President Obama has announced his fiscal 2017 plan which includes the proposal of a $10-per-barrel oil tax. The hope is to take advantage of falling oil prices and increase funding for alternative transportation research and development. More importantly, though, this proposal indicates yet another step in his plan to address climate change and encourage American innovation to lead the charge towards alternative energy.
“Even if the planet wasn’t at stake, even if 2014 wasn’t the warmest year on record – until 2015 turned out to be even hotter,” the Commander-In-Chief said at his January State of the Union address. He adds, “Why would we want to pass up the chance for American businesses to produce and sell the energy of the future?”
Accordingly, President Obama hopes that this proposal will increase environmental consciousness as well as help to pay for clean transportation like more railways and improved highway development. The tax he proposes is aimed to fund another $300 billion proposal which will improve the American infrastructure over the next five years, focusing more on things like light rail, subway systems, public transportation, and other new commuting options that might not have been available before.
Of course, the way the proposal works, oil companies are responsible for paying this tax but economists argue that companies could simply pass the buck, so to speak, onto the consumer. Fortunately, President Obama appears to be ahead of this issue, foreseeing that should this happen, it might encourage more consumers to invest both time and money in using less oil or more eco-friendly methods of transportation.
In a statement, the White House notes, “By placing a fee on oil, the President’s plan creates a clear incentive for private sector innovation to reduce our reliance on oil and at the same time invests in clean energy technologies that will power our future.” The White House also makes sure to add that the proposed tax is not designed to harm exported American oil; the tax will only apply to oil we import. And, should everything go as planned, the White House also states that the simple tax would increase the ability for the government to invest in a new clean transportation infrastructure by as much as fifty percent.