What's wrong with an oil-import fee

Philip K. Verleger, Jr. argues in an interview that an oil-import tariff has no real economic justification. A flat-rate tax per barrel assumes that world oil prices will remain constant, which will not be the case if supplies increase. It also assumes that conservation is linked directly only to the price of oil, and ignores the decline in energy use due to the recession and improved efficiency. Verleger feels that a tariff would interfere with conservation investments and could interfere with economic recovery. He thinks it will be more productive this year to reduce inflation, leaving deficit reduction for the '83 to '85 budgets. His counter arguments to those presented by tariff proponents include its limited effect on import dependency, vulnerability, and the stimulus for domestic exploration and the development of synthetic fuels. (DCK)