You’re starting with the false premise that the cost of gas directly affects the usage of gas (carbon emmisions)…
People use gas for necessities (Work, doctor’s visits, getting the kids to school) so in the short term, raise or lower the price by $2 or roads that can swallow a Peterbilt won’t make a bit of difference (short of torching.that SUV for an insurance fraud).
People also use gas for pleasure and in the short term this may make a significant difference so a $2 change in gas or hours long backups may make you decide to take a SW airlines vacation flight instead of driving to Tennessee or simply stay home.
So the real question is what is the impact on my specific situation.
In a Rural and an Urban.Area, an increase or decrease in gas tax won’t make a bit of difference in gas consumption because “necessity” consumption is already locked in. If you’re on a farm you already have to use a car/truck for necessities and if you’re in a major city, using a car/truck for necessities is already impractical so you’re already using Mass Transit and the car (if you have one) remains parked 90% of the time anyway.
The real impact will be in the Suburban and ExUrban areas on discressionary travel, where a car/truck and decent roads are a “somewhat necessity” and no mass transit options are available.
Do I drive my kid to school or make them take the bus? Carpool to work or dive my car? Make 2 trips to the grocery or 1?
On the short term decreasing the fuel tax probably won’t make a difference in decreasing gas consumption but in the long term, hours long backups on the interstates due to road failure, probably will shift discressionary travel to mass alternatives like discount airlines.
Long story short, if I lived in a rural area while I’d object to any price increase I’d be in favor of actually increasing the Gas Tax, may cost me a little more but I absolutlty depend on decent roads.
If I lived in an Urban city, I probably wouldn’t give a hoot. The roads already suck and I’m already using alternative transportation so who cares.
And if I lived in the Suburbs / ExUrbs where I’m already benefitting from the needs of the Rural and Urban folk without paying the piper, I’d be crying like a baby. (It cost me $5 more to gas up my Range Rover to get Muffy to her Soccer Trianer which is TOTALLY UNFAIR!)
Long story but to quote H. L. Menken, “To any difficult problem there’s anlways an easy solution, which is always wrong”.
I don’t know about your area but around here especially in the bigger towns that uses a lot of unnecessary gas you can go past a school and see the school busses picking up or dropping off with only a third to half the seats being used and cars lined up for a mile in either direction. They are for gas in their own cars plus fuel for the busses through taxes I never could figure out why parents have to drive their kids both ways to school every day.and letting the busses mostly go to waste. I can agrree with everything else you said.
That was proven true at times of major gas price spikes. When prices jumped, sales of compact cars increased, and you couldn’t give away big cars/SUVs. When prices dropped, SUV sales took off. Simple facts.
I think you’re talking about two different things. You’re talking about car sales, and @Beancounter is talking about fuel sales.
Quite often, people who drive small fuel efficient cars use that as an excuse not to curb their driving (no pun intended), so they end up using about the same amount of fuel even after buying a smaller car.
On the other hand, the price of fuel tends to be somewhat inelastic until it gets crazy high.
Here come the ‘other reasons’. People were trying to find ways to use less gas during those spikes directly because of the price increases, I observed and experienced it. Were other factors also at play? Sure, but the claim that ‘prices don’t affect gasoline consumption’ is demonstrably false. Short term people drive less, long term people buy more economical cars, just like they do in Europe.
Whether fuel prices affect fuel consumption isn’t a binary question. Of course they do. The question is: How much does a price change influence the change in consumption?
Compared to the majority of consumer goods, demand for fuel is relatively inelastic. It takes a very large increase in price to have a small effect on the nation’s fuel consumption.
The two things you claim are directly linked aren’t even plotted on the same chart you posted. You had to post two different charts with two different scales.
Lastly, I will ask: Which is a bigger factor in fuel consumption? Is it the price of fuel, GDP, or consumer confidence?
In the hopes of moderation, like most serious questions there’s more factors at play than the Gas Tax in determining Gas Usage and Devil’s in the details.
For example, assuming $3 gas, the Federal Gas Tax is 18 cents, Pennsylvania’s State Gas Tax is 59 cents and Virginia’s is 16 cents.
Would elimination of the Federal Gas Tax of 18 cents (a price reduction of 6%) be enough to encourage someone to change their gas usage by changing their driving miles or changing their vehicle?
If this were true, you’d expect that Virginia and Pennsylvania, with a much larger 41 cent (14%) State Gas Tax difference would also have significantly different gas consumption and driving habits but I haven’t seen it.
For me it’s like laundry detergent. If Tide goes on sale I’ll probably stock up and be pleased by the savings but I’m not going to change washing habits or buy a new, more efficient washer to save a few cents on detergent.
That’s a great analogy since anyone who trades in a vehicle just for better fuel economy is a fool.
If you crunch the numbers, even if gas is $5/gallon and you drive a Suburban, the depreciation costs and other costs associated with buying a new/used vehicle make trading in a vehicle just for fuel economy a financial loss.
If you’re already in the market for a vehicle, buying a the smallest most fuel efficient vehicle that suits your needs is the smart choice, but not if you’re only doing it to save fuel.
What’s really fun is to buy a small fuel efficient vehicle when fuel is cheap, and then watch the price of fuel creep up knowing you’ll still be able to afford to drive your car while people are parking their Suburbans.
Texases - In some cases you’re correct, “lower prices result in higher consumption” but you’ve made a dangerous “cause and effect” assumption that’s easily proven incorrect.
Remember a few months ago when gas prices went from $3 about $2?
In your model the 1/3rd lower prices (cause) should have the effect of a 1/3rd increase in gas consumption but it didn’t happen.
What actually happened was a decrease in consumption forced a decrease in price, a very different cause and effect.
This “cause & effect” error is common and the source of one of my favorite jokes
A man walks down the street dropping banana peels behind him
Another man asks, “Why are you dropping banana peels?”, which the first man replies,“To keep away the elephants.”
The second man is incredulous! "Elephants!!! There’s no elephants around here!!!
The first man replies, “See, it’s working!”
I would never image that to happen. Nothing like a one to one relationship. I’m only stating that increasing prices will decrease, to some extent, gas consumption. That’s all.
Interesting that you used Tide as an example. When Costco puts it on sale, I stock up. They do that about every 4 months or so.
During one of the Car Talk quizes, they asked what one word change was added to shampoo labels that doubled their sales. The word was “repeat”.
Tide did something to double their sales also, but it wasn’t anything on the label or the outside of the box, or the size of the box, or the amount of detergent inside the box. They have always included a free scoop inside the box. The maximum amount of detergent recommended is still three lines on the scoop. They changed the scoop from three line size to a six line size and most people would just fill the scoop and not notice the size change.
I use liquid Tide HP. Just bought a new bottle. Wife used some Tide pods then switched to Arm and Hammer. Maybe I should keep an eye on her but I’m kind of over-stocked now with two full liquid Tide bottles, a full A & H, and some pods. I’m ready but hope they don’t shut the water off.
The sad truth is that most of the public will respond to “What I know” and “What I believe” instead of subjecting it to critical evaluation.
It takes some effort and an understanding of “what goes on” beyond your Congressional district or State lines but it’s important.
We have a serious problems confronting us that require some serious decisions and I hope that I’ll be able to keep my 52 MG on the road while allowing my future grandchildren to breathe.
