On the Road

A man’s ( or woman’s) car is his dream machine. Ever since the internal combustion engine overrode the manpower of the bicycle, men and women have been seduced by the automobile. My 1st love was no different. But today, chrome and metal have been replaced by plastic, padding and air bags. And rules, rules, rules have completely transformed the marvelous, driving machine and the auto industry.

We recently celebrated Labor Day. What better way to evaluate it than to note that the power of unions and government regulations have crippled a great auto industry. The Obama administration just implemented new CAFÉ rules. No one likes a new rule, another layer of freedom stripped away, but apparently these automakers do: GM, Toyota Motor, General Motors, Chrysler Group, Ford Motor, Honda Motor, Nissan Motor, and BMW.

New rules will require truck manufacturers to meet fuel-efficiency standards for lowering carbon-dioxide emissions by as much as 20% by 2018. 18 wheelers, buses, garbage trucks and delivery trucks are included. This rule follows a preceding rule for autos. It requires a corporate average of 54.5 mpg between 2017 and 2025. Since 9 million gallons of oil fill up our cars and trucks every day, these rules will 1. reduce our addiction to oil, 2. curb carbon pollution, 3. create jobs, and 4. save consumers money. Really? How can one administration tell such a quadruple whopper of a lie? Big Brother’s real agenda is not only the destruction of the free market system in energy consumption and car choice but also the push for alternative fuels, the swans of the EPA. Oil is the ugly duckling.

More rules mean more problems, less profit and fewer jobs. Union victories of high labor costs and unsustainable retirement benefits as well as government regulations, eventually brought our big 3 car makers to their knees. As we know, Chrysler and GM were in fiscal crises for years. GM was restructured by the government after a $50 billion bailout having been $40 billion in debt. How can a unionized company fall $50 billion into debt for retiree health-care obligations? Chrysler, having already been bailed out in the 80's, received another bailout and partial buyout by the government. In restructuring, Chrysler reduced its UAW hourly wages and benefits from $76.00 to $49.00. Volkswagen and Hyundai Motors, by the way, pay $25.00 an hour. It is appropriate to discuss the ‘benefits’ of unionization close to the holiday, Labor Day.

Fortunately the auto industry knows that ‘no’ from our administration never means ‘no.’ In negotiating their deal, auto makers engineered an escape route of a review by 2018, when, if targets are judged too ambitious, targets could get lowered or rules changed. Halfway through the cycle, a review will determine if rules are overly harsh or lenient given fuel prices, consumer behavior and technological advancements. The new requirements - known as CAFE (corporate average fuel economy) can be thus fudged. Credits can be earned to make it easier for manufacturers to reach higher mpg’s.



Perhaps as you read the rules above for mpg you missed the phrase ‘ corporate average.’ This allows for loopholes. Credits for technologies exist for solar-panels in the roof to power a cooling system, front grille louvers that automatically close to reduce drag when the car’s driving at higher speeds, air conditioning systems that use climate-friendly refrigerants and battery-powered vehicles that allow auto makers to comply without reaching the 54.5 mpg. Credits can be won for hybrid trucks, alternative fuels and other ways of improving fuel economy. An electric car counts as two zero emission cars when calculating efficiency and CO2 emissions of the total fleet. Large pickups called ‘strong hybrids,’ that run for a time on battery power can get a credit on every truck sold for 1.5 to 2 mpg. ‘Mild hybrids’ that give an electric boost to acceleration from a stop get a credit for 1 mpg. A credit for engines shutting down at stop lights. Yes. Beefier batteries, energy recycling brakes. Yes. Yes. Smaller and lighter cars? Yes. Even a turbo-charged 4-cylinder engine that acts as a fuel economy feature.

Will the regulations save drivers more in gas costs than they add to the price of cars and trucks? Will citizens diet to drops the pounds needed to fit into mini cars? Will tax credits be necessary like rebates in the Cash for Clunkers program?

Auto makers apparently will simply play the credit game, allowing them to avoid dramatically shrinking the size and power of some vehicles yet continue to offer an array of models ranging from small electric cars to beefy pickups. Obviously, selection and free choice power the auto industry.

Government gives with one hand and takes with the other. This is the lesson to be learned from such nonsense and over- regulation. If it is all too depressing and confusing to you, flash with me back to the time of my 1st love, a ‘51 Ford. I can recall the thrills of yesteryear in my lime green, pop-eyed beast with white walls and Overdrive. Poor indeed is the chance for a 21st century, regulated American to feel the passion I felt behind that ivory wheel.