Yesterday, president Obama announced emission standards which he said would raise the cost of automobiles by $1300.
While the new fuel and emission standards for cars and trucks will save billions of barrels of oil, they are expected to cost consumers an extra 1,300 US dollars per vehicle by the time the plan is complete in 2016. Mr Obama said the fuel cost savings would offset the higher price of vehicles in three years.
His remarkable comment caught my attention, because one of the primary purposes of Obama’s “cap and trade” plan is to massively raise the cost of fuel. There aren’t going to be any fuel cost savings. In fact, Mr. Obama told the San Francisco Chronicle last year that he actually intends to bankrupt coal fired power plants using cap and trade:
You know, when I was asked earlier about the issue of coal, uh, you know — Under my plan of a cap and trade system, electricity rates would necessarily skyrocket. Even regardless of what I say about whether coal is good or bad. Because I’m capping greenhouse gases, coal power plants, you know, natural gas, you name it — whatever the plants were, whatever the industry was, uh, they would have to retrofit their operations. That will cost money. They will pass that money on to consumers.
Two automobile companies are already going bankrupt, so I think we should take Mr. Obama’s words seriously.
I can make a firm pledge. Under my plan no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains tax, not any of your taxes.
WASHINGTON – Democrat Barack Obama said Sunday that if elected he will push to increase the amount of income that is taxed to provide monthly Social Security benefits.
Audacity indeed. The assumption seems to be that no one remembers what was said last week.
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Bold for the comprehensionally challenged –
“you know, uh ….”
That said, if they allow construction of more nuke plants, I’d be more than happy. From my readings, it seems that the guys at NASA who are the AGW zealots may be purposely overexaggerating GW to get more nuclear power in the US and as a spinoff, get more funding for nuclear power and propulsion in space, where NASA needs it.
So then why aren’t they proposing that as a solution?
All I’ve seen is a trail of denied permits.
“The AP article in my morning paper said that pickups would become too expensive for most people and would only be used for work. Phooey.
Sounds like alarmism, like how seat belts and cat converters would drive the car companies bankrupt.
We will adapt.”
Uhhhh…. except they are already bankrupt.
The very fact that a profitable market emerged in the EU with this famous cap and trade is the hallmark of a scam, a pyramid scheme.
If a government wants to regulate, it can just do so, by direct taxation, or by fear of fines and or imprisonment. They forbid drugs after all.
They regulate smoking. Maybe they should use the cap and trade method to stop smokers from smoking? Us nonsmokers can sell our smoking credits to smokers.
Does that sound like a good plan to stop the population smoking? The whole concept is bizarre.
Anthony, I think you’d enjoy this:
http://bighollywood.breitbart.com/amcelhinney/2009/05/20/bono-discovers-sustainable-development-isnt-sustainable/
Cap & Trade is the Administration’s chosen method of paying for the 7 – 8 trillion dollars needed for its agenda items. C&T is definitely a tax on consumption, since prices will rise across the board. This will negatively impact employment because people will buy less.
I’m not a fan of George Bush’s spending policies, but to put what’s happening in perspective: Bush agreed to $700 billion to re-liquify the banking system. Obama needs a thousand times as much for his pet projects. He’s already warning people about inflation, which he could rein in by putting his extravagant spending plans on hold.
The prudent course of action at this point would be to reduce debt and reward productivity. Obama is doing exactly the opposite. That is the road to ruin.
No taxation without respiration
Oil prices rose to $147 and the economic crisis was seeded when Bush was in power.
For years, Bush had ‘spared’ the US automakers the inconvenience of investing in higher environmental standards, including the decision to back off from implementing specific mpg targets.
In the short-term, that might have seemed like a gift to US car manufacturers, but it was incredibly short-sighted. Because when the oil price rose and gasoline costs increased in 2008, pretty sensibly no one wanted to buy fuel-inefficient cars any more and those companies simply collapsed.
The oil price today is $61. When you bear in mind that it has only exceeded $70 for 12 months in the whole of economic industry, then today’s ‘low’ oil price looks an awful lot higher. And it’s $61 in the middle of the worst economic crisis the world has seen for decades.
In that perspective, a move towards more fuel-efficient vehicles is not only desirable. It’s going to be financially unavoidable for each and every one of us.
NC,
The foolishness of banking execs and the repeal of (portions of) the Glass Steagall act was part of the reason for the recent banking collapse. Our government forcing lenders to reduce qualifying requirements (to the point that a pizza boy could buy a mansion) and forcing the GSE’s (Fannie Mae and Freddie Mac) to buy those securities was the other reason.
Eliminating qualifying requirements unnaturally inflated the demand in housing, causing the bubble, and leading to a plunge in RE asset backed securities when that bubble popped. The drop in housing values is what bankrupted the system.
Wall Street execs can certainly be faulted for failing to see the end of the bubble. But our government was responsible for the bubble itself, and (in many regards) for the exposure financial institutions had when it burst.
Remember when you had to put 20% down on a conventional loan in the 80’s?
Intending to legislate “fairness” congress literally forced lenders and GSEs to implement (lack of) standards that ultimately led to collapse of the system. They applauded zero down and NINJA (No Income No Job or Assets) loans right up until the collapse. Then demonized Wall street for it.
Few people are aware that our new president was very active in enforcing that “fairness” legislation.
I´m sorry to say that what is written in this thread taken together with what is written in the press makes one feel the American government under Barack Obama behaves like enemies of its own people. I fear that at some point not so far away in the future we will read about Americans fighting Americans in the streets because the tensions will grow as the populace finds out they are being taken for a quite ruinous ride by the politicians.
Peter Barnes (09:41:20) :
What it means is because of the law of supply and demand, carbon trading will not result in a gram of co2 saved. Even if nuclear is built then the carbon credit, would just be used elsewhere, to release carbon.The overall effect could be to increase co2?
This seems relevant..
http://en.wikipedia.org/wiki/Jevons_paradox
Roads,
Nothing wrong with having more fuel efficient vehicles available. In the UK you can get 47 MPG (Imperial gallons) clean diesel with tons of power. People in US cities would love cars like that.
My problem is with not being honest about the costs/taxes – and forcing the same “solution” on everyone. People who live outside the cities need bigger vehicles because of a different lifestyle.
We are talking about the US, not the USSR.
Obama wants ALL of us to use small, super energy efficient cars. Yet SOME of us don’t want that…
Does it ever cross Obama’s mind that people could be different? That “one size does not fit all” ?
Has Obama ever thought about us as individuals rather than a “group”, a “community” he has to “direct” to do what he thinks is right ?
Oh, but i know if someone were to challenge Obama on these issues, he would throw out another general phrase like “responsibility”, “certainty”, … and that’s the end of it.
Hmmm…the “fees” (universal service fee) on your phone bills aren’t “taxes” either. It is a charge to the phone company.
So he’s technically correct. This is a “fee”, “carbon purchase” of the energy companies. And a mandatory technology fee to the auto companies.
Taxes won’t go up. But we’ll be “fee”‘d up the wazzoo.
I believe that is what is known as “taxation without representation”.
Re to Steve Goddard
I agree. There’s nothing wrong when in a free market, some company introduces a new car that provides better gas mileage and a smoother engine feel, etc. , and some people will consider buying it and it will compete in the market. Let the free market roll and take its course wherever it might lead. In fact, gas mileage was ALWAYS in the arena of ideas and competitiveness of cars, even 40 years ago. It simply wasn’t the top priority so the buyers weren’t willing to give up other luxuries such as air conditioning in order to have better gas mileage. They were willing to pay more for more, simple as that.
Now however, here comes the Messiah Obama and tells us we have collectively, as a free market, made the “wrong” (climate “ethics”) decisions, and now he will come in and FORCE us to make the “right” (climate religion) decisions, whether we WANT it or NOT. What “audacity” indeed.
To me the big mystery of the left is how they get away with it decade after decade.
I think it works like this
What the workers need:
1) Entertainment
“The media circus then kicked off. Amid the hubbub of the reception, the three were individually and collectively shepherded into quiet corners of the office for newspaper and magazine interviews. The following morning, they appeared on BBC Breakfast TV and radio programmes across the whole country.”
http://www.catlinarcticsurvey.com/headline.aspx?postId=188
2) Compassion
http://video.google.fr/videosearch?client=firefox-a&rls=org.mozilla:en-GB:official&channel=s&hl=en&q=Obama+compassion&um=1&ie=UTF-8&ei=T1cUSpiiAo6hjAez_aS9BA&sa=X&oi=video_result_group&resnum=4&ct=title#
(“I’ve talked about it in my own life” – very, very strange thing to say)
3) Security
http://www.democracyarsenal.org/2009/05/obama-erases-national-security-gap.html
But even at the expense of
1) Work, 2) Work, 3) Work
http://winteryknight.wordpress.com/2009/04/11/cap-and-trade-will-raise-electricity-prices-and-increase-unemployment/
So what happens when the workers don’t have work?
Kurt Vonnegut wrote a very pertinent book in my view, Player Piano:
http://www.amazon.com/Player-Piano-Kurt-Vonnegut/dp/0385333781
France is full of idle ‘workers’. Sadly Player Piano is a utopia compared to the reality:
http://www.flickr.com/photos/31090725@N08/3464084344/in/photostream/
(That’s barely five miles from the very centre of Paris)
Socialism: make the ‘workers’ dependent on you, then sit back and enjoy the power:
http://video.google.com/videoplay?docid=-3392652783578267863
Latest trick: cap n’ trade
Full disclosure: I am guilty of ’26 second’ googling to make my point.
Wonder how long it will take for people who voted Chairman Zero into office to admit buyers remorse. With the press flying top-cover, will they even understand what’s happening?
Roads (12:17:15), just about everything you said is incorrect.
US automakers didn’t fail because of what they produced. The Toyota NUUMI plant in California is doing fine. It is non-union. The BMW plant in S. Carolina is also doing fine. Neither are in any danger of bankruptcy.
GM and Chrysler failed for the same reason that causes most company failures: bad management.
Claiming that Bush “spared” U.S. automakers tougher environmental standards doesn’t hold water; U.S. plants run by Toyota and BMW had to meet exactly the same environmental standards as GM and Chrysler.
And in retrospect, oil at almost $150/bbl was simply a bubble. That happens sometimes. There was no reason for it based on supply and demand. Since the price of oil has declined, Prius sales have slumped badly.
Finally, I’m not a Republican, but I find it disingenuous to constantly blame Bush for everything bad, and at the same time never give him credit for anything good. He effectively kicked the climate change can down the road for eight years — sparing U.S. taxpayers the Cap & Trade proposals going on right now.
Congress has been completely controlled by Democrats in both the House and Senate since 2006. Congress is responsible for every spending bill, not the President. And it was Congress that deregulated the banking system, leading to the excesses that are now being painfully purged.
Re Smokey “…Claiming that Bush “spared” U.S. automaker…”
Here they are playing games with our minds again. To argue back and forth about whether Bush delayed tougher rules or not is suggesting between the lines that we somehow have an “obligation” to always impose tougher and tougher environmental rules. But nobody asks why should we have to do that? Just like taxes that increase and increase and are never repealed, this cannot go on forever, or at some point people will revolt against it.
And don’t forget, you new “fuel efficient” car will run on biofuels … which will destroy the engine.
“Not only is ethanol proving to be a dud as a fuel substitute but there is increasing evidence that it is destroying engines in large numbers”
http://www.businessweek.com/lifestyle/content/may2009/bw20090514_058678.htm?chan=autos_autos+–+lifestyle+subindex+page_top+stories
http://www.dailymail.co.uk/news/article-564154/Motorists-face-huge-repairs-Government-biofuels-destroy-engines.html
SUCKERS!!!!
JLawson (11:32:09) :
We’d LIKE to upgrade – but we can’t afford the initial investment without taking out a loan for it – and for some strange reason with the economic climate the way it is we’re loath to take on more debt.
Now we’re supposed to prep our wallets to buy an approved Governmental Motors eco-mobile?
It ain’t gonna happen.
Glad to hear it. The environmental impact (which the promoters say they care about) of manufacturing the new gear is likely far greater than the improvement in efficiency would pay for, even if you didn’t take advantage of the extra cooling capacity!
We have a similar situation here in the UK, where people are encouraged to scrap old but simple and reliable central heating boilers in favour of high-efficiency, computer-controlled ‘condensing’ boilers (so-called because the exhaust gas is cool enough to cause condensation and give up some latent heat) that have flow meters, fans, regulators and various sensors, all assembled around a lightweight heat exchanger that, if you’re lucky, will finish corroding about the same time that everything else packs up, say in 5-6 years…
As for cars, the same rules apply – a 10-year old large car will carry on working for much longer than a 10-year old small one, yet paradoxically will be cheaper (I’m assuming this is the same in the US). The perception of ‘economy’ when you buy something that does a few more MPG is far greater than it is in real life, especially when it costs more to buy and wears out sooner. A motoring writer called James Ruppert coined the term ‘bangernomics’ which makes a lot of sense to me (a banger being any old, cheap car) – some interesting examples here:
http://www.bangernomics.com/Bargains.html
Keith Hennessy:
(each point is backed up at the link)
Here are ten things you might want to know about President Obama’s new fuel economy proposal. I will reference some tables and analysis from the NHTSA analysis done for the near-final Bush rule. This is a long list, so this summary will let you skip around as you like:
1. It’s aggressive.
2. Rather than maximizing net societal benefits, this proposal raises the standard until (total societal benefits = total societal costs), meaning the net benefits to society are roughly zero. This is not an invalid framework for making a policy decision, but it is unusual. It represents a different value choice.
3. NHTSA estimated that a similar option would cost almost 150,000 U.S. auto manufacturing jobs over five years.
4. NHTSA guesses that under a similar option, manufacturers will make huge increases in dual clutches or automated manual transmissions, a big increase in hybrids, and medium-sized increases in diesel engines, downsizing engines, and turbocharging.
5. It will have a trivial effect on global climate change.
6. The national standard = the California standard (roughly).
7. The auto manufacturers got rolled by the Governator.
8. Granting the California waiver means California has leverage for next time.
9. In Washington, EPA is now in the driver’s seat, not NHTSA.
10. Today’s action will accelerate EPA’s regulation of greenhouse gas emissions from stationary sources. While Congress is futzing around on a climate change bill, EPA is getting ready to bring their “PSD” monster to your community soon.
http://keithhennessey.com/2009/05/19/understanding-the-presidents-cafe-announcement/
B.O. says:
“I can make a firm pledge. Under my plan no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains tax, not any of your taxes.”
Just ONE of his numerous baldfaced lies. I hope the majority of Americans wake up soon and notice that the liar constantly says one thing and does another.
Gary the last I looked it was deregulation of banks, read free market, that got everyone into this fiscal mess.
Uh. No.
It was The Best Congress Fannie Could Buy. The banks could all dump their bad loans on Fannie. Bad loans the CRA encouraged them to buy in order to expand their business. Well, with more housing demand prices started going up. And that made other customers look good who were marginal. And any way with prices going up they could just refinance to cover the expense they couldn’t afford. And it all worked for a while. That was the worst part.
btw, a hearty recommendation to read the whole Keith Hennessy post at the link above. He was a sr. econ adviser for Bush, and he highlights the differences between the Bush CAFE hike and Obama’s, in terms of cost (inc. job loss comparison) and benefit.
Again, unbelievable.