After my recusal on the matter of cars on today's Chris Matthews' show, my personal interest in Mike Kinsley's proposal is obvious. But the general point remains nonetheless. We desperately need to move toward a lower-carbon economy. The most effective tool we have to goad us into this is the high price of gasoline. Higher gas prices were tough for a while for many people, but they reduced oil consumption, made alternative fuels more viable and helped the planet. Now, alas, the price has plummeted - and all those good green things are vulnerable to collapse. So wasn't ten months ago the perfect moment to raise the gas tax? If done gradually, we could have essentially moved all that oil money from the pockets of people who hate us to the US Treasury - while avoiding a big price hike. But we did nothing. What could the Treasury do with the money? Obvious:
[G]ive the money back to people by lowering the payroll tax. The payroll tax, or FICA, collects about 15% of your wages or salary half from you and half from your employer. It is expected to bring in close to a trillion dollars in 2009. Using our windfall from plummeting crude-oil prices alone, we could cut the FICA tax by more than half. Including other forms of energy would bring in even more.
We help the working poor and accelerate energy innovation and encourage employment. Why does this obviously simple and great proposal never get off the ground?