40 



deemed worthy, how do you know that the five percent tax or even 

 a seven percent tax doesn't get applied, for instance, to washing 

 machines because they use a lot of water and pollute the water and 

 create demand for, you know, clean water services? That seven per- 

 cent tax in Canada applies to washing machines and household 

 equipment and garbage disposals and things like that. 



I think that once you have this funding mechanism in place, once 

 you have State agencies and advocacy groups that benefit from this 

 Federal funding, you are going to see the tax applied to more and 

 more items and the tax applied at a higher level, and eventually 

 a situation where just as we see the gas tax diverted, you will see 

 these tax funds diverted to things that have nothing to do with 

 conservation. 



Also, taxes like this give people the impression they are paying 

 for what services they demand. For instance, people are generally 

 aware that they are paying something in the form of a user fee — 

 gas tax for highways. And yet we also put a lot of money from gen- 

 eral State taxes and general Federal funding into highways as well. 



The result has been a massive overbuilding of highways in the 

 U.S. by some estimates, which is doing quite a lot to hurt the envi- 

 ronmental quality. If there were a closer link between using high- 

 ways, demanding highway services, demanding highway construc- 

 tion, and building of highways, and people that actually drove cars 

 paid more of the tax directly for highways, there would probably 

 be fewer highways and perhaps more efficient development of 

 transportation, more use of mass transportation, et cetera. 



So in that situation, you have people confused by inaccurate sig- 

 nals in the marketplace, demanding too much of the wrong things, 

 demanding too many highways and thus destroying many valuable 

 acres of farmland. 



Mr. Saxton. Thank you. Ms. Steed, I understand there is draft 

 legislation. Do you happen to know how the draft legislation de- 

 fines sport utility vehicle? 



Ms. Steed. I don't. I haven't seen the legislation itself, but I 

 would be happy to take a look at it. 



Mr. Saxton. I think that is certainly something that you might 

 want to look at. I think I know what a sports utility vehicle is, but 

 I am not cure that the definition would go along with the way I 

 necessarily define sports utility vehicle. 



One final comment. In my other role that I play, as Mr. Lucier 

 mentioned, I am the Vice Chairman of the Joint Economic Commit- 

 tee, and we have a saying there that is not new. It is something 

 that is actually quite old. And the saying is, "If you want less of 

 something, tax it." 



And I suspect that to a greater or lesser degree, that old parable 

 would come into play here although it might be, I must say, to a 

 lesser degree because this is a hidden user's fee or tax which is col- 

 lected very early in the process. And so I am not sure just what 

 effect that would have in this case. 



But in any event, we have been here for better than two and a 

 half hours. And I thank you all for coming. We appreciate your tes- 

 timony. And we look forward to talking about this issue more in 

 the future. And before I close, I just must ask unanimous consent 



