--- biofuels-biz@yahoogroups.com wrote: Message: 1 Date: Sat, 14 Dec 2002 19:22:36 +0800 From: Marc de Piolenc <[EMAIL PROTECTED]> Subject: Taxes are GOOD for you!
>"Following the Iraqi invasion of Kuwait, the Wall Street Journal (9/10/90) reported on >why Japan has been so much more successful in conserving oil than the U.S. The report >focused on the role of Japan's government in coordinating energy programs and >compelling corporations to install energy-saving machinery. Yet it managed to overlook >what Ronald Morse, an energy specialist quoted in the article, subsequently described to >EXTRA! as the most important reason of all: a tax policy that keeps Japanese energy >prices high and demand low." >Let's not mention that the Japanese economy is in the toilet – that would be impolite. >Prosperity is inversely tied to the cost of energy, folks, and anybody who really believes >that giving the bureaucracy a dollar or two every time we buy gas at the pump is going >to help us should move to Europe or Japan...and keep a stiff upper lip in the face of >chronic, steadily rising unemployment. >When free market prices for a commodity go up, the extra profit goes into producers' >pockets and provides an incentive for capital to migrate either to increase supply or to >provide alternatives. When prices are raised artificially and the extra cost is pissed away >by government, the result is economic stagnation now and worse to come. Marc de Piolenc Iligan City, Philippines -------------------------------------------- Marc, As I read your post, you make 3 points: 1. Taxes that raise the price of energy above the “free market” (i.e. untaxed) price create economic stagnation; because 2. “Prosperity is inversely related to the cost of energy;” and 3. Japan’s prolonged recession (approaching a depression now) is evidence of this phenomenon. 4. “Government bureaucracy” pisses away taxes uselessly. Let me offer the following observations. First, as you are no doubt aware, the price of a commodity and its cost are not the same thing. As Keith pointed out, the cost of petroleum is hardly reflected in the untaxed price—neither the environmental/ecological cost, the cost to human health, the subsidies to the oil industry, nor (for the US and Europe) the cost of a foreign policy geared to keeping oil flowing from “friendly” middle eastern countries. I don’t know how it is in the Philippines, but in the U.S., gasoline is severely undertaxed, despite federal and state taxes. I would cite as evidence of this the fact that U.S. consumers, by and large, are not clamouring for more fuel-efficient vehicles. The cost of gasoline is simply not a barrier to driving a car/SUV that gets 15 mpg. The economy in the U.S. certainly does respond to fluctuations in energy prices, but I would like to see some evidence for the “inversely proportional” assertion. What happens is that, as energy prices go up, producers at the margin of profitability, or that engage in energy-intensive activities, may start to lose money if they cannot find ways to increase their energy efficiency, and/or the cost of their products becomes more expensive to consumers. In response, alternatives to those products (substitutes) appear more attractive. The kicker in the States is transportation—not production, not heating. Our transportation infrastructure depends overly on roads and automobiles/trucks for moving people and services. Compare to the EU, which has much higher prices and taxes on petroleum (not on biodiesel though in Germany as I understand it) and yet retains some of the highest worker productivity and design ingenuity in the world. Go figure. On the other end of the scale, despite at least modest taxes on fuel, the U.S. nevertheless manages, somehow, to outcompete countries who have extremely low-priced gasoline, such as Brunei, Venezuela, Nigeria, and Mexico, (ok, Brunei was facetious), or widespread cheap alternatives such as ethanol in Brazil. And when we lose manufacturing investment to other countries the reason always cited is the cost of labor, not the price of energy. Regarding Japan, I don’t doubt the veracity of Keith’s observations. He has been there much more recently than I. What I can say is that it’s important to understand that Japan is hamstrung by a political crisis, not an economic one. The economics are simply a symptom. The fact is that Japan is unable to reform its banking sector, which has been in crisis since the real estate bubble burst in 93, and that has messed everything else up. If you want to know more about why, I’d suggest “The Enigma of Japanese Power” by Karel van Wolferen as a start. This book provides insights into the dynamics of Japanese national politics as a power struggle between agencies. Finally, however much one may dislike government, whether generally or specifically, I would hope for a more eloquent and engaging line of reasoning that a blanket assertion that “the bureaucracy” (whatever that is) pisses away tax dollars uselessly. That pisses ME off. Governments (at least participatory ones) are more or less effective in their investments of tax dollars, in direct proportion to the extent that people (not corporations) participate actively, vote, complain, write, and run for office. I know people who bitch about government doing this and not doing that, of overtaxing etc etc. But they still want their roads and schools and subsidized transit and social services. Gee, where do you think the money comes from? In my experience, few who lambast government as wasteful suggest any alternative policy. Come visit me in Washington State, where you can see first-hand how selfish, ignorant and ill-advised voters have surgically gutted a tax system, enabled by a charismatic moron of an initiative writer who proposes no solutions, simply fewer taxes. Remember the old saying from the 60s, “If you’re not part of the solution, you’re part of the problem.” Best to all, thanks for tolerating my 5am Sunday morning rant. thor skov ===== Grants Manager Stillaguamish Tribe Of Indians 3439 Stoluckquamish Lane P.O. Box 277 Arlington, WA 98223-0277 (360) 652-7362 Ext 284 __________________________________________________ Do you Yahoo!? Yahoo! Mail Plus - Powerful. Affordable. Sign up now. http://mailplus.yahoo.com Biofuels at Journey to Forever http://journeytoforever.org/biofuel.html Biofuel at WebConX http://webconx.green-trust.org/2000/biofuel/biofuel.htm List messages are archived at the Info-Archive at NNYTech: http://archive.nnytech.net/ To unsubscribe from this group, send an email to: [EMAIL PROTECTED] Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
