What could actually motivate America to become fuel efficient?
"Probably not in election year, but some day..."
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I had the opportunity to go to Brazil earlier this year. One of the things that surprised me the most was the sheer number of flexible-fuel vehicles...and I don't just mean ethanol because almost all flex cars also run on alcohol! Here is a crazy fact: As of 2005, popular manufacturers that build flexible fuel vehicles in Brazil are Chevrolet, Fiat, Ford, Peugeot, Renault ,Volkswagen, Honda, Mitsubishi, Toyota and Citröen. CHEVROLET? FORD? VOLKSWAGEN? HONDA? TOYOTA? Those companies make cars in the U.S too! I think they would make those cars available in the US, if it was profitable to do so. Here is the bottom line: Congress needs to stop listening to lobbyists from Detroit and start enacting legislation favors alternative energy!
-Forget vehicle size/weight/luxury classification, tax any vehicle that gets less than 20 mpg.
-Add a tax break/subsidy for the purchase of any vehicle that gets more than 35 mpg -Add parking spaces at shopping malls and sporting events for cars that get more than 35 mpg (right next to the handicapped spaces) -Tax gasoline (yeah, I said it) -Take gasoline tax proceeds and increase subsidies for solar/wind/other alternative power projects -Establish energy and water per capita guidelines (i.e. 1 reasonable person uses x kilowatt hours of electricity per month. These could be different from state to state, or even county to county depending on specific local necessities.) Then establish tax rebates for households that are able to keep their consumption below these pre-determined usage levels. 1
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No way. Too radical, and the old oil money would never allow it, taking taxes from gasoline to promote competition. Sure, it would drive the consumer, but it also imposes a resource quota, very unpopular. What I suggest is rather a dismantaling of the culture surrounding SUV's and gas guzzlers. Like, market new, fuel efficient models as sexy and efficient, maybe start giving NASCAR fuel quotas and efficiency points or something that really stikes the core american values, and changes the perspective on gas guzzlers rather than force the consumer through regulations and taxes. 2
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Yep. Prices and markets are marvelously effective mechanisms for coordinating economic decisions. If the US were to tax gasoline to the same extent that the Europeans do (or more, as you point out), you can bet that we would become more fuel efficient. Natural resource economists refer to this as internalizing environmental externalities. The real question is why don't we do it, and that has to do with politics. There are other mechanisms - incentives, R&D;subsidies, public procurement initiatives, etc. - but these are all less efficient than prices. The advantage of taxes is that we get to keep the revenue here in the US rather than ship it overseas.
Exactly. As much as people give credence to the pollution effects and how driving gasoline cars is bad for the environment, the only way people will actually listen is if you hit someone in the wallet. When gasoline prices rise to the point of people not being able to afford to fill up their car (which it seems like isn't too far in the future), the natural market mechanism of supply and demand will force auto manufacturers to come up with a new product that consumers will use.
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