On Dec 31 2008, 10:05*am, Joseph Gwinn wrote:
Holman Jenkins continues making his case against CAFE and other root
causes of the Big Three's inability to make profitable cars in Detroit.

http://online.wsj.com/article/SB123069003507444659.html

The Wall Street Journal, 31 December 2008.

Joe Gwinn


CAFE is a good example of a supposed good idea gone bad. Since the
actual cost to drive a large, low mileage vehicle for errands to the
market with one passenger etc. was low, people naturally wanted bigger
vehicle. The auto companies saw the demand for heavy, large, fast
vehicles and just responded with truck size SUV's and marketing of
trucks to people for daily driving. When gas went high and raised the
real cost of moving a 3 ton vehicle around for no good reason, many
began to think a 3 ton SUV was not a such a great idea. The lesson
from this is, if you want to limit fuel use, tax the fuel, don't
impose contrived mandatory fuel standards. In Europe fuel consumption
has dropped 20%, while at the same time in the US fuel consumption has
increased since CAFE was mandated. When fuel costs 4-8 dollars a
gallon you don't use as much. You can't "mandate" a 3 ton vehicle to
get 35 mpg. Of course in Europe Diesel is not a dirty word, and since
diesels are ~ 30% more efficient and 50% of the cars are diesel, that
helped a lot. Meanwhile are roads and bridges are falling apart, and
states are selling off to the highest bidder the toll roads for short
term gains to make ends meet. TAX the fuel, but PUT the TAX back into
the roads, not pet projects. May as well ditch the 55mph speed limit
at the same time, it was about as useful as CAFE.