Question

Would you support a 30% increase in taxes on gasoline rather than a 30% decrease in the CAFÉ standard? Why or why not? (Be specific and justify).

Answer 1

It is a bad idea to decrease the CAFE(Corporate Average Fuel Economy) standard, against the idea of a increase in taxes on gasoline to curtail it's consumption.

• It's more sensible to reduce demand through a gas tax as decades of higher gas prices have led to manufacturers producing more efficient engines and to consumers preferentially purchasing small engined cars. The CAFE standards are such a bad way to try and reduce petroleum demand through lowering the amount of gas that cars use.
• An increase in gasoline tax is a better idea because ,gasoline tax incurs the least cost because it elicits responses on several fronts. It provides a strong incentive for consumers to buy fuel efficient vehicles, adopt biofuels if they are cost-effective, and sharply curtail travel in both new and used vehicles. In addition to the above point a gasoline tax does bring in some tax revenue as well.
• The new fuel economy standards are 6 to 14 times more expensive than an equal consumption-reducing gas tax.

CONCLUSION: I WOULD RATHER SUPPORT A 30% INCREASE IN TAXES, RATHER THAN A 30% DECREASE IN THE CAFE STANDARD.