Economics 101: The Difference Between a Toll and a Tax

Bob Gibson, political reporter for Charlottesville’s Daily Progress, opines on the prospects for transportation taxes in the 2007 session of the General Assembly. Traditional wisdom, he writes, says that it’s hard to get new taxes passed in the 46 days allotted to short sessions of the legislature, especially when all seats in the House and the Senate are up for re-election later in the year.

This year, Gibson contends, the pressure to do something about transportation is so intense that the Assembly may well pass a tax without calling it a tax. One possibility is to let congestion-prone regions like Northern Virginia or Hampton Roads impose a regional levy upon themselves — it may be a tax, but it’s not a “general” tax. Another is to pass a mini-tax on the grounds that, “If it’s hidden, or it’s small, a tax is a tax but may not be much of a tax at all.”

A third trick, suggests Gibson, “is to call a tax a toll.”

I take from the tone of Gibson’s column that his intent is to be light and clever, which entails adopting a voice of tongue-in-cheek cynicism. Fair enough. Trouble is, if enough people adopt that voice, they may kill off one of Virginia’s best hopes to deal rationally with traffic congestion.

A toll is NOT a tax. It is a user fee — and that’s not just semantics. A tax collects revenues from people generally and then redistributes it to someone else. Even narrow-bore taxes like the Kaine administration’s proposed auto titling tax would tax citizens generally (all those who purchase cars, regardless of how much, or where, or when they drive) and redistribute it for the benefit of those who drive the most (pushing up maintenance costs) or who drive on congested routes (increasing the demand for new roads).

With tolls, the people who pay for a road are the ones who use it, when they use it — unless, of course, they are Dulles Toll Road commuters, who are being levied to pay for the Rail to Dulles heavy rail project… in which case the toll really is a tax.

A toll is a “toll,” and not a “tax,” when it is either (a) used to pay off the cost of building an entirely new transportation asset, or (b) is used to ration scarce roadway capacity in order to reduce traffic congestion to levels consistent with optimal throughput. In either case, the toll payer is receiving a direct benefit — access to a roadway — in exchange for his money.

As public opinions consistently show, citizens understand the difference. They express greater willingness to accept tolls than transportation taxes because they know that there is a direct exchange of value when they pay tolls, while there is no guarantee of value when they pay taxes. Citizens understand that gasoline taxes often fund projects that benefit no one but developers, land speculators and the politicians in their pockets.

Share this article


(comments below)


(comments below)


23 responses to “Economics 101: The Difference Between a Toll and a Tax”

  1. Larry Gross Avatar
    Larry Gross

    From a philosophical point of view, would one view a tax that is not dedicated to a specific purpose different from a tax that goes into a general fund and the allocation of – determined by elected representatives?

    For instance, one of the sore points with the collection and allocation of the gasoline tax is the traditional {intended?} target to be roads – and not transit – and not bike/ped trails and the related argument that by “diverting” such funds – we are diverting funds and deferring road-based improvements.

    One could also question the 1/2% of the sales taxes – DEDICATED solely to VDOT.

    It would be interesting to see if the sales tax is roughly equivalent to the amount diverted to transit.

    One more – VRE member jurisdictions levy a 2% tax on gasoline then use it for both VRE and roads but the first bite at the apple goes to fund VRE and whatever is left over is given to the jurisdiction for non-VRE transportation uses.

    Note also that THIS tax IS indexed to inflation as it is levied on the total sale not gallons.

    Now the reason I go into all of this – is the prevailing and conventional wisdom of most GA guys – (not all) that transportation funding needs to be separate, dedicated and essentially “fire walled” from general revenues.

    The HD guys – apparently contrary to this stream of thought seem to not mind utilizing “perceived” (wishful thinking) “surplus” funds for specific one-shot transportation construction projects.

    to keep this short.. my thoughts about utilizing tolls for transportation projects external to the facility that collects the toll.

  2. Larry Gross Avatar
    Larry Gross

    re: using toll revenues for transportation projects other than the facility that collects the toll.

    Recent agreements in other states – have “traded” privately operated toll roads in exchange for the state getting a “cut” of the proceeds to fund other transportation projects.

    JB calls this a tax and I’d probably agree to not call it a tax is a semantic argument with the exception of the question I asked as to whether or not if the money is dedicated for the same general purpose – transportation.

    No matter. The essential point is that some toll roads, especially ones that utilize congestion pricing will likely generate toll revenue in excess of that needed for maintenance, improvements and even a profit and the question is – what would folks want this money to be used for if not for that facility?

    My speculation is that folks will be okay with the idea as long as it is spent locally on other needed transportation projects – to include even transit but certainly things like true “improvements” like signal timing, upgraded interchanges, fixing substandard secondary roads, etc.

    But if those excess tolls would be targeted to state coffers for VDOT to determine how it would be spent – then my speculation is that voters are not going to care for this – for the same reason they don’t like their tax dollars going to Richmond. It’s not the money per se – it’s the process for determining how it will be spent and whether it will primarily benefit the locality that the funds came from OR .. be diverted for some other “good” purpose – as determined by unelected VDOT guys.

    Note that in the GA – there are multiple legislations for PPTA to include BOTH VDOT …AND localities.

    I would submit that this aspect of TOLLING is of critical importance to regions like NoVa and HR – if they want to truly keep their revenues and not let them be diverted – more important than whether some folks will see it as a “Toll” or a “tax”.

    Finally – look at the state level political and business community discussions about transportation funding.

    They tend towards higher TAXES with a distinct non-interest in TOLLing – even to the point of demagoguing the issue by claiming tolls are for Lexus lanes and unfair to the common man – like taxes don’t have that problem…..

  3. Anonymous Avatar

    Another strong possibility is the “tax that fellow behind the tree” approach, which is at the heart of the current proposal in Northern Virginia. It relies heavily on imposing a 30 percent real estate tax surcharge on commercial and industrial property ONLY, which would allow the politician to go door to door and claim “I didn’t vote to raise your taxes” (as if business doesn’t pass along higher taxes in higher prices.) Once they’ve pulled that off, expect higher gas taxes on business travel only — massive business vehicle license fee increses — anything to spare the individual from actually paying for the roads they use….

  4. Anonymous Avatar

    11:33 A couple of reactions, first, there’s a segment of the local NoVA business community that is always in the van for higher taxes. That segment is heavily populated by the commercial real estate industry. Shouldn’t they be putting their money where their mouths are?

    While businesses must, over time, recover all their costs, including taxes, there’s no warranty that this can be done all of the time. I suspect that, in a softening market, a significant portion of the 30% tax surcharge could not be passed along to tenants and their customers. This is probably especially true as the new Democratic Congress reduces the rate of growth in defense and homeland security contracts.

    In justifying the residential taxpayer subsidy to the commercial real estate industry in the form of funding the Fairfax County Economic Development Authority, residents are told that these tax dollars bring in real estate taxes from commercial entities to keep down residential real estate taxes. However, results in the last ten years have generally shown a major decline in the proportion of real estate taxes paid by commercial buildings. In other words, we’ve gained virtually nothing for our investment. By imposing a surcharge, this trend would likely reverse itself and the residents of Fairfax County would likely begin to reap some benefit for their forced subsidies. Dr. Gordon’s argument for subsidies might become valid.

    Since there are apparently more jobs in NoVA than workers, the area must import workers from outside NoVA, which, in turn, creates more traffic problems. It would seem economically rational and fair to try to recover the costs for addressing traffic from the cost-causers. Moreover, by increasing the price for renting real estate in NoVA, businesses would be encouraged to look at other areas of Virginia for growth and expansion, which, in turn, would likely reduce some of the commuting traffic pressure on NoVA and the concomitant need to build more roads.

    Finally, imposing this tax on commercial real estate seems consistent with Ramsey Pricing principles. Needless to say, NoVA’s closeness to the Nation’s Capital creates a strong pressure for some, but not all, businesses to locate in NoVA. Thus, the demand curve for commercial is probably fairly inelastic, at least in relationship to other Virginia markets. Since we are dealing with a tax, Ramsey Pricing teaches to levy that tax on services/goods/property with the most inelastic demand in order to capture the most money.

    These are just random thoughts and not part of a coherent position, but they all seem to support the imposition of a surcharge on commercial property to fund transportation needs.

  5. Jim Bacon Avatar

    Larry, You raise a good point about congestion tolls: What do you do with the revenues? Do you just hand them over to VDOT and the politicians? I agree, people won’t like that. I wouldn’t like that.

    My solution is to create transportation corridors or congestion zones with legal guarantees that revenues generated by congestion tolls will be reinvested in the same corridors and zones. VDOT could pursue any number of congestion mitigation strategies: invest the funds in expanding road capacity, in traffic light synchronization, in other intelligent transportation systems, in bus stations… wherever they could get the most bang for the buck.

    Here’s the beauty of this arrangement: There is a self-limiting feedback system. If congestion tolls are really expensive and generate lots of money, they provide lots of revenue for corridor/zone improvements. As those improvements take hold, congestion eases… and the tolls go down.

  6. Larry Gross Avatar
    Larry Gross

    yes I agree. There is a balance – a market symmetry – truly supply/demand and consumer choice.

    one caveat – PPTA investors are essentially betting that over a 30-100 year timeframe that congestion will be “adequate” enough to give them an ROI that is competitive or superior to other investments.

    I say “betting” as opposed “gambling” because most savvy investor entities (as opposed to individuals) know where that line is – usually and/or they know what the “provisions” of their agreement must safeguard.

    Some PPTA ventures have essentially “no-compete” clauses that give them veto power over transportation improvements that might jeopardize their ventures.

    The folks at the Southern Environmental Law Center have expressed concerns that the current practice of keeping information from the public because it has “proprietary competitive information” limits the publics ability to judge whether a PPTA is a good deal or not.

    The only thing worse in my mind that VDOT having ahold of the publics short-hairs is a private profit-making enterprise with a tight grip on the same short hairs.

    Having a PPTA congestion pricing facility in NoVa that essentially ruled out certain subsequent transportation improvements and kept hidden from the public until it “explodes” like an expose has the potential to destroy trust in the concept.

    Another important reason why if congestion pricing goes forward that NoVa be fully involved to protect their interests.

  7. Larry Gross Avatar
    Larry Gross

    Here’s a Florida TOLL road success story:

    “Once considered a white elephant, the Polk Parkway has evolved into a golden goose.”

    The 25 Mile long Polk Parkway has seen a huge increase in traffic and tolls since it opened in late 1998.

    The chart below shows average daily traffic trips, in millions and annual revenue from tolls.

    YEAR – TRIPS PER DAY – TOLL REVENUE (In millions of dollars)
    2006 – 69, 426 – $21.2
    2005 – 62,638 – 18.5
    2004 – 55,403 – 16.2
    2003 – 47,740 – 13.7
    2002 – 41,792 – 12.0
    2001 – 35,145 – 10.2
    2000 – 24,895 – 7.0

    Folks in NoVa, HR, Richmond, and other jurisdictions have to ask themselves – would an extra $21 million dollars a year with no increases in Real Estate, Sales or Income Taxes be “worth” it – IF – at the same time congestion levels actually IMPROVED at the same time?

    NoVa has almost double the AADT at rush hour as the Florida Toll Road.

    This seems like such a no-brainer despite the fact that there are potential pitfalls if localities are careless in implementation.

  8. Jim Bacon Avatar

    Larry, Again, those are all valid points. That’s why I suspect that PPTAs are best suited for projects that add new road capacity, and state-administered congestion-pricing tolls are best suited for existing infrastructure.

    Of course, there are the hybrid projects like the HOT lanes proposed for Interstate 95 and the beltway. I’m not whether they should be treated as PPTAs, as in current proposals, or the state should run them as congestion pricing projects. Any thoughts?

  9. Anonymous Avatar

    I think that tolls and congestion-based pricing, if kept at reasonable levels, make sense and would help improve transportation in Virginia. There are, however, some issues related to restrictions upon a state’s ability to impose tolls on roads receiving federal money. I understand that none of these issues are absolute barriers, but simply another set of issues that must handled.

  10. A toll is in fact a tax.



    1.a sum of money demanded by a government for its support or for specific facilities or services, levied upon incomes, property, sales, etc.
    2.a burdensome charge, obligation, duty, or demand. –verb (used with object)
    3.(of a government) demand a tax from (a person, business, etc.). demand a tax in consideration of the possession or occurrence of (income, goods, sales, etc.), usually in proportion to the value of money involved. lay a burden on; make serious demands on: to tax one’s resources. take to task; censure; reprove; accuse: to tax one with laziness.
    6.Informal. to charge: What did he tax you for that?
    7.Archaic. to estimate or determine the amount or value of.
    –verb (used without object) levy taxes.


    1.a payment or fee exacted by the state, the local authorities, etc., for some right or privilege, as for passage along a road or over a bridge.
    2.the extent of loss, damage, suffering, etc., resulting from some action or calamity: The toll was 300 persons dead or missing.
    3.a tax, duty, or tribute, as for services or use of facilities.
    4.a payment made for a long-distance telephone call.
    5.(formerly, in England) the right to take such payment.
    6.a compensation for services, as for transportation or transmission.
    7.grain retained by a miller in payment for grinding.
    –verb (used with object) collect (something) as toll. impose a tax or toll on (a person).
    –verb (used without object) collect toll; levy toll.

  11. Larry Gross Avatar
    Larry Gross

    re: “f course, there are the hybrid projects like the HOT lanes proposed for Interstate 95 and the beltway. I’m not whether they should be treated as PPTAs, as in current proposals, or the state should run them as congestion pricing projects. Any thoughts?”

    thoughts? yes.

    I think for the first projects – it needs to be clear what the benefits will be to commuters.

    It would not surprise me to see the tax-first demagogues out in force portraying congestion pricing and toll roads as an unfair tax on roads that ought to be free and/or are already paid for with our existing taxes.

    The average person is not clear on the specifics of road financing – but the POLLs do indicate they are catching on.

    I think any toll proposal has to clearly show a benefit to commuters – enough to rebut those who attempt to frame the issue the other way.

    I’m also leery of VDOT being in charge of the process – because they have a inherent conflict.

    If PPTA Toll Roads work like they are supposed to work – it will reduce not only VDOT’s role, it will be a repudiation of their whole approach to transportation planning so they’re going to be not strong supporters and more likely unwilling participants.

    I think that’s why the US 460 and 3rd crossing issues were “framed” the way it way they were – was to set up a strawman to demonstrate that TOLL roads are not viable in Va – that taxes will STILL be required.

    Isn’t it curious that a dozen other states are having great success with them including Indiana which will NET an additional Billion dollars a year for other transportation projects.

    The problem with 460 and a 3rd crossing is that no investor is going to build an additional corridor that is going to compete against existing corridors with no or lower tolls.

    I-95 “works” because there is no competing corridor.

  12. The residents of Hampton Roads will never approve of tolls. The reason is obvious to anyone driving the local interstates. Orange cones and idle equipment. Why pay more to contractors and VDOT, when they never seem to be on the job site?

  13. Maybe I’m just simple minded about it, but if the government takes money out of my pocket, its a tax. The fact that it is dedicated to one thing or another makes no difference.

    I pay a “registration fee” of $350 to keep my land in the land use program. I simply can’t believe it costs $350 to write my name down on a list, so I consider it to be a tax, however it is called.

    Saying a toll is not a tax is like saying a lemon is not a lime. Sure enough, they are different, yet in Spanish they are called by one name, limón, so close is the resemblance and usage.

    The government is about to help Dominion Power take something like a million dollars out of my wife’s pocket so they can use it to make millions more by selling electricity below its actual cost. I’m not sure what to call that kind of tax, but I’m pretty sure it isn’t printable.

  14. If you are worried about the allocation of funds being performed by elected representatives, then follow my advice and put the allocation on the back of the tax forms.

    The problem is that if that doesn’t work out the way you would like either, who would you blame? It would make it very hard to claim that the people really believe this or that, or that they really want this or that, or that they don’t know what they are allocating their funds for.

    On the other hand, you have previously argued that if the elected representatives want to take away building rights without compensating for them, well, that’s leagal and within their authority. It seems to me it is legal and within their authority to spend our money just as they please. It also seems to me that you and I are equally empowered to lobby our representatives for what it is we want.

    I think we ought to at least send them a clear message, and saying they are free to do as they please on one hand, and not on the other is hardly a clear message.

    If it comes down to lobbying, people with a lot more money than you and I are likely to come out on top in that game, therefore I favor direct allocation of funds.

  15. More and more, our national parks and even our local parks are being funded by user fees, because we have failed to raise enough tax money to support them properly.

    Even the government has a hard time supporting open land, it seems.

    Would you suggest that if our national parks cannot pay their own way through user fees that they are somehow economically unviable, as you would with roads?

    Really, you guys are wasting an awful lot of energy arguing over who pays for what. The fact is that we don’t know, but we do know that businesses pass their taxes on to their customers. If you really had the metrics, I suspect you would find it comes out in the wash.

    As for me, I believe our national parks are a real treasure. They infuse our entire netional character, even including people who never visit them but merely se them on TV. I’m more than happy to pay that tax for a facility I seldom have a chance to enjoy, just because I think it is important. I have no idea how the legislators allocate my puny tax dollar among the parks, so I trust them to do their job.

    Roads are hardly as inspiring as the national parks, but I suspect the value may be even more deeply infused into the fabric of our lives and our livings.

  16. Anonymous Avatar

    Ray – I think that you have identified the crucial difference — trust. Based on observations, I tend to trust the people who run our national and state parks to do a reasonably good job. I too support devoting some tax dollars to fund their work.

    But I have no trust in Virginia’s transportation operation. This is not a slam at the many good men and women who come to work each day, but at the dysfunctional system. VDOT has no cost controls. The CTB funds whatever can lobbyied best without regard to priorities based on engineering and economics. VDOT received more than $1 M to begin workings towards the timing of lights on Route 7 from Loudoun County to Tysons Corner.

    When it snows two inches, VDOT plows some local streets, but not others and tells me that it did not snow enough for plowing my neighborhood, but they don’t why ten other subdivisions were plowed. Toss in the Silver Line debacle with the failed 2002 referenda, and I’m not ready to give Kaine and company another dime. Let’s see the reforms implemented first. There’s no trust and no reason to trust.

  17. Larry Gross Avatar
    Larry Gross

    Yes.. I support user fees for the National Parks for the same reason I support User Fees (TOLLS) for roads.

    The MAINTENANCE of roads and parks is a direct taxpayer responsibility.

    But the AMOUNT you use those facilities needs to be tied to a cost per use in my opinion.

    I favor the same thing for Medicare, Prescription Drugs, electricity, water/sewer, etc.

    If you don’t do this – the demand will outstrip the ability to provide the services.

    I think sometimes we judge whether or not something should not be charged to users or paid for by taxpayers on whether it is in our own subjective opinion – a “good” or worthwhile service – and if it has a LOT of users then it deserves more taxpayer funding.

    This is how we go broke – when we render costly services for less than they cost to provide – and the only way out if you don’t employ user fees is to keep raising taxes to provide even more services for less than they cost.

    Private industry – the market takes care of this problem simply by ensuring that they make a profit on each service – enough to pay for the cost of the services plus a little extra.

    Many Government services don’t work this way. If the demand goes up for services – already provided at a loss – the only solution is to raise taxes – on everyone.

    This is the fundamental problem with roads is that raising taxes does not result in a situation that will not require raising taxes again and again.

    So – over time – the tax bite keeps going up. It never stabilizes and becomes static.

    ANY service that the government provides for a set fee and the demand keeps rising – needs to utilize user fees so that the more one uses – the more it costs – otherwise the tax bite will continue to escalate.

    I do agree that indexing the gas tax is reasonable but all that will do – is maintain a rough parity between maintenance costs and funding for those costs – it will not provide money for new roads.

    WHO should pay for new roads? The people that use them – not taxpayers – otherwise the demand for roads will ever increase because of the perception that roads are “free”.

  18. “But the AMOUNT you use those facilities needs to be tied to a cost per use in my opinion.

    I favor the same thing for Medicare, Prescription Drugs, electricity, water/sewer, etc.”

    Thank you. Please send a letter to Dominion Power and tell them that – before they run an infinite amount of power through my front yard in exchange for a one time payment.

  19. I think that roads require input from many sources, the part of those sources that come from users is tied to the fuel tax. We could do it by tolls, but, are we going to toll ALL the roads, or is this another way to tax the guy behind the tree?

    I’m OK with doing an equivalent job with tolls, but I think it is unwieldy, cumbersome, and expensive. If we do it with GPS, it is also intrusive.


    I have previously pointed out that the County claims they save $2800 a year for every house I don’t build.

    Effectively, they are using my facilities, year after year. I’d be more than happy if they paid me a modest cost per use, as you suggest. Instead, they are charging me 3x what I cost them, AND they are saving other peoples money while I am forcibly required to defer a much larger annual gain than they are saving.

    As far as I can figure out, this is indefensible. It is indefensible if you think people should pay for what they get (savings at someone elses expense). It is indefensible on a true cost-to-the-taxpayers basis (if you include me as one of them). It is indefensible if you think taxes should be associated with costs. And it is indefensible if you think people should be paid when they do work you require of them.

    Some people just call it property rights, but that is far too simplistic.

    So, having labored for years to provide all these benefits at my own expense, what is my reward? Because there are no houses here, I become a prime target for a power line. EEEYAAAH!

    In this case, Private Industry is going to take care of “the problem” by paying less for the services than they cost, and they expect to make a handome profit on the deal. (Maybe government can figure out how to pull this off.)

    Meanwhile, my neighbors to the North who have protected their property with the help of government tax breaks get to take a pass on being considered for their share of the need for power.

    WHO should pay for new roads (or power lines)? The people who use them, and they should pay a fair price. Who should pay for clean electricty and water, the people who use them, and they should pay a fair price. Who should pay for the savings gained by preventing growth? The people who get them, and they should pay a fair price. WHO should pay for the costs of growth? The people who cause them.

    I guess that lets me off the hook, since I have no children.

    But, if the taxpayers aren’t the ones who have fornicated themselves into untrammmeled growth, then who is it? (OK, I can hear it now, The Immigrants.) If the taxpayers aren’t the ones using the roads, then who is it? Aren’t the taxpayers the ones using the roads? Aren’t they the ones causing growth?

    Show me the metrics.


    I agree with you about user fees. Some people are more inclined to avail themselves of the parks, and they should pay more. Same with the roads. That’s why we have a gas tax. We could do it some other way, or some additional way, but why would we? It’s just more expense and more government, and more waste.

    I understand what you say about maintenance. Every time I build a fence, I have to consider whether I can afford to build it, and then whether I can afford to maintain it, and then whether the value is equal to the costs. But, if I build a fence on the property line, maybe I can talk my neighbor into sharing the costs while doubling the benefits. I think that where roads get short shrift is that we don’t recognize the effects of whatever is the road equivalent of increasing the benefits. Or if we do, we denigrate it as some kind of subsidy to developers.

    The roads are not free, we all pay for them, and we pay for them through various devices. Those devices may not be fair or equitable, so maybe we need to work on that. Show me the metrics. Show me the money to go get the metrics.

    You are right about usage in the sense that, having paid for the roads, people figure they might as well get their money’s worth. But I don’t think it is an infinite equation. They have real limitations in terms of time, their own operating and capital costs, and in the value received per trip. In this regard I think your argument is overly absolutist: we are not going to use up every scrap of road, no matter how much we build. WE might use up every scrap of road if we build far too little road or far too much of everything else. You can see that by observing all the roads we already have that are underutilized, including some toll roads.

    I think it is a mistake to claim that only “New” people use new roads and only “New” people should pay for them. Considering the often stated claim that residential housing is a net loss, then surely some of that loss is due to the fact that we are, in fact, not paying enough to maintain and improve what is around us.

    I think that those that cause growth SHOULD pay for it, but I don’t think we can fairly place ALL the blame on those who produce and consume the products of growth.

    At some point, we have to look in the mirror.

  20. Larry Gross Avatar
    Larry Gross

    re: Dominion Power Line

    Both Dominion AND VDOT believe that undeveloped land is the best place to propose new facilities.

    So you could be in worse shape – VDOT could be knocking on your door offering you “fair” compensation for a new road through your property!

    There are two excellent articles in the NYT today explaining what is going on with the powerline issues:

    “Grid Limitations Increase Prices for Electricity
    Like the nation’s highways and bridges, the network of transmission lines has not been maintained and expanded enough to meet growing demand, the United States Department of Energy says.”

    is there irony here between advocacy for roads to meet “demand” and powerlines to meet “demand”?

    and then excerpts from:

    “The Cost of an Overheated Planet

    The iconic culprit in global warming is the coal-fired power plant. It burns the dirtiest, most carbon-laden of fuels, and its smokestacks belch millions of tons of carbon dioxide, the main global warming gas.

    So it is something of a surprise that James E. Rogers, chief executive of Duke Energy, a coal-burning utility in the Midwest and the Southeast, has emerged as an unexpected advocate of federal regulation that would for the first time impose a cost for emitting carbon dioxide.

    Global warming is not only an environmental hazard, but also a great challenge for economic policy. Without economic incentives, analysts say, the needed investments in industrial cleanup, innovative low-carbon technologies, fuel-efficient cars and other ways of reducing energy waste will not occur.


    But even today, there are sizable opportunities, by insisting on more efficient energy use, that are not being seized, according to the McKinsey Global Institute. In a new report, the institute, a business-oriented research group that is part of McKinsey & Company consultants, estimated that the yearly growth in worldwide energy demand could be

    ….. cut by more than half through 2020 — to an annual rate of 0.6 percent from a forecast 2.2 percent, using current technology alone.

    Available steps that would yield a more productive, and efficient, use of energy include compact fluorescent lighting, improved insulation on new buildings, reduced standby power requirements and an accelerated push for appliance-efficiency standards.

    All these moves, McKinsey said, would save money for consumers and businesses. “We were really surprised by these huge straightforward opportunities that are not being taken,” said Diana Farrell, the McKinsey Global Institute’s director. “In some senses, there is a big market failure.”

    so .. that powerline… is being spurred by NOT doing what even Power Company executives claim should be done – another irony…

  21. “So you could be in worse shape – VDOT could be knocking on your door offering you “fair” compensation for a new road through your property!”

    They already did that. I have six lanes of road and an interchange sitting on part of the former farm. Yet I am STILL prohibited from building anything for fear I might overwhelm the infrastructure with my one-house development.

    So the state gets eighty acres and I get – nothing.

  22. I think we can make some savings with conservation, even some significant ones that don’t caost more than they save.

    But it won’t be enough.

    Sooner or later, someone is going to be ruined by a power line or other facility that does not compensate them properly. We need to fix that, regardless of who gets hurt.

    And, it wouldn’t matter how much we save individually, there are so many more of us, and so many more uses that the profit motive to build power lines will remain, regardless of what we do.

    There isn’t anything wrong with a profit motive, but stealing isn’t making profit. It is stealing.

  23. Tolls look like taxes to me despite what some economists may say. When the government starts charging for things that used to be free (i.e. paid for with general taxes)and doesn’t lower taxes (as traditionally defined) it costs us all more to live and work.

    Why stop at roads? You call the police – you get a bill. You want the fire department to come to your house (because it’s burning) – give the 911 operator a credit card number. Your kids go to public school – you pay for it.

    Obviously (I hope) these are extreme examples intended to illustrate a point. Where do “use fees” or tolls end?

    I also believe that taxes (or tolls) are an inefficient way to influence behavior. You want less congestion? Change the zoning laws. It works just fine in countries like Germany. Of course, you’d have to confront the multi-millionaire land developers who provide vast amounts of campaign funding for VA politicians. Now that would be taxing!

Leave a Reply