Thomas Friedman makes a great case for this in Hot, Flat and Crowded.  We need economic incentives to create energy change.

 This is a political risky idea to be sure, but it comes from an honest place.  Is there some way to tie it to alternative energy? Maybe a piece of the extra income from the fuel tax goes towards subsidy's or incentives for hybrid and electric cars?  (In addition to mass transit as the writer mentioned.)

$3.50 is TOO EXCESSIVE, too wide a segment of our population is SEVERELY affected by fuel cost at this level and too wide a population has no access to public transportation or rideshare alternatives. The low cost of fuel has been responsible for America's ability to thrive. Too many industries and aspects of American life or threatened by high fuel costs. People go cold in the winter, others go without food or medicine in order to get to work. The only silver lining in our current economic crisis is that food price, commercial transportation costs and the cost of getting to work or heating your home is once again within an "AFFORDABLE RANGE" for 80% of the population instead of only 20% to 30%.

The boating industry is a $40 billion industry that is being pummelled by high fuel costs and no real way to find alternatives. In Florida alone it is an $18 billion industry which is 3 times larger than the Florida Citrus industry to put that in perspective. (I know nothing sounds big anymore with $7 trillion in write downs and bailouts). This is only one major industry though that should be "underwritten" in terms of fuel costs. Too many people are employed by this industry and too many state economies depend on its success.

Don't get me wrong, there is ABSOLUTELY NO DOUBT that we need to develop alternative fuels - but to purposely make the majority of Americans and American businesses suffer to do it is completely UNWARRENTED. There are plenty of companies who are busting at the seams for tax credits, investment credits, government and civic support. INVEST in INFRASTRUCTURE for the distribution of Compressed Natural Gas and Electric Charging Stations, (but develop standards for connections first). No one is going to invest heavily in alternative fuel technologies until we are willing to invest in the infrastructure to support it. It won't matter at all what the price of gasoline is. In the meantime, let the average American family get to work, buy medicine and stay warm. Low fuel prices are the only REAL economic stimulus this country can actually see at work.

Agreed - The demand for oil went down when prices were high, period.  PPL drove less, the demand for hybrid technologies increased, and people were generally affected and chose to be consume less fuel. 

If gas continues to be at $1.75/gallon - people will not adjust their habbits.  If we can keep it at a price that is managable for consumers/businesses, and invest the additional money in alternative technologies, we will all benefit long term. 

Yes, it will be uncomfortable in the short run, but looking out 10 years - it's the only way people will change their habbits

We do need a higher gas tax.  Period

There are two ideas that will make this happen.

1) it must be a certain amount.  Stating that it will make gas prices a certain number only incentives the gas companies to charge more.  If you say that gas has to be $3.50, they will charge $3.50 and there will be no money going to the government.

2) The money must go into technology to reduce gas consumption.  More efficient gasoline engine, alternative fuels, better battery technology should be funded with the taxes.  There has to be a benefit or else the tax will be seen as a punishment.

3) Make it gradual.  We are not going to fix this in a year.  Make it 8 years.  Increase the tax .50 a year.  It will get there and people will know that it will only go up.  This doesn't force them to change their habits even if they don't have the means, but their next purchase will be greatly influenced by the knowledge that it will not go up.   In the "new" car market, people will not change their cars every 3 years.  It may take 6 years before a person is willing or even able to buy a new car.  Give them time, but give them proper incentive and motivation.

I agree with Crytopean.  You can't raise the prices without having the alternative infrastructure in place.  I live in a city of 300,000 and you can't get where you need to go using public transportation.  I see vehicles all over the place stating "Flex Fuel".  The problem is that "Flex Fuel" isn't available.  And where it is available, it's double the price.  Great alternative.....

Well stated.  I think the problem with much of our way of life is that we believe or have this illusion that everything is forever.  That we will always have access to gasoline and other basic things but the reality is that resources of this kind are greatly limited.  The way the plan could work is simple.  First providing the significant infrastructure investment to alternative supply and with the cooperation of private industries give significant tax breaks to those who decide to.  At the same time calculate a progressive raising of the gas prices in the US in order to equally match the investment in alternative energy.  This strategy would allow a concrete vision of how the country will be in 10 years or so.  This country will not be surprised and will expect a change as time goes on.  I think we can become independent in 10 years but it will take some serious aggressive policies to do this.

Is this tax going up and down with the cost of oil to keep the price per gallon ay $3.50??  No??  I didn't think so.   Are you going to subsidize my gas bill so I can go to the store occasionally to get some food?  

It makes me furious to constantly be reminded of the high cost of being poor. 

Three dollars is what percentage of your weekly income?  0.001%?  For me it's 1%. 
That means that I would pay 1000 times the taxes on gas than you do.  But who gives a damn about the old and the poor.  I guess we should have thought of the consequences of getting old before we did it.  

You're going about this the wrong way. Trying to fight supply and demand is a risky and ultimately flawed idea.

The people in charge of the price of oil is the organization OPEC. If we want to affect the price of gas and oil we would need to deal with them, which is not an easy task.

A law like this would need to go into effect after the entire country has moved to fuel efficient cars. Something like this might work in about 20-25 years, but right now, people who are dependant on their car have no way out of the crushing costs of high gas prices.

Global Warming is a myth. Plain and simple. If you do some research you will see.

I completely support an increased national gasoline tax!

And all of the revenue generated from the gas tax should be used to fund healthy new transportation and clean energy across America.

http://www.economics.harvard.edu/faculty/mankiw/files/Smart%20Taxes.pdf

Greg Mankiw, a Harvard Economist and one-time head of Bush's economic council, advocates as much in this paper.

Good idea but as someone else has said it is a bit excessive unless the increase is phased in gradually. Here's a slightly different way of going about it: Eliminate the state gas tax and raise the federal to $1.00 per gallon. Discount the federal rate by the percentage of biofuel in the fuel purchased. For example, the rate on E-85 would be 15 cents per gallon. Of the revenue collected allow the states to keep 40% and have the federal government offer up 20 percent in matching funds for what each each state uses towards public transportation.  This rate could be increased over time but it certainly would have many benefits to do it this way rather than just increasing the rate on all fuels.  Discounting the tax on biofeuls would be an incentive for more production and distribution. Some of the revenue collected should go to funding tax credits for purchase of fuel efficient vehicles and developing a high speed interstate rail service.

What is true is that the Americans who most need economical cars can't afford to buy them.  What I propose is a tax on gas to raise the price to $4 a gallon and use the revenue produced by this tax to subsidize the price of efficient cars.

If a car gets 50 MPG then government pays 50% of the price of the car with the subsidy going as high as 90% for any car that gets 90 MPG or more.  To be eligible for the subsidy, a car has to be built in the US with 100% American built parts. 

This program would reduce the use of gasoline by 25% within 5 years and within 10 years the US would be energy independent.  None of the solar or winds programs could even come close to this and the program could be made revenue neutral so it would both dramatically improve our balance of payments and reduce the portion of global warming caused by transportation.

While the price of gasoline would double, poor people would be better off because they would be using less than half as much due to the mileage improvements.

Unfortunately, this wouldn't work because gas companies would just raise their prices to the $3.50 level.  I give it thumbs up though, because a gas tax raise is dearly needed.

I agree with HomeAlone. How is excessively taxing something that is a necessity for most every working American going to benefit our economy? How will that affect the working poor and middle-class?

The free market works so much better than government set price signals ever could. Sure, I look forward to more economical and environmentally friendly vehicles that will bring us energy independence as much as anyone, but it takes time to develop these technologies to where they can be put into a practical, and affordable, everyday application.

Meanwhile, Americans don't need politicians looting and plundering them in order to create a demand for something that can't be fulfilled quite yet.

Obviously, you folks do not have to pay the heating bill, pay for gas to get to work,
pay for the high cost of food due to energy prices. Did you ever consider why so many
retailers are going out of business after this Christmas. It is because the American
consumer gave billions of dollars to BIG OIL. ...so why don't you genuises get real
tax the OIL companies get our money back and spend it on energy independence.

You do not have to convince me as an ordinary American that we need Energy Independence by taxing us up the ying. THE OIL COMPANIES ALREADY GOT OUR
Money....I will scream that on the highest mountain.
 

MONEY

For people opposed to this idea you forget that these low prices we have now are temporary and lure us away from alternatives. 

For those that do not belive in climate change the supply is not keeping up with demand.  This is not a climate change issue, it is a price stability issue.  A change towards electric even powered by coal would reduce greenhouse gases.  Biofuel may also reduce.  But again, it's not a climate change issue there just isn't enough oil when the global economies are going at full steam.

The federal gas tax is 18.4 cents.  I would propose to double it to 37 cents a gallon  when the average price for a year is under $3 for a year AND we are not in recession.  I would propose that we triple it to 55 cents when the average price for a year is under $2 for a year AND we are not in recession.  In this way we give ourselves a break when we need it and keep from being lured by cheap fuel which cannot sustain us when we are growing strong.

No.
Plain and simple, OPEC is rich beyond compare at the end-users expense and punishing the poor even further for a necessity is cruel and illogical.

Big Oil has been suppressing the technologies that would have gotten us off our dependence but like a drug dealer to an addict they keep it the way it is. When the environemnt is gone will they be selling you your drinking water next?

The truth is that I personally know someone who (for a mere cost of $10 in parts) could equip any combustion engine to increase mileage by using hydrogen. It is simple, a bottle for the water, vacuum lines (from the engine) and electrical stimulus to separate the hydrogen molecules. He was shut down by the FBI.  I have personally considered using vibration like a radio speaker to excite the water but haven't bothered with R&D as I am more interested in eliminating the internal combustion engine entirely.

It is not only highly inefficient and wastes the majority of energy via heat-loss, but we have become complacent in its use and any attempts at discovering/developing free - energy (zero point) or alternate means has been met with both ridcule from a dogmatic scientific community that is shackled by an outworn creed and stifled from powers that be that see advancement as a threat to what ... National Security? I put it to you to ask yourself just how secure current policy is.

Education into these new fields (hyper-dimensional physics) is the only thing that would keep a free world free. It's always business as usual with support for a country in an explosive environment  with the main purpose of gaining a foothold in the area of wealth.

I would much rather see technologies being allowed instead of continually being suppressed for the benefit of the few and detriment to the many.

Further, we could have been off of fossil fuels for everything except petro-chemicals (plastics rubber etc)  had the patent holders not sold out or been  intimidated (or killed) into silence. We could be levitating already and imagine how much of the environment that would save with every shuttle/satellite launch. It is easier than you have been led to believe. 

The other option is to depend upon oil for our transportaion means and remain hostage while the rest of the world is making advances that will put us behind in the race to the future. We are already lagged.

I would like to see disclosure on UFO's as well so the reverse - enineered techniques could further my theories yet any technology is developed on a weapons first basis isn't it.

You can laugh it off but once you've seen a high-speed right-angle turn with your own eyes you will be a believer forever. It was that memory that kept me searching for the means (and without a shot-down craft to study) and I feel I am on to those means. I had sent them to  President-elect Obama's  team already and whether he even gets to see my theories remains outside of my influence and probably still in the hands of those who profit from the oil industry themselves.

It wouldn't surprise me in the slightest. I look at history. Twenty-first century man could be interstellar already and not still "dreaming" about inter-planetary travel.  I look forward to what exactly President Obama has in store for us... the populace not the corporatists. My personal opinion remains pessimistic but hopeful.

Require states to increase on-road fuel taxes (gasoline, E85, diesel) by $0.02 every month for the next 8 years. At the end of the period, the total tax hike will be $1.92. Proceeds to go into states' *general* funds, i.e. not earmarked for specific kind of spending. States that fail to comply will be subject to an identical increase in federal fuel tax.

Recommend that states also cut sales or other regressive taxes to keep measure approx. revenue neutral. Objective: force consumers to *earn* a net tax break by adopting more fuel efficient technology and/or usage patterns based on predictable fuel tax trend. High fuel tax = low fuel price volatility, so spikes in oil prices have a smaller *relative* impact on family fuel budget = greater probability of selecting home close to work and keeping up with mortgage payments.

Measure increases demand for fuel efficient gasoline, diesel and (partially electric passenger cars with higher margins for auto makers. Those are needed to support ever-higher health care and pensions overheads for retirees, who would be dumped into the socialized Pension Guaranty Corporation if the Big Three go bankrupt. Rising fuel taxes will save auto jobs and also structurally reduce demand for on-road fuels. Raising CAFE and funding bailouts will be ineffective.

I had an idea, very much in line with this, that I posted. The post is called re-inventing the gas tax. It says that the the gas tax should increase when the price falls below a predesignated amount i.e. $3.50 and decrease when it goes above that amount. I'm sure its not an origional idea but I posted it anyway. 

well, i would say that 50% of fuel needs to be tax to pay for changing to alternative fuels and to encourage smaller more efficient cars and alternate modes of transportation. some of the funds should be used to help people with moderate to low incomes to upgrade their fuel-inefficient cars.