Exxon CEO for Gas Tax
January 8th, 2009 by Jon Taplin
The chief executive of Exxon Mobil Corp. for the first time called on Congress to enact a tax on greenhouse-gas emissions in order to fight global warming.
In a speech in Washington, Rex Tillerson said that a tax was a “more direct, a more transparent and a more effective approach” to curtailing greenhouse gases than other plans popular in Congress and with the incoming Obama administration.
Does this mean that the Senators from Texas and Oklahoma will no longer fight a gas tax bill? The Obama Administration should embrace this and not go down the Cap and Trade route.
Can’t help but look favourably upon this comment around halfway through the article…
“Calling for a carbon tax could be a ploy because few observers believe such a tax is politically feasible in our Congress,” says Daniel J. Weiss, a fellow at the Center for American Progress, a left-of-center think tank in Washington.
Can’t help but look favourably upon this comment around halfway through the article…
“Calling for a carbon tax could be a ploy because few observers believe such a tax is politically feasible in our Congress,” says Daniel J. Weiss, a fellow at the Center for American Progress, a left-of-center think tank in Washington.
Could be a ploy, but this statement will help to legitimize discussion of a broader range of policy choices regardless of the underlying intent.
Could be a ploy, but this statement will help to legitimize discussion of a broader range of policy choices regardless of the underlying intent.
I don’t think a cap-and-trade system is a ploy at all. Most politicians think a higher gas tax would be political suicide yet realize carbon needs to be taxed by some method. A carbon tax is seen as a politically acceptable solution that hides the tax from the public.
Remember the 2004 campaign when Bush successfully attacked Kerry for proposing a 50-cent gas tax in Congress in 1994? As recently as the summer of 2008 McCain and Clinton thought it was good politics to propose a gas tax holiday. Many politicians still view a gas tax in the same boat as social security form and other third rails.
My own feeling is that the public is ahead of the politicians on this one and is finally willing to accept a gas tax if proposed and explained the right way.
If Obama has the courage to propose one (with a payroll tax offset or something similar), I think a lot of these politicians are going to find the uproar is much less than they expected and jump on board once they realize they can still hold their jobs and support a gas tax.
I don’t think a cap-and-trade system is a ploy at all. Most politicians think a higher gas tax would be political suicide yet realize carbon needs to be taxed by some method. A carbon tax is seen as a politically acceptable solution that hides the tax from the public.
Remember the 2004 campaign when Bush successfully attacked Kerry for proposing a 50-cent gas tax in Congress in 1994? As recently as the summer of 2008 McCain and Clinton thought it was good politics to propose a gas tax holiday. Many politicians still view a gas tax in the same boat as social security form and other third rails.
My own feeling is that the public is ahead of the politicians on this one and is finally willing to accept a gas tax if proposed and explained the right way.
If Obama has the courage to propose one (with a payroll tax offset or something similar), I think a lot of these politicians are going to find the uproar is much less than they expected and jump on board once they realize they can still hold their jobs and support a gas tax.
Why do I get the feeling that the “gas tax” debate will become a red herring this year, distracting us from having a real discussion about energy policy, carbon reduction, etc? Anyway…
I used to be a big fan of increasing the gas tax, but the economic downturn has put this idea in a ‘cart before the horse’ scenario. We currently have lots of people stuck in suburbia with inefficient cars, living in houses they can’t sell. Any policy bringing gas back above $4 anytime soon will crush many families and exacerbate the economic situation. Is a payroll tax ‘offset’ really an offset when increasing numbers of people are unemployed? A gas tax increase would just hurt the most vulnerable at this point.
Maybe for a year or two, instead of pushing families over the edge with a gas tax, we can provide incentives to help them prepare for the coming carbon tax system (whatever form it will ultimately take). How about implementing the ‘feebate’ system proposed by Amory Lovins (dirty cars get fees to pay for rebates on cleaner ones)? How about getting some of those mass transit infrastructure projects underway? How about having a Building Conservation Corps spread across the country, winterizing homes and encouraging efficiency improvements in new buildings? How about standardizing green leases so landlords and tenants have a shared (instead of split) incentive to make apartments and offices more efficient? Increasing auto and building efficiency is the biggest and cheapest thing we can do at the moment and, unlike a gas tax, one can pitch conservation policies in terms of increasing the economic resilience of citizens, both in response to the recession and for when tough decisions on carbon taxes/caps/whatever come in the future.
Believe me, I am as anxious as anyone to have a saner energy policy where the fossil fuels aren’t subsidized like crazy. However, environmentalists and policy geeks need to realize that, thanks to our outgoing president et al, the common citizen is in a very precarious state. Every move will have to be strategic and must bear issues of equity in mind.
Why do I get the feeling that the “gas tax” debate will become a red herring this year, distracting us from having a real discussion about energy policy, carbon reduction, etc? Anyway…
I used to be a big fan of increasing the gas tax, but the economic downturn has put this idea in a ‘cart before the horse’ scenario. We currently have lots of people stuck in suburbia with inefficient cars, living in houses they can’t sell. Any policy bringing gas back above $4 anytime soon will crush many families and exacerbate the economic situation. Is a payroll tax ‘offset’ really an offset when increasing numbers of people are unemployed? A gas tax increase would just hurt the most vulnerable at this point.
Maybe for a year or two, instead of pushing families over the edge with a gas tax, we can provide incentives to help them prepare for the coming carbon tax system (whatever form it will ultimately take). How about implementing the ‘feebate’ system proposed by Amory Lovins (dirty cars get fees to pay for rebates on cleaner ones)? How about getting some of those mass transit infrastructure projects underway? How about having a Building Conservation Corps spread across the country, winterizing homes and encouraging efficiency improvements in new buildings? How about standardizing green leases so landlords and tenants have a shared (instead of split) incentive to make apartments and offices more efficient? Increasing auto and building efficiency is the biggest and cheapest thing we can do at the moment and, unlike a gas tax, one can pitch conservation policies in terms of increasing the economic resilience of citizens, both in response to the recession and for when tough decisions on carbon taxes/caps/whatever come in the future.
Believe me, I am as anxious as anyone to have a saner energy policy where the fossil fuels aren’t subsidized like crazy. However, environmentalists and policy geeks need to realize that, thanks to our outgoing president et al, the common citizen is in a very precarious state. Every move will have to be strategic and must bear issues of equity in mind.
Roy I agree overall with your point. The trouble is, if you wait a couple of years, it will change to “Let’s wait a couple more years, until this fledgling recovery really takes hold,” then after that it will be, “If we impose new taxes now, it will derail this sensational recovery we’re experiencing,” and then a few years after that, “Typical tax-and-spend liberals who want to foist their mythical global-warming imperatives on us so that they can establish a green dictatorship”, and the next one after that will be, “OMG the economy is in a meltdown! We have to REMOVE taxes, not RAISE them!”
Nearly everyone agreed back in 2003 that we faced this dire threat in Iraq and we had spend eleventy billion dollars to get rid of it. Full speed ahead! No cost is too great! Support the troops! And it all went down the drain, it was all a lie.
Now the only thing we seem to agree on is that we have to prop up the banks, the investment houses, the insurance companies, the car manufacturers, and all of the other sloppy industries that dug this hole.
Putting a brake on the reckless and still-growing dependence on foreign oil? Maybe later.
I say, now or never. Of course I’m probably wrong.
Roy I agree overall with your point. The trouble is, if you wait a couple of years, it will change to “Let’s wait a couple more years, until this fledgling recovery really takes hold,” then after that it will be, “If we impose new taxes now, it will derail this sensational recovery we’re experiencing,” and then a few years after that, “Typical tax-and-spend liberals who want to foist their mythical global-warming imperatives on us so that they can establish a green dictatorship”, and the next one after that will be, “OMG the economy is in a meltdown! We have to REMOVE taxes, not RAISE them!”
Nearly everyone agreed back in 2003 that we faced this dire threat in Iraq and we had spend eleventy billion dollars to get rid of it. Full speed ahead! No cost is too great! Support the troops! And it all went down the drain, it was all a lie.
Now the only thing we seem to agree on is that we have to prop up the banks, the investment houses, the insurance companies, the car manufacturers, and all of the other sloppy industries that dug this hole.
Putting a brake on the reckless and still-growing dependence on foreign oil? Maybe later.
I say, now or never. Of course I’m probably wrong.
Roy, I agree with a lot of what you said. Perhaps we should have neither a gas tax or a cap-and-trade system now because of the economy. But if we have to pick between the two, I think a gas tax makes more sense.
There’s a way to do it that I don’t think would cause much hardship on anyone. One, make it a penny a month for the next four years. It will be gradual enough that people will be able to adjust.
Also, during the recession, make the increase revenue-neutral. Put the funds in a kitty and rebate it to everyone at the end of the year.
People who drive inefficient cars and drive more than the average will still end up paying a little, and people who drive less than average will get a small reward for their habits. But that is the point.
Lots of people are wondering how they can help their country. I think they would respond favorably if Obama asked them to give a penny a month.
Roy, I agree with a lot of what you said. Perhaps we should have neither a gas tax or a cap-and-trade system now because of the economy. But if we have to pick between the two, I think a gas tax makes more sense.
There’s a way to do it that I don’t think would cause much hardship on anyone. One, make it a penny a month for the next four years. It will be gradual enough that people will be able to adjust.
Also, during the recession, make the increase revenue-neutral. Put the funds in a kitty and rebate it to everyone at the end of the year.
People who drive inefficient cars and drive more than the average will still end up paying a little, and people who drive less than average will get a small reward for their habits. But that is the point.
Lots of people are wondering how they can help their country. I think they would respond favorably if Obama asked them to give a penny a month.
Dan is right on… There is no more “couple of years.” IPCC folks are clearly stating that the numbers look worse now than they did when they did initial calculations and many are openly worrying that we might be too late already.
A gas tax (and Jon, sorry to come late to this debate and repeat on two threads…) does not work quickly enough to deal with our carbon problem. You have to have a cap. It forces change from consumers and price producers more quickly—and, immediately establishes a decreasing trend in carbon emissions. This MIGHT happen with a tax…or it might not. Certainty is necessary at this point.
Of course Exxon wants a gas tax. I agree it is likely a red herring, but the writing is on the wall and carbon legislation is coming whether they want it or not. With a Gas Tax, Exxon needn’t change their ways, they just keep peddling their goo and making slightly less than the highest profits in American corporate history.
With the cap, they will have no choice but make changes.
So, cap and trade? Cap and dividend? That will need to be hammered out, but clearly cap and dividend seems to be growing in favor and would have less impact on the folks garnering concern in this string…
…but whatever the system, there is no more time to dither. We’ve wasted the last 8 years and cannot continue at a snails pace—or we might as well chuck it completely…
Dan is right on… There is no more “couple of years.” IPCC folks are clearly stating that the numbers look worse now than they did when they did initial calculations and many are openly worrying that we might be too late already.
A gas tax (and Jon, sorry to come late to this debate and repeat on two threads…) does not work quickly enough to deal with our carbon problem. You have to have a cap. It forces change from consumers and price producers more quickly—and, immediately establishes a decreasing trend in carbon emissions. This MIGHT happen with a tax…or it might not. Certainty is necessary at this point.
Of course Exxon wants a gas tax. I agree it is likely a red herring, but the writing is on the wall and carbon legislation is coming whether they want it or not. With a Gas Tax, Exxon needn’t change their ways, they just keep peddling their goo and making slightly less than the highest profits in American corporate history.
With the cap, they will have no choice but make changes.
So, cap and trade? Cap and dividend? That will need to be hammered out, but clearly cap and dividend seems to be growing in favor and would have less impact on the folks garnering concern in this string…
…but whatever the system, there is no more time to dither. We’ve wasted the last 8 years and cannot continue at a snails pace—or we might as well chuck it completely…
Thank you all for your responses.
I fully appreciate the argument against procrastination. I should probably refine my comment by saying I am not necessarily against a gas tax, just an ill-conceived one that isn’t aware of the larger economic situation. That, and I still think incentivizing widespread efficiency gains in buildings and cars would be a more affordable and palatable first step, or maybe a just a more important step that’s done in tandem with a gas tax. My concerns are primarily focused on a gas tax being a) sudden and b) the only thing we do on the energy front. A gradual ramp-up with direct offsets (not through payroll taxes) might well be a more equitable approach. In any event, a more comprehensive energy approach is still warranted, but I’m preaching to the choir in that regard I think.
Thank you all for your responses.
I fully appreciate the argument against procrastination. I should probably refine my comment by saying I am not necessarily against a gas tax, just an ill-conceived one that isn’t aware of the larger economic situation. That, and I still think incentivizing widespread efficiency gains in buildings and cars would be a more affordable and palatable first step, or maybe a just a more important step that’s done in tandem with a gas tax. My concerns are primarily focused on a gas tax being a) sudden and b) the only thing we do on the energy front. A gradual ramp-up with direct offsets (not through payroll taxes) might well be a more equitable approach. In any event, a more comprehensive energy approach is still warranted, but I’m preaching to the choir in that regard I think.