Wednesday, May 20, 2009

When the government runs the auto industry

So President Obama proposed his new CAFE standards and tailpipe CO2 emission limits to nary a whisper of dissent from the auto industry. Why the silence?


What amazes me is that people actually think its a good idea for the federal government to run the car industry. It's one thing when government regulates an industry that is trying to maintain profitability within the constraints of that regulation. But when politicians run an entire industry, profitability becomes entirely irrelevant in the face of political considerations of all types.

These new CAFE and emissions standards are a great example. Are they doable? Probably. Just like it would be "doable" to require that no new home could have more than 1500 square feet.

You'd probably get support for such a regulation in some circles. People who would tell us how much energy we'd save, how much cheaper it would be.

But a lot of people don't want that kind of house, just as a lot of people, would prefer a larger, heavier vehicle and will happily pay the extra $1500 a year in fuel expense.

President Obama is basically saying that people will no longer have this option. I don't think this is the appropriate role for government. Where will it stop? How about the meat industry? You know how much CO2 is created by that?

Back to autos - the government wants to mandate a vehicle fleet that would not be the preference of consumers if left to make their own choices. That is inherently bad for profitability. But now government is on both sides of the equation - regulator and owner.

Look forward to many more bailouts of the auto industry.


OregonGuy said...

Stifling innovation.

Imagine having the dream of building cars. You've done a few drawings. You've a degree in mechanical engineering. Your car will have looks, power and affordability. In other words, it's a car that people would buy.

But the government hears about your innovative plan. It doesn't matter that your car would sell, and sell well. It is not "innovative" in the way that the community organizers of our great land feel innovation should be exhibited.

Your choices are build to their "innovative" standard, or not build.

What would you choose? And, who is John Galt?

Sabokat said...

And, the same thing can happen from the large corporations. They too cans stifle innovation if they feel their profits are threatened. Or dole out the innovation slowly - to maximize profit (your innovative engineer will likely to have to go through one of the majors to get his car made).

Big corporations are as bureaucratic.. and as much of a threat to our freedoms... as is big government.

Now, I actually agree. I think people should be allowed to buy huge honkin' cars/trucks if they wanna. Lets float this idea - there is a tax surcharge placed on vehicles that over a certain gross tonnage and that fall below certain benchmarks for emissions and gas mileage. If people want the luxury of a large car, paying for it shouldn't be a huge issue. In addition, the surcharge would be a deduction for people/businesses that need such a vehicle for their work and employment.

Just kickin' around some thoughts. Pros? Cons?

Anonymous said...

Big corporations can stifle their own activities. And we can shop elsewhere

Government can stifle everyone. And we cannot shop elsewhere. That is the difference.

Oh, and government will send men with guns if you disobey.

Sabokat said...

I'm not convinced. In some cases we can - in others, we don't have that much choice, or if we do, we don't necessarily have the time to hunt down every small producer or manufacturer.

In the instance of cars, and I honestly don't know, what other choices are there? How many small automobile companies exist in the U.S.? I could google it, but my fingers are feeling lazy.

Corporations have ways of exercising their power too.. not as openly as government, but no less detrimental or invasive.

Rob Kremer said...

In the 20th century alone, governments literally murdered more than 100 million people. I don't think "big corporations" are anywhere near the threat to our freedoms as is government.

Sabokat said...

I was thinking about our government, actually, and not looking abroad. And I agree that big government, including ours, is an issue. I just don't want to give the big corps a pass. Unfortunately, big business and big government frequently work hand in hand. I think we need to worry about both.

Anonymous said...

This is great news - My old big-rig could start appreciating!

David Appell said...

Rob Kremer wrote:
> How about the meat industry? You
> know how much CO2 is created by that?

I suspect you mean methane. (You do realize it's a different gas, right, and it doesn't come out of cars?) But it's also a problem. Live stock are responsible for about 15-20% of global methane emissions. Of course, they exist only as food for humans, so fewer meat eaters would mean less livestock would mean less methane. There aren't a lot of other good options, though people are studying the issue (such as modifying their diet, or perhaps even genes).

David Appell said...

Rob Kremer wrote:
> What amazes me is that people
> actually think its a good idea
> for the federal government to run
> the car industry.

Please. You know that's not what they're doing.

What the government is doing is what it is designed to do: protect common resources from being exploited or ruined by people who abuse it. That means protecting oil supplies (so there is enough), protecting the atmosphere and oceans from warming and acidification, protecting the large numbers of Americans who die of air pollution-related illnesses (about 100,000/yr). Protecting children whose asthma (up by a factor of 2.5 in 20 yrs) is exacerbated by automobile emissions.

If the car makers acted as good corporate citizens and showed a respect for the environment they and we have to live in, they would be doing this already and government would not need to force them. But, it seems, all they care about are profits, and they let everyone else suffer the consequences of their product's external costs and damages.

Anonymous said...

Hey David, quit spreading your lies.

The world is not running out of oil.

CO2 does NOT cause warming.

The oceans are not acid (and you know it.)

Air pollution is getting better, not worse.

100,000 Americans do not die of air pollution yearly.

BTW, Al Gore lied about the polar bears too.


DavidAppell's conscience said...

Why, you might ask, do I detest profits and thus corporations and capitalism? I'm trying to get a freakin' job with Podesta or Axelrod for cryin' out loud and you're either with the program or you are dust. That's what the conference calls are all about. You Conserv-a-Nutz ought to read up on the Labor Theory of Capital. By a guy name of Karl Marx. It's good stuff. Catch the wave. Quark Soup!

David Appell said...

"Air Pollution Deadlier Than Previously Thought," March 2000, Harvard School of Public Health,

Their number is "70,000."

Yes, air pollution has gotten better in recent decades, so perhaps the above number is a little smaller. Is 60,000 deaths/yr acceptable, then?

DavidAppell's conscience said...

Does anyone know how I can find a current boycott list for oppressive fabric softener manufacturers? I ran out last weekend at the laundromat and I don't want to buy the wrong brand. They don't have too many choices at the laundromat but I'm probably going to swing by Costco this week. That is, if I can get my car fixed.

Roadrunner said...


You seem to think that we have a God-given right to drive the vehicle we want, no matter the effect on others. Am I correct in that assessment?

Are you also okay with people just tossing their garbage out in the street?

It may have been okay to toss our airborne garbage with no concern for others when the human population was small, but as our population has increased, so has the effect of our thoughtless behavior.

DavidAppell's conscience said...

Rob, Why won't you have a personal dialog in front of everyone else on this blog with me? You'd elevate Roadie and dust me? Why? What do you have against anti-capitalists anyway? Roadie is just a poser. He's actually to the Left of me. You should hear him on the conference calls. Just so you know.

RoadrunnersConscience said...

Look! Shiny!

Sabokat said...

DavidAppell's conscience and RoadrunnersConscience -

Working on perfecting your heckler's veto?

DavidAppell's conscience said...

Actually David Appell is the heckler. I just come in behind him to clean up the mess.