Projo Cars Blog

I spent last week in France where all the cars are small.

Why? It's simple. Gas costs the equivalent of $6 a gallon there, diesel the equivalent of $5 a gallon.

Why? Because it is heavily taxed - in France about 70 percent of the price of fuel reflects taxes.

The result? Smaller cars consuming less fuel which is a good thing for two reasons: Energy security from reduced dependence on politically unstable and hostile Mideast oil producers; and reduced carbon emissions.

In addition, with taxes making up such a large proportion of the price of fuel, increases in the price of crude oil have a less dramatic impact on fuel prices. The doubling of gas prices last summer, with all the ensuing chaos, was a uniquely American phenomenon.

At the same time, while Europeans might be driving more fuel efficient cars and thus consuming less fuel, they are still paying more overall. Consider the following simplistic formulas:

If you drive 100 miles in a car that gets 25 mpg, you will use 4 gallons of gas. At about $2 a gallon in the U.S., that will cost you $8.

If you drive 100 miles in a car that gets 40 mpg, you will use 2.5 gallons of gas. At about $6 a gallon in France, that will cost you $15.

But when you consider that about half of the cars in Europe are diesel powered, if you drive 100 miles in a car that gets 50 mpg, you will use 2 gallons of diesel. At about $5 a gallon in France, that will cost you $10.

The fact that Europeans are prepared to pay more to drive - not happily, needless to say - reflects a stronger commitment to social responsibility than in the U.S. that will not be bridged any time soon, if ever.

If anyone is under the illusion that individualism does not have a strong influence here, I advise a chat with a committed member of the National Rifle Association.

Indeed, calls to raise the taxes on fuel in the U.S. have successfully fallen foul of the same private interests that put the development of fuel efficient vehicles on the back burner - the auto companies and such related industries as oil, rubber, steel, plastic, glass, road building.

But it seems to me that with U.S. gas and diesel prices less than half those in Europe, we could increase gas taxes by a moderate amount and thus avoid a return to the cheap gas-guzzling days of recent yore.

- Peter C.T. Elsworth

 Tags  Commentary Europe gas taxes

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