The interest of these treasuries in 2010 was a whopping 2.760 percent. Plus who pays the interest? The federal government (ultimately the US tax payer) does who's currently insolvent with $14T in debt, they can't afford to pay back these cause the cash we put into the trust is long gone and they've spent themselves into near default. They "swapped" cold hard asset of cash for a "special issue" treasury (promissory note to repay the principal plus interest backed by the US government (treasury) lot of good that is when the government and treasury isn't financially solvent and now they don't want to pay it back. They're solution? Convince you that you may get $.20 cents on every dollar you put in. Again the short summary, they stole the cash, used it on some "war" and now want to "negotiate" with Americans on accepting something less than the "promissory" notes (treasuries) that are outstanding. A key here should be when the institution that's promising to "repay" your good faith loan, operates with a negative $14T balance sheet, this should be a clue that their credit rating is well below sub prime and that you may want to reconsider lending them squat.

If they would have let the cash be, or had it backed by a real asset like gold! Opps we used to do that until 1971 until they removed our monetary system from the gold standard, now it's backed by only our governments promise to pay (paper). And now they're attempting to renegotiate, this among the thousands of other thousands of other examples on how not to conduct personal or business financial decisions we'd all be much better off if they would have just left the cash alone.

So no a gasoline tax now, with an economy that isn't growing, tax revenue is falling, and the rich elite never having a lower effective tax rate since the start of our country, is not the solution for anything. Moreover the examples are pretty clear by now government should never be the solution.

 

The cash is gone, but my point basically is that what replaced it still has value and can be sold on the open market for cash. If not the Federal Reserve will just print money and buy them in the next QE program.

 

I don't think I would mind a gas tax increase IF the money was gaurenteed to be used on road improvements. The tax hasn't increased with inflation, and with cars using less gas, the revenue is not there as years passed. I say raise the tax to match inflation, and make sure ALL revenue is earmarked to roads. Another way to get money for improvements would be to stop putting these billions into Iraq and Afgahnistan. We need to stop re-building other countries and re-build America first!

 

The revenue coming in from the gas tax is much higher than in the 90's because demand is much higher. Remember its .18 a gallon which at current gas prices is about a 5% tax on gas. When gas was at $1.80 a gallon it was a 10% tax on gas. Here in our wonderful land of tax and spend Ca. we also pay another .17 on top of that, plus another 9 to 10% in sales tax. Yeh we need more gas taxes.