Additional loopholes in the CAFE bill

Gregg Easterbrook notes that the ramp-up to 35mpg, rather than requiring incremental increases on the way, is entirely voluntary until 2020. (Scroll about halfway down the page.)
And, that’s not all. It also has a waiver provision!

But TMQ is hugely suspicious, and hopes the media will watch the specifics of the bill carefully. The mpg legislation the Senate already has approved requires a one-third improvement in fuel efficiency — but nothing becomes mandatory until 2020, meaning Detroit could continue to do nothing for 13 years. Worse, the Senate version has a waiver provision that says that if the new standards prove too onerous, automakers can ask they be waived before 2020. That is a formula for what Washington specializes in: the appearance of dramatic action while nothing actually happens.

(Automakers drag their feet, then demand a waiver.) In January, George W. Bush proposed, and Barack Obama endorsed, new mpg rules that would take effect right now, mandating a 4 percent annual improvement in fuel efficiency until a one-third overall betterment is achieved. How often do a sitting conservative president and one of his leading liberal opponents agree on something? The Bush-Obama mpg reform would have gone into effect immediately, with immediate positive results. I worry that what Congress ends up enacting on mpg will be a make-believe bill that sets lofty targets but has no teeth. And I worry that the mainstream media, excited by gaffes and scandals but endlessly bored by the details of public-policy proposals, will be too gullible to notice the difference between real mpg reform and make-believe.

Easterbrook goes on to note that cars now don’t meet the current 27.5mpg average. Since the government reformulated its fuel-economy tests closer to real-world standards, I have no doubt that’s true. I also don’t doubt that current standards probably aren’t being enforced that well by the Environmental Protection Agency.

Finally, he blames the increase in auto horsepower over the last decade or so as being a contributor to road rage. Hmm….

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Big Three to get bribed as part of 35mpg deal

That’s the word on what it’s going to involve to get a 35mpg CAFE bill past Congress. Now, the NYT story doesn’t use the word “bribe,” but here’s the details.

Such a deal would also provide incentives for the three big American manufacturers to continue building small cars in this country, preserving an estimated 17,000 jobs. The United Automobile Workers union and members of Congress from automaking states insisted on that provision as a condition of supporting the broader compromise.

The deal also appears to include mileage credits for so-called flexible-fuel vehicles that can run on a mixture of gasoline in relatively small proportions, and ethanol. It is comparatively inexpensive to convert vehicles to run on ethanol blends, but the fuel is available at a limited number of service stations, so the gasoline savings are expected to be minimal in the next few years.

And, here’s all that’s wrong with that.

First, E85 is a horrible answer to fuel economy. We don’t have nearly enough corn to make that kind of ethanol, the 51-cent a gallon payout for ethanol lines the pockets of ADM and Cargill, and we have no idea of celluolosic ethanol can in any way come close to filling the gap.

Second, the amount of incentives aren’t being spelled out, but you can bet it ain’t cheap. For two decades, the Big Three have resisted making better small cars and otherwise deal with a changing oil future and now, they’re getting rewarded for bad behavior. I was against the Chrysler bailout in 1981 and I’m against this now.

Also, it’s conservatives and Democratic moderates who allegedly are strong capitalists chucking principles for unprincipled protectionism again. (There is principled protectionism, for unfair job competition by countries with no worker safeguards, etc., but, Congress on both sides of the aisle never talks about that seriously, let alone acts.)

Meanwhile, some good provisions are likely to be dropped:

Reaching agreement on that timetable is likely to require Congressional leaders to drop provisions like a mandate that electric utilities nationwide generate 15 percent of their power from renewable sources, including wind, solar and hydroelectric power. Utilities lobbied intensively against that requirement.

A House-passed measure to repeal $16 billion in tax breaks for the oil industry is also expected to be scrapped, aides said. President Bush threatened to veto the entire package if the oil and gas tax bill were included.

So, Congress is kowtowing to a threatened Bush veto rather than trying to shame him for blocking “energy security.” And, Congress is also kowtowing to Big Electricity (and Big Coal behind it).

And, our Senatorial Presidential candidates? Well, on the Democratic side, Obama has shown himself to be the worst anti-environmental panderer so far.

Update, Dec. 1: The House passed the revised bill, including ramping up ethanol requirements to 20 billion gals/year AND, even worse, keeping separate CAFE standards for cars and light trucks. I'm disgusted.

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The Dingell is in the details on carbon taxes

Several weeks after promising it, Michigan’s House Democratic war horse, John Dingell, has delivered an carbon-tax energy bill. And, as I expected at that time, there’s a lot about which to be concerned; there’s some halfway good stuff, too, but even that has the lingering aroma stench of pandering to it.

I have several points of analysis:

• I’m OK with a carbon tax. But, if you’re going to submit something so serious, and you intend for it to succeed (whether Dingell does so or not is an open question, at best), you’d better put plenty of negotiating padding in there. And, I don’t think $50 a ton does. I think you would need to start at $100 a ton (too much more than that would turn people off right away) to bargain down to $50 a ton.

• Exempting biofuels? Crazy, and scientifically illiterate. Carbon dioxide is carbon dioxide, no matter its source. But, Michigan grows some amount of corn, and sugar beets, which some wonder whether they might substitute for cane sugar for ethanol. Michigan/Midwestern political pandering, at least to a fair degree, I think.

• A 50-cent a gallon gas tax is good, but, exempting diesel fuel? The Oil Drum argues that Dingell is pandering to the Teamsters. It’s possible, is what I’ll say, at the least. Dingell ranks 17th among Representatives from 1990-2006 in Teamsters political contributions, according to Open Secrets, receiving $71,000.

• Eliminating the mortgage writeoff above 3K square feet on homes? The size standard panders somewhat to anybody not moving to the upper edge of the middle class and beyond, but, as more and more cookie cutter McMansions beyond this size are built by cheap builders, I welcome this. Dingell does soften the blow by having homes over 3K in size lose the mortgage deduction on a sliding scale and not all at once.

• The “revenue-neutral” part? I’m OK with putting part of the money this raises toward health care issues, but think part of it should be used for budget reduction, too, rather than all of it being spent.

Bottom line? If Dingell’s bill is intended in addition to the 35mpg CAFÉ standard for cars (and trucks being finally included), I’ll give him a B-minus. It doesn’t get higher because we need to nail a first effort on carbon tax. In addition to junking the gas tax free ride for diesel and the carbon tax loophole for biofuels, I’d like to see a carbon cap-and-trade program as part of this legislation.

If this is intended to substitute for a CAFÉ increase, there’s enough here I won’t give Dingell an F. But, that’s about all I’ll say.

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A Drop in the Bucke...er, Tank

I ran across this article today in the Detroit News and was - frankly - unsurprised. The House Oversight Committee has opened another investigation into the workings of the Executive Branch:

The U.S. Department of Transportation secretly lobbied dozens of members of Congress in recent weeks, urging them to join the Bush administration in opposing California's request to impose its own strict fuel efficiency regulations, according to a House investigative committee.

Using a one-page script and a list of auto facilities obtained from the Alliance of Automobile Manufacturers, a trade group that represents automakers, staffers at the Department of Transportation called nearly every congressional member from Michigan and Ohio, urging them to oppose California's request[*], according to records released this week by the House Oversight Committee. They also targeted other auto-heavy districts and governors in at least seven other states.

While federal law bars government officials from lobbying lawmakers on issues before Congress, there are no such restrictions on regulatory questions, such as the California waiver.

Still, the lobbying suggests an "improper hidden agenda" because it comes as the administration is making "an independent assessment of the merits" of California's request, U.S. Rep. Henry Waxman, D-Calif., chairman of the oversight committee, said in a letter to Transportation Secretary Mary Peters...

...Until now, the Bush administration has not taken a public position on the California waiver, but the records released by Waxman show the Department of Transportation mounted a fairly extensive opposition effort that essentially supports automakers.

The Department of Transportation turned over 71 pages of e-mails and other records to Waxman's committee, which began investigating last month after a House staffer gave the committee a voice mail received from Heideh Shahmoradi, a special assistant for governmental affairs at the Department of Transportation...

...The lobbying blitz came ahead of a June 15 deadline for submitting comments to the EPA on California's request. [Joe] Knollenberg, [Candace] Miller and five other Michigan congressional Republicans sent a letter to the agency urging it to reject the waiver.

"The stakes for Michigan and American manufacturing could not be higher," the letter said. "The EPA should not allow California and other states to make a mad rush to saddle the auto industry with technologically infeasible mandates"...

...Joan Claybrook, director of Public Citizen, criticized the campaign. "How is the EPA going to make an independent decision if the Transportation Department is lobbying to oppose it?"

Read the whole article for the full content. I really have no informed comment at this time regarding an increase of fuel standards versus economic impact, and that's not really what this comment is about...The fight over fuel and emission standards is one of those wonky things that the average American cares about only in a vague manner - not that they shouldn't care more, mind you - but it lacks the sexiness of the politicization of the Department of Justice or the outing of a CIA covert operative. As (possible) scandals go, it's a drop in a much bigger bucket**.

What this article (and investigation) does, however, is to further highlight the modi operandi of the Bush Administration: Press or puncture the legal and ethical envelopes that are necessary for a properly functioning democracy and then mislead and deceive to avoid accountability. When being held to account is inevitable, as in the case of Scooter Libby's multiple convictions, use whatever legal loopholes are available to lessen the impact on the Inner Circle and shrug off any criticism...there will always be another professional wrestler or useless socialite to attract the public's attention.

And, even larger than that, is the issue of how the American government has been co-opted by business interests in such a way that government operates as an extension of those businesses...How else can you explain the apparent lobbying by the Department of Transportation on behalf of the automobile industry? You'd think that foreign and domestic auto companies have lobbyists with contacts in Congress that can express the same sentiments...I know that buying elected officials' votes has been around as long as there have been elected officials to buy, but our government institutions like the EPA or DOJ should be above and independent from partisanship, ideology, or the fiscal concerns of business.

Finally, I'm left with the same set of questions, only asked to different members of this administration...from the article:

The Transportation Department withheld 53 e-mails from the oversight committee. [DOT spokesman Brian] Turmail said Peters did not personally lobby any members of Congress on the issue.

Well, who were the persons in the DOT that lobbied members of Congress? Who directed them to do so? What is the DOT's rationale for withholding those messages?

I feel that these hearings won't get much coverage, but it would be interesting to hear the responses to those questions.

*The request by California is to establish limits on greenhouse gas emissions and create a higher standard of fuel economy. The adoption of these standards cannot take effect without a waiver from the EPA, hence the lobbying effort...Also, eleven other states want to adopt California's standards.
**Hence the title. Clever me.

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FINALLY — new car/truck/SUV mileage standards could be on tap

Without Michgan gasbag Carl Levin able to block, the Senate has approved a 35mpg standard. for cars, pickups and SUVs.

The Senate energy bill is still weak. The 35mpg standard doesn’t hit until 2020, with Levin saying he’s still going to work to kill it. Senate Republicans killed a $29 billion tax on oil companies to pay for renewable energy development, a pittance compared to what most Western nations, especially in Europe, finance.

Also bad, bad is a requirement that half of cars be able to flex-fuel on 85 percent ethanol by 2015. Ethanol from corn is energy-neutral at best, possibly energy-negative. It’s also not that much lighter on CO2 emissions than conventional gasoline.

But, it’s something.

Its strongest point is to put pickups and SUVs under the same overall mileage standards, thus killing a HUGE loophole.

And, this is a fair part of why Levin opposes it, I think.

Detroit builds most of its SUVs on truck platforms; Tokyo on car rails. So, Japanese SUVs get better gas mileage, and can be further improved more easily

Tough shit, Carl. The Not-So-Big Three have had 33 years since the first oil embargo

Cross posted at SocraticGadfly.

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