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'Flirting With Energy Chaos'

November 29, 1988

Your proposal to raise gas taxes by 25 cents to cut consumption is way, way off the mark. For most U.S. drivers a 25-cent increase in the cost of gasoline would be a nuisance tax, not a disincentive.

The following table of gas taxes in the Western world in 1987 illustrates the point: United States, 29 cents; Australia, 65 cents; West Germany, $1.34; United Kingdom, $1.53; France, $2.32; Japan, $1.47; Denmark, $2.93; Italy, $2.78.

It would appear, then, that an increase of $1 or $2 in the gas tax would be needed to create a disincentive to gasoline consumption.

The reason of course, is that a 25-cent increase is marginal to other costs of operating a car: insurance, taxes, maintenance, parking and the number of commute miles to and from work.

And, of course, a $1 gasoline tax increase would be politically impossible, especially if you are a good lip reader.

So forget about the short-term possibilities. Let's go for fuel efficient cars. From 1973 to 1985 gasoline consumption dropped 20 billion gallons a year as a result of increasing miles-per-gallon efficiency. But U.S. cars are still the least fuel-efficient in the Western world.

LU HAAS

Pacific Palisades

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