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The Geopolitical Argument for Higher Gas Taxes
Posted at 11:50 a.m. on July 14, 2014
Congressional efforts to keep gasoline prices low are missing the big picture, says the head of the International Energy Agency.
“If I look at your gasoline prices – wow – I see that they’re quite a bit lower than what we pay in Europe,” Maria van der Hoeven said Monday at a conference held by the U.S. Energy Information Administration. “The main reason is your gasoline taxes.”
The relatively low level of U.S. gasoline tax, which has not been raised for two decades, constitutes a subsidy that encourages wasteful use, she said, identifying such subsidies as a key target in the fight against climate change. Beyond revenue for localities, higher taxes would curb use, leaving more product for export, she argued.
“From a global perspective, I just urge you to take a hard look,” van der Hoeven said.
While many lawmakers remain loath to hit voters at the pump, Sens. Christopher S. Murphy, D-Conn., and Bob Corker, R-Tenn., last month agreed that a $0.12 increase on gasoline tax would be one way to prop up the Highway Trust Fund.
Van der Hoeven urged the United States to not to fall into complacency amid a boom of shale oil and gas, citing projections for oil production to plateau in coming years, which she said will lead to a growing reliance on Middle East.
On the other hand, she argued, conserving resources could enhance the nation’s geopolitical position.
“Energy security is about much more than supply,” she said.