Questions regarding Ron's Stance on Gas Taxes

[Truth_Man]

A friend had this to say regarding Ron's stance on our current gasoline situation:

Ah, Ron Paul--keep in mind that suspending the federal gas tax would bankrupt the fund that repairs our nation's highways. Being a libertarian, he could care less for taxes, but paying for our roads is in my opinion a justifiable tax. Furthermore, there's no guarantee that gas companies would pass on the savings to the consumer. What's to stop them from just bumping the price of gas back up to where it would be w/ the tax? And the offshore drilling moratorium incorporates more than just ANWR; it includes the atlantic coast of florida. Would you want an oil spill off the coast of miami beach? The argument isn't just environmental. Tourism generates billions of dollars for florida. Ruining our beaches could send florida into a serious economic depression.

Does anyone here have any knowledge regarding these issues? I'm not sure what taxes pay for what, but I thought that federal gas taxes did pay for building and repairing our highways. I know Ron mentioned suspending that federal gas tax only when gas went over $3.00 a gallon. Any comments would be very much appreciated. Thanks!

[John E]

I dont know about your neck of the woods but they've been working on the Brooklyn Queens Expressway for YEARS and its worse than when they started...

I guess the point can be argued rather well in any number of ways but that doesn't mean we shouldn't consider alternative solutions and adjust what is the current status quo.

In the two examples cited, that could be lowering the tax on gas if its above $x ($1 a gallon x 10% (?) tax = 10 cent tax on the gallon versus $4 a gallon x 10% (?) tax = 40 cent tax per gallon ... a 30 cent per gallon difference... is this needed or is it surpluss going nowhere?).

Or ANWAR drilling (which I dont support) -- compromise and drill in Alaska and not in Florida if those are the concerns.

[Truth_Man]

Thanks for the response. So does suspending the federal gas tax when gas is beyond $3.00 a gallon mean that the government could still apply the tax up to $3.00? That would make sense. As far as ANWR, that is located in Alaska. You said you didn't support ANWR drilling, but to compromise and drill in Alaska. Did you mean just a different part of Alaska?

[Truth_Man]

BTW, I hear ya on the road work. It's pretty ridiculous!

[Crickett]

Here is the thing people do not seem to "get". Cutting the tax on gas, for example, is not the way to start. The way to start is CUT THE SPENDING. Then STOP borrowing money from Communists (which I can not find out how ever got started or approved). THEN begin to see what a balanced budget looks like, and what taxes we can do without..RP is mostly for getting rid of the unconstitutional tax on personal labor, but he is MORE about cutting spending...

[therealjjj77]

A friend had this to say regarding Ron's stance on our current gasoline situation:

Ah, Ron Paul--keep in mind that suspending the federal gas tax would bankrupt the fund that repairs our nation's highways. Being a libertarian, he could care less for taxes, but paying for our roads is in my opinion a justifiable tax. Furthermore, there's no guarantee that gas companies would pass on the savings to the consumer. What's to stop them from just bumping the price of gas back up to where it would be w/ the tax? And the offshore drilling moratorium incorporates more than just ANWR; it includes the atlantic coast of florida. Would you want an oil spill off the coast of miami beach? The argument isn't just environmental. Tourism generates billions of dollars for florida. Ruining our beaches could send florida into a serious economic depression.

Does anyone here have any knowledge regarding these issues? I'm not sure what taxes pay for what, but I thought that federal gas taxes did pay for building and repairing our highways. I know Ron mentioned suspending that federal gas tax only when gas went over $3.00 a gallon. Any comments would be very much appreciated. Thanks!

In response to your friend insinuating that the gas companies would just bump up their prices, ask him this: "If you owned a store and were making a 10% profit and someone opened across the street and was willing to sell for a lower price at a 7% profit, who's going to stay in business? How many people are going to buy the higher priced stuff at your store? Would that be very smart for them to do? Competition is what keeps prices down."

However, I would gander, haven't studied the subject much, that the Department of Energy actually sets the prices to a certain degree like the FCC does with cell phone companies. So get rid of that and we'll be in great shape.

Also, what good is it doing paying this road tax to have it just sent over to Iraq to rebuild their roads? You think much of it is actually making it to our roads?

In fact, to state where Ron Paul stands, he's fine with a tax on gasoline(a usage tax) to pay for roads. The Constitution does authorize it. However, I'm sure, like myself, he would prefer the roads being sold to the private sector and amending the Constitution as such. Let the private sector drive down the costs with competition.

[RSLudlum]

the Federal Highway/Transporation Trust Fund has nothing in it! It has been raided just like the SS Trust Fund....I remember RP mentioning something about it in an interview late april/early may...There's also been news that it's currently running a very large deficit and could be up to 2billion by end of 2009 and 10billion by 2010. Whether the tax is reduced/removed there's no money for roads anyway and the states are going to have to foot the bill for their own roads.

Just look at it this way:
A common trick the Fed gov't uses to get states to adhere/adopt it's policies is threatening to with-hold Highway Funding if they don't enact the feds 'prescribed' policies/laws/programs. If the feds don't have any money to dish out then they have nothing to keep the states in check. I say get rid of the fed tax, each state raise it's own tax according to what it needs and the problem is fixed! We could end up paying less in gas taxes at the pump, and the feds wouldn't have the 'highway funding' tool. A big win for States! On the other hand some States might see an increase in taxes at the pump but would be out from under the feds threats! :)

[nickcoons]

Ah, Ron Paul--keep in mind that suspending the federal gas tax would bankrupt the fund that repairs our nation's highways. Being a libertarian, he could care less for taxes, but paying for our roads is in my opinion a justifiable tax.

Someone here mentioned Ron Paul's stance on this well when comparing the Highway funds to the SS fund. Paul is not opposed to the gas tax if it were actually used to fund highways. It's one of the "fairest" taxes that we have (people who buy more gas, and therefore use the roads more, pay more for their upkeep). But gas taxes go to the general fund, so there is no longer a real fund for the highways.


Furthermore, there's no guarantee that gas companies would pass on the savings to the consumer. What's to stop them from just bumping the price of gas back up to where it would be w/ the tax?

This argument has been brought up many different times in different circumstances. The guarantee that gas companies won't raise the prices to compensate for the tax savings is the same guarantee that prevents them from arbitrarily raises prices right now. If there was nothing to prevent this, then why wouldn't they be charging, $5, $7, or even $10 per gallon right now? It's competition. Gas prices might be higher than what we want them to be. But a free market will always level out to the lowest possible price, which may or may not be lower than what any given individual's preconceived notion of what prices should be actually is.


And the offshore drilling moratorium incorporates more than just ANWR; it includes the atlantic coast of florida. Would you want an oil spill off the coast of miami beach?

The oil companies don't want that either. Imagine all of that lost profit floating away.


Ruining our beaches could send florida into a serious economic depression.[/I]

It could take quite a bit of funds away from the oil companies too, being responsible for all of that cleanup. Imagine how careful they would be in order to not lose that revenue, and not have to incur the cleanup expenses.

[Truth_Man]

Thanks for the responses, everyone. I found out that the federal gas tax is actually 18.4 cents per gallon. The state gas tax varies per state. So it's not a percentage that's being taken for taxes; it's a set amount. So then I guess that means RP would suggest completely getting rid of the federal taxes if gas passes $3.00/gallon. He probably figures, like another poster mentioned, that the money isn't really going to fix our roads anyways. What a freakin' mess this country is in. We need a clean sweep out of govt officials. They've all failed us and sold us down the river. Hopefully the rEVOLution brings in some young people with integrity to fill local govt offices, or else nothing is ever going to change.

[kylejack]

A friend had this to say regarding Ron's stance on our current gasoline situation:

Ah, Ron Paul--keep in mind that suspending the federal gas tax would bankrupt the fund that repairs our nation's highways. Being a libertarian, he could care less for taxes, but paying for our roads is in my opinion a justifiable tax. Furthermore, there's no guarantee that gas companies would pass on the savings to the consumer. What's to stop them from just bumping the price of gas back up to where it would be w/ the tax? And the offshore drilling moratorium incorporates more than just ANWR; it includes the atlantic coast of florida. Would you want an oil spill off the coast of miami beach? The argument isn't just environmental. Tourism generates billions of dollars for florida. Ruining our beaches could send florida into a serious economic depression.

Does anyone here have any knowledge regarding these issues? I'm not sure what taxes pay for what, but I thought that federal gas taxes did pay for building and repairing our highways. I know Ron mentioned suspending that federal gas tax only when gas went over $3.00 a gallon. Any comments would be very much appreciated. Thanks!
Its correct that its paying for highways, however it has run a positive flow for a long time. A significant chunk of gas taxes go on to General Revenue to be spent on anything because more than enough tax is collected for the highway fund.