Thursday, March 10, 2011

Put the Brakes on $4 per Gallon Gasoline at the Pump!

Repost from Facebook, which explains the more casual tone:

(I stole my title from David Vitter, whose strategy was "Drill more wells in the Gulf of Mexico!!!!")

You want my opinion on how to end our dependence on foreign oil? Eliminate the volatility of energy prices stimulate our high-tech sector? Impose a gasoline tax to pin the price to $4 per gallon. Use the proceeds to create an emergency fund to subsidize gas in the event that the price ever rises over $4, then give put the rest into the existing DoE grant structure for R&D in renewable (solar, not biofuel) energy.

Why $4 per gallon? As far as I know, prices have been that high only once before - summer of 2008, I believe. When they got that high, demand actually started to drop a little. So setting the price there might begin to reduce demand, but not enough to grind our economy to a halt. If we set it too much lower, we might not break even. But at $4 per gallon it's easy to compute the cost of a tank, gas stations can take down their signs, and everyone's happy. Right?

Why use the existing DoE grant structure? Because our need for investment in renewable energy infrastructure needs to be completely independent of this "taxidy" (that's a portmanteua of the words "tax" and "subsidy" in case you were wondering) program. If our DoE programs aren't good enough, we need to fix them before we start pouring all this money in, because the money that's being distributed through there now needs to be handled just as wisely. This should also prevent a lot of the political fighting over how the money will be used.

Why not biofuels? Because they're not sustainable, folks. Corn-based ethanol, by most measures, requires more energy to produce than you get back from burning it. That's right, its thermodynamic efficiency is negative. But its political efficiency is impressive, because Iowa is a swing state or something like that. Or because Monsanto has a powerful lobbying arm. . . Other biofuels may be more efficient than corn, and noncompetitive with our food supply, but they still can't really compete with solar energy. Solar energy won't power our cars any time soon, but once we have a cheap, stable electrical supply, getting the energy into the cars won't be nearly as difficult. Trust me on this; I know a lot more about emerging technologies at the fundamental level than you do (assuming you're a politician reading this note.)

That's the plan, and it should work until gas prices level out near or over $4 per gallon. At that time it shouldn't be too difficult to pass a rate hike to the existing program. Now we just need to elect a congress with the political will to enact this legislation. Here's a hint: David Vitter has got to go.

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