Thanks to plunging recessionary demand gas prices head under $3 a gallon -- bring back our SUVs and forget all that talk about alternative energy sources. In fact, given what happened almost 30 years ago, if energy prices were to keep going down, fervor could quickly abate for conservation and driving less.
Actually, now is the time to raise the federal gas tax 25 cents a gallon. Raise taxes! How outrageous when everyone has been wracked by the financial meltdown. Will it happen? Very unlikely given the political wave of bailouts, rescues, and tax givebacks pushing up our national debt to increasingly stratospheric levels.
But raising the gas tax would help on three essential fronts, providing short and long-term solutions to problems facing the country: (1) raise money to create jobs and repair our aging transport systems, (2) build new 21st century infrastructure that is necessary for keeping the nation competitive, and (3) restrain notions that we can slip back and do nothing about our energy dependency.
Just this morning New York State reported suspending $250 million in sorely needed road repairs, because the funding from tolls and taxes isn't available. Other states face the same conundrum and will initiate similar cutbacks. That amounts to tens of thousands of sidelined jobs rippling through an economy torpedoed by steadily rising unemployment.
As noted in this space, the country is smoking something if we think we can get away without rethinking and rebuilding our roads, rails and mass transit and that requires massive funding infusions. At some point, people will have to pay through a combination of higher taxes and user fees. And the sooner we start the better to reduce congestion, pollution, and the chance for catastrophic failures.
Over the long-term, energy prices can be expected to rise steadily, despite the current nosedive. When the world's economy gets back on track... eventually, demand will push prices back up. Our new infrastructure needs to be designed to help us use less energy and get around more quickly and efficiently. We cannot get trapped in any short-term complacency that we can avoid making adjustments in how and where we live and work.
The federal gas tax -- a measly 18 cents a gallon -- hasn't been raised since the early 1990s. Now the Highway Trust Fund which pays for road and mass transit projects approaches insolvency. States layoff construction workers and set aside projects and we all hit more potholes... literally.
If gas prices drop by about $1 a gallon, it's a propitious time to raise a tax that hasn't been touched for years and avoid the potential for deleterious results if we do nothing. Yes, it's an outrageous notion, but a necessary step to setting the country in the right direction.
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Jonathan D. Miller
A marketing communication strategist who turned to real estate analysis, Jonathan D. Miller is a foremost interpreter of 21st citistate futures – cities and suburbs alike – seen through the lens of lifestyles and market realities. For more than 20 years (1992-2013), Miller authored Emerging Trends in Real Estate, the leading commercial real estate industry outlook report, published annually by PricewaterhouseCoopers and the Urban Land Institute (ULI). He has lectures frequently on trends in real estate, including the future of America's major 24-hour urban centers and sprawling suburbs. He also has been author of ULI’s annual forecasts on infrastructure and its What’s Next? series of forecasts. On a weekly basis, he writes the Trendczar blog for GlobeStreet.com, the real estate news website. Outside his published forecasting work, Miller is a prominent communications/institutional investor-marketing strategist and partner in Miller Ryan LLC, helping corporate clients develop and execute branding and communications programs. He led the re-branding of GMAC Commercial Mortgage to Capmark Financial Group Inc. and he was part of the management team that helped build Equitable Real Estate Investment Management, Inc. (subsequently Lend Lease Real Estate Investments, Inc.) into the leading real estate advisor to pension funds and other real institutional investors. He joined the Equitable Life Assurance Society of the U.S. in 1981, moving to Equitable Real Estate in 1984 as head of Corporate/Marketing Communications. In the 1980's he managed relations for several of the country's most prominent real estate developments including New York's Trump Tower and the Equitable Center. Earlier in his career, Miller was a reporter for Gannett Newspapers. He is a member of the Citistates Group and a board member of NYC Outward Bound Schools and the Center for Employment Opportunities.
