The Economist: Future Gasoline Automobile Bans are as Effective as a Carbon Tax

Guest essay by Eric Worrall

According to The Economist, announcing a future ban on the sale of gasoline cars, as California just did, helps shape future expectations, and discourages investment in vehicles with a looming end of life.

Outright bans can sometimes be a good way to fight climate change

Studies show prospective bans on petrol-powered cars may be less inefficient than you think

If electric vehicles were in every way as satisfactory as alternatives, it would take little or no policy incentive to flip the market from petrol-powered cars to electric ones.

Without policy guidance, the market might grope its way towards balance. Shanjun Li and Lang Tong of Cornell University, Jianwei Xing, now of Peking University, and Yiyi Zhou of Stony Brook University estimate that a 10% rise in the availability of charging stations boosts sales of electric vehicles by 8%, and a 10% increase in the number of electric cars on the roads raises the construction of new charging points by 6%. A promise to ban sales of petrol-powered cars at a certain date stands to accelerate this process and reduce its cost by co-ordinating the expectations of firms and consumers. Both firms and households would be less likely to waste money on capital goods the lifespan of which may be unexpectedly shortened by the disappearance of complementary technologies. Other scale economies might be realised: carmakers may feel more comfortable shifting the bulk of their r&d spending towards electric vehicles, for instance, and mechanics might start preparing to service electric cars. Meanwhile, the investment in services linked to petrol-powered vehicles would shrink rapidly.

Read more: https://www.economist.com/finance-and-economics/2020/10/03/outright-bans-can-sometimes-be-a-good-way-to-fight-climate-change

The authors admit electric vehicles are inferior, then discuss the relative merits of punitive carbon taxes vs outright bans – “shoving” the population in the direction of the desired choices.

Somewhat lost in this analysis is a consideration of the impact of bans and carbon taxes on ordinary people, of the impact of ordinary people being forced to accept inferior products, because someone else thinks they have the right to dictate your consumer choices.

79 thoughts on “The Economist: Future Gasoline Automobile Bans are as Effective as a Carbon Tax

  1. Whatever.
    Has nothing to do with saving Earth from global warming.
    Not that Earth needs saving, but isn’t that the stated purpose?

    • Several of the heads of the UN IPCC have admitted that the Global warming scam is nothing to do with climate , but just a way to get rid of Western democracy to bring about a Socialist One World Government .
      And the way to do it is by taking everyones money with unreliables ,[ Wind & solar ] , generation , which costs about 4 times more than nuclear & about 15 times more than gas powered generation .https://edmhdotme.wordpress.com/the-excess-costs-of-weather-dependent-renewable-power-generation-in-the-eu28w/

      Also the cost of EVs & the fact that they will never work will take more money as well as restricting peoples mobility .
      In the UK , if 5% of motorists went EV , then the grid would not cope in the winter months and only just about manage 10% of them per day charging in the Summer months .

      • Do a search on: Figueres Capitalism
        The intent is for the ‘Great Reset’ meeting in January- supported by WEF, Prince Charles, Bill Gates and Bernie Sanders, to replace the Bretton Woods agreement on world trade, world bank etc., and move every county to a single party Maoist government within a global governance under the UN and global industries. [search on WEF great reset January]
        Effectively, the opposite of The United States Constitution.

  2. My local politician seems to believe that it is not the political parties shoving us to renewables (and electrically-driven transport) as is demonstrated by her reply to a recent query I sent to her.

    However, I should make it clear that the transition to renewables is occurring regardless of any individual politician’s views, driven by the economic reality that renewable energy is much cheaper – and getting cheaper still – relative to fossil fuel energy.

    How she does not see that it is the government subsidies and preferential treatment of renewables that is encouraging their existence, I fail to see any logical argument against renewables getting through to her.

    • A donkey is cheaper than a car too. So is a bicycle.

      In any case, legislation for the highly regulated utilities should require that the majority of cost savings be passed back to consumers. Can’t wait for rates to fall.

        • Yes, they are totally supine, When Ed Milliband’s ( as a tool of Tony Blair) 2007 climate change act was passed only SEVEN MPs voted against it. Decarbonisation by 2050 was passed by statutory instrument, there was no debate. They are all automata on this issue. All our major parties are committed to these insane policies. There is no opposition to vote for. We need one fast because our politicians are ill-advised, alarmist & panicking, causing them to give their support to bad policies that are excessive & unnecessary & which cost more than any benefit that they will deliver.

    • You need to email her back put in quotes that renewables are cheaper and then as a simple questiion. Are you really that stupid. Anyone who thinks renewables are cheaper are really stupid. Most renewables won ‘t recover the energy it took to make them, period.

  3. When They Get a ban on gasoline and diesel CAR. They will start demonizing electric and Hydrogen cars to. Their object is to Take away individual soulutions on all aspects of our life.

    • Of course they will. Hydrogen, when burned, generates water vapor, which is a greenhouse gas. It is built in. Merkel, in her last year’s talk to the masses, explicitly said we will “have to abandon all that we have been given by the Industrial Revolution” – it is not a bug, it is a feature.

      The feature is a feudalistic society with wealthy and technologically advanced elites governing the illiterate masses. They’ve already established the new eco-religion – Woke Pope Francis cares more about Mother Gaia than God, and last year the mainstream media has already advocated for “ecological confession of sins”. The indoctrinated masses will give away all to the climate shamans to keep the weather good.

      • – we will “have to abandon all that we have been given by the Industrial Revolution” – Merkel

        Okay, but is SHE going to suffer the slings and arrows of outrageous stupidity when SHE can’t turn on the kitchen light or run the dishwasher? Is SHE (Merkel) going to give me a piggyback ride to the grocery store and drag my groceries home in a Radio Flyer wagon?

        Just askin’, because I want to see The Them – the Idiot Political Set – suffer from their decisions long before the rest of us do.

        • “Is SHE (Merkel) going to give me a piggyback ride to the grocery store and drag my groceries home in a Radio Flyer wagon?”

          A “Garden Way” cart would work a lot better. It could hold more groceries and it would be easier for Merkel to pull.

          Unfortunately, Garden Way went out of business some years ago. Probably because they made too good a product that never needed to be replaced. I bought my Garden Way carts in 1983, and still use them all the time. They are the best tool I ever bought. With a good cart, one man can do by himself what it takes two or three men to do without a cart.

          I think there are construction plans available on the internet if you want to build your own Garden Way cart. Pretty simple construction. Highly recommended.

        • I’m sure that Merkel is convinced that she and hers won’t have to suffer any inconveniences. It’s the rest of us that have to suffer for humanity’s sake.

        • Merkel, the same politician who defended her country’s defense spending record compared to the USA with “USA has to spend more, they have 2 oceans to defend Germany has only one ocean”
          My point, politicians will say anything to defend their view no matter how ludicrous.
          I thought scientists would be above such malarkey, but then the world has the ‘Michael Manns.’

      • Hydrogen engines are ICE. Why would they ban a mechanism when they say that the problem is the fuel. ICEs can run on all sorts of things like wood gas and hydrogen, methanol, ethanol and butanol. All can be made from bio-origin materials (if there is enough). Further algae can produce gasoline equivalents directly.

        The sheer foolishness of banning a mechanical device in order to pursue an ideological goal is amazing.

        • I think the idea for hydrogen powered cars is to use hydrogen in fuel cells to generate electricity to drive an electric motor, but the end result is the same-water.

          • Er – and just HOW does one get the Hydrogen? Every efficient method starts with natural gas (fossil fuel), or else uses ELECTRICAL power (fossil fuel) to split water. It doesn’t seem to have soaked in to many heads that Hydrogen, like any kind of battery, is a TRANSPORT of energy, not a producer!

  4. Ban on ICE vehicles is a stupid remark by a stupid governor that will soon be out of office and his executive orders revoked. same as the blabber about “carbon neutral” whenever. The most recent climate action, here in Cali was following last month’s blackout, a scheduled for retirement natural gas power plant will be staying online.

    • Our Bavarian conservative Minister President Söder will also ban ICE cars til 2035. There are no borders for stupidity when politicians are seeking for an uptick in polls.

      • Hopefully Bavarian Motor Works responds by closing down their remaining ICE plants in Bavaria and upping ICE production (and jobs) elsewhere.

    • Our Governor did NOT announce a ban on ICE vehicles. He did order a ban on the sales of new ICE vehicles. I suspect that one should start buying futures in used car, as sales will grow. Also, the price of new ICE cars will increase as the deadline approaches. That is, if there is anyone left in California by then.

      And, of course, will the ban still be in force by then, or will there be an outbreak of rationality by then? Oh, its California – fat chance.

  5. So, what’s to stop a customer buying an ICE vehicle in another state & driving it home to California?

        • I see an opportunity here. Buy a couple of acres in Nevada and put up a line of metal garden sheds. Get the post office to give each an address. They then become domiciles for CA residents to rent as a “second home”. A cot and a portapotty is all you need to actually stay a night or two and make it a true residence. Then register your car there legally. Nothing CA could say about it.

          • State of Residence in the United States is a matter of intent. If you intend to live there, it can be your residence even if there is no building, and you have never spent the night there. IIRC throughout his presidency the first President Bush’s residence was a vacant lot in Texas. So you can skip the portapotty and cot.

          • South Dakota is where many people living in a recreational vehicle (RV) anywhere parked in the USA establish their residency in 24 hours to get the vehicle registration, etc. There are several options for a street address offering paid mail forwarding service.

    • Lack of places to fuel up as most gas stations will go out of business due to the reduction is ICE vehicles.

          • Yes, it will be. Fortunes will be made by criminals, lives will be lost, human suffering will increase, criminal associations will expand and government will crack down by imprisoning and killing even more people. All these things are stated goals of the Democrat Party and their leftist brown-shirts.

  6. At least half an hour to refuel electric versus three or four minutes for internal combustion. Work out the productivity cost of that alone.

    • The problem is that each 30 minute recharge shortens the life of your already too expensive battery.

    • Mack, true info on charging, but Tesla most recent battery day leaks show that Tesla battery technology is showing rapid improvement in life, number of recharges, charging rate, cost. Tesla has been showing positive cash flow for almost enough quarters to rate a SP500 rating. There will be 3-4 different battery chemistries depending on characteristics needed. New solar cell technology is hitting the market, made in USA I read. Tesla is planning big factories in major countries, with operations in China, 3 in US, one under construction in Germany, perhaps 10 planned in all. Best place to find Tesla info is on YouTube, if not present on ir.tesla.com

      • NO reason for gov to ban ICE cars, the market will be swift, depending on how intense the competition is.

      • At least that’s what the press releases claim.
        Out here in the real world, we’re still waiting.

  7. “Looming end of life” only in their mental cinema , if they can make it happen

    Doesnt it always end so well when governments try to pick winners?

  8. I gave up subscribing to the Apologist years ago.

    PC-ness replaced classical economics as its maitre and it’s tedious.

    • Ha …. I call them the Ecommunist and let my subscription lapse as they have gone full commie-lite socialist / marxist.
      They continued sending me free issues for 5 or 6 weeks begging me to subscribe again.
      Last week they offered me a 1/2 price subscription. No thanks.

      I look forward to reading about the Ecommunist going bankrupt.

      • Yes
        My subscription is still running but they just pile up unread now.
        It has become a preaching organ instead of news

        It’s too bad because I really used to enjoy it, especially the christmas double issue. I remember being engrossed in a 6 page history of barb wire, it was so well written.

        No more

  9. They will have to ban the USE of ICE cars as well as the SALE.
    Otherwise the Cuba experience will be repeated in California, with cars kept on the road for 50+ years by enterprising mechanics.
    California seems to need some experience of the logical conclusions of their drive to carbon neutral.
    And to those leaving California for other states, maybe you could leave your prejudices behind.
    If you do plan to leave, a move to Portland may be a good option as it will seem like a home from home.

  10. Is the aim to reduce CO2 in the atmosphere? Any bets on whether this will happen? The Guardian says daily that 350ppm is the ‘safe level’. Mauna Loa shows no change from corona-led deindustrialisation in its inexorable rise.

  11. It would be good to have a high-quality free-market-inclined weekly. There used to be one, called the Economist. I, too, gave up my subscription years ago.

    Which leads me to ask, again, where is the public face of the intellectual leadership against all this climate nonsense? I follow WUWT, I give to requests for funding now and then as means permit, I support the GWPF, but something bigger and more dangerous seems to be needed. I would have expected the fossil fuel suppliers to do this, but they have not. I am not quite sure why, although political timidity and a desire to please are no doubt part of it. I am reasonably confident that there is a pretty solid ‘sceptic’ public mood (just look at the reviews of books on Amazon; it’s no random sample, but the sceptic books [for example Shellenberger’s latest] get hundreds of favourable mentions, and the alarmist reviews get beaten up when they appear – I suppose I am referring here to Amazon UK, not elsewhere – and I suppose if Amazon thought it might be a significant player in opinion forming it might start censoring reviews, so let’s not put ideas into its head). I have moaned about this before, but I am genuinely puzzled. We could just leave it to the politicians to learn from bitter experience, but that seems such an expensive and destructive path to follow.

    • Here in canada we have CAPP doing things, canadian association of petroleum producers, and the Canada Action Network does good job publicizing things but this is needed at a global level

  12. “Somewhat lost in this analysis is a consideration of the impact of bans and carbon taxes on ordinary people”

    Problem is, once politicians enter the world of politics, most of them rapidly forget what it is to be an ‘ordinary’ person, even if they came from humble beginnings themselves. They become driven by the need for virtue-signalling to other politicians and to media-driven fads. They love a ‘crisis’ to which they can be seen to be responding robustly. If ordinary people must sacrifice personal mobility in order to save the planet, that is a sacrifice they are willing for ordinary people to take.

  13. I’m puzzled by the disconnect from reality in political and pseudo-religious profligate figures who revel in public prominence pretenses, persuading people to follow their instructions, but don’t do it themselves. (I can do more alliteration, if anyone wants it.)

    The hypocrisy of that bunch of self-appointed (insert foul terminology here) potentates puzzles, perplexes and prompts me to start laughing and pointing. I really do think they should do without what The They want the rest of us to do without before we have to do without it…. but none of them will give up those luxuries, will they?

    Naw….. that would make sense.

    No wonder there’s an entire USA generation of overgrown children without even a molecule of common sense in their brain pans.

    • 🙂 🙂 🙂

      See ce Sol setting? So soon, so slowly, so….. um, hmm, swampily.
      Slithy stoves, slippery silverware, sliding slowly southward
      So smoothly, so slowly, so slipperily.

      That was fun.

  14. They call it “fighting climate change”, but that’s nothing but a Big Lie, as well as thinly-disguised cover for what they’re actually doing. The War on Carbon is a war against humanity and against rationality itself, and its primary weapon is propaganda. Talk of banning future sales of ICE vehicles is merely part and parcel to that propaganda campaign. For the Marxonomist to crow about how effective one facet of a gigantic propaganda campaign is, is disgusting, not because it isn’t true, but because of the pretense that it has anything to do with “saving the planet”.

    • Better still … bring back British Leyland 😉 …. U can own as many cars as u want but they won’t start or run!!

      • Three engineers got into a car. It wouldn’t start. The hydrolics guy said he better check the fuel. The electrical type said it was probably the ignition. The computer engineer said, “Why don’t we all get out and get in again.”

  15. So, neither works at all, except to destroy wealth and drive people into poverty. They both work just great for that.

  16. The first stupid claim is that a gas powered car’s life will end when the ban takes affect. That is not true – the ban marks the time when gas powered cars cannot be sold by manufacturers. And the time of the ban (California is 2035) is so far in the future that it will have no effect on cars bought today.
    The final stupidity is that a ban is needed to prevent the production of gas powered vehicles. That is pure nonsense – GM, for example, will produce no gas powered cars beyond 2025. There are 500 electric car models scheduled to be in showrooms over the next 4 to 5 years. All automakers are concentrating on developing electric cars at this point , as they are clearly the future. Battery costs are approaching $100 per kWhr, the point at which an electric car becomes price competitive. They always are cheaper than gas powered cars in the long run and have much longer warranties. Electric cars are more reliable and much simpler than gas powered vehicles and would be cheaper were it no for the cost of the batteries, which also now have lifespans greater than the cars they power. Bans on gas powered cars are totally irrelevant , as are govt subsidies these days – Tesla cars have zero Federal subsidies and are selling well. It’s astounding how ignorant folks like Gov Newsom and others are – they have no clue.

    • Where did you come up with “GM will produce no gas powered cars after 2025?” GM has announced plans for an all-electric future, but at an unspecified date. GM doesn’t have enough battery manufacturing capacity to do that by 2025.

      EVs are still more expensive than ICE cars at $100 per kWhr. The battery in a 75 kWhr battery would cost $7500 alone. Add the cost of the motors, controllers, charging circuitry etc. and you’re talking close to $10,000 – thousands more than the cost of an ICE engine and transmission. That’s why EVs still cost $10,000 or more than an equivalent ICE car. Now look at the cost of driving a hybrid that gets 50 MPG (Prius, Honda Insight, Kia Nero etc.) 2000 gallons to go 100,000 miles. That’s about 7 years of driving at the average number of miles. At the current average price of gas ($2.20) that’s $4400 – throw in $600 for oil changes – say $5000. At the real world mileage of a Tesla Model 3, (Car and Driver got 230 miles at 75 mph on a Tesla that was rated to go more than 300), so let’s say 250 miles just for a round number, that’s 400 charges to go the same distance. At the average price of residential electricity, ($0.12) that’s about $3800 (75 KW per charge, 6% heat loss during charging). The savings will be about $1200 per year, roughly recovering the price penalty of $15,000 in 12 years (not counting interest on the money you could have saved on a Prius). But here’s the kicker – if you charge on a Tesla supercharger at $0.28 per kWhr, the Tesla model 3 costs almost twice as much per mile as a Prius. You’ll only recover your investment in an EV if you rarely use for-fee public chargers.

      The Tesla warranty is a joke. 8 years on the battery but only if the battery drops below 70% of its initial range. If your battery drops to 71 percent, Tesla will do nothing. Given that all EVs have substantially inflated ranges (see Car and Driver) when they’re brand new, dropping to 70% range could easily take you to well below 200 miles of range.

      The batteries do not outlast the cars. Tesloop, a Tesla company, has a Model S with 450,000 miles on it. It’s on its third battery and second motor. My oil change tech has a Chevy Silverado with 420,000 miles all on its original motor and transmission.

      • The guy who thinks that just because a nuclear technology works in the lab, is proof that they can immediately jump to large scale production of commercial sized units, also believes that GM can switch from building ICE cars to EV cars overnight.

    • Tesla Corp. receives revenue from regulatory credits…2020 2nd qtr. was over $400 million….this is where most of the “profit” comes from. Panasonic or one of those large electronic co.s has a new battery….sounds great….better than lithium…but wait…it costs twice as much….sorry. Elon the Great has bet big on China….maybe he better move to China?

    • Why bother? An ICE car battery costs $100 and you can buy a good second hand for $10,000. Beat that electric car!
      Also, lifetime costs are not a consideration as very few people keep a car for their whole life.

  17. Ramifications of California Governor Newsom’s ban on gas-powered vehicles – Jumping onto the EV train without a plan will be devastating to the California economy. The Governor’s ban on gas-powered vehicles by 2035 is a green new car wreck that doesn’t account for half the residents that cannot afford new cars which incentivizes re-registration of older polluters that will have California replacing CUBA as the vintage car capital of the world , trying to charge EV’s with a dysfunctional electrical system, the loss of fuel taxes for road maintenance, and keeping a secret about a vehicle mileage tax (VMT) to replenish lost fuel taxes, and the list goes on.
    https://www.cfact.org/2020/10/03/ramifications-of-california-governor-newsoms-ban-on-gas-powered-vehicles/

    • Ramifications of California Governor Newsom’s ban on gas-powered vehicles – Jumping onto the EV train without a plan will be devastating to the California economy.

      Devastating the California economy would seem to be his intent.

  18. The Economist has as much connection with economics as Scientific American has with science.
    IE, none.

  19. Fine. To achieve zero plate tectonic and tsunami exposure rates while enhancing economic growth without a tectonic tsunami exposure tax, ban all active tsunami and tectonic fault zone urban and suburban dwellings by 2035 to achieve better primate safety for the children.

  20. To affluent people, other affluent people are ordinary. Middle and working class people are just the people you pay to do things you don’t have to, and whom you avoid as much as possible. If affluent people think about their economic inferiors at all it as supernumeraries in the operas where the rich and powerful sing the leading roles.

    I remember our Pierre Trudeau, our prime minster in Canada in the seventies and eighties, blithely opining that most members of Parliament were “nobodies” once they got a hundred yards from the House. Nobodies is a revealing word for the leader of Canada to use in reference to any of the citizens he is sworn to serve, as it reveals a dismissive, snobbish arrogance that democratic leaders are expected to abjure in public.

  21. Honda released the Clarity the other year nationwide after having it in just a few states. In most parts of the country it failed so miserably that they are only selling them in a few states, and it is a much better vehicle than the Volt. And that’s just a plugin hybrid. Even in tech areas, like the Raleigh-Durham-Chapel Hill area, people are like “na.” Sure, lots of people with lots of money buy Teslas, but, you can buy a top end Honda Accord Hybrid Touring for less than the lowest priced Tesla, and not worry about charging stations.

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