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Our Views: A break at the pump

With hike in gas tax halted, travelers can spend their summer hitting the road, not the ATM

POSTED: June 8, 2014 1:08 a.m.

It’s summer vacation season, when many families load up the vehicle and head down the road to visit the grandparents, explore the mountains or hit the beach.

That trip has gotten more expensive over the years as the price of gasoline has risen, then fallen back a bit, but it remains between $3 and $4 a gallon. Even at that level, filling up the large tank of an SUV or minivan is a chunk of change.

And it would have been even pricier after July 1 had Gov. Nathan Deal not canceled a state tax increase on gasoline scheduled to go into effect that day. Those tax hikes would have raised pump prices from an average of $3.21 a gallon to $3.66, just as many were getting out on the roads for their summer trips.

The fuel tax is scheduled to be reset by the Department of Revenue every six months based on the average price. The tax was set to go up 15 percent in July to match the rise in pump prices overall.

It marks the third time in his four years in office Deal has headed off the scheduled tax increase, citing the harm it would do to the economy. With the state’s industries and job picture on the rebound, the last thing officials want is a setback.

“We’re seeing a steady rebound in Georgia’s economy ... but Georgians are still paying gas prices that are high by historical standards,” the governor said in a statement.

State legislators will be able to ratify the suspension when they reconvene in January. The hope is that, by then, the cost of gasoline will go down and tax increases won’t be necessary next year.

Let’s hope that’s the case. As the governor says, raising the tax, and the overall price at the pump, could have a severe negative effect on the economy. There are better ways to boost state revenue for roads and other needs that won’t do more harm than good.

Beyond revenue goals, many environmentalists have urged a tax increase in an attempt to discourage more highway traffic, in the hope of reducing carbon emissions. It’s a noble goal, but such disincentive is not the best way to achieve it.

Raising pump prices might discourage some voluntary travel and force us to think twice about whether to make a trip. But higher pump prices also would hit those who must drive for work and business. Those with lengthy commutes already suffer from having to fill up more often, and raising the tax would increase that pain. That leaves less money in everyone’s pockets to spend on other needs, and the economy stagnates when cash stops flowing.

In particular, businesses need to move goods and services cheaply to earn profits and keep prices down. If transport costs go up, they are forced to make tough choices: Raise prices or cut workers. So in addition to paying more at the pump, you’d pay more at the grocery store when you got there.

This wouldn’t just hurt large businesses, either. Imagine a small pizza delivery service being forced to raise the price of pizza or add delivery surcharges to offset higher costs. That could lead to fewer people placing orders, especially with less money of their own to spend. Fewer pizzas, less business, more worker layoffs. Lose-lose.

In addition, more of those summer travelers might opt for a “staycation” instead, which would hurt a hospitality industry that relies on visitors hitting the road during school breaks.

Yet many who seek to clean up the atmosphere don’t seem concerned with such trivial matters as whether the folks breathing that air have jobs to provide for their other needs.

Such is the case with the debate over the White House’s new proposal to limit pollution from coal-burning plants and other energy producers over a period of time. Under guidelines issued June 2, Georgia would need to reduce carbon dioxide emissions by a whopping 44 percent by 2030. The state only produces about a third of its power from such plants, but the effect would be considerable here and nationwide.

Again, we’re not against taking reasonable steps to clean up our planet, but using a stick instead of a carrot would have a negative effect on energy prices, job creation and the economy in general.

And as many point out, including a columnist on the front of today’s Viewpoint section, the new U.S. standards would have no effect on the amount of filth nations such as China can continue to pump into the sky. Thus, the U.S. is saddling its own economy with harsh new restrictions while seeing only nominal impact on the environment.

Even some Democrats aren’t on board with this plan, including many from coal-mining states. And in an election year, they know anything that hurts jobs and the economy is a nonstarter.

The nation’s unemployment worries finally have begun to ease, with four straight months of job growth boosting long-term hopes. The last thing we need is an onerous policy aimed to please one special interest that would derail that progress.

Keep in mind as well that limits on coal-powered plants could result in a boost in nuclear power. Georgia Power is moving in that direction with two reactors under construction. Many environmentalists aren’t any crazier about nukes than they are coal, which might end up pitting one group against another.

The simple truth is that solar, wind and water sources can’t provide enough affordable energy to fill our needs. Most power for electricity and vehicles requires something to be burned or heated, creating waste and pollution. Unless we’re ready to take society back to the Stone Age, we need to accept that fact and find ways to do it cleaner.

In the real world, governments, power producers and fuel providers should work to find more renewable energy sources to clean up our atmosphere while creating reasonable pollution standards.

Whether you believe such emissions contribute to climate change, it’s in our mutual interests to keep the air breathable. But it needs to be done in such a way that doesn’t drive people out of their jobs and devastate our economy in the process.


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