I understand that the high price of gasoline at the pump is hitting some folks hard. But the federal gas tax moratorium proposed by McCain and Clinton is a terrible idea for addressing the problem and amounts to the worst kind of pandering. We want people to use less gasoline not more and high prices are the best way to achieve this. Yes, people will drive less and that will mean lower sales at the mall and at restaurants which may further slow down the economy but I believe that’s inevitable in any case as consumers were spending above their means. In fact higher gas prices may be our best hope for increasing the savings rate! So what is to be done? If one really wants to provide temporary relief for those who can’t afford to get to their jobs then create a program that provides pre-paid debit cards that only work at gas stations (this is how trucking companies pay for gas). The hurdle for getting a card should be significant, such as having to stand in line at the DMV. Some might call that ‘discrimination’ but that’s exactly the point. We don’t want to subsidize someone filling up their SUV for a trip to the beach. But if your livelihood depends on driving you are likely to be willing to go through some hassle to get a fuel card.

I understand that the high price of gasoline at the pump is hitting some folks hard. But the federal gas tax moratorium proposed by McCain and Clinton is a terrible idea for addressing the problem and amounts to the worst kind of pandering. We want people to use less gasoline not more and high prices are the best way to achieve this. Yes, people will drive less and that will mean lower sales at the mall and at restaurants which may further slow down the economy but I believe that’s inevitable in any case as consumers were spending above their means. In fact higher gas prices may be our best hope for increasing the savings rate! So what is to be done? If one really wants to provide temporary relief for those who can’t afford to get to their jobs then create a program that provides pre-paid debit cards that only work at gas stations (this is how trucking companies pay for gas). The hurdle for getting a card should be significant, such as having to stand in line at the DMV. Some might call that ‘discrimination’ but that’s exactly the point. We don’t want to subsidize someone filling up their SUV for a trip to the beach. But if your livelihood depends on driving you are likely to be willing to go through some hassle to get a fuel card.