However, anyone who thinks that the money from the gas tax will be used for anything useful is dreaming. We’ve been pushing for government spending reform constantly — and it’s slowly starting to work. I should know: I’m in the military, and our finances (sans combat zones) have been getting leaner by the day. But government reform is something that takes constant pushing, prodding, and leading. Like raising a toddler, except this toddler will never grow up.

I think the idea Zentih had about increasing the EIC is a good one – it would definitely help out people on my end of things. And the EIC earnings cap should be raised a bit too — or be based on the taxpayer’s geographical location (i.e., someone making $40k in San Antonio has a lot more buying power than someone making $40k in San Francisco, thanks to high prices of *everything*). The military does something like this already (Cost of Living Allowance) to help offset the cost of service members transferred to bases in expensive areas (Japan, Pearl Harbor, Korea, etc). An extra $500-1000 in tax returns would certainly make things easier on the lower income folks. Heck, I could refi my car with that, allowing me to afford those higher gas prices!

It seems one reason why all this supposedly earmarked money (i.e., whats supposed to go to roads, schools, etc.) isn’t going where we thought it would go is because there are so many interest groups in Washington.

See, we common people vote to elect someone. But who actually goes beyond that? Those lobbyists are in your congress person’s ear day and night, telling them what to vote for, and what to put into their bills. What have you told your Congressperson lately?

We all know our benevolent rulers are not the brightest people in the world. They certainly can’t be expected to read your mind.

Another idea might be to double EITCs the duration of their car loans for those who can prove that they junked a gas hog and replaced it with a high-mpg vehicle.

ANWAR would have virtually no effect on oil prices whatsoever.

Two data points will make that clear:

-Current US oil consumption: 20.8 million barrels per day (and climbing)

-Projected peak production of ANWAR: 876,000 barrels per day (reached approximately 20 years after construction begins.)

An EIA report from 2004 predicted that ANWAR would lower world oil prices by about 50 cents per barrel. It would be about as helpful in fulfilling US energy needs as would a teaspoon in putting out a house fire.

Have we forgotten that Exxon-Mobil and the other large oil companies have been begging for years to drill in ANWAR (Alaska) and other US sites that have been labeled as homes to endangered species or pose possible evironmental risk. Just you wait. When the price of oil gets high enough ($5/gal? $10/gal?) you will hear the public begging for the oil companies to get their rigs up to ANWAR and start drilling especially when they promise that the vast amounts of oil they will pump will bring prices down.

Ultimately it comes down to this. Until the oil/gas situation becomes dire(about to run out), there is little if any incentive to dedicate any real time and energy to an alternative fuel source. If the government really wanted to find an alternitave fuel they would dedicate the finances and recources to do it. You need proof? If President Bush had a crystal ball that told him the war on terror could be won for $3 trillion would the government find a way to pay for it? You bet your life they would. Yet the government claims that buying imported oil is the greatest threat to our national security.

It boils down to money. The oil companies still have a vast amount of money to make before they pack up shop and go into a different business.

Of course the new CAFE regulations are a muddled mess – what did you expect?

I haven’t read the fine print, because I doubt the House will pass the same bill, and in any case, Bush’s veto pen is waiting, or so I have read.

On the other hand, 35 mpg isn’t all that onerous for cars at least, considering it’s probably still calculated using the old, old method (that is via the original 1975 test procedure without the 1985 and 2008 model year “correction factors” that significantly reduce the window sticker mpg ratings). And if the E85 loophole is still in place, that’ll make it even easier for the manufacturers.

So maybe this is much ado about nothing. Meanwhile, the rising price of gas will shift the market toward more efficient vehicles.

In any case, anybody who is forced this way to take the bus will vote against any politician who voted to force them to do so (by making them not be able to afford to drive a vehicle by increasing gas prices). It’s a political non-starter-so don’t mention it, because it ain’t going to happen.

So, the question becomes, “Is increasing the CAFE a good idea?”, as well as, “Does this fake increase actually increase average fuel economy?” If it changes everything so that each size of vehicle has to meet a certain mileage standard (as opposed to an overall number), all the Detroit Three will do is stop building small vehicles (or, if the import/domestic split is eliminated as well, maybe import them from China or South Korea or India). They suck at making them anyways, and lose boatloads of money on them, mainly because they suck at making them.

However, the UAW will scream to stop the import/domestic split from being eliminated (because they know that that will eliminate thousands of thier jobs). They will yell less about the splitting it up by size, although that will have a similiar effect (unless that actually means the Detroit Three will sell more larger vehicles to compensate, which it might if the prices of those go down because they no longer have to subsidize the smaller vehicles’ losses).

In any case, the net result will be signficantly fewer smaller vehicles built by the Detroit Three (unless gas prices go up significantly above thier current high level), and no net gain in fuel economy.

Meanwhile, Honda and Toyota will do what they always do-make small vehicles with very good fuel economy. Toyota will build larger vehicles as well, if there’s profit there (Honda is more “pure” in thier “no big vehicles” mentality-they refuse to build V8s, for example).

And here I thought taxes were used to financially support the government. Instead, I see it’s being used as some sort of subversive behavioral modification program.

Taxes serve both purposes. The government uses the money to pay for government services that it, and presumably the people of the country, consider necessary. However, taxes are also used to encourage activities that the government thinks are beneficial (e.g. donations to certain charities, certain types of investments, etc.) and to dissuade people from activities that the government has decided are either not beneficial to society or possibly even detrimental (e.g. smoking, drinking, etc.). Theirs nothing subversive about it, it is very straight forward though rarely stated by government officials and even rarer still stated in plain terms. The power to tax is the power to rule.

Of course, I’m sure even a Prius owner would be up in arms if they’re having to pay $140 to fill that thing up.

Sitting@home:

Maybe you could explain how those issues have anything to do with a natural response to the supply and demand curve-increased prices for gas-won’t effect the types of cars that we buy. How do any of the secondary issues you mentioned have any effect on the market? I think that I may know what you are referring to in terms of our governemnts intervention on these issues. If you are referring to attempts to ensure a large supply of foriegn oil for our economy, let’s not forget they also artificially reduce our in country supply by not allowing oil companies to pump out the oil in the ground right here at home. If we were at least at the point where we could ramp up our own oil production within a few months (wells in place but not used), then we wouldn’t have to worry so much about the foriegn oil supplies, and the foriegn oil producers wouldn’t be able to hold it over our heads so much.

I am proud to say that I have voted against the two senators from California every year since I was first able to legally vote, including our current two senators, Dianne Feinstein and Barbara Boxer. Am I allowed to complain about the politicians in Washington and hold them in completely low esteem? I hold the voters in low esteem as well. They all seem to think that you can get something for nothing. They want everything but expect to pay for none of it. They did a poll a few weeks ago in California whether or nto the voters were in favor of a particular bond measure. The poll included a questions to determine if the respondant was aware of what a bond is and how it is paid back. Less than 30% of those in favor of this particular bond measure knew how a bond was paid. These are the people who vote for the huge bond measures every year that I vote against.

Given that the price of petroleum products are on the rise, the market place, in this case consumer choice would better determine fuel mileage for each class of vehicles.

My observation is that when gas goes over about $3.10 a gallon, you see more cars with two or more people in them, and they are smaller cars.

Once gas goes below about $2.75, the number of loners in big SUVs starts rising again, as does overall traffic volume.

A better solution than a complex and easily cheated-on CAFE would be to have a floating federal gas tax designed to keep the national average gas price at a given minimum level, say $3.50 a gallon.

I agree that ethanol is just a sop to big agribusiness and not a viable solution. Both my vehicles get 22 mpg in town on pure gas and only about 20 on E10.

In that E10, despite all the government subsidies, is only 3% cheaper than pure regular unleaded and yields 10% less gas mileage, who in their right mind would use it.

Watch Secretary of Agriculture Mike Johanns. He is NOT your friend. As Governor of Nebraska, he tried to advance an agenda of requiring all gas sold in Nebraska to be adulterated with ethanol.

No, they banned assualt rifles because, like most gun control advocates, they are clueless about firearms and react based on emotion and the need to “do something,” regardless of whether or not the “something” really works.

Which, in retrospect, is quite like the thinking behind CAFE. So maybe your example is perfect.

210delray: I’m personally proud of our 2 senators in VA, John Warner and Jim Webb, not so enamored of my congressman Virgil Goode. What say ye about your own representatives?

Okay, I’ll bite.

We were talking about Senator Arlen Specter the other day. I said he is like a cockroach – whether it’s health problems (the man has survived a brain tumor and looks as healthy as people 20 years younger!) or political disasters (the silly backlash over the Clarence Thomas hearings), he manages to come out with his skin intact. Somehow, whether you are a Republican or Democrat, you’ve got to respect him. And when I call his office for help – they respond immediately, so he obviously runs a tight ship.

As for Bob Casey, Jr., – the people wanted “anyone but Santorum,” and they went with Casey because they thought he could win, and now they are discovering that on many social issues he isn’t all that different from Santorum, except he is liberal on economic issues. Together, they remind me of why libertarianism makes increasing sense…but then, so does this discussion surrounding CAFE.

As for U.S. Representative Tim Holden – he is “blue dog” Democrat, so he isn’t too far out of sync with the views of this area, and he keeps his nose clean.

Raising taxes — ANY taxes — has been the “third rail” of politics for a generation. You know the old saw, “don’t tax you, don’t tax me, tax that fellow behind the tree!” (So the fellow behind the tree is the car manufacturer in this case, by having to meet CAFE requirements. You’re that fellow if you rent a car or a hotel room!)

I think it’s even the First Commandment of the Republican Party: Thou shalt not raise taxes. (”Read my lips” and all of that.)

But what amazes me in this and other forums is how much venom is directed toward our national legislators. Don’t “we the people” elect them in the first place? Or are the gripers those who sit on the sidelines and don’t vote “because all politicians are the same?”

I’m personally proud of our 2 senators in VA, John Warner and Jim Webb, not so enamored of my congressman Virgil Goode. What say ye about your own representatives?

As for Subaru cars – yeah, once Subie builds a hybrid Forester, they’ll get my biz. Much as I used to like diesels and no longer do, IF Subie can do a 50 mpg diesel hybrid Forester, that’ll be our commuter vehicle and the Prius will play 2nd fiddle (at least in the winter time).

The reason I’m having 2nd thoughts about my dislike for diesels are two-fold.

1) The new emissions standards will enable them to be nearly as clean as California spec cars (or only maybe 6 or 8 times “dirtier” than my Prius instead of about 17 to 20 times “dirtier” than my Prius). I’m not enamored with the idea of Urea, but Honda say they have the emissions licked without use of Urea. Hopefully Subie will, too.

2) When gasoline was $2.19.9 locally, diesel was $2.79.9; when gasoline was $3.65.9 locally, diesel was $2.84.9. Both come from crude oil which had spiked in price “per barrel.” So, that got the gears going in my head.

It made me think that the gas price spike was either 80% price gouging and 20% crude oil spike, (i.e. a total rip-off), not forgetting that much of the net price increase goes to our “esteemed” government in taxes.

Another alternative might be a Honda Civic GX and PHILL unit (except that Honda can’t be pursuaded to sell the car retail in Michigan yet – California and New York, yes). Needless to say, I happen to have natural gas in my home and I would go ahead and pay $29,000 for a new Civic GX AND the PHILL unit to fill a natural gas Civic at home – currently the equivalent price per gallon compared to gasoline, is $1.25 per gallon for compressed natural gas, approximately.

…Luther!

Tell him what he has won, Bob.

Under current regulations are these just all averaged together for CAFE purposes? So you get a CAFE average of 15 MPG, right?

That’s right as far as CAFE is concerned (assuming equal numbers of each one sold). However, consider this little experiment… If each of those three vehicles drives on a 60 mile trip, what is the average MPG? The three vehicles consume 6, 4, and 3 gallons of fuel respectively for a total of 13 gallons. The total miles travels is 3 * 60 = 180 miles. The MPG (”miles per gallon”) is 180 / 13 = 13.85 MPG. Notice that this isn’t 15 MPG! The problem is that the EPA’s MPG is based on the average of MPGs of the vehicles, but should be instead calculated as I have done above.

The result of the EPA’s calculation method is that when a manufacturer produces a high-mileage vehicle that then lets them create a low-mileage vehicle, that company stays within CAFE while underperforming in the real world.

Considering what has happened to GM’s market share over time, Lutz is the last person who should talk about what the market is saying. Let him turn GM around, AND THEN talk. Not before. Until then, the reasonable assumption is that GM (and any other auto company with its market share history) is unresponsive to the market.

I’d apply ‘gas guzzler’ taxes on a per-model basis rather than a per-manufacturer basis. After all, if cars are part of a transportation infrastructure that imposes environmental and national security costs (after all, the original purchaser sells the car, which is resold, until it either becomes parts or is crushed in a junkyard), then that cost is because of the vehicles’ own characteristics, not those of the manufacturer. Imposing these costs on purchasers through regulation seems like a reasonable way to reduce their impact while still allowing for personal choice – those who really can’t live without a behemothmobile will pay for it, those who can won’t.

I interpret CAFE as being based upon an assumption that domestic manufacturers will not, on their own, choose to build what the market has AGAIN AND AGAIN said it wants. Allowing the domestic industry to fail due to it’s own repeated product failures, dating from the mid-1970s, will damage whole communities, not just the shareholders who allowed the failures to continue.

The more Lutz talks, the more he makes me think the assumptions behind CAFE are correct.

As for trucks for real work (i.e. contractors), go to Europe or the rest of the world and look at what the working people use there.
Not humungous Ford F150’s with monster V8’s, but snub-nose van-based pickup trucks with turbo-diesels.

Indeed. And farmers have smaller diesel trucks, too. Perhaps the problem is that we demand monster trucks with Peterbilt grills because folks feel they need such capabilities and image. Brawn over brains prevails again. Sigh.

I remember seeing when I was in Italy about three years ago phone company service vehicles that were small fiat hatchbacks (looked kind of like the one the Yugo was based on) with ther ladders one would use to climb a pole tied down on the roof…..most ‘mericans would expect to see something like a Ford Transit van trying to do that sort of job over there.

The “old” CAFE standards exacerbate the car/truck danger by promoting trucks. The new ones will be even worse by promoting even larger trucks.

Proposal: Government crash tests should require that the vehicle being tested inflict a “safe” level of damage against a standard small benchmark car. Vehicles that cause excessive damage would be banned from the roads or severely restricted in their public-road use. This would probably mean that light trucks would have to have a lower ride height during on-road use (and perhaps an adjustable suspension that could be triggered when the go off-road) and would be forced to have more forgiving crumple zones.

California has banned “assault rifles” because they are felt to be too dangerous. The EPA response to “assault rifles” would be that citizens should just buy heavier-duty body armor.

Why stunt the ability of people who choose to live in…….areas that need large 4×4 vehicles for …….weather conditions to purchase what they want and still afford the fuel to operate it (Try driving around after it snows in upper Michigan, Wisconsin, or Minnesota in a Prius)?
Subarus will drive circles around the vast majority of 4×4 trucks and SUVs.

Indeed. And farmers have smaller diesel trucks, too. Perhaps the problem is that we demand monster trucks with Peterbilt grills because folks feel they need such capabilities and image. Brawn over brains prevails again. Sigh.