Friday, February 27, 2009

Op-Ed: Robin Chase on Tax for Driving?

Tax for Driving? An Economic Engine

[See comments/discussion that follows just below.]

Let's spin some straw into gold. There is a hunger in the Whitehouse and state houses, on Wall Street and Main Streets for something, anything, to turn our financial distress and disappearing budgets into a future that restores hope, prosperity and confidence in government. I see the shimmering gold that keeps getting mistaken for impractical straw. You just have to get the right angle to the light.

The glimmer lasted only a few hours when late last week the AP reported that Transportation Secretary, Ray LaHood said: ''We should look at the vehicular miles program where people are actually clocked on the number of miles that they traveled'' as a substitute for the gas tax.

But within hours of its first report, transportation department spokeswoman Lori Irving declared: "The policy of taxing motorists based on how many miles they have traveled is not and will not be Obama administration policy." And later this sentiment was reiterated later by President Obama's own Press Secretary Robert Gibbs: "It is not and will not be the policy of the Obama administration.''

And that shimmering straw was thrown back into its dark policy-wonk corner again. But hold on. Let's re-examine the implications of paying for roads by the mile rather than by the gallon.

Point zero (not a point for this story but we need to put it behind us so that you can focus): your locational privacy as you drive can be protected. Really. We can deliver on that so put it out of your mind.

Point number one: if we follow through with the Economic Stimulus Bill just signed, state and federal governments are going to be replacing a whole bunch of old fuel-inefficient cars with fuel efficient ones, quickly if they follow the promised timetable. And then the rest of us are supposed to be replacing ours similarly, if the car companies and the EPA follow through with their recent promises. And so begins the inexorable melting of the tried and trusty gas-tax that finances our transportation infrastructure. Inadequate gas taxes, inadequate infrastructure.

Secondly, a VMT tax requires technology. And because cars and roads go everywhere, so too will this technology need to be everywhere. And therein lies the gold!

Unless you are a communications industry nerd, you'll have missed a very short and far-sighted clause in the Economic Recovery Bill: smart-grid demonstrations projects - 50% of which will be financed by us, the taxpayers -- must "utilize open protocols and standards (including Internet-based protocols and standards) if available and appropriate."

Imagine if the VMT technology applied this same language. Instead of having a single purposed transponder in every car, you'd have a device that could communicate and interact with the also ubiquitous and also everywhere smart grid. Are you beginning to see the shine?

Imagine further, that at your own option, and thanks to the genius of the private sector, this device would be much like any smart phone or laptop. You could download any number of applications. In fact, you might consider this VMT infrastructure -- end user financed because we want to pick our own devices to suit our own needs -- to be the nub of a mobile internet.

And like the Internet, it is a network, routing data over cars, through smart grids, and throughout our environment, in a dynamic decentralized way. A network owned by no one, but powered by all of us. Just like the Internet.

And just like the Internet -- remember the glow emanating from the late 90s? -- this will be an economic engine like no other. Is this a fantasy? The military is using just this technology to connect people, tanks, and planes in a decentralized robust and secure network in Iraq right this minute.

What did our last President say? Bring it on! Bring on that VMT tax! But make it shimmer, turn it into real gold by requiring open standards, Internet protocols and opening up excess network capacity that is funded with our tax dollars. No, it won't happen overnight. That only happens in fairytales.

Robin Chase, CEO of GoLoco, Founding CEO of Zipcar,

Source: Originally posted on Huffington Post , 26 Feb. 2009

Print this article


  1. i think it's "crazy." There are about 112,000 gas stations in the U.S. It's relatively easy to create 112,000 accounts for paying the excise tax on gasoline to state, federal, and local authorities.

    Instead, with a VMT mileage charge, every vehicle has to have a real-time transponder, recording every mile, with clearance and accounting systems for every car in the U.S., how many are there? Maybe 100 million?

    Instead of worrying about that why not just charge more money for the gas tax, index it to inflation, and charge a goodly amount?

    cf. Patrick set to propose 19 cent increase in gasoline tax - The Boston Globe

    Why try to do the hardest thing? Because you get to use cool technological systems?

    I will admit that my bias favors simplicity.

    Richard Layman

  2. Richard,

    I agree that high-tech is not necessarily the best way to do everything, especially when there are also low-tech simple ways of achieving the same goal. In many places cars need to be inspected on an annual basis in order to have the vehicle registration renewed (in California they already do this to assure that vehicle emissions standards are maintained). As part of the inspection/registration process one can also note the number of KM which were driven since the previous registration and include the tax on that directly in the registration cost.... When a vehicle changes ownership, the KM at the transaction would need to be noted and the 'back-taxes' paid in full by the previous owner.

    True this method will not distinguish VMT by road conditions, time of day, etc. but it is better than nothing and not at all difficult to implement. Just a question of political will (in the face of very weak public support). Once the system is in place, then it will be possible to refine it further. On a related note - once people understand that registering a vehicle is not just some token symbolic fee, but something which depends on other factors as well, it will also be easier to 'adjust' taxes per individual vehicle. This could include obligatory vehicle transponders (which BTW are only the size of a credit card attached to the inside of the windsheild), taxes basd on actual vehicle emissions (as mesured at the inspection), all kinds of things....


    Zvi Leve,

  3. A lot of our problems depend on vehicle kilometers traveled, NOT fuel consumed, Richard. That’s why this idea makes great sense.

    Lee Schipper, Ph.D0
    Project Scientist
    Global Metropolitan Studies

    skype: mrmeter

    Senior Research Engineer
    Precourt Institute for Energy Efficiency
    Stanford University


Thank you for your comment. You may wish to check back to the original entry from time to time to see if there are reactions to this. If you have questions, send an email to: