LESSER OF EVILS
Brad DeLong notes that
John Irons points to a new Congressional Budget Office study saying that auto fuel-economy standards are a much worse policy than a gasoline tax.
But what is a gasoline tax worse than?
Even aside from libertarian arguments, I’d be interested in seeing analysis on the impact of increased gasoline taxes. Presumably, at some point, people would indeed gravitate toward more fuel efficient vehicles, including even motorcycles or scooters. But these vehicles are generally much less safe than the larger vehicles, including SUVs, that they’d displace. Is the decreased consumption of a reasonably abundant natural resource a worthy tradeoff?
My general preference would be to let the market decide these things. But if we decide that this is sufficiently important to require government intervention, then wouldn’t it make more sense to devote our efforts to coming up with alternative technologies? For example, subsidizing research into hydrogen-powered vehicles and the necessary infrastructure setup costs that would accompany the transition?