Posts filed under “Taxes and Policy”
On Monday, I discussed why Tesla’s latest announcement was big. The electric carmaker said it planned a modification that would give its autos the ability to accelerate faster than cars that cost two to three times more and keep up with those that cost 10 to 20 times more. That’s an astonishing accomplishment. I made the supposition that if you squint, you can see the beginning of the end for gasoline-powered internal combustion engines. They won’t go away for a while, but they have a credible challenger in electric battery-powered vehicles.
Let’s assume for the moment that my wild-eyed speculation is correct. Play this out and it means that at some point in the future, sales of gasoline-powered automobiles will peak and begin to fall. This has enormous ramifications for the U.S. transportation grid, and the health of the American economy — and for anyone investing in energy or transportation and all the related industries.
We now pay for the maintenance and construction of our interstate highway system, bridges and tunnels — plus many state and local roads — through the Highway Trust fund. (We have discussed this before here, here, here and here). The Fund is financed by a gasoline tax that has been stuck in a time warp. The last time the tax was increased to keep up with the cost of construction and maintenance was in 1993, to 18.4 cents a gallon. But now the Trust fund is being starved of funding because the tax wasn’t indexed to inflation. Adding to the strains is weather that has gotten worse for roads because of hotter summers and colder snowier winters.
A never-ending series of emergency measures and short-term fixes have kept the Fund afloat, but now it’s just about out of money.
Continues here: Raise the Gas Tax Before It’s Too Late
The Stimulative Effect of Redistribution Bart Hobijn and Alexander Nussbacher FRBSF Economic Letter June 29, 2015 Policymakers often consider temporarily redistributing income from rich to poor households to stimulate the economy. This is based in part on the idea that poor households spend a larger share of their income than rich ones do. However,…Read More
If you missed the big Barron’s article (How Much Do Silicon Valley Firms Really Earn?) story this past weekend on Silicon Valley’s accounting, you should definitely check it out. There has always been a element of bullshit in not expensing stock options, but this has now moved towards absurdity. Compaore & Contrast Source: Barron’s
My wife leaves for work earlier than I do, giving her first choice of which car to drive. She has a longer drive than my three-minute jaunt to the train station, so I don’t mind. That often means I get the rear-wheel drive convertible in the snowy winter months, and the all-wheel drive Jeep in…Read More
This week, Los Angeles became the third major West Coast city and the biggest in the U.S. to agree to raise the minimum wage to $15 an hour, an increase that will go into effect by 2020. Los Angeles follows Seattle, which will require employers with 500 workers or more to pay $15 by 2017….Read More
The details are still being sorted out on the deadly Amtrak crash that killed at least six people earlier this week and injured 100s more. But what we do know is that the stretch of track where the train derailed did not have the latest automated speed control system. National Transportation Safety Board (NTSB) board…Read More