From Monetary Affairs:
I asked Professor Mankiw, “If you had carte blanche today, what three economic reforms would you put in place?” His answers: (1) raise the retirement age of Social Security and Medicare by 10 years gradually over a period of time; (2) raise the gas tax by $2 and rebate it to have neutral distributional effects; (3) reform taxes by broadening the base through eliminating exemptions, excepting charitable deductions, and lower the marginal tax rates.
The first would be super but seems politically impossible under current conditions – though the gradual process would lessen opposition to a certain extent. The second is theoretically positive to deal with pollution externalities but will incentivize greater population concentration – which I can imagine having lots of bad effects for the things I care about. The third should be favored by everyone who isn’t a rent-seeker, assuming that other more radical tax plans are off the table.
BTW, here is a recent paper on some of the distributional issues raised by such a gas tax.