Cafe Hayek: Fuel for Thought

« A Rerun | Main | J.K. Galbraith (1908-2006)» Don Boudreaux

April 29, 2006

Fuel for Thought

Don Boudreaux

Each year, American drivers consume about 65 billion gallons of gasoline. (You can figure out how I derived this figure by seeing this useful chart published by the U.S. Department of Energy, and then noting that each barrel of crude oil produces about 19.5 gallons of gasoline.)

The average price of unleaded 87-octane gasoline in 2004 was $1.88 per gallon. Today it's about $2.93 -- so, $1.05 per gallon more today than in 2004. Thus, at $2.93 per gallon, we Americans are spending $68.3 billon more per year for gasoline than we spent in 2004. (I'm crudely assuming that this higher price of gasoline doesn't cause the quantity demanded of gasoline to fall. Of course, to the extent that this higher price does cause quantity demanded to fall, the extra amount of money we spend on gasoline per year will be lower than $68.3 billion.)

Let's put this figure in perspective: According to this just-released paper from the Cato Institute, Chris Edwards reports that the annual cost in 1995 of complying with federal-income-tax requirements was $112 billion. In 2005, this compliance cost was up to $265 billion -- $153 billion more in 2005 than in 1995. Adjusted for inflation, this compliance-cost increase is $122 billion (in 2005 dollars).

Note that in 2005 our cost of complying with federal-income-tax regulations was $53.7 billion more, in real 2005 dollars, than the extra amount we're now spending compared to 2004, on an annual basis, for gasoline.

And Congress has the gall to pontificate about the alleged unacceptability of the higher prices now charged by oil companies.

Posted by Don Boudreaux in Prices | Permalink

TrackBack

TrackBack URL for this entry:
http://www.typepad.com/services/trackback/6a00d834518ccc69e200d8342a1dd353ef

Listed below are links to weblogs that reference Fuel for Thought:

» Making the most of fallacies from Not PC
Cafe Hayek turns ad hominem back on the opponents of free trade. Neatly done. And then fails to resit the temptation to turn tu quoque round on the US Government. Why resist? [Hat tip Stephen Hicks] [Read More]

Tracked on May 2, 2006 8:29:46 PM

Comments

The report you mention is actually from the Tax Foundation, which Edwards cites his most recent newsletter. Here's the full TF study on tax compliance costs:

http://www.taxfoundation.org/publications/show/1281.html

And here's the Edwards newsletter (Tax & Budget Bulletin) where he mentions it:

http://www.cato.org/pubs/tbb/tbb-0604-33.pdf

Posted by: Andrew | Apr 29, 2006 6:46:32 PM

I like the line of reasoning in this post, but it seems that the analysis is open to two criticisms as presented. First, aggregate numbers are inappropriate due to population changes. The difference may be insignificant from 2004 to 2006, but it surely is not for 1995 to 2005. Of course the cost of tax compliance will increase when more citizens must fill out tax forms. Why not look at compliance costs (and gasoline expenditures) per capita instead?

Second, the years compared do not agree. Since the report cited compares 1995 to 2005, it makes sense to use the data provided. With scarce intellectual capacity (and time to research), a skeptical reader may well assume that 2004 and 2006 were chosen purposefully to magnify or dampen the effect of the gasoline price change. Why not simply use the same years for each?

Posted by: blink | Apr 29, 2006 10:12:48 PM

Nice find.

The humble taxpaying citizen is getting squeezed all around...

Posted by: Aaron Krowne | Apr 30, 2006 12:30:25 AM

Great job Dr. Boudreaux.

Posted by: Christopher Meisenzahl | Apr 30, 2006 12:56:00 AM

"Great job Dr. Boudreaux"

I second that; Congress, specifically the Senate, will do anything to distract the average citizen from recognizing the fact that the Senate is inept.

Posted by: Grzegorz | Apr 30, 2006 6:32:09 AM

You need to explore the reasons why the tax code always drifts towards complexity, and how this can be stopped.

After all, even liberals ought to favor a simpler tax code because it means more revenue is collected and that there's less cheating.

Posted by: Half Sigma | Apr 30, 2006 5:13:21 PM

And of course the Cato Institute or the Tax Foundation which like taxes like they like eating hot rocks whole will give us a correct and unbiased "estimate."

Posted by: lee | May 1, 2006 12:25:08 AM

dr. boudreaux

i think your gasoline consumption number is low. it's about twice your figure.

www.eia.doe.gov/neic/quickfacts/quickoil.html

Posted by: matt | May 1, 2006 11:01:42 AM

nevermind.

Posted by: matt | May 1, 2006 11:29:18 AM

Excellent. Perhaps some reasoning will enter into the system and Congress will do their part in reducing the burden to Americans. And fairies will sprinkle dust all over us and all will be well. Right!

Posted by: David Andrew Taylor | May 1, 2006 1:50:23 PM

Don,
Lee is correct. Your gasoline consumption number is too low. According to the EIA, per capita gasoline consumption was 464 gallons in 2004. According to Census the population was 293.9 billion. Thus the U.S. consumes about 136 billion gallons of gasoline per year.

http://www.energy.ca.gov/gasoline/statistics/gasoline_per_capita.html

Posted by: Brendan Lowney | May 1, 2006 3:17:40 PM

papi -
perfect dp -
pimp my black teen -
please bang my wife -
public invasion -
pussy ass mouth -
real brazil hardcore -
reality kings -
reality pass plus -
reel 18 -
ronni tuscadero -
round and brown -
round mound of ass -
sammy4u -
sapphic erotica -
see her squirt -
she got switched -
shocking parties -
stacy bride -
stag shag -
street blowjobs -
street ranger -
sweet devon -
tawnee stone -
taylor little -
teeny bopper club -
terry lightspeed -
tgirl island -
the big swallow -
throat jobs -
tinys black adventures -
tori stone -
tranny surprise -
true twinks -
tug jobs -
vaginal cumshots -
vengified -
vip crew -
we live together -
wild hot dates -
xxx proposal -
xxx raimi -
summer time milf -
18 interracial -
8th street latinas -
adult dating friends -
adult friend finder -
adult love line -
adult movie zone -
all big cocks -
all reality pass -
all sites access -
a lucky stranger -
anal destruction -
ashley lightspeed -
asian angels -
asian love line -
asia porno -
ass parade -
bait bus -
ball honeys -
bangbros network -
bang bus -
bang match -
bare foot maniacs -
barely legal -
big and slutty -
big cock teen addiction -
big league facials -
big mouthfuls -
big naturals -
big tit patrol -
big tits round asses -
black cocks tiny teens -
boys first time -
boys gone bad -
brandi belle -
brandy didder -
britney lightspeed -
bruno b -
budapest bang -
busty adventures -
busty amateurs -
captain stabbin -
casting couch teens -
circle jerk boys -
coeds need cash -
college party dates -
college teens bookbang -
courtney lightspeed -
creampie freaks -
cumfiesta -
cum splatter -
dana lightspeed -
desperate popstars -
dirty aly -
dirty dykes -
dirty schoolgirl -
dirty teen -
dude dorm -
easy drunk girls -
ebony love line -
erica lightspeed -
euro masturbation -
euro sex parties -
exclusive mature sex -
extra big dicks -
extreme asses -
extreme naturals -
facial humiliation -
faith lightspeed -
female pov -
first time auditions -
fuck spy -
giants black meat white treat -
gigi lightspeed -
got fooled -
granny fucking -
heather lightspeed -
heels and hoes -
her first throatjob -
hood hunter -
horny spanish flies -
hungarian butt sluts -
im live -
in focus girls -
interracial fuck -
in the vip -
ir orgy -
i spy camel toe -
jordan capri -
lacey white -
latin love line -
lesbian teen hunter -
lesbo 101 -
lightspeed 18 -
lightspeed dvds -
lightspeed girls -
lightspeed sorority -
lightspeed tv -
lightspeed university -
lightspeed world -
little troublemaker -
lonely wives dating club -
mandy lightspeed -
man hookups -
meaty man movies -
men in the nude -
men over 30 -
mike in brazil -
mikes apartment -
milf challenge -
milf hunter -
milf internal -
milf lessons -
milf next door -
milf whore -
moms creampie -
monsters of cock -
mr big dicks hot chicks -
mr chews asian beaver -
mr skin -
my gay roommates -
nikki grinds -
older women love cock too -
old tarts -
ox pass -
panties and fannies -
papi -
perfect dp -
pimp my black teen -
please bang my wife -
public invasion -
pussy ass mouth -
reality kings -
reality pass plus -
real latin hardcore -
reel 18 -
ronni tuscadero -
round and brown -
round mound of ass -
sammy4u -
sapphic erotica -
see her squirt -
sexier -
sex spy -
she got switched -
shocking parties -
simply gay -
simply tranny -
sinful tales -
slutty mamma -
spy cams -
stacy bride -
street blowjobs -
street ranger -
super men -
sweet devon -
tawnee stone -
taylor little -
teen movie zone -
teens home alone -
teen teen teen -
teeny bopper club -
terry lightspeed -
tgirl island -
the big swallow -
throat jobs -
tinys black adventures -
tit vision -
tori stone -
tranny surprise -
true twinks -
tug jobs -
upskirts -
vaginal cumshots -
vengified -
vip crew -
voyeur dorm -
we live together -
wetscape -
wild hot dates -
wild match -
wives exposed -
xxx proposal -
xxx raimi -
young latina -
tamed teens -
18 interracial -
8th street latinas -
adult dating friends -
adult friend finder -
adult love line -
adult movie zone -
all big cocks -
all reality pass -
all sites access -
a lucky stranger -
anal destruction -
ashley lightspeed -
asian angels -
asian love line -
asia porno -
ass parade -
bait bus -
ball honeys -
bangbros network -
bang bus -
bang match -
bare foot maniacs -
barely legal -
big and slutty -
big cock teen addiction -
big league facials -
big mouthfuls -
big naturals -
big tit patrol -
big tits round asses -
black cocks tiny teens -
boys first time -
boys gone bad -
brandi belle -
brandy didder -
britney lightspeed -
bruno b -
budapest bang -
busty adventures -
busty amateurs -
captain stabbin -
casting couch teens -
circle jerk boys -
coeds need cash -
college party dates -
college teens bookbang -
courtney lightspeed -
creampie freaks -
cumfiesta -
cum splatter -
dana lightspeed -
desperate popstars -
dirty aly -
dirty dykes -
dirty schoolgirl -
dirty teen -
dude dorm -
easy drunk girls -
ebony love line -
erica lightspeed -
euro masturbation -
euro sex parties -
exclusive mature sex -
extra big dicks -
extreme asses -
extreme naturals -
facial humiliation -
faith lightspeed -
female pov -
first time auditions -
fuck spy -
giants black meat white treat -
gigi lightspeed -
got fooled -
granny fucking -
heather lightspeed -
heels and hoes -
her first throatjob -
hood hunter -
horny spanish flies -
hungarian butt sluts -
im live -
in focus girls -
interracial fuck -
in the vip -
ir orgy -
i spy camel toe -
jordan capri -
lacey white -
latin love line -
lesbian teen hunter -
lesbo 101 -
lightspeed 18 -
lightspeed dvds -
lightspeed girls -
lightspeed sorority -
lightspeed tv -
lightspeed university -
lightspeed world -
little troublemaker -
lonely wives dating club -
mandy lightspeed -
man hookups -
meaty man movies -
men in the nude -
men over 30 -
mike in brazil -
mikes apartment -
milf challenge -
milf hunter -
milf internal -
milf lessons -
milf next door -
milf whore -
moms creampie -
monsters of cock -
mr big dicks hot chicks -
mr chews asian beaver -
mr skin -
my gay roommates -
nikki grinds -
older women love cock too -
old tarts -
ox pass -
panties and fannies -
papi -
perfect dp -
pimp my black teen -
please bang my wife -
public invasion -
pussy ass mouth -
reality kings -
reality pass plus -
real latin hardcore -
reel 18 -
ronni tuscadero -
round and brown -
round mound of ass -
sammy4u -
sapphic erotica -
see her squirt -
sexier -
sex spy -
she got switched -
shocking parties -
simply gay -
simply tranny -
sinful tales -
slutty mamma -
spy cams -
stacy bride -
street blowjobs -
street ranger -
super men -
sweet devon -
tawnee stone -
taylor little -
teen movie zone -
teens home alone -
teen teen teen -
teeny bopper club -
terry lightspeed -
tgirl island -
the big swallow -
throat jobs -
tinys black adventures -
tit vision -
tori stone -
tranny surprise -
true twinks -
tug jobs -
upskirts -
vaginal cumshots -
vengified -
vip crew -
voyeur dorm -
we live together -
wetscape -
wild hot dates -
wild match -
wives exposed -
xxx proposal -
xxx raimi -
young latina -
taylor bow -
18 interracial -
8th street latinas -
adult dating friends -
adult friend finder -
adult love line -
adult movie zone -
all big cocks -
all reality pass -
all sites access -
a lucky stranger -
anal destruction -
ashley lightspeed -
asian angels -
asian love line -
asia porno -
ass parade -
bait bus -
ball honeys -
bangbros network -
bang bus -
bang match -
bare foot maniacs -
barely legal -
big and slutty -
big cock teen addiction -
big league facials -
big mouthfuls -
big naturals -
big tit patrol -
big tits round asses -
black cocks tiny teens -
boys first time -
boys gone bad -
brandi belle -
brandy didder -
britney lightspeed -
bruno b -
budapest bang -
busty adventures -
busty amateurs -
captain stabbin -
casting couch teens -
circle jerk boys -
coeds need cash -
college party dates -
college teens bookbang -
courtney lightspeed -
creampie freaks -
cumfiesta -
cum splatter -
dana lightspeed -
desperate popstars -
dirty aly -
dirty dykes -
dirty schoolgirl -
dirty teen -
dude dorm -
easy drunk girls -
ebony love line -
erica lightspeed -
euro masturbation -
euro sex parties -
exclusive mature sex -
extra big dicks -
extreme asses -
extreme naturals -
facial humiliation -
faith lightspeed -
female pov -
first time auditions -
fuck spy -
giants black meat white treat -
gigi lightspeed -
got fooled -
granny fucking -
heather lightspeed -
heels and hoes -
her first throatjob -
hood hunter -
horny spanish flies -
hungarian butt sluts -
im live -
in focus girls -
interracial fuck -
in the vip -
ir orgy -
i spy camel toe -
jordan capri -
lacey white -
latin love line -
lesbian teen hunter -
lesbo 101 -
lightspeed 18 -
lightspeed dvds -
lightspeed girls -
lightspeed sorority -
lightspeed tv -
lightspeed university -
lightspeed world -
little troublemaker -
lonely wives dating club -
mandy lightspeed -
man hookups -
meaty man movies -
men in the nude -
men over 30 -
mike in brazil -
mikes apartment -
milf challenge -
milf hunter -
milf internal -
milf lessons -
milf next door -
milf whore -
moms creampie -
monsters of cock -
mr big dicks hot chicks -
mr chews asian beaver -
mr skin -
my gay roommates -
nikki grinds -
older women love cock too -
old tarts -
ox pass -
panties and fannies -
papi -
perfect dp -
pimp my black teen -
please bang my wife -
public invasion -
pussy ass mouth -
reality kings -
reality pass plus -
real latin hardcore -
reel 18 -
ronni tuscadero -
round and brown -
round mound of ass -
sammy4u -
sapphic erotica -
see her squirt -
sexier -
sex spy -
she got switched -
shocking parties -
simply gay -
simply tranny -
sinful tales -
slutty mamma -
spy cams -
stacy bride -
street blowjobs -
street ranger -
super men -
sweet devon -
tawnee stone -
taylor little -
teen movie zone -
teens home alone -
teen teen teen -
teeny bopper club -
terry lightspeed -
tgirl island -
the big swallow -
throat jobs -
tinys black adventures -
tit vision -
tori stone -
tranny surprise -
true twinks -
tug jobs -
upskirts -
vaginal cumshots -
vengified -
vip crew -
voyeur dorm -
we live together -
wetscape -
wild hot dates -
wild match -
wives exposed -
xxx proposal -
xxx raimi -
young latina -
team squirt -
18 interracial -
8th street latinas -
adult dating friends -
adult friend finder -
adult love line -
adult movie zone -
all big cocks -
all reality pass -
all sites access -
a lucky stranger -
anal destruction -
ashley lightspeed -
asian angels -
asian love line -
asia porno -
ass parade -
bait bus -
ball honeys -
bangbros network -
bang bus -
bang match -
bare foot maniacs -
barely legal -
big and slutty -
big cock teen addiction -
big league facials -
big mouthfuls -
big naturals -
big tit patrol -
big tits round asses -
black cocks tiny teens -
boys first time -
boys gone bad -
brandi belle -
brandy didder -
britney lightspeed -
bruno b -
budapest bang -
busty adventures -
busty amateurs -
captain stabbin -
casting couch teens -
circle jerk boys -
coeds need cash -
college party dates -
college teens bookbang -
courtney lightspeed -
creampie freaks -
cumfiesta -
cum splatter -
dana lightspeed -
desperate popstars -
dirty aly -