NRDC’s recently released report ranks states in two critical areas related to our nation’s continuing addiction to oil: gas price vulnerability – calculated as the percentage of personal income spent on gasoline by the average driver in each state – and state’s adoptions of solutions to reduce oil dependence.
The report yields some conclusions:
- All states are impacted by oil dependence, but some states’ drivers are hit harder economically than others.
- The top 6 states most vulnerable to gas prices are Mississippi, West Virginia, South Carolina, Kentucky, Oklahoma and Texas, with the average drivers in these states spending 7.3-9% of their income on gasoline.
- Some states are pursuing solutions to oil dependence, but many states are still taking few, if any, of the steps listed in this report to reduce their oil dependence.
What are the critical state policies to relieve this adverse impact within their borders? Should the federal government incentivize the states to adopt policies that will minimize the oil price impact on its residents? If so, what kinds of incentives?
I agree with the basic finding that families and individuals, particularly low income families and individuals, are hurt as a result of the high cost of gasoline. Inteviews and discussions I have done with low income folks suggest that gasoline prices have negatively affected budgets for basic necessities and restricted job choices and mobility. I am also convinced that a state by state solution or response, while making us feel good and providing anecdotes for the development of policy options, will not make a real difference. In this context, a carbon tax will only make the price at the pump worse. I would hope that we would look nationally for a policy or program option . Why not try to build a coalition around lowering the price of gas through use of alternative transitional fuels. Doing so would require opening up of now restricted transportation fuel markets. Succeeding would reduce the cost of oil per barrel , reduce incentives to drill in hard to get at environmentally sensitive areas, and reduce cost of gas at the pump. Doing so, would also lower ghg emissions. We have for last twenty years tried to secure environmental objectives by raising prices of oil and gas to secure environmental objectives; reducing the price of both promises better results without hurting the poor. Marshall Kaplan, http://www.fuelfreedom.org
NRDC’s colorful map looks like a jumble of statistical artifacts. It hardly seems surprising, upon a bit of reflection, that states with a large number of poor people and states with low population density and wide-open spaces would be spending relatively more of their income on transportation fuel.
Of the top 6 states listed, 5 receive more money from the federal government than they contribute in taxes (ditto 7 of NRDC’s top 10). It may be hard to make a case for increasing aid from the federal government even further, given Washington’s struggle with the ‘fiscal cliff.’ Texas runs a slight surplus in its net tax contributions. Proposing aid from Washington to Texas seems like a non-starter.
Oklahoma and Texas are major oil producers. It seems unlikely that there is much sentiment in those communities to reduce dependence on oil.
If the cost of motor fuel puts an undue burden on people in some places, the most practical solution to that problem would seem to be to (a) increase supplies of fuel, lowering cost and (b) increase incomes. Opposing the fracking that has expanded the supplies of natural gas and oil and added wealth to many poorer, rural areas; opposing the Keystone XL pipeline that would expand oil supplies and jobs; and opposing coal altogether would seem to be effective ways to make the problem worse, especially in places like Texas, Oklahoma, Kentucky, and West Virginia.
NRDC generally likes blue states and does not like red states. Its report seems to want to impose a cultural revolution where one is not evidently wanted.
At a time when many economists foresee the US soon becoming a net exporter of energy, NRDC’s concern about reducing dependence on petroleum seems a bit anachronistic.
The NRDC report suggests reducing vulnerability with clean energy vehicles and advanced fuels. Unfortunately those two measures at this point would also increase costs for lower income families, who are effectively priced out of the EV/hybrid market. The economic link between some of the other policies they identify, such as expanding public transit is also lacking. Metropolitan areas that have proposed transit projects such as bus lines and rail are more often than not seeking to pay for those projects through new or increased taxes. The analysis reports a metric of percentage of income spent on gasoline, however a comparable metric with recommended policies (i.e. transportation costs) is not developed. The “with” and “without” policy analysis approach is central to evaluating the impacts of proposed regulations/policy. Without such an analysis, the report is only commenting on current status, without any evidence that the recommendations would reduce transportation cost vulnerability.