Tuesday, May 30, 2006

Gas price pain? Take another tax, call in the morning

By Erik N. Nelson, STAFF WRITER
Inside Bay Area
It is often said that pain and improvement go hand-in-hand. The athlete must endure it to build strength. Negotiators must sometimes make painful compromises to reach a deal. The dental patient must bear the sharp pain of treatment to end the long-running toothache.

Managing transportation in the Bay Area and beyond also involves a kind of benevolent pain, a hurt that is supposed to help, and in the end, make us all feel better.

That could mean paying more for a gallon of gasoline, sitting in line 30 minutes longer to pay bridge tolls or paying for the privilege of driving in downtown San Francisco.

To some, it is unnecessary, it is misguided social engineering and even un-American. To others, it is a way to cure traffic jams, pollution and make the nation stronger in the face of terror.

"There's this addiction to oil that we have in this country. The reality is, we have to find ways to move people away from foreign oil," says Assemblyman Joe Nation, D-San Rafael.

His way? Charge Californians — already hurting from record gas prices — another 25 cents a gallon in gasoline sales tax. The pain would be blunted by phasing in the increase at a nickel a pop over five years and offering a tax credit for the lowest 20 percent of income-earners.

There is some pleasure in Nation's bill in Sacramento, from the $2.6 billion a year it would raise for improving traffic flow and the $1.3 billion for alternative-fuel transportation research to the $1.3 billion in rebates for those who buy alternative-fuel vehicles. Besides raising the money, "it would change people's behavior," the assemblyman says.

"Typically, gas prices shoot up, andthey'll probably come back down," says Nation, who is an economist by trade. "People say, 'It's just Memorial Day, I'm going to keep the big car because I know prices are going to fall again.'"

"What evidence shows is if those prices stay high for a year or more, people start to change their behavior," says Nation, who would see to it that prices don't come back down.

And Nation has a point, considering how unflinching Americans' demand for fuel can be, says Rod Diridon, executive director of the Mineta Transportation Institute in San Jose.

While most product sales are subject to normal pressures of price, supply and demand, "when you have a product that everybody wants to use, no matter what the price, that's called inelastic demand."

Consumers won't snap to their senses until they reach a point of "elasticity conversion," when they hurt enough to change their habits, ride BART or trade in the SUV for a hybrid. Or so the theory goes.

Americans are so enamored of their cars that the point of unbearable pain may have already exceeded $3.50 a gallon, Diridon says.

While the prospects of Nation's bill surviving an election-year legislature are dubious, the Bay Area's Metropolitan Transportation Commission is more certain of using the pain principle to fix the problem of lines at toll booths and the high cost of collecting cash tolls.

The solution: Longer lines and more pain in the seat-cushion.

The idea, expected to be approved at the MTC's June 14 meeting, converts 10 cash-only lanes to FasTrak-only lanes on most Bay Area bridges, which require a radio transponder that identifies motorists and allows the Bay Area Toll Authority to deduct the amount of the toll from the motorist's pre-paid account.

The switch, planned for April, is expected to cause 30- to 35-minute delays on the Dumbarton and Carquinez bridges, but those delays are the bitter pill that will make people sign up for FasTrak accounts, says MTC spokesman Randy Rentschler.

And in the end, delays will be reduced as a result of this prodding. "You kind of focus the pain in one small segment, rather than stringing it out for a long period of time," Rentschler says.

There is also the pleasure principle, the one that comes from receiving a discount for using a transponder — offered by other toll agencies around the country — but the MTC does not have enough legal or financial leeway to do more than provide random $100 prizes and one-time bonuses to new members, Rentschler says.

If certain members of the San Francisco Board of Supervisors have their way, the city will follow London's example of needling motorists to lead them in a new direction. London charges nearly $15 a day, excluding nights, weekends and holidays, for driving downtown, paid by a transponder.

San Francisco Supervisor Jake McGoldrick, pointing to London's 30-percent congestion reduction, has convinced the city to study the idea under a $1 million Federal Highway Administration grant.

The Bay Area's well-intentioned pain fixation has its detractors, as one might expect.

Republican state controller candidate Tony Strickland is particularly peeved with Nation's gas tax proposal.

"Social engineering is not working. People are still driving their cars, and they feel even more of a severe pain at the pump now." Like many Republicans, he is proposing to eliminate California's sales tax on gasoline, and ease that pain.

Strickland is into the pleasure principle to such an extent that he recently handed out 21 cents per gallon to motorists at gas stations to show just how good his proposal would make them feel.

"With an average price at $3, you would think at that price, citizens would get out of their cars right now, but most of California is built around the automobile," Strickland says.

But with demand going up and supplies lagging, Nation says the status quo simply can't be preserved.

As many nurses have warned while holding a syringe, you can take the pain now, or live with it later.

Contact Erik Nelson at enelson

@angnewspapers.com and read his Capricious Commuter blog at http://www.


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