Monday, August 22, 2005

FW: Progress Report: Bad Policy Fuels High Prices


Bad Policy Fuels High Prices

As millions of Americans hop in their cars for vacation, the average price for a gallon of gas has spiked to $2.60 -- and many people are paying more than $3.00 per gallon to fill their tank While most everyone is feeling the pinch, "for many lower-income people -- often those who work in service jobs or are looking for work -- each new bump up in price means altering daily routines, spending less on clothes and food, and keeping the kids at home instead of driving them to the pool or friends' houses." A big part of the problem is that, despite huge advances in technology, "America's cars and trucks are significantly less efficient, on average, than they were in the late 1980's," driving up demand, and the price, for fuel. Meanwhile, the Bush administration has staunchly resisted efforts to help solve the problem by improving fuel efficiency standards. Now, all Americans are paying the price.
In late July, "the Environmental Protection Agency made an 11th-hour delay the planned release of an annual report on fuel economy."  The decision to block the release of the report was made "because it would have come on the eve of a final vote in Congress on energy legislation." The study showed that "the average 2004 model car or truck got 208 miles per gallon, about 6 percent less than the 22.1 m.p.g. of the average new vehicle sold in the late 1980's." Specifically, "the average 2004 model sold by Nissan, Hyundai and Volkswagen was at least a half-mile a gallon less fuel-efficient than in the previous model year, a sharp drop." (A report by Environmental Defense provides details for all major manufacturers.) That wasn't news the Bush administration wanted public to hear because the bill "largely ignore[d] auto mileage regulations." Several Senators offered amendments "to strengthen fuel economy standards for S.U.V.'s, minivans and pickups" but they were all rejected. Bush signed the energy bill, which gave away billions to the energy industry, on August 8. Even the administration acknowledges the bill will do nothing to reduce gas prices.

FAST, FURIOUS AND GAS-GUZZLING: The failure to mandate the production of more fuel efficient vehicles is a giant missed opportunity. There have been "leaps in engine technology over the last couple of decades" that could make cars much more efficient. But in the absence of stricter efficiency standards, these gains "have been mostly used to make cars faster." Also, since the early 1980s, "average new vehicle weight has risen to about 4,000 pounds today, from about 3,200." During that time "the horsepower of an average engine has roughly doubled over two decades, trimming four seconds from the time it takes for the average vehicle to accelerate from zero to 60."

KEEP ON TRUCKING: The key to avoiding fuel efficiency standards is to classify every new and trendy "crossover" vehicle as a truck. Light trucks "are held to a lower [average fuel efficiency] standard—20.7 mpg as of model year 2003, compared to 27.5 mpg for cars." Manufacturers are also moving vehicles that were once classified as cars to the truck class "to sell more of the large trucks on which profit margins have been so high" Today "S.U.V.'s and other light-duty vehicles account for 40 percent of the nation's oil use." With only the smallest cars remaining in the "car class" there is no pressure to improve the efficiency of those vehicles either. President Bush and the Congress had the opportunity to close these loopholes and improve overall efficiency in the energy bill, but didn't do it. New regulations set to be released later this month will create up to five classes of vehicles based on height and width Dan Becker of the Sierra Club says the upcoming proposal is "an invitation to game the system."

BUSH PROTECTS MASSIVE LOOPHOLE FOR HUMMERS: In 2003, President Bush proposed extending "fuel economy regulations to include Hummer H2's and other huge sport utility vehicles," which are now completely exempt. As gas prices soar to record levels, the administration has abandoned the proposal The exemption applies to vehicles weighing over 8,500 pounds. When it was created, "vehicles of that weight were generally used for commercial purposes, but now hundreds of thousands sold each year are intended for family use." The exemption, along with potential tax breaks for consumers who purchase them, create "powerful incentives to produce such vehicles."


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