Philosopher/Poet Christopher Wallace

Humans used to have problems. Real problems: our dinner could be dangerous and was difficult to find and catch; the remedy to disease was to take some herbs and pray to the gods that sickness went away; and disputes were often settled with bows and arrows. Turn your pagers to 2012. Our basic needs have been met. There is so much food that the government pays farmers not to grow crops. Third-world diseases, like dysentery and cholera, have been replaced with first-world diseases, like diabetes and heart-failure. And disputes can be resolved by a gavel. As the great philosopher-poet, Christopher Wallace, once said, “Things done changed.”

Well, most would say that things done changed for the better. And yet, we still face major challenges. For example, pollution from industrialization is bad for the environment and human health. It is estimated that tens-of-thousands of people die from the carcinogens released from tail-pipes and factory smoke-stacks. However, these are not real problems. Hold on, let’s clarify – these are not problems we have evolved to face. These are not problems where we are battling a saber-tooth tiger with a spear in one hand while bathed in the light of a flaming torch in the other hand. Many of the major issues we face today are those caused by, humans – that is to say, the problems are artificial.

As a society, we already have a logical understanding of how to solve our artificial problems. For example, the previously mentioned pollution problems can be greatly ameliorated by a floating-rate gas tax that would gradually increase over time. This tax would establish a target-price for gas prices. The price of gasoline on the open market would still fluctuate, but the shocks would be tempered by the target rate. If the market rate ever somehow exceeded the target rate, the tax would fall to zero.

The advantages of a floating-rate gas tax are numerous:

• The expectation of rising costs would incentivize consumers to buy fuel efficient cars and incentivize researchers to develop technology to improve energy efficiency.
• Consumers would drive less and travel with others more, thereby reducing traffic-jams and travel time for commuters.
• Tax money could be used to pay for roads, bridges, and other infrastructure assets.
• Knowledge of future prices would allow businesses to fix their transportation-costs, allowing more, and smarter, business investment.
• Negotiating power with other countries would increase due to greater US energy independence.
• There would be a drastic reduction in pollution.

Unfortunately, there would be one small disadvantage:

• The average cost of gasoline would increase slightly.

This point is so significant, that it overrides all logical thinking. We already subsidize gas by paying for it in time lost to traffic jams, increased sickness from carcinogens, and environmental damage. But the floating-rate gas tax would never receive approval. Even the proposal of gasoline taxes would spark fierce resistance and even death threats. Why? The crux of the problem is that humans want things for free. They want infinite goods and services in a world with finite resources. They want a Ferrari for the price of a Taurus.

This guy had to work for food.

This is the cause of some major crises in first-world countries. From the debt crisis in Greece, to water shortages in the southern US, to the worldwide financial crisis of 2008 – all of these problems are caused by the desire to get something without paying for it. The solution to these problems should be simple. We know how the free-market works. We know that correctly pricing goods and services is the most efficient way to allocate resources. And yet, the drive to get something for nothing is so tempting, it consistently propels us towards avoidable crises.

“There’s no such thing as a free lunch.”

—Milton Friedman (Somewhat successful economist)