ON THE AGENDA

Will Too Much Debt Fuel A Double-Dip Recession?

Francie Grace
Nov 20, 2009

That was the question raised by President Obama during an interview in China (one of our biggest creditors), as cartoonists seized the opportunity to comment on America's looming national debt. "It is important," said Mr.

Comment Read More

Will a Delay on the Climate Treaty be Time Well-Spent?

Scott Bittle
Nov 16, 2009

World leaders flatly admitted this weekend what everyone pretty much knew: there won't be a major deal on climate change at the big conference in Copenhagen next month. Instead, leaders will try to keep the process going, in hopes of coming up with a deal next year.

Comment Read More

FACING UP TO THE
Nation's Finances

National Debt Clock

Obama Announces Auto Emissions and Mileage Standards

By Jenny Choi on May 19, 2009

President Obama announced today new federal standards on auto emissions and mileage for cars and light trucks, the first ever nationwide regulation of its kind. With the help of the Environmental Protection Agency and the Transportation Department to outline enforcement policies, the rules will go into effect in 2012 and the new standard will be 35.5 miles per gallon (39 mpg for cars and 30 mpg for light trucks), up from the current average of about 25 mpg. Official projections show the change would effectively make the nationwide fleet of vehicles 30 to 40 percent cleaner by the time the plan expires in 2016.

The announcement is, in many ways, the result of, and solution to, an unusual confluence of circumstances. It puts an end to several years of legal battles over whether states can impose their own emissions standards -- a conflict that pitted California, and a host of other states that wished to follow its lead, in opposition to the Bush administration and the auto industry itself. Furthermore, the new federal standards arrive at an especially vulnerable time for automakers, with Chrysler under bankruptcy protection and General Motors expected to file before the end of the month. With both receiving federal help, business strategies and product lineups are sure to be drastically reconfigured. And both car makers have praised the president's move.

The inevitable question is, of course: what about the cost? The Associated Press estimates the new standards will cost consumers an additional $600 per vehicle by 2016, on top of the $700 for mileage standards that had already been approved.

Oftentimes, public opinion on any given issue can hinge significantly on cost; in other words, survey respondents may strongly support a proposal -- until costs or other tradeoffs are mentioned. Then support falls. In the case of auto emissions standards and mileage requirements, the American public generally supports such regulations. Our recent Energy Learning Curve study found that three-quarters (78 percent) support higher auto standards. And majorities of the public are even willing to make some sacrifices in order to improve the country's energy situation: 78 percent are willing to cut back on leisure driving on weekends and vacations, 64 percent are willing to have a 55-miles-an-hour speed limit on highway driving, and 55 percent are willing to carpool to work or school.

But as is often the case with other issues, proposals that would effectively raise the cost of driving, like gas taxes, a federal minimum on gas prices or a traffic congestion fee, are all rejected by the public. Which goes to show that Americans do want change and favor incentives, such as a tax credit to people who drive a hybrid or high gas mileage vehicle, but they don't want to be pushed.

Tags: auto, bailout, California, Cars, chrysler, emissions, GM, Learning Curve, mileage, Obama

Re: Obama Announces Auto Emissions and Mileage Standards

On May 22, 2009 Anonymous says:

Public policy that supports the expansion of the current CAFE standards and in effect have the Government picking winners and losers in the market place is foolish. This was a great opportunity for the Obama Administration to scrap the CAFE approach and replace it with a transparent one that works such as a gas tax. A gas tax would ensure improved vehicle MPG performance based on consumer demand, reduced foriegn oil imports, reduced environmental impact, AND raise revenue that could be used to seed the development of new technologies and reduce the deficit........once again the american public's lack of real understanding of the issue will be utilized by another set of RUN THE MILL POLITICIANS AKA the "change focused" Obama Administration to satisfy their political obligations at the expense of the country.