Mileage Standards

MILEAGE STANDARDS….You know that something has changed when even Ted Stevens is in favor of raising fuel mileage standards for cars. The Los Angeles Times reports:

“I’m trying to protect my state,” said Stevens, who recently called climate change “more apparent in Alaska than anywhere else.”

The 83-year-old senator’s change of heart illustrates how the landscape has shifted in Congress, and could signal a turning point in the long campaign by environmentalists — successfully fended off by Detroit — to toughen fuel-economy standards.

“There is clear bipartisan agreement, for the first time in 30 years, that Congress is going to have to act to increase fuel economy standards,” said Philip E. Clapp, president of the National Environmental Trust.

This is one of those subjects that’s a big deal among traditional liberal environmental groups but gets surprisingly little love in the blogosphere, which (to the extent it cares at all) seems to favor higher gasoline taxes as the best way to reduce gasoline usage. This is odd, since CAFE standards have a clearly demonstrated capacity to reduce gasoline consumption while higher gasoline prices have a very modest effect. What’s more, gasoline taxes hurt the poor far more than the rich and are probably even less likely than higher mileage standards to make it through the legislative meatgrinder. Higher CAFE standards ought to be a slam dunk for anyone who cares about global warming, cleaning up the air, and reducing our dependence on oil.

Of course, that’s not to say that we shouldn’t favor higher gasoline taxes too. After all, we can do more than one thing if we’re serious about this stuff. A broad-based carbon tax is the backbone of any decent energy policy, partly because it reduces consumption and partly because (unlike CAFE standards) it raises money that we could use to fund other mitigation programs. I’m also a fan of a gas guzzler tax/credit scheme, which taxes low-mileage cars while providing refunds to purchasers of high-mileage cars. This can be revenue neutral if desired; it incentivizes the purchase of efficient cars; and it’s strongly progressive since rich people tend to buy expensive, low-mileage cars. And if we ever do impose higher gasoline taxes, a refund for small cars would help offset the impact of the tax on the poor and working class.

As for CAFE standards themselves, I don’t really understand George Bush’s proposal to make them “attribute-based” (i.e., different targets for different classes of cars). Everyone agrees that the goal of increased mileage standards is to improve average fuel consumption, so why not just mandate that, maybe add in a credit-trading scheme, and then let the car manufacturers comply any way they want? Creating extra rules and extra complexity is just an invitation to a bigger bureaucracy and provokes attempts to game the system by automakers. Why not funnel that energy into making better cars instead?