Bryan Caplan supports the McCain-Clinton gas tax holiday in the NYTimes today:
I think it’s an idea worth supporting. In fact, I’ve got two arguments in favor of it, though I doubt that either candidate will want to repeat them in public.
The first idea is a maxi-min strategy: Of all the wrong things that politicians could do to respond to high gas prices, a gas tax holiday is the most benign. Got that?
The second idea is more strange: The knee jerk reaction when gas prices are high and oil companies are earning record profits is to impose a windfall profits tax. Most economists agree that a windfall profits tax is a bad idea. So, if that is the knee jerk reaction, a policy that gives oil companies more profits, such as a gas tax holiday, is a good thing. Got that?
In conclusion, Caplan writes:
This sounds cynical, but I’m just being honest.
Bizarrely cynical. And I'm being honest.
Update: From EconLog:
I'm in the New York Times. Sweet!
P.S. I may be on CNBC some time today to talk about the piece; look here for updates.
Caplan is your garden variety self proclaimed libertarian. He is against all taxes, all forms of government - oh - except those that help him. Doesn't he work at a public university? Doesn't he drive to work on publicly maintained roads? And doesn't he enjoy the benefits of the local police force?
Posted by: jim casey | May 08, 2008 at 08:28 AM
It's arguments like these that give economists a bad name ...
Posted by: aaron schiff | May 08, 2008 at 09:47 AM
A windfall profits tax is bad (presumably because it discourages new entrants), but increased royalties on scarce resources is probably a good idea? Should it just be renamed?
Posted by: reason | May 08, 2008 at 09:51 AM
Caplan looks and reads like a snide smart allec. I find it hard to treat him as being fully serious.
Posted by: reason | May 08, 2008 at 09:53 AM
I don't find Caplan's argument very compelling, but nor do I find ad homonym attacks against him very compelling either. I don't think Caplan is an anarchist who is against all taxes and all government. Yet even if he were, those publicly maintained road are maintained because of taxes extracted from the private sector. The police department is paid from taxes extracted from the private sector. Should socialists be consistent and be opposed to any form of private activity? Perhaps socialist should be opposed to taxation because the money the government is receiving is coming from the evil private sector, with evil private property, and evil money and markets.
Posted by: Tom | May 08, 2008 at 12:35 PM
Since socialists are in favor of the government ownership of the means of production, shouldn't socialists only purchase goods and services produced by government? Isn't it hypocritical for a socialist to shop at Best Buy or Wal-Mart? Aren't socialists getting their groceries from places like the Pathmark where the means of production are in ... oh my god ... privately owned hands? Such hypocrisy!!!
Posted by: Tom | May 08, 2008 at 12:52 PM
I fail to see a Free Market Economist in that your post John..
Oh wait i think i see him....
What is all this straw laying around for?
Posted by: joshua corning | May 08, 2008 at 03:08 PM
Tom...
all non-fundamentalists are not atheists. Get it!
Posted by: reason | May 09, 2008 at 08:36 AM
How Far the NYT had to go to Find an Economist to Support the Gas Tax Holiday
Posted by: Anonymous | May 09, 2008 at 09:52 AM