Don't Pay the Idiot Tax

A writer at Max Gladwell biked by a big yellow hummer and thought ?Wow, that guy is really paying an idiot tax.? He (or she) is being penalized at a far greater rate than non-Hummer owners, and it stems directly from their own stupidity. And by stupidity, we mean shortsightedness, naivete, and a general sense of importance or invulnerability. Not only does it cost more to fill the tank, but who?s going to buy a Hummer these days? Anyone who has a recent loan is probably already under water. The depreciation has to be accelerating."

It is true; the idiot tax is being paid by everyone who traded a little more green space for a longer commute, a few more cupholders and a little more convenience for much poorer gas mileage, all the choices that so many people have made when the price of fuel was not a consideration. For many, the trade-off made sense; nobody could imagine that things could change so quickly. It is not fair to call people stupid, the choices made some sense at the time.

That is why the Ford F-250 was the most popular vehicle in America. In the 90s, fuel over five years would have cost $10,000; now it is $30,000. The difference in ownership and operating costs over five years between the Ford F250 and a Ford Focus is $ 60,000, the average income of a typical American family. The idiot tax on the pickup is 20%.

So whatever you are buying, figure the extra price you will pay over the next five years when buying a house, a car, a boat or a vacation for choosing what you want instead of what you need. That is the idiot tax, and it is huge.

See also the New York Times on the cost of operating big vehicles.