Should New Jersey Get Rid Of Its Cheap Gas?

Here in New York, New Jersey is known for three things. The first is for being the Place That We Shall Never Live, the second is for being the once and future home of Travis Okulski, and the third is for cheap gas. But Matthew Yglesias over at Slate says that last one should end.

New Jersey's cheap gas isn't just an unusual quirk in its own right, it's actually derived from a much more unusualer quirk in state law. By order of the government, you are not allowed to pump your own gas. It's weird, I know. It's not an unusual sight to pull off Interstate 95 for a quick fill-up and a spot of Roy Rogers, and see someone from out of state hop right out of their car to the pump and immediately be told to sit back down again.

Not being allowed to fill up your tank is ostensibly a safety issue, according to New Jersey state law, but in the real excuse from government officials is that cheap gas saves the jobs of the guys who fill your tank. Which is ridiculous, because it's not like everyone in every industry gets that sort of perk, nor do gas stations actually make the majority of their money on gasoline sales.

The cheap gas comes as a result of this strange labor practice. Since all gas stations in New Jersey are essentially full-service, the price of gasoline should be higher. To compensate, New Jersey has extremely low gas taxes (often disproportionately so), which makes New Jersey have the cheapest gasoline in the region. Yglesias says this is wrong:

That ends up depriving the state government of a source of revenue that scores unusually well on the economic efficiency scale. It's a consumption tax, which economists generally like. But it also penalizes an environmental externality (burning fuel), and since poor people tend not to own cars, it doesn't have the regressive implications of a sales tax. Maryland is being smart and raising its gasoline tax to save for the future by investing in transportation infrastructure. New Jersey, meanwhile, is stuck in a dysfunctional equilibrium of underinvesting in its infrastructure, underpricing gasoline, and annoying everyone with an inefficient gasoline delivery system.

To be honest, I get the complaints about inefficient and artificial economic systems. They tend to mess with our finances and actually hurt jobs in the long run (I'm looking at you, student loan debt), but I don't regard the plus of sitting in my toasty warm car in winter plus saving at the pump as a huge annoyance.

What do you think though? Should New Jersey end its arcane fuel stance? Or is it not so bad? Let us know below in the comments!

Image credit: Patrick Emerson