In the endorsement statement, IFBF President Craig Lang (also recently elevated as an Iowa Regent at the request of Gov. Terry Branstad) said that an increase “is the fairest way to fund” road repairs “because it charges people who actually use the roads whether they live in Iowa or are from out-of-state.”

Here’s the statement:

With rural roads making up nearly 90,000 miles of the state’s 114,000-mile road system, the Iowa Farm Bureau Federation (IFBF) applauds the Governor’s Transportation 2020 Citizen Advisory Commission recommendation for an additional 8 to 10 cents per gallon fuel tax.

“Our roads and bridges have been severely impacted over the years by flooding and neglect, negatively impacting all of Iowa, but especially our rural communities, businesses and farms. Our members believe it’s imperative to repair the roads and bridges to help rural Iowa thrive,” said Craig Lang, IFBF president. “We believe that an increase in the fuel tax is the fairest way to fund those repairs because it charges people who actually use the roads whether they live in Iowa or are from out of state.”

Lang notes that IFBF delegates in 2008 passed policy calling for the fuel tax increase to repair the state’s roads and bridges.

The tax increase recommendation was made to the Iowa Department of Transportation (IDOT) this week after several listening sessions around the state. The recommendations will be submitted to the Iowa Legislature by the IDOT by the end of the year. The IDOT reports that Iowa needs an additional $215 million per year to meet critical roadway needs and the recommended increase will generate $184 million to $230 million per year.

The Advisory Commission was established by Branstad last spring and held a series of seven public input meetings during August and September. Iowa Code requires a complete review by the Iowa Department of Transportation of the current revenue levels of Iowa’s road use tax fund and to determine if the revenues will meet the construction and maintenance needs of Iowa’s roads every five years. The appointed commission members were to provide input into final recommendation and to collaborate on public education.

While the 12-member Commission notes the hike may be troublesome for Iowa families already mired in an economic downturn, they believe the estimated $280 million could be put to good use for Iowa roads and bridges.

The gas tax in Iowa has been stagnant since 1989 at 22 cents per gallon. One cent of the tax goes to underground storage tank clean up and the remainder is used for road work.

The Commission is also recommending an increase in new vehicle registration fees from 5 to 6 percent of the purchase price.

And the results in Europe have been impressive. A cash-for-clunkers program in Germany helped boost new car orders by 63 percent in February, according to the Verband der Automobilindustrie, a German automobile interest group. As a result, the country’s auto fleet became more fuel efficient and kinder to the environment.

Sound too good to be true? That’s because it is — for the United States, at least. As The Wall Street Journal points out, gas costs nearly $6 a gallon in Germany, even with oil prices way down from last year. The incentive to trade in your old Land Rover for a new Smart car are huge there, when you can save nearly $100 on a long day of driving with the smaller vehicle.

Here in the United States, where gas is a third of the price of Germany’s and a high gas tax seems politically impossible, there’s no way that a cash-for-clunkers program could have the same kind of traction.

Still, if Rep. Betty Sutton’s (D-Ohio) Consumer Assistance to Recycle and Save (CARS) Act does pass and provide credits of up to $5,000 for people seeking to trade up, it would be a small but important step toward the creation of a strong, fuel-efficient U.S. auto industry.

Update: Evidently Sutton’s CARS bill has its flaws. From the American Council for an Energy-Efficient Economy:

The most serious shortcomings of the bill are:

-The qualification for vehicles to be scrapped under the program is based on age (model year 2000 or earlier) rather than poor fuel economy; and

-The fuel economy threshold for U.S.-assembled cars to be purchased under the program (27 miles per gallon highway) is very weak, with well over half of all cars sold meeting this threshold.

Scrapping all pre-2001 vehicles indiscriminately does not serve any valid purpose and should not be funded by taxpayers. Fuel economy in the U.S. has been roughly flat since the late 1980s, so replacing an older vehicle with a newer one does not generally save fuel. The bill as currently drafted fails to ensure that a new vehicle purchased under the program will be significantly more fuel-efficient than the vehicle that is scrapped.

Crafting a bill that will both accelerate our transition to a vehicle fleet that dramatically reduces oil consumption and greenhouse gas emissions AND stimulate demand for new vehicles to help our auto industry recover is an achievable goal. Any bill offering federal subsidies for new vehicle purchases should require that the scrapped vehicle is a fuel-inefficient vehicle, not simply an old vehicle, and that the purchased vehicle is a highly fuel-efficient vehicle.

We recommend the approach taken in H.R. 520, the ARIVA bill introduced in January by Rep. Israel, which promotes scrappage of vehicles having a combined fuel economy under 18 miles per gallon and purchase of vehicles exceeding Corporate Average Fuel Economy (CAFE) standards by at least 25 percent.

According to the report, the Highway Trust Fund is facing a $400 billion deficit over the next five years, and the $40 billion provided by the stimulus for transportation improvements can only support the fund for three months. A broader long-term solution is needed, and the 15 experts on the commission recommend “immediate augmentation” of current funding measures — including the gas tax — followed by a pay-by-the-mile tax on drivers beginning in 2020.

Transportation Secretary Ray LaHood proposed a mileage tax last week but was quickly rebuffed by the White House, and the tax was largely disparaged in the press. I dug deeper into this issue and found that a number of energy and transportation experts backed the mileage tax as the most sensible and forward-thinking approach to the highway budget shortfall. The commission’s report provides further validation of this perspective.

However, it appears unlikely that the commission’s recommendations will be put into effect. On the campaign trail, then-candidate Barack Obama pledged not to raise the gas tax because it would place “additional burdens on American families” in hard economic times. And when White House Press Secretary Robert Gibbs was asked about a mileage tax last Friday, he responded, “It is not and will not be the policy of the Obama administration.”

Perhaps the urging of congressionally appointed experts will give them pause to reconsider.

Case closed. Breathe a sigh of relief that fuel efficiency won’t lose its incentives. Or maybe not.

An editorial in The Washington Post this morning, titled “Mr. LaHood’s Good Idea,” praised a VMT tax as “the most promising, fairest, most environmentally responsible replacement for the gas tax.” The argument is that drivers will use increasingly little gas as alternative fuels take hold and vehicles become more efficient. As a result, revenues will decline, and funding for road and bridge repairs will collapse. A VMT tax would be a sustainable source of revenue for the long term.

Also this morning, several industy leaders, including the president and CEO of AAA, came out in favor of the plan. I’ll stay on top of this story and have some more analysis soon. But in the meantime, it looks like it could be premature to dismiss LaHood’s proposal as pure speculation.

In an interview with The Associated Press yesterday, LaHood rejected the possibility of raising the gas tax in the economic downturn, preferring to “[think] outside the box on how we fund our infrastructure in America.” The VMT tax would likely require the installation of a GPS chip in every vehicle in the country to track mileage.

It’s hard for me to see how this is not worse than a gas tax on every level. First of all, getting the program started will be a logistical nightmare. (Think installing digital converter boxes in 6.5 million households has been hard? Try putting GPS chips in the country’s estimated 250 million passenger vehicles.) It will also be a tremendous expense at a time when LaHood’s former Republican colleagues in Congress haven’t exactly welcomed excessive government spending.

But most importantly, it gets the incentives all wrong. Under LaHood’s plan, the driver of a Rav4 (22/28 MPG) would pay no more than the driver of a Prius (48/45), even though he’s consuming twice as much gas. A shopper at a Toyota dealership will see the Rav4′s lower price tag and spacious interior and feel little motivation to spring for the cosy Prius.

The only possible rationale for a VMT tax is political. A higher gas tax is tangibly painful for drivers who find themselves shelling out much more at the pump. It’s a hard sell. A little GPS chip in their cars and some extra tax forms, on the other hand — well, that just might be sneaky and abstract enough to work.

Still, if a gas tax is politically impossible when gas prices are just about as low as they’ll get, then when will it be feasible?

UPDATE: Transportation Department spokeswoman Lori Irving just shot down everything LaHood said: “The policy of taxing motorists based on how many miles they have traveled is not and will not be Obama administration policy.” Guess our transportation secretary was just speculating when he told the AP, “We should look at the vehicular miles program where people are actually clocked on the number of miles that they traveled.”

LATER UPDATE: Press Secretary Robert Gibbs also dismissed the notion of a VMT tax. “It is not and will not be the policy of the Obama administration,” he said at this afternoon’s press briefing. Again, makes you wonder why LaHood would bring it up without consulting anyone.

“Despite all the public discussion of fuel efficiency, SUVs and trucks are the industry’s biggest sellers right now as a remarkable number of buyers seem to be compelled by three factors: great deals, low gas prices and winter weather,” said Michelle Krebs, Senior Editor of Edmunds‘ AutoObserver.com.

Is anyone else thinking “Scarface” right now? As in: I have this big pile of coke on my desk and I just can’t keep my face out of it.

(Who said gas tax?)

Flickr: ilmungo

As the nation’s automakers near collapse, global temperatures rise, and consumers and government wallow in debt, there might be a one-stop remedy for all three: raise the gas tax.

The chief boosters of the idea are not Washington policymakers. Instead, they are some of the nation’s top economists, environmentalists and newspaper editorial boards.

Illustration by: Matt Mahurin

Here’s their argument: Hiking the federal gas tax, which hasn’t changed in 15 years, would not only encourage consumers to drive less and buy higher-mileage cars — thus reducing pollution and slowing climate change — it would also nudge Detroit’s automakers to produce the vehicles, thereby making them more competitive.

Despite the recession, proponents say the time is right for Congress to hike the 18.4-cent federal tax because fuel prices are lower — at a national average of $1.68 a gallon for regular gas — than they’ve been in months. If lawmakers don’t act, they worry, consumers might again be tempted to buy — and automakers produce — the gas guzzlers that largely contributed to the industry’s current economic troubles.

“Let’s not let lower oil prices permanently filter through to consumers,” Robert J. Samuelson, long-time business columnist at the Washington Post, wrote recently. “We’ve seen this movie before.”

Gas prices have been on a roller coaster this year. They skyrocketed over the summer, peaking in July when the national average hit $4.11 a gallon.  Consumers fled the large-vehicle market in favor of smaller, higher-mileage cars. Unsold trucks and SUVs, which had been so popular for a decade, started filling up dealers’ lots.

Falling gas prices could change all that, and the Big Three automakers might start churning out SUVs again if consumer demand for them picks up.

“If the price of gasoline sinks and stays at a buck and a half a gallon,” Peter Morici, an economist at the University of Maryland, told the House Select Committee for Energy Independence and Global Warming this week, “all of a sudden those big pickup trucks start looking good again and [the automakers] can make a lot of money.”

Morici did not respond to requests for comment about raising the gas tax.

The federal gas tax hike was last raised in 1993, and it wasn’t easy. No Republicans supported the per-gallon increase of 4.3 cents, one of the revenue raisers that President Bill Clinton pushed as a way to balance the budget. The bill passed only after Vice President Al Gore voted yes to break a tie in the Senate.

Ian Parry, an economist at Resources for the Future, said today’s gas taxes, federal and state, add an average of 40 cents to the cost of a gallon of gasoline. The levies “don’t reflect the societal costs of driving,” Parry says, because the expenses associated with congestion, pollution and accidents are simply ignored. “Regardless of the price of oil,” he said, “these externalities are not considered [in the tax].” Parry suggested a combined state and federal tax of at least $1 to make up the difference.

A hike in the gas tax faces a big obstacle. Appearing on “Meet the Press” on Sunday, President-elect Barack Obama rejected the idea because the middle of a recession is no time to take more money out of consumers’ pockets.

“Yes, gas prices have gone down,” Obama said. “But, in the meantime, maybe somebody in the family has lost their job. In the meantime, their housing values have plummeted. In the meantime, maybe their hours [at work] have been cut back. Or if they’re a small-business owner, their sales have gone down 50, 60, 70 percent. So putting additional burdens on American families right now, I think, is a mistake.”

Supporters of the new tax, however, say there are ways to lighten the burden. Samuelson, for example, suggested a one-penny increase per month spread over the next 48 months. That would allow consumers to take advantage of lower gas prices during the economic downturn, “but they’d also be on notice that prices won’t permanently stay down.”

Beside Samuelson, economist and New York Times columnist Paul Krugman has called for higher gas taxes. And this week, editorials in the Washington Post and the Christian Science Monitor urged Congress to raise the levy.

The debate arrives as Congress haggles over legislation to rescue Detroit’s automakers from potential bankruptcy. Some lawmakers wanted new fuel-efficiency standards to be a condition of the bailout, but that idea didn’t survive initial negotiations.

Nor did language, backed by Democrats, that would have prevented automakers from using bailout money to join lawsuits against states proposing tighter restrictions on tailpipe emissions. The provision was cut from the final version of the House bill after the White House balked.

Most Republicans oppose states’ efforts to curb greenhouse-gas emissions because they would impose an undue burden on the automakers at a time when they can least afford it. “That flies in the face of logic under the circumstances,” Alabama Rep. Spencer Bachus, the highest-ranking Republican on the Financial Services Committee, said Wednesday.

Given the political environment, supporters of a higher gas tax say there’s little wonder the idea hasn’t gone anywhere. “It’s smart policy,” said Daniel Becker, head of the Safe Climate Campaign. “It’s not great politics right now.”

Even some Democrats with long records of backing stiffer fuel-economy standards oppose raising the gas tax. Rep. Edward Markey (D-Mass.), who chairs the House committee on energy indepence and global warming, had proposed this week that the Detroit bailout include new emission standards proposed by many states. Markey sponsored the law, passed last December, that increased mileage standards, called CAFE, from 25 to 35 miles a gallon by 2020.

Markey spokesman Jeff Sharp said that the Massachusetts congressman thinks that higher mileage standards — not a higher gas tax — “is the best direction” to go.

“Better fuel economy will lower consumption regardless of the price of gas,” Sharp wrote in an email, “and put more people to work building the green cars of the future.”

Yet a 2004 report from the Congressional Budget Office found that a 46-cent increase in the federal gas tax would cut fuel use faster than increasing CAFE rules. “A gasoline tax is a good policy to compare with CAFE standards because it is the most direct way to reduce gasoline consumption,” the report stated.

Gilbert E. Metcalf, an economist at Tufts University, thinks an incremental tax on oil, when prices range between $40 and $120 a barrel, would do more to cut the country’s overall reliance on oil than a higher gas tax. (At $40 a barrel, the tax would be $40, while at $120, it would be zero.) Metcalf says such a taxation system would send “the right price signal” to encourage Detroit’s automakers to make high-mileage cars.

This woud be preferrable to a gas tax hike because “30 percent of oil is used for non-transport purposes,” Metcalf wrote in an email. “It keeps the focus on our desire to reduce oil consumption.

Whatever the plan, it will have to wait until at least next year. The House on Wednesday passed its Detroit bailout bill, which would provide $14 billion in emergency “bridge loans” to Chrysler and General Motors. Ford says it has enough cash to survive 2009, unless the economy tanks further.) The Senate is expected to vote on the bill later this week, though Republican opposition could kill the bailout.

Meanwhile, gas tax supporters are under no illusions about their minority status. “There’s not a very long line [of gas-tax proponents],” said Becker, of the Safe Climate Campaign. “We could meet in a phone booth.”