Students who commute to UCLA over the summer know how much of an issue paying for gas for all the driving can be.
Thus, when Sen. John McCain (R-Ariz.), the all but certain Republican nominee for president, announced on Tuesday that he would propose a summer suspension of the federal gas tax, which is about 18 cents a gallon, it seemed that this proposal would be great for students commuting to UCLA over the summer since it would save them money.
However, upon analyzing the reality of such a policy, it seems that not only would suspending that tax have little benefit for commuting students, but that suspending the tax could actually be bad for the country as a whole. While I wholeheartedly applaud McCain for trying to help the American driver, it seems this plan simply will not do so.
Currently, Americans pay the federal government about 18 cents per gallon of gas that they purchase. While that number may seem small, it helps to pay for highway and road upkeep around the country. McCain has proposed suspending that tax from Memorial Day until Labor Day, the busiest driving season of the year, to help Americans save money on gas over the summer.
The problem is, this isn’t going to happen. Specifically, this proposal would do little to actually help the roughly 14,000 summer student commuters at UCLA save money. Indeed, Americans for Transportation Mobility Coalition has estimated that the average American would, over the course of the summer, save only about $28.
“(This suspension) would not really have an affect on me as a student commuter over the summer because over the entire summer it is not that much of a savings,” said first-year undeclared student Nerissa D’silva. “I don’t even know if I would notice it.”
To be sure, rather than providing students with an instant savings of about $28 at some fixed point during the summer, students would only save a few dollars every week or two, about the cost of two to three coffees at Kerckhoff Coffee House.
“The bottom line is in terms of its impact, the gas tax is small,” said professor Edward Leamer, director of the UCLA Anderson Forecast, which projects trends in the economy.
That said, doing away with the federal gas tax for only a few months could have devastating effects of the ability of the government to take care of roads and highways across the country. Some economists estimate that without receiving the revenue that the gas tax provides, the government would loose about $9 billion for those months, and that is $9 billion the government would have to get elsewhere to make sure roads were safe for using.
“You can’t have tax cuts without spending cuts, and we probably don’t want to have infrastructure cuts,” Leamer said.
Furthermore, suspending the gas tax for the summer could have negative effects on the environment. Rolling back the gas tax could encourage people to buy gas since technically they would be getting gas for less money, even if the difference in payment is only a marginal one. Thus, not only would more gas consumption be releasing more carbon into the environment, but it would also use up more gas that needs to be conserved as it is.
“You don’t want to stimulate consumption,” said Lawrence Goldstein, an economist at the Energy Policy Research Foundation, to the New York Times. “The signal you want to send is the opposite one. Politicians should say that conservation is where people’s mindset ought to be”.
Finally, repeal of the gas tax could make gas prices go up. If people buy more gas since they think they are paying less for it overall, gas stations could mark up prices since demand would have gone up. Thus, McCain’s proposal would not only fail in helping UCLA commuters and American drivers as a whole, but it would also take away much needed money from the government. Perhaps the failures of this proposal are most indicated by the fact that such ideas have failed in this past. Indeed, since 2000 alone repeal of the gas tax during the summer season has failed six times.
Rather than doing away with a marginal tax needed to take care of American roads and highways, McCain, and other policy makers in Washington, DC should focus on lowering the actual price of gas, now at about $3.69 per gallon. Then perhaps UCLA student commuters would have one less thing to worry about over summer.
E-mail Margolis at mmargolis@media.ucla.edu if you want to see a policy that would actually lower gas prices. Send general comments to viewpoint@media.ucla.edu.