Greg Mankiw Pumps for a Higher Gas Tax
We should raise the tax on gasoline. Not quickly, but substantially. I would like to see Congress increase the gas tax by $1 per gallon, phased in gradually by 10 cents per year over the next decade.
He lists seven reason, including reducing CO2 emissions, reducing traffic congestion, and
as a higher gas tax discouraged oil consumption, the price of oil would fall in world markets. As a result, the price of gas to consumers would rise by less than the increase in the tax. Some of the tax would in effect be paid by Saudi Arabia and Venezuela.
In effect, we are taxing furriners.
As I recall, Jeff Frankel came up with eight reasons for a higher gas tax, so Greg should maybe ask his colleague to remind him what the eighth reason was.