CAFE (Corporate Average Fuel Economy) Must Die

Brad Kozak
by Brad Kozak
cafe corporate average fuel economy must die

Current Corporate Average Fuel Economy (CAFE) standards dictate that U.S. automobile manufacturers must produce vehicles whose overall average achieves 27.5 mpg (for cars) and/or 22.2 mpg (for trucks). The regulation’s stated goal: “encourage” manufacturers to build more fuel-efficient vehicles and, therefore, somehow, eventually, “lead” American consumers into buying same. Yeah right.

Generally speaking, people don’t buy what’s good for them. Whether it's cigarettes or SUV’s, people buy the products they want and then rationalize their purchases afterwards (if they can be bothered). CAFE’s underlying principle– forcing manufacturers to build products people don’t want– is a very special kind of lunacy, normally reserved for “planned economies.” And it’s about as effective as it sounds.

By the same token, trying to force consumers to buy something they don’t want (for their own and the planet’s good, for example) instead of something they do want (even though some supposedly smarter person says they shouldn’t) is about as sensible as herding cats. Social pressures and “education” will only take you so far, and no further.

In practice, CAFE regs are even worse than they are in theory. Raising mpg average numbers seems noble enough– until you devil into the details. Even a brief examination shows that the manufacturers have used their political clout to rig the system.

The end result: Honda, Toyota, Nissan, etc. have all figured out how to create fuel-efficient cars that people willingly buy and drive, while the Big 2.5 ain’t got game. The CAFE regs failed to force them to do so.

Gasoline prices, however, have focused Detroit’s mind wonderfully. Thanks to pump price escalation, Detroit must now listen to the U.S. automotive market and build what it demands– or go belly-up. Again, this new reality has nothing to do with previous, existing or future CAFE legislation.

In fact, let’s imagine a CAFE-free world. With gas heading up past three bucks a gallon, it’s easy to suppose that a large number of people would voluntarily choose to abandon their luxobarges in favor of a more frugal set of wheels.

While those who can afford five dollar a gallon gas and/or depend on driving a HD truck or SUV for their livelihood would stay with their big rigs, the rest of us would transfer to rides that conserve our cash.

But what if gas prices crash? There’s an accepted legislative methodology for discouraging the consumption of products judged injurious to society: sin taxes.

Hiking up the cost of alcohol, cigarettes, gas guzzlers, etc. through taxation [supposedly] prices consumers out of the forbidden fruit market. Considering the power of addiction, it’s a policy that tends to be more revenue than results positive. But it’s about as good as it gets.

If we want to curtail sales of gas guzzlers, we should immediately abandon all federal regulations concerning fuel economy and slap on a big old federal gas tax. That, however, would hit everyone – rich and poor alike – in their wallets. The only thing politicians hate more than missing an opportunity to regulate something is getting caught with their hands in your wallet.

Instead of focusing on nit-picking laws and regulations, what about actually solving the environmental and national security problem inherent in our gas-powered society by switching to alternative fuels? You know, launch some sort of Manhattan project that changes our automotive infrastructure from oil-based fuel to corn or sawgrass 'shine?

As this website has argued before, federal alt fuel initiatives are proof positive that you can create more pollution and political turmoil and greenhouses gasses by trying NOT to use gas than you can by using it. Government interference in the E85 industry– from CAFE credits for vehicles that will never touch a drop of corn juice to federal corn subsidies– are nothing more than lipstick on a pork barrel.

While I dream of hydrogen-powered cars, I don’t want my tax dollars poured into national hydrogen research, production and distribution. If you thought the reconstruction of Iraq was riddled with corruption, can you imagine the billions that a hydrogen-power project would waste? And for what? To shift national energy consumption from pump to plant?

The free market is the answer. If E85, plug-in hybrids or hydrogen fuel cell cars pay, they play. If manufacturers want to build jumbo SUV’s in times of high fuel prices, they’ll increase SUV fuel efficiency. If they can’t, American consumers will migrate to more efficient vehicles all on their own. If not, a tax at the tap will jolly them along. If there’s no political will for that solution, so be it. Last time I looked, it wasn’t the government’s job to impose its will on the people.

In short, there’s no need to set some arbitrary limit on the fuel economy of new vehicles. It’s time for CAFE to go.

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2 of 56 comments
  • Mike_i_n_mich Mike_i_n_mich on May 10, 2007

    A swap of gas tax for national health care would hurt the Detroit makers on one hand, because they tend to sell larger cars. But it would help them relative to the foreign car companies because they pay billions more for private health insurance for retirees and workers. No one said the tax had to be raised over night. I do not believe in direct taxes on big cars or direct subsidies on fuel efficient ones, especially foreign cars. This is a blunt instrument, even worse than CAFE. What if someone has 4 kids, do they pay a higher tax for a 6 passenger vehicle? How do you distinguish between someone who needs a pickup for their business, from someone who doesn't? The gas tax will provide enough incentive to buy fuel efficient cars.

  • Fugue137 Fugue137 on May 24, 2007

    To add fuel to the "what to do with the money" fire, I'll throw this in: those advocating alternative energy technology, I think, have it half-right. But emissions aren't the only problem that cars cause. How about urban sprawl? "Free" parking, which is nothing but a subsidy for those who drive paid by those who do not? Massive expanses of concrete? An excuse for terrible city planning? Tires filling landfills? Arguably obesity and stress, and the millions of problems that those create? I've been commuting by bike for the last few years, pretty consistently. I happen to live in a very bike-friendly town, which makes that possible. More than possible--I've never been in better shape, or more relaxed, or happier on my commute. Even if I drove a dickheadmobile I could laugh off the gas prices, since I "need" to drive a handful of thousands of miles per year. If public transportation designers count on foot passengers only, then public transportation has to take you within not much more than a mile of your destination. Even a small city with a 20-mile diameter would require something like 70 bus stops. But on a bike in a city that is bike-friendly, I can bus the unpleasant parts and, if I'm pretty lazy, bike no more than 5 miles on either end (20 minutes or so), the same city needs about 4 stops. Obviously we can't all bike all the time, so owning a car is still important. But what do you think your city would be like with, say, half as many cars on the road? Would you object to gas costing twice as much if you only had to drive half as much? How about if you also didn't have to worry about obesity, heart disease, cancer, high blood pressure, asthma, that ridiculous diet, .......? Bikes could potentially be a very nice part of the answer, but they're not all of it. However, they serve to make my point: investment in better car technologies would be one worthwhile use of the money from a gas tax. But cars will never be even remotely as efficient as no cars. Create infrastructure to make alternative transportation of all kinds not just viable, but preferable.

  • ToolGuy VW (marque not group) and Tesla very nearly switched positions on a YTD basis.
  • RHD Inexpensive gasoline appears to be a thing of the past. ILO is correct - we have enough sunlight, wind and emerging ocean wave energy to power the entire country and then some. Clean air is nice, and being free of the whims of OPEC, geopolitics and hugely profitable oil companies will do all of us a world of good.
  • Raymond Segura Can you tell me where I can get the rear bumper for 69 impala?
  • Art Vandelay some of the crazy numbers I get. Percentages look bigger with any fluctuations with low volume makes and brands leaving the market will see massive month over month changes. But what’s with Buick? I still see the occasional ad on TV and yet the drop is disproportionate even compared to all the other GM brands.
  • Master Baiter "There is no mandate for consumers to buy EVs, not in any country or state. That’s made up."Right. And you are not mandated to purchase a toilet that only uses 1.6 gallons/flush. You could choose to not have a toilet--just go in the woods, like the bears do.