Transportation Costs/ Fuel, Taxes, etc.

[wkmac]

Ran across this article about a proposal in the UK to tax via the mile driven in certain areas. Other similar proposals have gotten some press here in the US. Not making any judgement whether good or bad but just linking the article since going this route here in the States could effect many if not all of us whether as a company or in our personal vehicles. The one potential good is if the cost to travel to a store now bares a direct upfront payment of tax rather than the hidden excise tax at the gas pump people may order more goods via phone, internet and have it shipped. There are lots of negatives as well so I'm sure it's not a purely one sided world to our benefit as a company.

 

[wily_old_vet]

wkmac-i have heard of places here discussing this. What a crock. They try to get us into high mpg cars to lessen our dependence on foreign oil and then when they don't bleed enough from us in gasoline taxes they have to come up with other ways to gouge us. We as apeople have become way to dependent on government services and are going to be taxed right out of existence one day.

 

[ms]

Here in the Midwest they push Ethanol blended (15%) gasoline. It is mandated that state vehicles use Ethanol and IA has started a pilot program with vehicles running on 85% ethanol. It is about 5 cents cheaper per gallon ($1.90) then regular gas but only because it is subsidized by the government. Without subsidy it would cost about $.60 more per gallon than gas. It also takes more energy to produce Ethanol than it provides. Pork barrel.
Doesn't a liter of gas cost about $5 in the UK?
Nobody drives 60 miles to go to the grocery store. If possible large corporations should provide satelite offices to prevent commutes for people.

 

[ups79]

Not only that but you will get less miles per gallon, as a result your gas budget will go up. Not down.

 

[speeddemon]

Hydrogen is where its at my friends.

 

[traveler]

speeddemon,

I strongly suggest you and any other folks who belive that hydrogen fueled vehicles is the way to go read this article:

http://www.forbes.com/execpicks/global/2005/0509/032.html

I never did believe that hydrogen was where to put my bet for a cleaner environment (the way that hydrogen is produced will pollute more than the gasoline it replaces) but after reading this my eyes were opened to the facts. I will let the readers form their own opinion.

 

[wkmac]

wily old vet,
Good points but let me throw out a different way of looking at it. First off, many of the America proposals would have a GPS data unit on board the car documenting not only the miles you drive but where you drive. This is a concern to many liberty minded folk who are not real keen on the idea of the gov't being able to track you 24/7 so to speak. Real Concern or Over Reacting? Hard to say but I understand their point.

Believe it or not I actually like the idea of killing the excise tax at the pump and then you pay by the mile traveled because it does 2 things.

1)The tax is no longer hidden and it slaps you right in the face. If America is forced to pay the tax straight out of pocket instead of having someone else be the tax collector and bury the tax within the cost of a product then maybe America will begin to see just how wasteful and free spending our gov't is and start putting some real heat on our leadership.

2) Under the current method of excise tax via fuels that go to support roads, etc. the system actually works against very high mileage vehicles. Our gov't has a transportation budget to support the highway infastructure of America and a large part of that budget is obtained from fuel excise taxes. If say tomorrow we could all double our mpg of our cars we'd all think that was good not only because of the less oil but also the environmental positive of less pollution which is also very important as well. The gov't however has a business to run and when faced with cutting their tax take in half as a result of the doubling of fuel effecency of all vehicles you can bet they won't go for it and yes I absolutely believe that. Because first and foremost I believe gov't is nothing but a business and it will protect itself first at all costs.

By taxing via the mile traveled you now kick the door down for higher mileage vehicles to come about and people will pressure politicians to do a better job with road costs. How many roads are built in America not because they are truly needed but are needed by a developer and the politically connected get their roads. They generally get their way because the tax for such ventures are generally hidden within the cost of auto related products and the people don't feel the pain of paying out the money directly.

I think we are about to enter an era where many new things will happen whether that be how we are taxed to support roads of what kind of fuel will power the vehicle we use to get there. It's wide open to a degree but even with it's cons I do like the talk about paying by the mile driven. Whether that becomes the method or is the right method I don't have that answer but more importantly I like the method that the user pays for it. It just might be that this step in a user pays tax for roads might transition into other gov't programs and those folks who want the nanny State can have it via a user pays and those of us who don't can live devoid of it. I will say this, don't pay the user tax and then use the system, I hope the penalties for such when caught are extremely harsh as IMO they should be.

 

[traveler]

wkmac,

Your idea of a mileage based tax is interesting but taking the "devil's advocate" point of view I submit the following:

How do you check odometers periodically to assertain the tax due?

Income tax much as the gasoling excise tax is deducted from ones paycheck to make that tax a "pay as you go" system. Have you ever noted that those small companies that collect and don't remit that tax are constantly in trouble with the IRS? The don't have the cash when it comes time to settle. How many private citizens who live paycheck to paycheck will have the cash to pay up when the time comes?

Haw many more odometers will break or be turned back to avoid taxes?

How many more autos will go unregistered, using stolen or old licence plates to avoid the tax?

How much more clerical administration and heirarchy would be needed to collect and administer that tax?

I really don't feel a mileage based system will solve anything but only create a bunch of new problems.

 

[wily_old_vet]

wkmac-My point was that by encouraging higher mileage vehicles the federal and state coffers didn't get their much needed replenishment so they had to come up with another way to come up with the cash. Voila, the mileage tax. Never mind maybe trying to cut back on the waste, the gov't must have their (I prefer to think of it as my) cash. The same thing has happened with cigarette taxes. On one hand gov't says quit smoking so you will remain healthy but when people do and their cash flow is cut they jack up the taxes on cigarettes. Gov't needs to cut back. When you or I have abudget shortfall we cut our spending. The gov't should do the same.

 

[speeddemon]

Traveler, I suggest you check your facts on the production of Hydrogen, and the by product of the engine. WATER

 

[traveler]

An excerpt from the article I referenced:

Hydrogen isn't there for the taking. The most common and cheapest place to get hydrogen is from natural gas, by mixing it with steam heated to 750 to 1,000 degrees Celsius. A two-step reforming process yields not only hydrogen, at a projected cost of $4 to $5 a kilogram (equivalent in chemical-energy content to a gallon of gasoline), but also carbon dioxide, a greenhouse gas. The world's most abundant reserves of natural gas happen to be found in the Middle East. The economics and the environmental attributes of the process could be improved by using waste heat from nuclear power plants to warm up the steam, but no one's doing that yet.

Hydrogen can also be extracted by sending electrical current through water, degrading it into hydrogen and oxygen. It is a well-developed process, but it <u>takes 50 kilowats of juice</u> worth $2.50 or more, to produce a kilogram of hydrogen. Nowadays incremental demand for electricity is met with natural-gas-burning power plants that also produce carbon dioxide. The energy-guzzling does not stop there. <u>It takes mountains of energy to compress and transport hydrogen.</u> Author Romm calculates it would take 25 truckloads of hydrogen to match the energy contained in one truckload of gasoline. Donald Anthrop, professor emeritus of environmental studies at San Jose State University, concludes, in a recent white paper: <u>"A transition from gasoline to hydrogen would nearly double net greenhouse gas emissions attributable to passenger vehicles."</u>

Yes, speeddemon, the use of hydrogen as a fuel produces only water vapor as a result but hydrogens production has many unwanted byproducts! This would be an "unintended consequence similar to that which is now occurring with the production of lower sulpher gasoline... many refineries now have piles and piles of sulphur that are unsalable and piling up and also blowing into the atmosphere.

 

[wkmac]

traveler,
On your comments.

1st) None of this is my idea. These ideas are being floated not only in the UK but here in the States in California and Oregon as just 2 examples. I appreciate the confidence but again they are not my ideas. I do however like the discussion they are bringing to the table on the idea of taxation and if you will read my posts again you will see where I fully admit this approach is not without it's many pitfalls.

The current system with the high mileage cars paying the tax at the pump are showing they are not paying enough of the tax to support the amount of their use of the roads and this inequity will only grow as the number of these vehicles grow. Thus the reason you see this new tax approach being discussed. Another idea is to tax at the purchase and then upon tag renewal but the taxation is feared to suppress people from buying the vehicle in the first place. Many would argue and rightly so that why should a buy this vehicle at a greater cost up front and then pay again annually when getting a gas hog may be a better choice just on cost basis alone. The high mileage market is one you want to grow not suppress. I wish I could remember who here has the hybrid as I'd love to have them join this conversation. They can bring a firsthand experience to this that I know I can't.

2nd) You completely error in assuming the odometer will be read on a set basis to determine the tax. Each vehicle will be outfitted with a GPS system that maps your travel on a daily basis and then at a set time you must submit the funds to pay the tax. Does this pose an array of problems? Absolutely it does but it does present an idea of the user pays and I like this approach. Also the new coputer systems in cars already have the ability with things like On Star to pinpoint your location and upload critical data as it pertains to your vehicle. Many States have already discussed using these systems to hook into their data bases and they monitor your on board emmissions systems. If your vehicle is beyond parameters you get a notice in the mail to have the problem corrected in so many days or you recieve a ticket. One proposal even went to far as that after so many days if you didn't have the problem fixed then your car would be disabled and you could not drive it. Yes my friend, Big Brother wants to get bigger.

As I said under a user pays system we can have those who prefer a cradle to grave system living side by side with those who perfer a more risk oriented lifestyle and everyone is happy so to speak. Utopian? Sure but no more so than the Utopian concept that gov't can cure all our ills, provide for all our needs and it doesn't cost us a dime.

You are right that hydrogen production is costly and not so environmentally pure to produce but I'll leave you with this one thought. In the 1700's 2 frenchmen figured out the concept of a hot air balloon and took that first step upwards. Flying in air via plane much less going to the stars was at the time considered at best an impossible task as it was thought it had to be lighter than air to fly at all. Well here we are today having visited the moon and working the design concepts to go farther so don't just sit back and expect the same ole, same ole. Keep the pressure on about costs and environment because I'm with ya but we need to also ask that all important question, " but what about if we did it this way?"

Have a good one.

 

[traveler]

wkmac,

I do relize that these were not "your" proposals so please don't take any of this personnaly. I was simply playing devil's advocate but didn't touch on the GPS idea.

With that in mind, a few new questions arise... how do you gey older cars updated and equipped with a GPS. There are plenty of folks living on minimum wage (or less) driving a vehicle held together with "spit "n bailing wire" or if there's a Home Depot nearby "duct tape". Does big brother give them a tax credit for a GPS system? A new bureau will be needed to take away and store all those old wrecks that would be confiscated due to non payment of taxes.

Okay, enough in that vein.

I do believe there <u>will be</u> a massive change in personal transportation and the fuels used in years to come. I just dont believe hydrogen is the answer. I also feel that the only way things will change is by crisis. Unfortunate that is the way things work but certainly the old maxim necessity is the mother of invention comes into play here and fortunately or unfortunately there is still an abundance of oil in the world.

As to the first use of a balloon, I do agree that bold steps must be taken to change the future just as these men did. That doesn't mean efforts will all be workable (balloons and other lighter than air vehicles never have worked out too well) but they did form the beginning of travel above the ground. I do feel that too many folks are blindly pinning their hopes on hydrogen as a fuel because the end product burns clean. I just think that no matter what fuel is used there will be some consequences to the envirnoment. A natural and almost untreated fuel would be best (such as natural gas, yes that will run out some day too) but there has to be an efficient way to produce a relatively clean burning synthetic fuel for the masses.

 

[wkmac]

traveler,
As for old cars? That's just one of the many pitfalls I was talking about. One interesting proposal I saw was that we would have side by side systems with the newest hybrid/high mileage vehicles having the GPS system and then each fuel dispenser would have a wireless comm. device to communicate with these newer vehicles. Upon arrival at the pump the comm. device would signal the pump not to charge the normal fuel excise tax as well as upload mileage data to the taxing authorities. This way older car owners would still pay at the pump while the high mileage vehicles would pay via another process where they pay by the mile driven. Sounds interesting but I've no clue how well it would really work and to be honest I don't think we are close to this type system until we begin to see a far greater number of these newer type vehicles on the road and the gov't really starts to experience a tax shortfall from their broader useage.

I agree with you that we are about to have a serious conversation in this country about how we travel. From the cost of fuel, to pollution to the hours and hours wasted sitting in traffic we are about to radically alter how we move about in this country. It will take many years to happen and I'm thinking decades but I do believe it will in form or fashion.

Hydrogen because it is so plentiful seems to have captured the collective imagination but production and distribution are still the major question. I think for the immediate future until some technological breakthroughs happen the Hybrid vehicles are the more likely and obvious paths to go. I also think we tend to sit in a box when it comes to energy needs but the real solution is not one solution at all. I believe the average home for example may in the future have multiple sources of energy. Lighting in the home for example could be a closed system that is not only low voltage, 12 VDC LED, but gets it's power via a solar panel system or even a wind system and back feeds any excess power into the grid system. This leaves the larger utility grid to power larger items like AC units or refrigerators while a home based power generation system could power smaller items that don't require or consume large quantities of power. A small amount of people are already taking this approach and the utility companies are watching as they are looking for ways to not have to build new power generating plants in the future as our national energy needs continue to only grow. Ironically one of the biggest investors in solar technolgy is BP oil so everything is on the table at this time. Hopefully we will finally learn that there is no single solution and that in some parts of the country you may get larger degree of power from solar, another part of the country from wind, another part from hydro specially micro hydro and we all may get power from the larger grid made up of hydro and hopefully more nuclear. 30 years ago we were justified after 3 Mile Island to be suspect but it's time to sit down and have a serious conversation about nuclear with all the cards on the table and all the pros and cons. I'd really like to see that.

Take care and enjoyed talking about not only a topic worth broader discussion but a topic I find of great interest. As a side note, I live on a large stream and I am looking at what it would take to build and install a micro hydro generator. It's not as easy as baking a cake but it's not overly impossible or improbable either.


(Message edited by wkmac on June 08, 2005)

 

[traveler]

Better fuel than hydrogen any old day!

 

[moreluck]

traveler....I think that is the fuel that Willie Nelson is promoting too.

 

[wkmac]

traveler,
We're both way off in transporation vehicles of the future. Here's the future hot off the presses.

 

[wkmac]

traveler,
Speaking of the cooking oil fuel my wife saw a program several months ago about Daryl Hanna the actress and she had her cars converted to running on spent cooking oil. From what my wife said Daryl was one who truly practiced what she preached unlike many Hollywood types and she had incorporated many alternative energy systems into her home life.

 

[traveler]

I do believe I mentioned natural gas somewhere in one of my posts!

 

[wkmac]

I guess there's always another way to look at it although it's hard to do when you're pumping the gas. LOL!