The US tax code taxes diesel fuel at one rate and taxes the ultra clean burning and domestically produced liquified natural gas at a rate that is 70% higher. This should be corrected!
The United States is now the largest producer of natural gas in the world. This is a positive development and will help us reliably and inexpensively heat our homes, power our economy, and fuel our vehicles. Moreover, it will reduce our dependence on unreliable foreign sources of energy.
Despite this good news, there is a bit of bad news. When natural gas is liquified and used as a transpiration fuel, our tax policy puts it at a huge disadvantage as compared to diesel fuel. We tax diesel at one rate and then tax the ultra clean burning and domestically produced liquified natural gas (LNG) at a rate that is 70% higher than diesel fuel based on its energy content. This is counter productive and disincentivizes the use of a reliable domestic energy resource.
Our tax policy should not be picking winners and losers and it shouldn’t be favoring one source of energy while penalizing another. Yet, that is precisely what the current tax code does to LNG and propane.
Some in the House and the Senate want to reduce the taxes on LNG and propane so that they are equalized with the taxes on diesel fuel. This amounts to a tax cut for LNG and propane so that it is taxed a the same rate as diesel fuel based on its energy content, rather than at substantially higher rates. We strongly support such a tax cut!
The Senate plan to extend federal funding for transportation projects into the summer of 2015 includes this important tax fairness and equalization provision. It is also an important economic growth provision. While we cannot support every measure within the Senate highway bill, this is a provision that we believe should be included in the final bill. It is fair. And it will help the economy grow because it will remove an arbitrary tax penalty and a counterproductive tax disincentive on an important homegrown energy resource.
We call upon the House to compromise by including this tax reduction and tax fairness provision in their highway transportation bill. We also call upon Senate Majority Leader Harry Reid to be willing to compromise with the House on the final bill and allow the legislative process to proceed. In our estimation, the House transportation bill has a great deal to recommend it. But by taking the strengths of the House bill and the Senate bill, we will end up with a better outcome.
Editors Note: When George W. Bush was the president, when gas prices increased, the mainstream media howled about the price increases, price gouging, and windfall profits. The Democratically controlled Congress held hearings on the matter. The public was reminded constantly that Bush and VP Dick Cheney were former “oil men” and the high prices were their fault and for the benefit of their influential friends. Now, with gas prices at historically high levels, the press is largely silent and when they do report the new higher prices, they do not blame the president or his policies. In fact, they blame world events without mentioning any of President Obama’s anti-energy policies. This is just one more proof that the mainstream media is not only biased, but is largely corrupt and dishonest. While that is not a new development, it is good to be reminded why the mainstream media is so widely distrusted.
Expect to pay more at the pump. Conflicts in Iraq have substantially caused gas to go up.
Marcus Washington reports right now gas prices are at a six year high for early summer.
As a projected 41 million people hit the road during this Fourth of July weekend, experts say get ready to pay more at the pump.
“Both nationally and in Maryland, the average today is $3.68 a gallon. That’s up two cents from a week ago nationally. And here in Maryland, it’s up about three cents,” said Ragina Cooper-Averella, AAA Mid-Atlantic.
The rising price of gas is a direct reflection of conflict in Iraq. Analysts are now focused on the militant uprising in the country, where America gets a large percentage of its oil supply.
“So far, with most of the fighting occurring in the northern region of Iraq, we have not seen any disruptions in the southern region, which is where a majority of the oil is produced in that country,” Averella said.
This summer it’s expected that most drivers will pay some of the highest prices at the pump since 2008, when the national average of gas rose to $4.10 a gallon.
“They closed at $107.26 a barrel on Friday, which is really high. And unfortunately, if the conflict continues, we’ll continue to see crude oil prices rise as well as gas prices,” said Averella.
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This news article appeared at the website of CBS Baltimore.
According to the Government Accountability Office (GAO) there were over 5.3 million vehicle crashes in 2011 that resulted in 2.2 million injuries and about 32,000 deaths.
What if it was possible to prevent up to 80 percent of those crashes simply by incorporating a few new pieces of technology into automobiles? Driver assisted vehicles boast both the ability to increase road safety (by electronically calculating the potential road safety hazards better than a human driver) and to potentially drive themselves, freeing the vehicle operator to focus on other tasks. To the outside observer, it would seem an easy conclusion that American automobile consumers would want to see the expansion of driver assisted vehicles in the upcoming years.
But underlying the proposed safety and lifestyle benefits of driver assisted and driverless vehicles are serious privacy and personal liberty concerns (the ability by the government or a third party to track where you are driving, digitized limits on vehicle speed, etc.) that need to be addressed before the public will be comfortable backing widespread adoption. As the automobile industry seeks to expand driver assisted and driverless vehicle technology the balance between safety and privacy concerns are an automotive freedom issue that industry American public will have to grapple with for some time.
As early as 1939 American engineers were developing driverless vehicles and the road systems on which they would travel. While the technology was not ready then, it is now at the point where science meets fiction. At a recent House Transportation and Infrastructure Committee hearing, National Highway Traffic Safety Administration (NHTSA) Administrator David Strickland said his agency will “decide this year whether to further advance” vehicle-to-vehicle communications technology “through regulatory action, additional research, or a combination of both.”
Vehicle-to-Vehicle (V2V) technology enables driver assisted and even autonomous driving. Central to this technology is a “black box,” a computer that interacts with sensors throughout an automobile to control functions such as speed and direction, and also communicates with other vehicles to avoid collisions. V2V technology has the potential to reduce collisions by as much as 80% and according to Administrator Strickland’s testimony “will give drivers information needed to make safe decisions on the road that cameras and radars just cannot provide.”
While full vehicle automation is still several years down the road, in the short term V2V technology will be a marginal improvement over current sensor technology, which assists with blind spots, braking and lane drifting. One of the first true V2V technologies adopted could be an adaptive cruise control that would automatically adjust a vehicle’s speed to maintain a safe driving distance. This has the potential to increase lane capacity, reduce collisions and improve fuel economy by up to 20 percent. The benefits of driverless vehicles also extend beyond increased safety and could offer increased mobility to disadvantaged populations, such as senior citizens and the disabled.
V2V technology has the potential to alter more than just the way we drive. It also has the potential to alter the way driving is taxed. Currently motorists fund the majority of road infrastructure through a series of state and federal gasoline excise taxes. The federal tax, set at 18.4 cents/gallon, has not been increased since 1993. This has resulted in a structural deficit in the Highway Trust Fund of roughly $15 billion.
The advent of more fuel-efficient vehicles coupled with a tax that some argue has not kept up with inflation, has sparked discussions on how to reform the taxes used to fund transportation projects in order to rebuild crumbling road infrastructure. Some advocates for reform argue that the excise tax should be replaced with a miles traveled tax that could be calculated and tracked by the same black-box type device that would enables motorist-assisted and autonomous driving.
While paying by the mile driven may be a fairer way to tax road use, it also illustrates many of the privacy concerns V2V communications systems present. As with income taxes, some individuals would likely try to tamper with their devices to reduce their tax burden. In 2011, the IRS identified roughly two million tax returns that were fraudulent, leading to an increase in audits and other agency actions. Other black boxes may simply malfunction. Like the IRS a government agency could easily be deemed necessary to ensure the integrity of the mileage tax. As a result, it is not difficult to envision a scenario where vehicles equipped with V2V technology would be subjected to regular, perhaps even weekly or monthly black box inspections.
There are additional privacy concerns that the government admits must be addressed before the V2V technology is more widely adopted. According to a November 2013 GAO report, one of the greatest challenges facing the development of V2V technology is establishing “technical specifications for a system that attempts to maintain users’ privacy while providing security for over the air transmission of data.”
Any technology that can upload mileage information to the government could also used to determine and regulate a variety of other factors. The radio system underpinning V2V technology broadcasts a number of different data points including “a vehicle’s latitude, longitude, time, heading angle, speed, lateral acceleration, longitudinal acceleration, yaw rate, throttle position, brake status, steering angle, headlight status, turn signal status, vehicle width, vehicle mass, bumper height and the number of occupants in the vehicle.” In theory, the government could use this information to not only determine your location and perhaps limit the speed you can drive, but third-party companies such as automobile insurers, could increase premiums based on the information regarding driving habits or law enforcement could use the information find fault in accidents or in criminal investigations and to issue remote tickets for traffic violations.
For example, in 2011, the New York Times reported that Timothy Murray, the then Lieutenant Governor of Massachusetts was involved in a car accident with his government issued vehicle. Mr. Murray initially claimed that he was wearing his seat belt and was not speeding. When the police checked the on-board computer the state has installed to monitor the vehicle, it was discovered that he was driving 100 mph and was not wearing a seat belt. As a result Mr. Carney, who claims he was asleep at the wheel, was issued a $555 ticket.
A continuous connection between your vehicle and a network could also pose a threat to how and when you drive. Eric Peters of the National Motorists Association recently reported on the Ford MyKey system and its broader applications across a fleet of smart vehicles. One of the things most striking to the author was an icon within the speedometer that uses GPS location to constantly inform the driver of a road’s given speed limit. The vehicle, through certain administrator privileges has the ability to set a maximum speed. By wedding these two technologies, the author contends that in the near future cars may be programmed to never exceed the speed limit on a given road. Peters also believes that a centralized control technology means “cars could also simply be turned off, individually (as when you haven’t paid a fine or done some other thing to incur the government’s displeasure) or en masse — in the event of some ‘national emergency.’”
As with many new technologies, there are significant advantages to be realized but also serious concerns that must be addressed. That is why automotive freedom and consumer choices are an important component to the proper development of V2V technology.
When considering the adoption of V2V vehicles two very different scenarios are possible. In one scenario, the government could promote V2V technology the way they have with fuel economy standards, through a command and control approach that has shunned new technologies like turbo engines, which could increase fuel economy without sacrificing performance. Instead, government regulations have forced companies to manufacture lighter and smaller vehicles, effectively restricting consumer choice.
In a second scenario, private industry rises to meet a market demand, absent of government mandates. This is true of antilock brakes, which were organically created to address a safety issue, and have since evolved into a standard feature on most vehicles. When left with a choice, the consumer benefits most from the market leading innovation and responding to demand. This is in essence, the heart of automotive freedom.
Vehicle to vehicle technology and its eventual path to autonomous driving has the potential to be one of the most consequential technologies of this generation, but public acceptance is contingent upon the fact that performance meets expectations and privacy concerns are addressed. This is why automotive freedom is such an important component of V2V expansion. Motorists should be vigilant as this technology develops to ensure that the proper balance of both performance and personal liberty is achieved.
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Travis Korson is the Communications Director for Frontiers of Freedom, a think tank with a mission to promote free markets, limited government and free enterprise. Visit them at www.ff.org to learn more about their automotive freedom project.
The U.S. Supreme Court decided this week to look at a case that has the potential to shorten the ever-expanding reach of the Environmental Protection Agency.
Justices agreed to weigh in on the case brought by the state of Texas, and joined by 11 other states including Oklahoma. At the heart of the matter is whether the EPA has the authority under the federal Clean Air Act to regulate greenhouse gas emissions from sources such as power plants.
A 2007 Supreme Court ruling allowed the agency to regulate carbon dioxide from “mobile sources” such as automobiles. Under the Obama administration, the EPA has passed rules to apply those regulations to “stationary sources” such as new or expanding industrial facilities. A separate piece of the Clean Air Act already covers those sources.
Pollution limits were set by Congress when it wrote the Clean Air Act, which became law in 1970. The EPA rewrote the thresholds as they related to greenhouse gases, despite not having that authority. The agency sees the limits as workable, but as The Wall Street Journal noted, the rule “could cost the economy $300 billion to $400 billion a year.”
Oklahoma Attorney General Scott Pruitt applauded the high court’s decision. “The states have the experience, expertise and ability to regulate environmental issues, and Congress clearly intended for the states to have primacy in this area and for the EPA to work closely with the states to regulate these issues,” Pruitt said. “However, the EPA is attempting to usurp the role of the states all in the name of imposing this administration’s anti-fossil fuels agenda.”
The EPA under this administration has expanded its rules to crack down on any number of entities it finds offensive, particularly those of the non-green variety. The Supreme Court’s willingness to take the case is encouraging. A rebuke from the court would be welcomed.
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This op-ed article was written by the editorial board of the Oklahoman newspaper.
Re: Renewable Fuel Standard “Reforms”
Dear Senator & Representative:
It has come to our attention that Congress is considering legislation this fall to reform the Renewable Fuel Standard (RFS). We, collectively and individually, believe the only reform to this failed government mandate should be to repeal the RFS. Repealing this mandate would bring certainty to the fuel markets and eliminate the harmful impacts this government program has had on businesses and consumers.
The RFS is a clumsy and misguided command and control mechanism that requires a certain level of ethanol to be blended into the nation’s transportation fuel supply. Gasoline has been required to contain 10% ethanol. The EPA plans to increase the amount of ethanol blended into gasoline by 50%. This is a horrifically bad idea. Congress has been working towards ending the counter-productive and costly RFS. Debt limit negotiations or other legislative vehicles moving through Congress at this time should not be used to expand regulatory burdens and impose additional costs on Americans. Continue reading
The automobile stands as an enduring symbol of mobility and opportunity in America — and of innovation that’s at the core of our nation’s economic strength and prosperity.
Yet the conventional gasoline-powered engine is sometimes disparaged and treated as if it’s yesterday’s technology. Listening to politicians, environmentalists and media pundits, you might think that the gas engine is inefficient and old-fashioned, a relic of the past that ought to be replaced by alternative automotive technologies like electric cars and plug-in hybrids. Continue reading