Project Patriot Tax

"The Real Patriot Act" | New York Times | 5 October 2003

This is a column about the war of ideas - but first a word about gasoline prices and Hummers.

In case you missed it, OPEC just decided to slash its oil production to keep gasoline prices high. I guess it would be foolhardy to expect that maybe Saudi Arabia or Kuwait would use its influence in OPEC to hold down prices at a time when Western economies are struggling to climb out of recession. Everybody's just looking out for themselves. So why don't we?

There's all sorts of talk now about how to finance the $87 billion price tag for the reconstruction of Iraq. I say, let's make OPEC pay - indirectly. Let's have a $1 a gallon gasoline tax and call it the "Patriot Tax." We could use the revenue it would raise - about $110 billion a year - to finance the entire reconstruction of Iraq, with plenty left for other good works.

Here's the logic: The two things OPEC hates most are falling oil prices and gasoline taxes - and the Patriot Tax would promote both. The reason that OPEC hates gasoline taxes is that if anyone is going to benefit from higher prices at the pump, OPEC wants it to be OPEC, not the consuming countries. It drives OPEC crazy that the Europeans pay roughly twice as much per gallon as Americans do, because their governments slap on so many taxes.

A $1 a gallon gasoline tax, phased in, would not only be a huge revenue generator (even with tax rebates to ease the burden on low-income people, farmers and truckers) but also a huge driver of conservation and reduced oil imports. Not only would it mean less money for Saudi Arabia to transfer to Wahhabi clerics to spread their intolerant brand of Islam around the world, but it would radically improve America's standing in Europe, where we are resented for being the world's energy hog.

President Bush could even say that this tax is his long-promised alternative to Kyoto, because the amount of energy conservation it would produce would result in a much greater reduction in U.S. energy consumption, and greenhouse gas emissions, than anything Kyoto would have mandated.

In short, a tax that finances the democratization of Iraq, takes money away from those who would use it to spread ideas harmful to us, weakens OPEC, makes us more energy independent, reduces the deficit and overnight improves the world's view of us - from selfish, Hummer-driving louts to good global citizens - would be the real patriot act. (It would also encourage Iraq not to become another oil-dependent state, but to build a middle class by learning to tap its people's entrepreneurship and creativity, not just its oil wells.)

"Until we raise energy prices we really aren't fighting the war on terrorism, because we're doing nothing to deny the countries who fund terrorists the cash they need to destroy us," says Philip K. Verleger Jr., the energy expert. "We could use the excess revenues to fund a true Manhattan Project to cut U.S. oil consumption in half by 2007, thereby permanently making OPEC irrelevant. That would be a truly patriotic move."

Yes, yes - I know, the Bush team would never even consider such a tax. But that's my point. When you have an administration that will not even consider undertaking the most obviously right course - a gasoline tax - that would produce so many strategic, economic and political benefits for America, then how do we win this war in the long run? Because this war on terrorism is not simply a military fight. That's the easy part. More important, it is a war of ideas. And to win a war of ideas we need to do two things:

First, we need to successfully partner with Iraqis to create a free, open and progressive model in the heart of the Arab-Muslim world to promote the ideas of tolerance, pluralism and democratization. But second, and just as important, we need to set an example ourselves, in order to get others - both potential allies and longtime adversaries - to buy into our war, to believe that we are not just out to benefit ourselves or protect ourselves, but that we really are out to repair the world.

Unfortunately, this president - for ideological reasons, because of whom he is beholden to economically, and because he knows that the American people never demanded this war, so he cannot demand much from them - will not summon Americans to set that example. He will not summon us to be the best global citizens we can be. The Bush war cry is: "Do as we say, not as we do. Good ideas for Iraqis, gluttony for Americans."

That is so wrong. We may not get a better Iraq out of this war, but let's at least make sure we get a better America.