Editor’s note – this is the first of a multi-part series on the current energy crisis. In coming weeks, I will take a look at the longer terms and what should be done.
The American Economy is in crisis. Gasoline prices have increased by $0.42 nationally in the past month (March 23, 2006 – April 23, 2006). Likewise, it has risen $0.68 cents nationally in the past year. Houston has been even harder hit over the last year, with the price jumping a whopping $0.83!
The first thing I will admit that it is not Government’s place to regulate the industry, but there are things that the legislative bodies in Washington can do to help ease the pain at the pump.
These things should be looked at and handled non-partisan, and non-special interest groups (hear me out environmentalists, this includes you).
- Congress should pass a law requiring that all patent owners use the patents they own, and if the owner does not use them, they will be released into the public domain after 10 years – (5 years for high technology).
There have long been stories of the oil companies paying large sums of hush money to the American entrepreneurs that produce devices that can consume considerably less fuel. This law would require the patent office to review all patents held by the oil companies, and turn them over to automobile manufacturers and others who can use those technologies. It would also have a side effect of quashing the patent trolls that are rampant in the high tech industries (Eolas – this means you and destroying the User Experience).
- Congress should suspend the gasoline tax for 18 months, or until prices are nationally below $2.50 a gallon, whichever comes first.
It’s only $0.184 per gallon of gas, but it can make a difference. State and local taxes make up a majority of the rest of the $0.62 per gallon average.
- The Federal Reserve should immediately drop short-term interest rates to 0%. Congress should encourage all lending institutions to pass that reduction to consumers.
If I have to spend more on gasoline, I’m going to spend less elsewhere. By dropping the Federal interest rate to banks, and the banks passing it on to consumers, a consumer can afford to make purchases on credit cards, or continue to pay off the debts they have. Without this change, I suspect that people seeking the mandatory credit counseling and then filing bankruptcy will skyrocket, as they cannot afford to pay bills with the higher fuel prices.
- Congress should pass a “windfall” tax, that affects companies when they rake in huge profits.
This kind of tax would make up for the drop of the gasoline tax for 18 months, by making these companies that rake in billions in profit every year to pay for their successes (and not reinvesting the profit in improving and expanding the infrastructure that they own).
- Congress should extend “Fuel Credits” to transportation industries.
A fuel credit is a tax break for companies, like airlines, railroads, trucking companies and others that use large quantities of fuel. One airline has been quoted that it costs the company $42 Million more for every $1 per barrel increase in the price of crude oil.
Next time, we’ll look at a 2 to 5 year (Near Term) plan.