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Right now we're enjoying the lowest price per barrel of oil since 2009. This means lower prices at the gas pump, lower heating costs for many, and lower costs to transport goods for businesses. If this trend continues, it should translate into a huge economic boom for our country and even the world. People are burning up less of their disposable income in their cars and homes, thus leaving them more money to spend on other things. The snowball effect would increase retail sales leading to more profits and thus more hiring. With lower unemployment and more people paying taxes, the future looks so bright we should all have to wear shades. Should we all go out and buy stocks in sunglass factories? Maybe not. There are two things we need to consider.

First of all, while the gas station attendants were busy changing the prices on their signs, they weren't even down from their ladders before politicians decided now is a great time to raise the gas tax. This is coming from both sides of the political aisle and both state and federal levels. I thought I had somehow driven into an alternate universe when I heard on my car radio that a Republican Senator from South Dakota had introduced a bill to raise the gas tax, but the White House Spokesman stated that the Democrat administration was opposed to the idea. Huh? Of course, our government in St. Paul was quick to leap onto that bandwagon. Dayton wants to increase gas taxes another 12 cents per gallon! This is on top of the 28.5 cents per gallon we will already be paying as of 10/1/15.

When gas prices are high, politicians have their hands tied. They moan and groan about our "crumbling infrastructure", but know the mere hint of raising the already burdensome price of fuel would probably be the end of their political careers. So is now the time? Do we really need to raise the gas tax to pay for road and bridge maintenance? What happened to the billions of dollars previously paid into the gas tax fund?

According to senior research fellow at the Mercatus Center of George Mason University, Veronique de Rugy, 25% of gas tax funds have been spent on other things besides the infrastructure for the cars and trucks consuming this fuel. Things like bicycle and hiking trails, sidewalks and the bloated budgets of mass transit systems. This is not what we were promised when the first gas tax bill was passed in 1956. What would lead us to believe things would be any different now?

The second problem I see is the reason why the price of oil has gone down so much. Yes, fracking is a big part of it, but maybe not the way you think. If you've ever had Economics 101 you know how prices are affected by supply and demand plus scarcity and abundance. Right now there's a global oversupply of oil, but it's not just because of increased U.S. production. OPEC (specifically Saudi Arabia) has intentionally increased supply to drive oil prices down to put fracking and other U.S. oil producers out of business. If they keep the prices low enough, long enough they'll accomplish just that. If the market was allowed to work without being manipulated, oil prices would be high enough to sustain our production, but still lower than the peak highs we've experienced for the last few years. Then we could continue working towards U.S. energy independence. Something the Middle East does not want to see happen.

So enjoy the low gas prices while they last, but don't get too accustomed to them. If the politicians have their way, you'll be paying more into gas taxes for them to waste. Then eventually some Saudi Prince will have a new wife he needs to build a palace for. Will gas prices go back up? Does GloZell like Fruit Loops?[[In-content Ad]]

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