SEARCH BLOG: POLITICS and AUTOMOBILES
I received this email the other day:
Friends,I sent this to Rep. Knollenberg:
Yesterday I unveiled new legislation that will help us grow the new Michigan economy.
I've called it the "New BIG THREE Act" because it's all about new jobs, new investments and new alternative fuels. It's about our hometown Michigan industry, Michigan jobs and Michigan's economic future.
My plan comes in direct response to the federal governments new corporate average fuel economy (CAFE) rules, which are an $85 billion unfunded mandate on the auto industry - and just the auto industry.
My bill will help match new federal government actions with the federal government's CAFE demands.
Our auto industry has been struggling and is working on successfully completing their turn-around plans. What they need, and what our economy needs, is a productive plan from Washington, not just an expensive mandate.
By investing in alternative fuel technology, we will not only create high-paying jobs, but also help families deal with rising gas prices. Like you, I can't believe the price we're paying at the pump. Having more fuel-efficient cars available will be one great way to help ease that pain. It will also help make us safer, by reducing our dependence on Middle East oil.
I've included some of the media coverage of my bill below. I'll hope you'll take a look at it.
I'm going to keep fighting everyday for new Michigan jobs and a stronger Michigan economy for our families.
Congressman Joe Knollenberg
Joe Knollenberg talks to WJR's Paul W. Smith about new legislation designed to help the auto industry. Listen here.
The Oakland Press: Knollenberg unveils 'Big' plan
Detroit Free Press: Knollenberg aims to help automakers and economy
The Associated Press: U.S. Rep. Joe Knollenberg proposes auto industry fuel economy plan
WWJ News Radio 950: Congressman: Help For Automakers
Detroit News: Knollenberg proposes $1.2 Billion aid for Big 3
Dear Representative Knollenberg:I didn't point out the obvious: if the mileage mandates are going to cost $85 billion and the aid proposed by Rep. Knollenberg amounts to $4.7 billion [research and tax credits], that leaves about $80 billion to be funded by... the customers who buy vehicles... you, brothers and sisters!
Your efforts to assist the automobile industry are commendable; however, the federal government tends to create both obstacles and market dislocations whenever it attempts to force the markets in specific directions.
I agree that whenever the federal government mandates technological changes, it should either fund the efforts required to meet the mandates or its should provide an implementable solution. In the case of mileage mandates, the government's plan is: 1) we are here; 2) a miracle happens; 3) the mandates are met.
But well beyond the technical issues are the marketplace issues. For example, if the only feasible solutions for achieving 2015 mandates for CAFE are small hybrid cars or small diesel-powered cars, the government is, in effect, directing automobile manufacturers to provide a more costly, less beneficial product to its customers... and take the blame for the reduction of choices. If, for example, the automobile companies do plan for higher volumes of hybrid cars or diesel-powered cars, will the government guarantee that the supply of nickel and lanthanum needed to make the nickel-metal hydride batteries will be sufficient to cover a volume increase of 5-10 times current volumes? Will the government guarantee that a sufficient supply of clean, low-sulfur diesel fuel will be available at a price competitive with gasoline so that European diesels can be used ... presuming the government allows their use?
That's the trouble with government mandates. All of the risk is borne by the manufacturers and none by the government.
It is well and good to say the government should be responsible, but history shows that government simply sets the rules and lets everyone else deal with the consequences. You may recall those early 1980 cars that kept stalling because the government mandated the use of engine control modules before they were adequately tested and a quality supply was available. What happens when the government realizes that significant increases in nickel mining will pose environmental hazards and tells automobile companies to use lithium-ion batteries that have a propensity to explode?
The government should get out of the mandate business! Has anyone in the government actually followed how the marketplace is reacting to higher-priced fuel? Has anyone in the government actually figured out that denying oil and natural gas drilling permits requires the U.S. to import increasing amounts of those commodities resulting in a greater trade deficit and a weakened strategic position? Has anyone in the government studied the concept of a free market?
Thank you for your efforts to help the automobile industry. The greatest help would be to have the government go on extended vacation.