One of my frustration with the American energy policy is that it is stop/start. We have an energy crisis and everyone runs around wanting fuel efficient cars, bio fuels, and so on. Just about the time we start to make progress, the price of oil drops and a new federal administration comes in. Government spending is cut and people start buying SUV's.
Ronald Reagan felt that a gasoline tax was a user tax. What if during his administration, his Council of Economical Advisors made the following recommendations:
1) Index the gasoline tax to the construction cost index. This would avoid the shrinking in real spending on road construction and improvements. The selling point is help provide jobs to the Reagan working class voters. Also this would also reduce the oil imported from countries such Russia and Iran.
2) To help sell the bill, dedicate a inflation adjusted penny per gallon for research into cellulose alcohol and other bio fuels. With the depression in the agriculture section the potential for new uses of farm crops would help get the vote of farm state congressmen
3) To help sell the bill, dedicate a inflation adjusted penny per gallon for support for mass transit. Outside of a few major cities, the American mass transit systems are very weak.
What would be the long time impact of this had happened.