Thomas Friedman stumps for the gas tax in his latest column. Although this blog agrees with his conclusion, as previous posts have noted, Friedman's column presents the arguments poorly; you get the feeling he phoned in the article from a dinner party.
While a gas or carbon tax de-incentivizes in a far more direct and honest manner than CAFE or similar government-mandated standards, it cannot be argued — as Friedman does — that a gas tax is "win, win, win, win, win — with no uncertainty at all."
Like most consumption taxes applied to basic goods, such as a state sales tax, the adverse effects of such taxes have more impact on the poor. And on an even more basic level, nobody likes higher prices, even after understanding the [dis]incentives behind a gas tax.
And there is uncertainty aplenty, as there is with every mechanism intended to push a market in a particular direction. The intent of any gas tax is to coerce the free market in a desired direction; a form of intentional, legal market manipulation. Hopefully a benevolent manipulation for which market participants will be well prepared. But that process is filled with uncertainty — and that's a good thing! It is the free market at work.
Friedman makes his case, but he does so poorly, omitting key factors incumbent in an honest debate.
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