Some choices are easy. Do you prefer democracy or dictatorship? Clean air or polluted air? Education or Ignorance? Some however are not. Here´s one. What do you prefer, oil at $30 per barrel or at $100 per barrel? If you own a car you may prefer oil at $30 per barrel. But if you think further you can see the benefits of oil at $100 per barrel: more investment in renewable energy, less traffic congestion, lower carbon emissions, higher sales of fuel efficient cars and higher use of public transportation. Now one of the problems we have in this planet is that when oil goes to $100 per barrel, there are a lot of doubtful characters who get very, very rich. Would you like to see King Abdullah earn more billions? And how about Putin? Hugo Chavez? Qaddafi? Mahmoud Ahmadinejah? So before you start giving these leaders more of your hard earned money here´s another model of preventive warfare. It´s simple. It´s been done before and it works. Let´s tax ourselves in Europe and America to the tune of 50 cents of euro and dollar per liter. Let´s do it gradually to be able to adjust to the pain say at 10 cents per liter every 6 months and let´s have the EU and USA drive the price of gasoline at the pump. In this way what we will accomplish is that we will reduce consumption, we will bring oil price down and WE will keep the difference and use it for what WE believe is right. With a policy like this we will accomplish all the good things of higher oil prices and avoid our money going to dictators and dubious characters. To me this is preventive warfare that works.

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Magnus Åström on May 3, 2006  · 

This is really something that concern the US more than any other county. In sweden and Europe we pay up to 1.6 US$ per liter. Im not very hopeful that this will happen in the US though, thinking of all the wars that have been started in order to keep the middle east oil wells going. And then there is George Bush….

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Raul on May 3, 2006  · 

Martin, Take a look at this:

U.S. oil consumption in 1900 – 1 barrel/per person/year
– U.S. oil consumption in 1970 – 27 barrels/per person/year

– Japan oil consumption in 1950 – 1 barrel/per person/year
– Japan oil consumption in 1970 – 17 barrels/per person/year

– South Korea oil consumption in 1965 – 1 barrel/per person/year
– South Korea oil consumption in 2005 – 17 barrels/per person/year

– China’s current consumption – 1.3 barrels/person/year

– India’s current consumption – 0.7 barrels/person/year

Even 1bpd extra demand from China and India would be 5.5mbpd.

The EIA reports 100,000 bpd of slack supply.

I am not sure what you propose will work. What do you think?

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Jack on May 3, 2006  · 

I’ve long been an advocate of putting reserves aside for future or unexpected contingencies, and hae often used this strategy in my own personal and business affairs.

So, in one sense; I see some merit in your proposition, however, putting this money anywhere where anyone even remotely connected with the government in ANY country is not something which I would support.

There are far too many excesses in government spending, of misallocation, misappropriations and even abuses of tax revenues to make me feel comfortable in placing any additional funds — voluntarily — within the reach of anyone who is not directly and personally responsible to me.

Briefly, I’ve thought that maybe this might work some good if the “tax” you propose were to be put into some private fund, but the complications of running this are almost as great as putting the revenue into government coffers.

I can’t see how you can honestly believe that the funds which would be generated by this tax would be wisely and correctly spent.

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Anonymous on May 3, 2006  · 

Presently, Europe is not suffering the price increase as much as it would were the dollar stronger. Otherwise, there would be a major crisis in the European transportation sector.

I think that the only real issue here is environmental justice. When the government increases taxes on energy, the immediate affect is that poorer sectors of society are affected and not the rich who can afford the hike. So,increases in say gas taxes widens the divide between those who can afford to drive to work and those who are forced to take public transportation, increaesing the segregation of amongst classes.

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Alex Brooks on May 6, 2006  · 

It has been tried in the UK:
The “fuel duty escalator” was supposed to raise taxes on fuel steadily, slowly, but regularly. Due to some LARGE protests by truckers it was pulled.
Also, have a look at the excellent:

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Karl-Friedrich Lenz on May 6, 2006  · 

Germany has done something like this a couple of years ago and paid back every Euro in tax increases for energy in tax reductions somewhere else. This idea is much more easy to get through Parliament if you can say that you are not increasing taxes, only shifting them.

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Antoin O Lachtnain on May 6, 2006  · 

The issue is globalized industries like aviation and steel. If you impose a tax like this on fuel used in making steel, for example, your country can kiss goodbye to its strategically important steel industry. You have to get everybody to sign up to the deal on the same day, which is very difficult. Similarly with the airline industry.

On the other hand, a tax on transport should be much more feasible and can be imposed on a country by country basis, because local transport is not a global business.

Home and commercial space heating is more difficult, and industrial activities are more difficult still.

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Martín Varsavsky on May 9, 2006  · 

Interesting Raul,

But doing nothing would work better?


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