The Electric Commentary

Sunday, February 18, 2007

Hiding costs from kids and consumers.

Governor Doyle has proposed a bunch of new taxes. Nearly all of them suck, but the one that sucks the most is a tax on oil companies that would forbid the companies from passing the cost of the tax on to consumers.

Doyle, a Democrat, said the new tax on oil companies would be a good way to have firms that have enjoyed record profits fund highways and other transportation projects.

"It seems to me that these companies that have had such a big killing - and this is money that has come directly out of the pockets of the people of Wisconsin and the people of the United States - they ought to be doing their share to help with the infrastructure needs," Doyle said.
Oil company officials would face up to six months in jail if they passed the tax on to consumers. The state Department of Revenue would audit the firms to ensure they do not.

"I think, given the severity of the penalties and the enforcement unit we'll put in place, any oil company would run a very big risk in Wisconsin if they attempted to violate that law," Doyle said.

This is a bad idea for a number of reasons. The first is that it seems like there would be several logistical problems with preventing a company from passing a cost on to that company's customers. The second is that it's probably unconstitutional. The third is that it's definitely un-American to punish a company for making "record profits." But the stupidest thing about this tax is that it hides costs from consumers. This leads to consumers making bad choices. Bad choices like buying SUVs.

Although fundamentally speaking, I'm against using taxes to control behavior, I think there's something to be said for paying $6 a gallon. It has led most of Europe to buy smaller, more fuel-efficient, safer cars that are better for the environment.

I watched a movie yesterday called This Film is Not Yet Rated. It's a documentary about the Motion Picture Association of American--the guys that rate movies. One of the things the film focused on was the difference between how the MPAA treated violence versus how it treated sex. A film can get away with a ton of violence and stay rated R, but a comparatively little bit of sex will knock in into NC-17 pretty fast. This is obviously very stupid. What parent would rather their kid watched a lot of violence than a little bit of the ol' birds and bees? But what really struck me is the film's discussion of how violence that shows the blood and guts is treated versus violence that doesn't show the blood and guts. Movies that show gunfire and mass killings, but no actual dead bodies (at least no close-ups of dead bodies) can get PG-13 ratings while movies that show people actually dying (think the opening scene in Saving Private Ryan) get an R-Rating. Wouldn't it make more sense for kids to learn what really happens when people get shot? Aren't we desensitizing kids to violence by showing them these shoot-em-up movies where people only die at a distance or off-screen and are then just forgotten? Aren't we hiding the costs of violence from kids in the same way that Jim Doyle wants to hide the costs of a gas tax from consumers? Wouldn't we be better able to make decisions if these costs weren't hidden from us?


  • It's also impossible for oil companies to pass costs on to the consumer ( or perhaps in this case since it will affect all of them, impossible for them not to) because prices are not set by oil companies. Prices are set by the market.

    By Blogger PaulNoonan, at 10:42 PM  

  • I dont think Doyle wants the public to use less gasoline. What does he care? Just like he doesnt want less smoking, as he claimed when he proposed the tobacco tax.

    They want to tax and create as much revenue for the state, with the least resistance from the public. Which is the reason for hidden taxes and taxes on people who are addicted to products.

    By Blogger Nick, at 12:51 PM  

  • So do they repeal this tax when the gas companies aren't making a "big killing?"

    What a crock.

    By Anonymous Rashid Muhammad, at 6:12 AM  

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