POD in mid November 1976 James Carter, President Elect of the USA starts
thinking about how he will govern the country. He is firmly convinced from
the 1973-74 oil crisis that the USA needs to get off of foreign oil, but he
is also cognizant of the fact that a sudden raising of taxes will derail the
economy. Finally he comes up with a plan and in the first week of January
while in Washington he approaches the Leadership of both houses of Congress.
"Gentleman, I would like you to review this simple law and pass it right
before the Inauguration so that I can sign it immediately after my address.
I want to do this quietly and painlessly because I want to wean the country
off of foreign oil."
"Hmm, this is certainly a simple law, I don't see any problem getting it
through without a problem." the Speaker replied.
"Agreed, this one is so short and simple I think it will sail through
without any objection, especially if I time it right." the President Pro Tem
of the Senate replied.
Thus the new law was passed almost without anyone noticing and signed into
law as the first law under President James Carter.
As of January 21, 1977 and on the 21st of each month thereafter the United
States excise tax on Gasoline and Diesel fuel will increase by 1 cent. All
monies collected will go to the Highway Trust Fund and be used as directed
by the Secretary of Transportation to fund repairs and improvements to
Federal Bridges and Highways.
Before this date the US Gasoline tax was only 4 cents per gallon. The
national average Gasoline price in 1977 was $0.622, however with the new law
in effect by the end of 1977 the price climbs to $0.742. Over the course of
1978 the price keeps climbing reaching $0.857 right before Christmas. OTL
this price was not reached until 1979 when the Iranian Revolution caused
disruption and chaos in the world Oil markets. In this ATL Politicians
blame the price rise on 'Foreign Oil' frequently and ignore the tax they
themselves put into place. Meanwhile the infrastructure of the United
States is experiencing a steady stream of new money and is accordingly being
rebuilt and improved as a result. Better quality of materials are being
used and bridges are being replaced or newly built much sooner than
originally planned.
On the consumer front the tax is placing a subtle inflation on everything
moved by road in the USA, Semi Tractor manufacturers are for the first time
incentivized by their customers to find more fuel efficient ways to design
Diesel engines and both the Tractor and Trailer portions of the system to
lower expenses for trucking companies. At the same time the Railroads are
seeing a renaissance of their own, cargo by rail is much more efficient than
long haul trucking by its very nature which makes it far easier for the
railroad companies to operate competitively with the trucking companies.
Naturally some people notice that the price of fuel is rising on the 21st
each month, but a slow steady one cent a month price increase is easily
forgotten before the next increase arrives, especially with the normal
seasonal volatility that fuel prices go through naturally. Even so the 6
cylinder automobile engine becomes a favored type for the 'Big Three' US
automobile manufacturer's because fuel efficiency is becoming a selling
point, and putting a straight 6 in a Chrysler Cordoba or a Chevrolet Camero
or a Ford Pinto instead of the earlier planned V-8 adds a couple of miles
per gallon to each vehicle.
In 1979 the Iranian Revolution causes the price of Gasoline to spike up over
a dollar to $1.229, then to $1.679 in 1980, at which time Demand Destruction
begins in earnest in the USA and a serious recession takes place. There is
plenty of fuel available because of the economic downturn and self enforced
conservation as people strive to adjust to the price rise of $1.05 in just
four short years. If not for the Iranian Revolution it would have taken
another 5 years before the price would have risen so high, but even so the
rises in 1977 and 1978 had car manufacturer's and buyers already interested
in better fuel efficiency for their products. Though the recession is bad
it is not as bad as it would have been without the Carter law. In addition
a lot of Infrastructure improvements have taken place and a new expansion
plan for the Highway system is under way which also employ's a fairly large
number of construction workers.
Alas the bungling of the Iranian Hostage situation is still too much for the
public to bare and Ronald Reagan win's a narrow victory in November 1980.
On January 21, 1981 the new President looks out over a country struggling
through a recession but improving despite, or perhaps because of, the 53
cent per gallon excise tax on Gasoline and Diesel fuel. USA petroleum
imports stand at a level 25% below where they were four years earlier. OPEC
squabbles for most of the year but settles on a benchmark ceiling of $38.00
per barrel. Because of USA conservation this price can not hold, their is a
glut on the world market clearly present by the end of the year. The price
falls by the end of the year to $29.00 on the open market. OPEC keeps
arguing and cutting production but widespread cheating by member states, the
USA fuel tax and the North Sea and Alaskan oil fields all combine to drive
the world price lower than they have been since 1978. In the USA however
the ever ratcheting gradual increase in fuel taxes continues, even as the
pump price falls. By the end of 1982 the price stands at $1.579, ten cents
cheaper than it was two years earlier. The USA has adjusted to the higher
prices by now for the most part, people do not drive long distances unless
they really need too. The phenomenal growth of Suburbia and Exurbia is
stifled as people desire to live close to where they work. It is again
fashionable to live in large cities like Detroit and Saint Louis instead of
commuting 45 miles or more to work.
--
Always appeal to a man's enlightened self interest, you can trust him to
look out for himself honestly,
It's when you appeal to his Honor or the Common Good that he stops paying
attention.
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