 for the trip home.

[ricco67]

individuals from what the story said. one of the ones interviewed was from germany. and i believe they said shipping was 1000 and insurance 500 for the trip home.

Tried to find the video/story and wasn't very successful at, but MM's dead on since I saw the report yesterday and can confirm what was said.

I forgot exactly why they want the SUV's here, aside from the fact they're saving a fortune even when you include the shipping costs.

[editor]

individuals from what the story said. one of the ones interviewed was from germany. and i believe they said shipping was 1000 and insurance 500 for the trip home.

You've got to be careful when shipping a car from the U.S. to Europe. Anything not bolted to the frame will magically "disappear." I know one woman who even got her windshield wipers stolen off of her Subaru.

[houstonmacbro]

I like the idea of shipping all our garbage cars to Europe. But I cannot imagine driving a Yukon with $8/gallon gas.

Just seems wrong.

[lockmat]

individuals from what the story said. one of the ones interviewed was from germany. and i believe they said shipping was 1000 and insurance 500 for the trip home.

Oh, I never saw the link so I didn't know there was an article.

[musicman]

I like the idea of shipping all our garbage cars to Europe.

looks like that garbage is making a few people some bucks.

[N Judah]

The problem is that there is no way to judge where prices might stabilize. If gas costs that much in Europe it is due to taxes, not the underlying commodity price. If for whatever reason the commodity price exceeded the benchmark you would still have to increase the retail price above the benchmark.

Then raise it a little higher, just to be sure. If it is too high then -worst comes to worst- you get extra tax money or maybe even get to make the politically heroic decision to cut the tax. But whatever you do, do it only once so that people don't have to keep making lifestyle adjustments over and over.

[Subdude]

I also thought I heard GM is quitting production of the Yukon because they simply aren't selling.

No way, Jose. True that truck and SUV sales have cratered and Ford is shifting production from trucks to cars. But still, trucks like the Yukon have been the car company's bread & butter for years. They are profitable enough that so long as there is still some reasonable demand they won't terminate production. Also, you have to realize that the current run-up in oil prices might very well be a temporary blip, and that prices could quickly fall back closer to (but still above) historical levels. If and when that happens, demand for the Yukon and its ilk will quickly rebound as we have seen happen in the past. There's no point in jumping the gun and ending production unless they could be sure demand would be cut on a more permanent basis.

the europeans and asians are buying used ones and shipping them back home. they had a story on this yesterday on 13.

This has all the earmarks of an instance being portrayed as a trend. I don't doubt there are instances where SUVs are shipped to Europe or Asia, but it simply doesn't make any sense on a large scale because giant SUVs make even less sense in other parts of the world where gas costs much more. However, given the ongoing weakness of the dollar I can see where exporting used vehicles that are more fuel-efficient might make a lot of sense.

[Subdude]

The CPI, the government's inflation index, is WAY undervalued. It always is and always has been. No president wants to be known for runaway inflation, so they pressure the analysts to substitute non-inflationary items for high inflation items. The items on their list change all the time. It is also heavily weighted with things like washing machines, things we buy every 8 to 10 years.

The funniest part is when they talk about "core inflation". That is the inflation index without gas or food included. Oh, yeah, take out the 2 highest inflation items, then tell me that inflation is in check. It does not fool anyone. We all see the gas pump and the cash register at Kroger. It just proves to people that the government is lying to us.

A finance blog I read has pointed out that the current inflation rate would be about 11% if the government used the same methodology as prior to 1982. You can imagine how upset people would be if they changed the measuring stick back and suddenly we had double digit inflation!

[musicman]

I don't doubt there are instances where SUVs are shipped to Europe or Asia, but it simply doesn't make any sense on a large scale because giant SUVs make even less sense in other parts of the world where gas costs much more.

it's about buyers (who are familiar with high gas prices already)who are getting a good deal on an SUV.

[ricco67]

No way, Jose. True that truck and SUV sales have cratered and Ford is shifting production from trucks to cars. But still, trucks like the Yukon have been the car company's bread & butter for years. They are profitable enough that so long as there is still some reasonable demand they won't terminate production. Also, you have to realize that the current run-up in oil prices might very well be a temporary blip, and that prices could quickly fall back closer to (but still above) historical levels. If and when that happens, demand for the Yukon and its ilk will quickly rebound as we have seen happen in the past. There's no point in jumping the gun and ending production unless they could be sure demand would be cut on a more permanent basis.

I've read several reports that one of the companies basically shut down to retool for more economical cars. Unfortunately, I can't remember which car maker it was. But I have to agree that Trucks and SUV's aren't going to totally disappear, but for different reasons. Vans, Trucks and SUV's are also used for various forms of business and civil work (Rescue vehicles, for example) and can provide enough business that they will probably be produced for decades to come.

This has all the earmarks of an instance being portrayed as a trend. I don't doubt there are instances where SUVs are shipped to Europe or Asia, but it simply doesn't make any sense on a large scale because giant SUVs make even less sense in other parts of the world where gas costs much more. However, given the ongoing weakness of the dollar I can see where exporting used vehicles that are more fuel-efficient might make a lot of sense.

The thing is that I can see them making sense in CERTAIN parts of the world that requires an SUV for some of the most challenging terrain.

I know people would ship Corvettes and Mustangs to Europe because they were as "exotic" as a Ferrari or whatever and that has been the case for decades, but I don't see how an SUV is going to be driven around some of the more congested/smaller streets in europe.

[houstonmacbro]

... but I don't see how an SUV is going to be driven around some of the more congested/smaller streets in europe.

Some of those streets (at least from photos I've seen) are very tiny.

[editor]

Some of those streets (at least from photos I've seen) are very tiny.

Americans have to get over the postcard stereotype of life in Europe as being cobblestone alleys and half-timber homes. They have sprawling suburbs and freeways and Wal-Marts and strip malls just like us.

It's our gift to the world.

[RedScare]

Americans have to get over the postcard stereotype of life in Europe as being cobblestone alleys and half-timber homes. They have sprawling suburbs and freeways and Wal-Marts and strip malls just like us.

It's our gift to the world.

Wait a minute! Sterotyping is part of being American! I can't believe you would attack one of our favorite pastimes, on Memorial Day weekend, no less!

I'll bet you're French!

[houstonmacbro]

Americans have to get over the postcard stereotype of life in Europe as being cobblestone alleys and half-timber homes. They have sprawling suburbs and freeways and Wal-Marts and strip malls just like us.

It's our gift to the world.

I ALWAYS envision cobblestone.

[CDeb]

It appears that Houston has its first $4.00 gasoline, a station located at Sw Freeway and Chimney Rock.

Gas Buddy.com

Enjoy your holiday travels.

I filled up for $3.79 at an Exxon in Vidor and $3.77 at a Chevron in Lafayette, so reports of $4 gas were somewhat overblown. Oddly, yesterday I did see a Shell station in Winnie selling regular for $4.03, right next to a Texaco selling regular for $3.79. I'm guessing the Shell didn't sell a lot of gasoline yesterday.

The number of obvious speeders does seem to have dropped just in the last 2 weeks.

I drove 60 between Houston, Lafayette and Alexandria this weekend and I was getting absolutely blown by. I passed not a soul.

It also meant keeping a one-year-old entertained for that much longer in her car seat (which she wasn't liking very much), but my very patient wife and I managed. That was offset by being more relaxed since I wasn't having to worry about a speeding ticket.

By the way, Red, 33.9 mpg on the last tank (on my 26 mpg HWY rated vehicle).

I'll bet if TxDOT put some gas message on their message boards like, "Drive 62, Save 15%", or something equally simple and true, it would drop even more.

The word needs to get out, that's for sure.

[sarahiki]

Americans have to get over the postcard stereotype of life in Europe as being cobblestone alleys and half-timber homes. They have sprawling suburbs and freeways and Wal-Marts and strip malls just like us.

It's our gift to the world.

Certainly true, but I am at present in a town in France with the narrowest streets and most hairpin turns I think I've ever seen. Most of the cars are quite tiny but the larger ones do manage. They just don't have as many parking options.