October 12, 2005


Posted by Scott at 09:56 PM

In a message I got from today's Wall Street Journal:

Higher Heating Costs This Winter

The Energy Department said Americans will pay, on average, $350 more for natural gas this winter than they did last year, an increase of 48%. Fuel-oil costs are expected to rise 32%.

Actually, I feared the number was going to be worse, but it's still going to be painful.

I was talking with my co-worker, Will, at lunch. I was recollecting how a common argument against a flat tax, especially by the left, is that they are regressive and hurt the poor while giving relief to the rich. (Actually, if you read the details of many flat plans, it's not exactly true, but stay with me on this...) I also recalled how for years we would occasionally hear (again usually from some on the left) about how we should tax fuel like Europe does to encourage conservation efforts and the search for alternative sources. At lunch I commented that such a tax would feel little different to the poor than the energy price spikes we're seeing now. But now that it's mega-corporations raising the price (and not the government), it's somehow evil and exploiting the poor. Wouldn't flat taxes on fuels be regressive and hurt the poor as well?

Don't get me wrong. I find a nerdy fascination in conservation and alternative fuels. In the embedded design world in which I work, the secret to success in today's world is all about innovative design and low power. I would just rather that the consumer would seek these out without government coercion I mean incentives. Don't try to manipulate the market with tax penalties.

I try to envision a government designed iPod or cell phone. The volume of specmanship and proposal paperwork and the civil servants monitoring its contracted development would blow your mind. It would weigh 5 pounds, have a battery life of about half an hour, and hold about 100 songs while being 2 years late in delivery and plagued with bugs. Meanwhile, consumer demand made the five ounce 30 gigabyte color iPod possible. Kudos to Apple for today announcing that new iPods will do video, as well as photos and audio. On the other hand, I'm not too thrilled when I read about Apple's heavy handedness with its suppliers. I also note that new iPod connectivity has dropped Firewire and is solely via USB from an (ahem) unnamed source. I'm just sayin'....