Running on Full: Clean Car Agreement is a Good Deal for America
Posted October 10, 2011
Today, I will be testifying a House oversight subcommittee hearing of the House Oversight and Investigations Committee chaired by Rep. Darrell Issa (R-CA). The topic is the historic agreement that President Obama announced on July 30th to strengthen new passenger vehicle pollution and fuel efficiency standards to deliver 54.5 mpg by 2025. With overwhelming benefits and overwhelming support, it’s difficult to see how anybody could find legitimate reasons to criticize the agreement.
Indeed the title of the hearing “Running on Empty: How Obama Administration’s Green Energy Gamble will Impact Small Businesses and Consumers” seems backwards. As I say in my testimony: “Far from ‘running on empty,’ these clean car and fuel efficiency standards will save Americans from emptying their wallets at the pump, slow the emptying of our national wealth for foreign oil, and cut the dangerous carbon pollution that is emptying our children’s future.”
In my testimony, I highlight the overwhelming consumer, energy security and pollution reduction benefits:
The combined savings of the first and second round of light-duty standards over the lifetime of 2012 to 2025 vehicles will save drivers $1.7 trillion in fuel cost, reduce oil dependency by 12 billion barrels of oil, and cut heat-trapping pollution that drives global warming by approximately 6 billion metric tons…The National Program will act as a powerful economic stimulus by keeping $100 billion annually in the U.S. economy instead of sending it overseas to Saudi Arabia, Iran, Venezuela and other oil-exporting nations. This higher level of investment in the U.S. economy, especially auto manufacturing, will result in roughly half a million more jobs by 2030… By 2030, the new agreement will provide the equivalent of a $330 tax rebate to every American household.
I also highlight the broad stakeholder support “from automakers to environmentalists, Republicans to Democrats, consumer advocates to energy security advocates, business leaders to labor unions.”
If the committee wanted to assess the impacts of the program on small businesses, perhaps the should have also invited a representative from the Small Business Majority who’s recent poll demonstrated that small business owners are overwhelming in support of stronger fuel efficiency standards. As my testimony notes:
A recent poll by the Small Business Majority found that 87 percent of small business owners overwhelmingly support adopting strong fuel efficiency standards now and 80 percent support requiring the auto industry to increase mileage to 60 mpg by 2025. According to the Small Business Majority poll: “Small business owners say that in order to survive and remain competitive, they need automobiles that get better gas mileage and cost less to operate.”
Finally, don’t be fooled by the “red herring” arguments that consumers don’t want fuel-efficient cars or that there’s been a violation of the good governance requirements of the Administrative Procedures Act. Both of these claims are false.
Consumer demand for fuel-efficient cars remains strong:
Despite the slight rebound in the market of SUVs and pickups in September, the long-term trend towards greater fuel efficiency is clear… sales-weighted fuel economy has steadily increased since model year 2005, rising from a 19.9 mpg to 22.5 mpg in model year 2010… overall 2011 year-to-date average fuel economy of 22.5 is higher than the 2010 average of about 22.1 mpg, peaking at 23.0 mpg in March, before receding to 22.1 mpg in September…
And there is clearly no violation of the Administrative Procedures Act. If anything, the agencies should be commended for consulting with a broad set of stakeholders:
This pre-proposal consultation is completely consistent with the Administrative Procedures Act and the procedural provisions of the Clean Air Act. Reflecting the fact that much technical work and interaction with affected parties precedes a formal proposal, the Clean Air Act specifically requires that both documents created by the agency and documents submitted by affected parties will be put in a public docket at the time of proposal. EPA undoubtedly will do that when it issues the forthcoming proposed standards for 2017 through 2025.
What’s most baffling about this hearing, with an agreement that’s good for consumers, good for industry and good for the environment, is why anybody in Congress would want to be responsible for creating even more unnecessary gridlock. As I state in my testimony:
But maybe the most important result of the newest clean car agreement is what it shows about getting beyond political gridlock in today’s America. The President, the auto companies, states, labor and environmentalists have, once again, shown what it means to govern effectively and what can be accomplished by constructive compromise…Upsetting this important program would only raise drivers’ fuel bills, increase dangerous pollution, and make us more dependent on imported oil. Upsetting the National Program would deprive the auto industry of the certainty it needs to make the long term technology investments it needs to be competitive in a global market, and deprive our economy of hundreds of billions of dollars that could be invested to strengthen our manufacturing base. In view of its overwhelming benefits and overwhelming support, if anything, Congress should be urging the agencies to implement this important program sooner rather than later.