"The Get America Working! approach would work, in effect, by correcting a major price distortion. The current U.S. Internal Revenue Code taxes employment far more heavily than it does the use of natural resources. This distortion has grown progressively worse as payroll taxes have grown. Revising this distortion would increase employment, equity and overall economic vigor importantly. And it would do so by responding to market price signals, not through clumsy and expensive government interventions."
Raise the Gas Tax: A Revenue-Neutral Way to Treat Our Oil Addiction
Date:
Sun, 02/01/2009
Source:
The Washington Post
Senator Lugar has long characterized America's excessive reliance on foreign oil as "the albatross of national security." In this op-ed he notes, “[A] new president and changed economic conditions offer the chance to take a bold step toward freeing our nation from the grip of foreign petroleum,” adding, “… the huge external costs of our oil addiction -- in terms of national security, economic vulnerability and environmental damage -- are not accounted for in the price Americans pay at the pump.” Given this “market failure” he suggests government “impose targeted taxes, which are almost always the most efficient, least invasive and most transparent remedy for market failure.” A revenue-neutral oil sec urity tax would take every penny collected at the pump and put it right back into the pockets of consumers. Options for doing so include cutting the payroll tax, which disproportionately affects the lowest-paid employees, so workers would see extra money every payday.”
