Saturday, December 16, 2006

Automakers Tell California to Suck C02


In an attempt to mix political agendas and bad science, California sued automakers for damages suffered from automotive carbon dioxide emissions. Regardless of the fact that the state could not possible show it was damaged directly or indirectly from automotive CO2 emissions, it makes great political press.

The automakers responded

The suit, filed by Attorney General Bill Lockyer in September, argues that General Motors Corp., Toyota Motor Corp., Ford Motor Co., Honda Motor Co., Nissan Motor Corp. and DaimlerChrysler A.G.'s Chrysler Group have violated public nuisance laws by contributing to global warming. The lawsuit seeks millions of dollars in damages.

It's the latest front in a multi-pronged legal battle to force the automakers and the federal government to reduce greenhouse gas emissions.

In a 35-page motion to dismiss filed late Friday, the automakers responded to the latest fight in California.

The lawsuit "has no legitimate origins in federal or state law, no jurisprudential stopping point and the potential to wreak incalculable damage on the nation's carefully regulated transportation industry and the national economy. The lawsuit is frivolous, meritless and must be dismissed," the automakers wrote.

"California, in particular, fosters a culture and identity that affirmatively encourages the use of the very product that it now seeks to brand as a nuisance," the automakers said.

Theodore J. Boutros, a Los Angeles lawyer representing the automakers, said the global warming debate belongs in Congress, not in the courts.

"These products are lawful, they are expressly allowed by federal and state law and California encourages their use," Boutros said in an interview Friday.

The suit notes that California has more than 37,000 government owned vehicles, builds highways and actively encourages people to drive. There are 500,000 state, federal and locally owned vehicles in California.

California residents own 32.5 million vehicles -- or 13.5 percent of all U.S. vehicles, according to Transportation Department statistics released this week.

Meanwhile, the Supreme Court listens to another related case:

The U.S. Supreme Court heard arguments Wednesday in its first global warming case, one that could have major implications for the U.S. auto industry.

The case pits Massachusetts, 11 other states, the District of Columbia and environmental groups against the Environmental Protection Agency in a dispute over whether the agency must regulate carbon dioxide emissions from vehicles, which have been linked to global warming, under the federal Clean Air Act.

The EPA says the act, passed in the 1970s to combat air pollution, does not govern carbon dioxide from vehicles.

Automakers, through their trade group, the Alliance for Automotive Manufacturers, filed a brief with the court siding with the EPA. Ted Olson, former solicitor general and an attorney representing the alliance, was in the courtroom Wednesday.

"The EPA has followed the advice of doctors: First do no harm," Olson said. He said the court should show deference to the EPA, which carefully studied the issue, rather than attempt to legislate a solution to global warming from the bench.

U.S. automobiles account for 6 percent of the world's carbon dioxide emissions; Massachusetts believes automakers could reduce emissions 40 percent, eventually resulting in a 2.5 percent cut in global emissions.

The automakers say mandated reductions could add $3,000 to the cost of every vehicle and prevent them from selling many larger, less-efficient vehicles.

In its argument, Massachusetts said it has a legal right to sue because it faces losing much of its coastline if global warming leads to rising ocean levels that put parts of the state underwater.

"While reducing U.S. emissions will not eliminate all the harm we face, it can reduce the harm that these emissions are causing," said assistant Massachusetts attorney general James Milkey.

The justices seemed split on the case, aligning along liberal and conservative lines.

Justice Stephen Breyer, a former trustee of the University of Massachusetts, was the most animated, comparing carbon dioxide emissions to a potentially more toxic output.

"Suppose there is a car coming down the street and it sprays Agent Orange," he said. "And I come to court and I say, 'You know, I think Agent Orange is going to kill me,' " conjuring an image of a "green cloud all over the city."

Breyer asked why "is it unreasonable to go to an agency and say 'now do your part' " -- through ethanol or other technological measures and "lo and behold Cape Cod is saved."

Chief Justice John Roberts said Massachusetts' arguments were "spitting out conjecture on conjecture" in suggesting a mandated reduction would lead to a chain reaction of improved technologies around the world and new reductions in emissions.

"It assumes there isn't going to be a greater contribution of greenhouse gases from economic development in China," he said.

Yes, but at least they fixed the blame... even if there isn't a problem to fix.

Can"t Find It?

Use the SEARCH BLOG feature at the upper left. For example, try "Global Warming".

You can also use the "LABELS" below or at the end of each post to find related posts.

Blog Archive

Cost of Gasoline - Enter Your Zipcode or Click on Map

CO2 Cap and Trade

There is always an easy solution to every human problem—neat, plausible, and wrong.
Henry Louis Mencken (1880–1956)
“The Divine Afflatus,” A Mencken Chrestomathy, chapter 25, p. 443 (1949)
... and one could add "not all human problems really are."
It was beautiful and simple, as truly great swindles are.
- O. Henry
... The Government is on course for an embarrassing showdown with the European Union, business groups and environmental charities after refusing to guarantee that billions of pounds of revenue it stands to earn from carbon-permit trading will be spent on combating climate change.
The Independent (UK)

Tracking Interest Rates

Tracking Interest Rates


SEARCH BLOG: FEDERAL RESERVE for full versions... or use the Blog Archive pulldown menu.

February 3, 2006
Go back to 1999-2000 and see what the Fed did. They are following the same pattern for 2005-06. If it ain't broke, the Fed will fix it... and good!
August 29, 2006 The Federal Reserve always acts on old information... and is the only cause of U.S. recessions.
December 5, 2006 Last spring I wrote about what I saw to be a sharp downturn in the economy in the "rustbelt" states, particularly Michigan.
March 28, 2007
The Federal Reserve sees no need to cut interest rates in the light of adverse recent economic data, Ben Bernanke said on Wednesday.
The Fed chairman said ”to date, the incoming data have supported the view that the current stance of policy is likely to foster sustainable economic growth and a gradual ebbing in core inflation”.

July 21, 2007 My guess is that if there is an interest rate change, a cut is more likely than an increase. The key variables to be watching at this point are real estate prices and the inventory of unsold homes.
August 11, 2007 I suspect that within 6 months the Federal Reserve will be forced to lower interest rates before housing becomes a black hole.
September 11, 2007 It only means that the overall process has flaws guaranteeing it will be slow in responding to changes in the economy... and tend to over-react as a result.
September 18, 2007 I think a 4% rate is really what is needed to turn the economy back on the right course. The rate may not get there, but more cuts will be needed with employment rates down and foreclosure rates up.
October 25, 2007 How long will it be before I will be able to write: "The Federal Reserve lowered its lending rate to 4% in response to the collapse of the U.S. housing market and massive numbers of foreclosures that threaten the banking and mortgage sectors."
"Should the elevated turbulence persist, it would increase the possibility of further tightening in financial conditions for households and businesses," he said.

"Uncertainties about the economic outlook are unusually high right now," he said. "These uncertainties require flexible and pragmatic policymaking -- nimble is the adjective I used a few weeks ago."

December 11, 2007 Somehow the Fed misses the obvious.
[Image from:]
December 13, 2007 [from The Christian Science Monitor]
"The odds of a recession are now above 50 percent," says Mark Zandi, chief economist at Moody's "We are right on the edge of a recession in part because of the Fed's reluctance to reduce interest rates more aggressively." [see my comments of September 11]
January 7, 2008 The real problem now is that consumers can't rescue the economy and manufacturing, which is already weakening, will continue to weaken. We've gutted the forces that could avoid a downturn. The question is not whether there will be a recession, but can it be dampened sufficiently so that it is very short.
January 11, 2008 This is death by a thousand cuts.
January 13, 2008 [N.Y. Times]
“The question is not whether we will have a recession, but how deep and prolonged it will be,” said David Rosenberg, the chief North American economist at Merrill Lynch. “Even if the Fed’s moves are going to work, it will not show up until the later part of 2008 or 2009.
January 17, 2008 A few days ago, Anna Schwartz, nonagenarian economist, implicated the Federal Reserve as the cause of the present lending crisis [from the Telegraph - UK]:
The high priestess of US monetarism - a revered figure at the Fed - says the central bank is itself the chief cause of the credit bubble, and now seems stunned as the consequences of its own actions engulf the financial system. "The new group at the Fed is not equal to the problem that faces it," she says, daring to utter a thought that fellow critics mostly utter sotto voce.
January 22, 2008 The cut has become infected and a limb is in danger. Ben Bernanke is panicking and the Fed has its emergency triage team cutting rates... this time by 3/4%. ...

What should the Federal Reserve do now? Step back... and don't be so anxious to raise rates at the first sign of economic improvement.
Individuals and businesses need stability in their financial cost structures so that they can plan effectively and keep their ships afloat. Wildly fluctuating rates... regardless of what the absolute levels are... create problems. Either too much spending or too much fear. It's just not that difficult to comprehend. Why has it been so difficult for the Fed?

About Me

My photo
Michigan, United States
Air Force (SAC) captain 1968-72. Retired after 35 years of business and logistical planning, including running a small business. Two sons with advanced degrees; one with a business and pre-law degree. Beautiful wife who has put up with me for 4 decades. Education: B.A. (Sociology major; minors in philosopy, English literature, and German) M.S. Operations Management (like a mixture of an MBA with logistical planning)