If the administration truly wants Americans to drive smaller cars, it needs to instill in automakers utter certainty that gasoline prices will rise and stay at very high rates. Short-term tax credits can't do that, as they leave carmakers unsure of what families will buy and afraid of losing the cushy-sized car market.
Raising the gasoline tax gradually but continuously is the only sure way to meet Obama's fuel-efficiency agenda. But Obama won't propose it because there is no way to hide the tax. Every time drivers fill their tanks, they'll see the price tag and know who put it there.
His entire 2008 campaign was based on telling voters they could get more government programs to promote health care, education and his environmental agenda -- but 95 percent of families would not have to pay for it. When asked in a debate with rival John McCain what sacrifices he would ask Americans to make, Obama answered, "There is going to be the need for each and every one of us to start thinking about how we use energy." That's right, his sacrifice wasn't in the pocketbook -- except for families earning more than $250,000 -- his sacrifice was in asking voters to think.
Consider Obama's campaign pledge to deliver universal access to health care. Say this for the French, they pay for their services; they pay a value-added tax of up to 19.6 percent and a 40 percent tax rate for income above some $88,313. But at the 2008 convention, the Democratic platform asserted that under ObamaCare, the "typical American family" would save "up to $2,500 per year." European services, American taxes -- with a bonus.
Who really pays? The future taxpayers of America saddled with rapidly accumulating debt.
There you have the real Obama model -- Europe, but on lower U.S. tax rates. This combo makes for an unsustainable model. Like Chrysler.
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