The Automobile Subsidy
in [Drive]
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From: Brent on 12 Nov 2009 21:45 On 2009-11-12, Stephen Sprunk <stephen(a)sprunk.org> wrote: > Brent wrote: >> On 2009-11-12, Clark F Morris <cfmpublic(a)ns.sympatico.ca> wrote: >>> On Thu, 12 Nov 2009 18:46:54 +0000 (UTC), Brent >>> <tetraethylleadREMOVETHIS(a)yahoo.com> wrote: >>>> On 2009-11-12, Stephen Sprunk <stephen(a)sprunk.org> wrote: >>>>> jim wrote: >>>>>> He refuses to look at the simple fact that the total sum of money spent >>>>>> on roads exceeds the total collected in vehicle and fuel taxes/fees by >>>>>> users of the roads. >>>>> >>>>> This is undeniably true; even the FHWA's own statistics demonstrate this. >>>> >>>> No, it's not. FHWA is government. It has an agenda, more money, more >>>> control. It wants to show that so it does. Yank all the taxes collected >>>> on anything to do with driving or trucking that go into the general >>>> fund. Not just the diversions, the taxes you pay on tires, the sales >>>> tax on a car, all of it and put it to roads only. Watch the elected >>>> office holders scream. City governments want car dealerships in their >>>> towns for the tax revenue. >> >>> Why should a general sales tax be applied just to roads. >> >> I was talking about taxes collected in relationship to autos. > > Why should general sales taxes on autos or auto supplies (such as fuel) > be applied only to autos rather than put into the general fund? Again, without driving there is no collecting of those taxes. It's to point out the absurdity of 'drivers not paying their way'. If drivers are not paying their way then it's a net gain to the general fund to just get rid of the road costs and the general taxes collected on driving activities. > Fuel excise taxes _in addition to_ the general sales tax are different. > However, in most states the fuel excise tax is _substituted_ for the > general sales tax, which is a subsidy from the general fund to autos. In other words, you know that driving is a net tax GAIN for the general fund. If drivers were not 'paying their way' it would be best to eject the revenue AND COSTS from driving from the general tax pool. So by your protest we can conclude that drivers in their automotive related spending are paying MORE into the general fund than is being taken out for roads, police, etc and so forth. >>> In the Canadian context I am familiar with, the fuel excise taxes should >>> go to roads but don't necessarily so there you would have a legitimate >>> gripe. The HST (or GST plus PST) which is also collected on bus, rail >>> and air tickets goes to the general coffers. Should that tax when >>> collected on clothing go to helping clothing manufacturers. Actually >>> I question the degree to which we subsidize transportation and the >>> distortions that subsidy causes. If we didn't subsidize harbors, >>> would there be as much production shifted out of Europe, the United >>> States and Canada to other countries? >> first I already gave an explaination on how sales tax often is a >> composite of taxes. Including a transit tax in NE IL. > Very true; I disagree with a transit-specific sales tax. The idea makes > little sense. Unfortunately, it seems to be a fairly common mechanism. >> If drivers were really being subsidized by general taxes on non-drivers >> then the 'drivers don't pay their way' crowd should take me up on that >> division. > Fine, I'll take you up on it. In Texas and many other states, local > roads (i.e. all roads other than state highways and tollways) are funded > over 99% by city or county property or sales taxes. Aside from a tiny, > tiny amount of CMAQ money, that is pure subsidy. Tollways are funded > 100% with toll revenues, though they're exempt from property and sales > taxes so they're still receiving subsidies from general funds. Finally, > all the people driving on those subsidized local roads or toll roads are > still paying the federal and state fuel excise taxes, which only fund > free state highways. That is another subsidy. If you believe that the taxes from driving don't cover expenses then you should have no problem with my proposal. > Claims that "drivers pay their own way" are therefore blatantly untrue; > people who do not drive are also paying for those roads. And they constitute what percentage of the tax paying population? I'll wager that you can remove their tax contributions entirely and it wouldn't make any significant change. >> If taxes were rearranged to make all the taxes for roads directly on >> driving the cost to drivers wouldn't increase. > It's not so much a matter of who pays as it is of the artificially low > marginal costs of driving. But outside of a few in r.a.d. the 'drivers don't pay their way' folks have no intention to shift to direct taxes and stop raiding the road funds. the desire is to use that excuse to punitively tax driving. In other words it's just an anti-driving agenda looking for an excuse. > Right now, most of what we pay to fund roads > is coming out of our pockets regardless of how much we drive, therefore > we want to drive as much as possible to get our money's worth. If we > had to pay the full cost of each trip separately, demand for roads would > naturally go down (because people either eliminated those trips or > switched to a lower-cost mode), which would reduce the amount we would > need to spend on roads in the first place. It would also make transit > and intercity rail more price competitive while requiring less (or > perhaps even no) subsidy of their own. I have no problem with it being usage based. A fuel tax does that. But I want to see all those other taxes reduced first. I doubt that's going to happen. We'll just end up paying more taxes. All the old indirect taxation that went to roads will just go someplace else. We will all be made poorer.
From: Daniel W. Rouse Jr. on 13 Nov 2009 01:25 "Stephen Sprunk" <stephen(a)sprunk.org> wrote in message news:hdhb51$i5h$1(a)news.eternal-september.org... > Daniel W. Rouse Jr. wrote: >> That's a mention of being stuck in a traffic break which, when compared >> to the daily commutes when traffic breaks do not usually occur, >> qualifies as a corner case/edge case in the daily commute. > > What are you smoking? Congestion, construction, accidents, etc. are a > _daily_ occurrence in every major or even mid-sized city. Radio > stations devote entire segments to describing all the traffic problems > during rush hour, and they usually don't even cover the "normal" issues, > i.e. roads moving at half their posted speed or less. > That' not the point. *Every* accident has a traffic break with a state highway patrol vehicle S-curving along all the lanes to bring traffic to a stop, then closing *all* lanes, *all* the time? No, I don't think so, thus why a traffic break as I specifically mentioned is the corner case/edge case in the bigger picture of the daily commute. [snip...]
From: Brent on 13 Nov 2009 10:53 On 2009-11-13, jim <".sjedgingN0sp"@m> wrote: > gpsman wrote: > Yup. How does the fact that Walmart can move into a small town put all the local > hardware, tire, clothing etc. stores out of business really help that small > town? They definitely aren't better off when the competition is all gone and the > town becomes a captive market. Do you have proof that walmart raises prices to or above what the shops that went out of business charged? Otherwise those people benefit in the form of lower prices for the things they wish to buy. It's also like the high priced ma and pa stores that complain about the internet exposing their customers to competition. This is true even when that competition is just another ma and pa some place else that is more competitive. > This is the consequences of subsidizing > transportation in its current form. It isn't that walmart operates a more > efficient store. it is the distribution infrastructure that tips the playing > field in walmart's favor. And that isn't a natural structure it is artificially > created by tax law. Even if trucking were not subsidized by the ordinary passenger car driver, walmart's distribution and business model would win. Remember, that stuff trucked to ma and pa got the same per mile advantage. It's silly to make this argument on the retail level. It works much better on the manufacturing level. On the manufacturing level tax dollars are used to the benefit of imported goods. Everything from transportation taxes to managed trade to military operations reduces the apparent costs of imported goods. This gets into an entirely different ball of wax on the de-industrialization of the USA, but I doubt this system to encourage imported goods on so many levels was just an accident. It's not so much imported goods at walmart vs. domestic at ma and pa, but the same thing at both with it costing significantly more at ma and pa. Or even significantly more at another chain retailer. >> (I'm reminded of Brent's assertion that licensing attorneys and >> doctors, etc., served no purpose other than to limit competition. I >> guess he doesn't have access to any Yellow Pages.) Guess gpstroll doesn't know the difference between 'limit' and 'none'. Guess gpstroll has never bothered to realize that the bigest supporters of licensing are those who are already in a particular business and would easily be licensed. Also, I suppose gpstroll has never heard of licenses that are limited in number, such as the license to operate a taxi in many cities. Lastly I doubt he's ever learned of the cartel like practices enforced through licensing to prevent undercutting the agreed upon prices. (again, taxi cabs are a prime example of prices controlled through licensing) Some reading material: http://www.pioneerinstitute.org/pdf/pdialg_32.pdf
From: jim on 13 Nov 2009 12:05 Brent wrote: > > On 2009-11-13, jim <".sjedgingN0sp"@m> wrote: > > gpsman wrote: > > > Yup. How does the fact that Walmart can move into a small town put all the local > > hardware, tire, clothing etc. stores out of business really help that small > > town? They definitely aren't better off when the competition is all gone and the > > town becomes a captive market. > > Do you have proof that walmart raises prices to or above what the shops > that went out of business charged? Otherwise those people benefit in the > form of lower prices for the things they wish to buy. When walmart is all that is left there is nothing stopping the prices from going up. There is no benefit to the citizens if the lower prices are a result of transportation subsidy that came out of their pockets. The transformation that occurred took place long before Walmart arrived so walmart is not really directly to blame. It is just the natural consequence. Ultimately a local economy needs to decide for itself regarding its own self worth. there have been places where people just refused to shop at walmart and eventually walmart just packed up and left. Some people are able to see that the current economic paradigm is extremely near sighted. Cheap energy is a bubble it's a bubble that will burst. when government does everything it can to build an economy around cheap energy it will make it pop more explosively. > > It's also like the high priced ma and pa stores that complain about the > internet exposing their customers to competition. This is true even when > that competition is just another ma and pa some place else that is more > competitive. > > > This is the consequences of subsidizing > > transportation in its current form. It isn't that walmart operates a more > > efficient store. it is the distribution infrastructure that tips the playing > > field in walmart's favor. And that isn't a natural structure it is artificially > > created by tax law. > > Even if trucking were not subsidized by the ordinary passenger car > driver, walmart's distribution and business model would win. Remember, > that stuff trucked to ma and pa got the same per mile advantage. Not really. But the local economies had already been transformed before Walmart arrived. The cost that enabled walmart to win had already mostly been paid. Rural people have had a disproportionate effected by the transportation policies of the last half century. Whether you regard that as a good or bad thing is a matter of taste. > > It's silly to make this argument on the retail level. It works much > better on the manufacturing level. On the manufacturing level tax > dollars are used to the benefit of imported goods. Well walmart is benefiting more from that than any local store could. > Everything from > transportation taxes to managed trade to military operations reduces > the apparent costs of imported goods. This gets into an entirely > different ball of wax on the de-industrialization of the USA, but I > doubt this system to encourage imported goods on so many levels was just > an accident. Yes. But de-industrialization has not yet occurred. The US is still the largest manufacturer. > > It's not so much imported goods at walmart vs. domestic at ma and pa, > but the same thing at both with it costing significantly more at ma and > pa. Or even significantly more at another chain retailer. > > >> (I'm reminded of Brent's assertion that licensing attorneys and > >> doctors, etc., served no purpose other than to limit competition. I > >> guess he doesn't have access to any Yellow Pages.) > > Guess gpstroll doesn't know the difference between 'limit' and 'none'. > Guess gpstroll has never bothered to realize that the bigest supporters > of licensing are those who are already in a particular business and > would easily be licensed. Also, I suppose gpstroll has never heard of > licenses that are limited in number, such as the license to operate a > taxi in many cities. Lastly I doubt he's ever learned of the cartel like > practices enforced through licensing to prevent undercutting the agreed > upon prices. (again, taxi cabs are a prime example of prices controlled > through licensing) May be true, but the number of people willing to live without licensing are small and not likely to get any bigger so your hope for eliminating that is a lost cause. Licensing cabs and licensing doctors works on a different basis. There is no limit on the number of doctors or lawyers. If there was a general interest in making Lawyers and doctors cheaper the government could just subsidize the education of lawyers and doctors. If you flood the market the amount they charge would come down. Try proposing that doctors and lawyers be given free tuition and you will find it is the doctors and lawyers who are the first to object. -jim > > Some reading material: http://www.pioneerinstitute.org/pdf/pdialg_32.pdf
From: jim on 13 Nov 2009 12:19
gpsman wrote: > > > Among other things, there are going to be > > less trucks on the road if those taxes would increase. > > Non sequitur. > Obviously you are in complete denial of reality. > > The important issue is not really whether trucks are being subsidized, but > > whether the energy used by trucks or cars or anything else is being subsidized. > > If you use the tax structure to keep the cost of energy as low as possible then > > you have removed some incentive to use it efficiently. > > I think fuel taxes suggest that is not the case. Well that would be true if fuel taxes were fuel taxes used by government to fund government functions, but instead they are really promotional green stamps. > > > > > The US economy rides on trucking and cheap freight rates. > > > > > > Certainly, > > Then your unsupported assertion that: "Subsidy to truckers contributes > to more congestion on the highways more wear and tear on the highways > and gives nothing in return unless you like diesel exhaust" is > obviously false. > Your quoting me out of context. I said it gives nothing in return to the motorist as a class. As you pointed out the only thing the motorist gets is a break in the cost of fuel delivered from pipeline terminal to gas station - that is probably at most a fraction of a penny per gallon. Consumers as a class do get lower prices, but whether in the long run that is a net savings is debatable since they also pay for the subsidy. And they pay for the economic depressions that subsidized energy causes. |