As the Antiplanner previously noted, House Transportation Committee Chair James Oberstar (D-MN) and Highways and Transit Subcommittee Chair Peter DeFazio (D-OR) want to spend $500 billion on transportation over the next six years — which is about $150 billion more than is available. Fortunately, if you think their plan is a good one, DeFazio has a solution: tax futures trades in oil.
This should easily raise $150 billion, DeFazio says, and “it should be wildly popular. I mean, everybody hates speculators.” That’s the ticket: just tax people everyone hates.
But whatever you think of speculators, it is a good principle of government to tax anyone that most people hate? This could lead to a lot of questionable and unintended consequences.
Furthermore, contrary to DeFazio’s claim that Enron somehow invented oil futures, the oil futures market has been around for at least 130 years. Can anyone think that taxing oil trades will do anything but raise the price of oil (which may be DeFazio’s hidden agenda)?
The truth is that there is no shortage of money for transportation if we rely on user fees to pay for it. But a user-fee-driven system would probably not result in the kinds of transportation DeFazio prefers, so he wants to tax someone — anyone — so he can impose his desires on everyone else.