Bipartisan Bill on Gas Mileage

[1967 R50/2]

http://news.yahoo.com/s/nm/20050914/tc_nm/katrina_energy_mileage_dc

Sounds like a step in the right direction

[304065]

I can't say I agree. Mandating increased CAFE is a substitute for real market forces driving more economical cars. I suppose the logic behind the legislation is that the hapless consumer is foreclosed from making an economical choice due to the big bad automakers only offering gas-guzzling SUV's.

Sooner or later the consumer has to wake up and realize that (s)he's spending a disproportionate share of the monthly household budget on nondiscretionary expenses like gasoline.

If Government wants to interfere with the market, they can do it the old-fashioned way: a $2 per gallon tax on gasoline, with $1 going to federal mass transit projects, and the other going toward alternative fuels research. Sorry, those of you with your hand out for other entitlements.

The impact of $5 per gallon gas would prompt an industry response FAR faster than a 10-year CAFE phase-in, with a corresponding lowering of gross tailpipe emissions.

Now, I can already sense the whining (not from YOU, R50, you're above that) from some here: "That's a regressive tax, because it disproportinately impacts people of lower socioeconomic status!" To which I say, Balderdash, you drive more, you pay more, it doesn't matter. And in fact, the opposite's probably true if you evaluate income level vs. using public transportation vs. owning a luxury car.

Putting the burden on three domestic corporations is certainly easier from a bureaucratic standpoint than taking the heat for a gas tax. No doubt that's central to the political mindset. But it creates perverse incentives, insofar as the consumer doesn't have any skin in the game-- and will still prefer the gas-hog end of the lineup if given the opportunity. Put the bite on the consumer and he will DEMAND a more fuel-efficient vehicle.

Signed

2.0 liter Porsche owner

[1967 R50/2]

Well, I don't disagree with you that the market forces would be far more effective.

But the reality is that a large gasoline tax as you suggest would be political suicide and few politicians have the guts to go there.

So in place of that, some new cafe standards are a step in the right direction.

[skipdup]

The beloved yet thirsty station-wagon was forced into extension by cafe standards.

[jyl]

Taxing gasoline to $5/gal is politically impossible. Also risks damage to the economy (retail spending) unless you trust the government to implement it skillfully.

Higher CAFE standards may be tough on Detroit but it is the least of their problems. If GM and F go under, the fault will be wholly their own (management and labor).

[DaveE]

As much as I would like to see SUV's diminish from our highways I don't think mandating the automakers to sell more of what people don't want is the answer either. I agree with those who say gasoline prices have to rise for people to make that decision.

[1967 R50/2]

Originally posted by DaveE
... I don't think mandating the automakers to sell more of what people don't want is the answer either. I agree with those who say gasoline prices have to rise for people to make that decision.

The purpose of the legislation is not to mandate that the big 3 make something other than SUVs...it is to require those SUVs and other cars to be more efficient.

I think there is a major distinction between those two points.

[Rondinone]

Originally posted by john_cramer
I can't say I agree. Mandating increased CAFE is a substitute for real market forces driving more economical cars. I suppose the logic behind the legislation is that the hapless consumer is foreclosed from making an economical choice due to the big bad automakers only offering gas-guzzling SUV's.

Sooner or later the consumer has to wake up and realize that (s)he's spending a disproportionate share of the monthly household budget on nondiscretionary expenses like gasoline.

If Government wants to interfere with the market, they can do it the old-fashioned way: a $2 per gallon tax on gasoline, with $1 going to federal mass transit projects, and the other going toward alternative fuels research. Sorry, those of you with your hand out for other entitlements.

The impact of $5 per gallon gas would prompt an industry response FAR faster than a 10-year CAFE phase-in, with a corresponding lowering of gross tailpipe emissions.

Now, I can already sense the whining (not from YOU, R50, you're above that) from some here: "That's a regressive tax, because it disproportinately impacts people of lower socioeconomic status!" To which I say, Balderdash, you drive more, you pay more, it doesn't matter. And in fact, the opposite's probably true if you evaluate income level vs. using public transportation vs. owning a luxury car.

Putting the burden on three domestic corporations is certainly easier from a bureaucratic standpoint than taking the heat for a gas tax. No doubt that's central to the political mindset. But it creates perverse incentives, insofar as the consumer doesn't have any skin in the game-- and will still prefer the gas-hog end of the lineup if given the opportunity. Put the bite on the consumer and he will DEMAND a more fuel-efficient vehicle.

Signed

2.0 liter Porsche owner

Yes, but we do not operate in a true market environment when it comes to gasoline. Our gasoline prices are artificially depressed due to government action. The feds subsidize exploration, technological development, provide equipment grants, build oil infrastructure, etc. Not to mention fight middle-Eastern wars to guarantee access to foreign supplies (not to say that I disagree with the Iraq war.) If the feds backed off the subsidies, we'd be paying $4/gallon. Perfect recent example: federal release of oil from SPR in order to keep prices down.

On the other hand, we have a long history of federal interference with the auto industry, with positive consequences. Would market forces have provided emissions controls, seatbelts, airbags, bumper and lighting standards, tire standards, crumple zones and safety glass, frontal and side impact standards, horns, or the meager milage we get now? Those were all mandated. I know most pellicanites don't like the federalization of their cars, but overall, for the average American, federal interference has made driving safer.

Regardless of what Detroit tells us, a 20% increase in milage is not at all difficult or expensive. Over the last 15 years Detroit has increased engine efficiency by much more than that, only to build bigger faster cars with the same milage.

Of course, my preferred solution is both higher milage standards AND a $2/gallon tax.

[artplumber]

So let me guess, the gubmint shouldn't mandate seatbelts, airbags, or helmet laws. Let the market decide?

[304065]

Peter,

My 1966 911 did not come stock with seatbelts or airbags. In those days, however, people either had tradtional indemnity health insurance or none at all, e.g. they self-insured for the risk of catastrophe. I have, at my own expense, retrofitted the car with three-point safety belts, although I am not required to by law. Being cut to ribbons by the windshield is NOT my idea of a wild time.

Now comes the modern welfare state, wherein responsibility for persons who injure themselves catastrophically ultimately defaults to the State. Now, the state has an interest in regulating both your car's equipment and your behavior, in order to keep its own costs low. Therefore, the State is incented to shift the burden of preventing your loss to the auto manufacturer, away from itself, and away from the small percentage of the population that wouldn't install safety features or purchase a car that had them.

Our benevolent society has such a high regard for its citizens that they deem regulation necessary to both prevent physical harm and help control your gas budget. Evidently you (I hope you realize I don't mean YOU) are incapable of doing so on your own, even though, in both cases, it's you who gets cut to ribbons, and you who gets evicted for nonpayment of rent. Evidently people are insufficient guardians of both their personal and financial interests.

[Rondinone]

Originally posted by john_cramer
Evidently people are insufficient guardians of both their personal and financial interests.

Unfortunately, in many cases this is correct. Not everybody is as car-conscious as the people that inhabit this board. No, that's not sarcasm.

But also, oil supply is really getting to the point of being a national security issue, hence it should be managed by the government. To understand why see my posts about oil supply at:

Those BLOOD SUCKING Arabs

[DaveE]

Originally posted by 1967 R50/2
The purpose of the legislation is not to mandate that the big 3 make something other than SUVs...it is to require those SUVs and other cars to be more efficient.

I think there is a major distinction between those two points.

My point was that there seems to be a significant number of people who like to drive around in large vehicles. Large vehicles aren't efficient. The automakers are caught between a rock and a hard place trying to give the public what they want and trying to satisfy the legislators. Admittedly they could make an attempt at going after the people who want to buy a quality car but they seem to prefer to built cheap cars, in quality and price, along with the behemoth gas-guzzlers that a large segment of the driving public seem to like.

[gaijindabe]

Detroit pretty much needs a re-invention. The days of cheap gas and large (and very profitable) SUVs & pick-up are going away. Dave you are right - they are stuck.

But as the U.S. car buying public moves away from the monster truck - what is going to capture the imagination of buying public? Safety? Greeness? Economy? Performance? Styling? Engineering?

The Japanese and Germans are going to eat their lunch..

[artplumber]

Originally posted by john_cramer
...Our benevolent society has such a high regard for its citizens that they deem regulation necessary to both prevent physical harm and help control your gas budget... Evidently people are insufficient guardians of both their personal and financial interests.

As others have said, the oil consumption issue is not just about personal financial interests, it's about the country's (economic & thereby geopolitical) future. The example I cited was to show that some things are better for society/the country may not coincide with what individuals prefer/are capable of doing. Economic forces would likely never drive individuals to use seatbelts or helmets, or spend an extra $500 for airbags. There is a plethora of similar issues, eg/home insurance vs living in a region of flooding.