My thinking is this. GM has made Hybrid SUV’s. There is a market, hopefully diminishing, for such vehicles. Let’s help GM, Ford, Chrysler, get rid of their INVENTORY of large hybrids, while “sunsetting” the subsidy to discourage future production. It should be easy enough to craft the language to exclude Lexus Hybrid SUV’s – sorry, but this market is composed of Junior League ‘fashionistas’, but perhaps I have succumbed to the masculinity of too many “like a rock” commercials, and am willing to accept the niche market of “real men” who need to haul boats, and hay, and all sorts of B.S.

While were at it. Kill ethanol production from corn. Make ‘em grow switchgrass, but prohibit agribusiness from utilizing any acreage currently or historically committed to corn, soy, etc.

Socialism? You betcha, but we saved the capitalists on Wall Street (had to, I suppose) – now let’s get smart. I may never buy an American-made vehicle, but that doesn’t mean for a New York minute that I want our auto industry to fail.

Besides, tesla already killed the model S……o, and where are all the original roadsters of which hundreds were to be produced in the first year alone. (last year by the way) Never happened until this year, and there were less than 50. All that didn’t happen during the financial crisis, but before, and because of faulty management. Why do you think they have switched CEOs so many times in the last year or so. I wish the best of luck to them, but they are really fallin apart.

The biggest problem with a tax increase is that — well, it’s a tax increase. I’m a fiscal small-government conservative, and thus believe that all other things being equal, less tax is better. Nevertheless, my conservative views also force me to be pleased with the reduced consumption resulting from recent high prices. In other words, the reduced consumption is good, but the resulting harm that has come to the economy (and hence individuals participating in that economy) is an unacceptable trade.

One possible way to balance these competing impulses, I think, would be to take an approach similar to the one adopted by proponents of the FairTax — some kind of rebate or “prebate” by which the taxes collected via an increased fuel tax would be distributed back to those who have paid them. In order not to undermine the tax’s influence on behavior, the size of the prebate would have to be the same for all, or at least would have to be independent of usage, so that people would still reap a meaningful benefit from limiting their consumption. The idea being that if you continue to exhibit average behavior with respect to consumption, it’s a wash. You pay a lot more for fuel because of the tax, but you get back the difference between what you do pay and what you would have paid without it. However now, instead of saving $2.50 or $3 for each gallon of gas you buy, you save $4 (or $4.50 or $5 or $15…). You avoid or at least mitigate the harm, but you still have the opportunity for substantial gain through modification of your own behavior.

The devil, of course, is in the details — including how to manage such a system as consumption and hence tax revenue drops. Do you increase the tax rate, reduce the rebate, or some combination of the two? And of course, who thinks for a second that such a proposal would make it across the desks of 535 members of congress without anyone trying to “improve” it by adjusting how the prebate is distributed in furtherance of some social agenda or other. EG maybe people in norther climes get a bit larger a prebate than everyone else to help heat their homes, or maybe people with less efficient cars get a little bit less.

If the government puts a floor under the price of gas, whether it be $4, $3.50, or $3, and the “correct” price is closer to $2.75, you end up with excessive supply. This isn’t necessarily bad (higher supply means more security since we can bolster reserves against a rainy day), and it isn’t necessarily good (excess supply will further erode prices on the open market, harming producers, which at the end of the day are legitimate companies in whose success we all have a stake, and in turn would provide a competitive advantage to economies around the world that don’t institute such controls, or that do the opposite, like China which sets a ceiling by subsidizing the cost of energy).

Rather, the point is that the interactions are complex and the consequences of such interference are by no means well understood. Yes, it will reduce US consumption, in turn harming the US economy and consumers even if it is for our own good. But it will do much more than than.