Gas prices forcing Republicans to actually do something

Evidently, public outcry has gotten bad enough about gas prices that even Republicans are considering interfering with the free-market process and regulating fuel efficiency.

Bilirakis is not alone. GOP Reps. Michael N. Castle (Del.), John R. "Randy" Kuhl Jr. (N.Y.) and John E. Sweeney (N.Y.) have all switched their stance and now back stricter federal requirements. Kuhl changed his mind after he surveyed his constituents late last year: Of 4,000 respondents, 70 percent supported more stringent CAFE standards.

Although in the end we must break completely free from dependence on oil, using less of it in automobiles is definitely a step in the right direction. There is of course a whole host of issues involved, such as whether making greener cars will hurt the US auto industry (although with the big three constantly cutting jobs, I can't see how anything can save the workers).

A major problem lies in the fact that CAFE only demands that a company's car lineup meet a goal of 27.5 mpg while their truck lineup only has to meet 20.7 mpg. These requirements are not per model, but per classification, so that automakers meet their averages by producing a few higher performing models expecting not to make money off of them while simultaneously producing a number of models that fall well below efficiency of 20.7 mpg for trucks. This is how GM gets away with making Hummers (the H1 gets only 10mpg). Naturally they are given this incentive by the fact that the profit margin on, say, a Ford Ranger is considerably lower than on a Ford Excursion. The big three make most of their profits off of sales of SUVs and trucks.

So even if CAFE restrictions are raised to demand an average of 30mpg for cars, or any other number, as long as it is structured in the same way as the current requirements, you'll still end up sitting at a red light behind and beside 5 or 6 pickups to 2 or three cars (at least in Texas).

Obviously requirements need to be more stringent than that. A lot of people buy trucks even knowing it's a bad idea because of their fuel economy. This is one of those times that you can't expect people to behave rationally, and therefore must help modify their behavior. Add to that a good number of people who buy these kinds of vehicles, like Hummers or Escalades are insensitive to the price of gas. In short, being rich means they don't have to respond to market pressure. Someone stated in a conversation I was having a while ago that their increased use of fuel meant they were paying for the privilege (because of the taxes that are added on to gasoline by the federal and state governments). That may be true, but the fact is that allowing people to buy unlimited quantities of gas only drives prices up. In simple market theory, higher demand means that suppliers should increase supply in order to sell more and make more profits. In reality though, oil suppliers are not increasing supplies at the rate demand is, specifically in order to make more money.

Chevron's profit in the first three months of this year leaped to $4 billion — 49 percent more than the same period a year earlier. ExxonMobil pulled in $371 billion in revenue last year and generated $36.1 billion in profit, an annual profit increase of 43 percent.

At this point, governmental regulations must be the bargaining chip between the US individual and the auto companies. The government is our voice, so it's time to let it be heard. We need every vehicle to get more than 30 mpg, and with today's technologies it shouldn't be hard to get the average sedan to have an economy of more than 40mpg. If the Germans can make a car that gets 157 mpg, surely we can make a car that gets 40 but meets our standards of safety, comfort, and convenience. The thing is, our changes to be made quickly, and they must be drastic. We can't take half-measures like this:

Congress initially set the passenger-car fuel economy standard in 1975 under President Gerald R. Ford, with the expectation that automakers would meet it in 10 years. President Bill Clinton added 0.2 miles per gallon to the requirement, but Congress then passed legislation starting in 1995 that blocked any further increase.

Bush persuaded Congress to lift the prohibition in 2001, and a National Academy of Sciences study that year concluded that a standard of 33 mpg was feasible and would not compromise passenger safety. But Bush has not pushed for such a change, instead opting last month to increase fuel economy standards for light trucks by an average of just under 2 mpg over four years. That move will save about 10.7 billion gallons of gas over two decades -- less than one month of current U.S. gasoline use.(emphasis added)

Saving one month's worth of gasoline in 20 years? That's like going to a grocery store because you get a free can of soup with every 5,000 cases you buy. It's not a good enough deal. We have got to do better, and unless people want to be faced with the prospect of either giving up automobiles entirely or paying $10 a gallon, we have got to make major changes now.

People never want to hear it until it's too late, but here's my advice anyway: Get SUVs and trucks off the streets by placing such a heavy surcharge on them that no middle-classers will get them and even the rich folk will notice. Cities should charge taxes on vehicles that don't meet the fuel-economy criteria they set (cities should be involved because of the environmental effects). Cars should mandatorily meet requirements of 40 mpg or above within the next 5 years (they may say it's impossible, but that's a complete lie). All milage requirements should rise every year, at something like 2-5%. Milage requirements must be per vehicle, not per class, and lastly, while corporations feel they are not beholden to anyone but their stockholders, the American government should set them straight and require them to increase refining capacity at a certain percentage rate per year.

The question isn't whether people want cars that get great milage, because they do, but the auto companies are not beholden to build that in to vehicles, and most people simply do not look at their individual choices as impacting the future of America and the world, so if the salesman says, "50 mpg, efficient, and friendly" and then walks over to the latest 6-cylinder 400 hp sedan from Ford and says, "Goes 0-60 in 2.4 seconds", unfortunately a lot of people are going to go by the rule of "Bigger is better".

There's only one reason that we aren't pushing for drastic changes: short-sightedness. We put off til tomorrow what we could do today. This article written by William G. Laffer III in 1991 demonstrates that myopia. All of his reasoning could be used against my arguments now, except that by his own criteria they have not met the test of time. His key claim is

If Congress wants to foster energy conservation, it simply should allow the price system to operate freely. As long as Congress does not reimpose price controls on gasoline and other petroleum products, as it did in the early 1970s, market prices will provide consumers with the proper incentive to conserve.

Yeah, we've really seen that so far.