Monday, November 24, 2003

Some people never learn. In an editorial last week castigating the energy bill, the New York Times fell back on the tired old claim that the solution to our nation’s oil import problem is stricter fuel efficiency standards for automobiles. This “solution” — officially known as the Corporate Average Fuel Economy standard or CAFE — has long been the favorite of New York’s Brie and Perrier set, a group always anxious to tell the rest of us poor mortals how to live our lives.

To bolster their argument, the Times editorialists cited China’s plans to impose fuel economy standards on their vehicles significantly stricter than those currently in force in the United States because of concern over rising oil imports. Noting that the United States has an even higher import dependence, the editorial chides: “The difference is that the Chinese are ready to do something about it, whereas Congress is not.”

Setting aside the fact that the Times chose to cite one of the world’s most repressive dictatorships as its policy exemplar, the simple fact is that someone at their editorial page must have flunked second grade math. Nothing else could explain such a stance.

The calculus is really very simple, consisting of three basic facts:

In October, we imported 61.6 percent of our oil.

Currently, the transportation sector accounts for 67.5 percent of all oil consumed in the United States.

The U.S. passenger fleet currently averages 24.4 miles per gallon.

Therefore, in order to eliminate imports by increasing automobile efficiency, we would need to achieve a fleet average of around 413.6 miles per gallon.

But even that would provide only a temporary respite.

The problem is that oil is a finite resource, and U.S. reserves are in a steady decline — a situation made worse by the consistent resistance of environmental groups to developing known reservoirs in Alaska and offshore. So we have to keep running faster just to stay in place. Even a doubling of automotive efficiency would do little more than prolong the agony.

Most important, no matter what rules the bureaucrats put in place, it’s the public’s buying habits that count, and the public has made its opinion abundantly clear.

The simple truth is that the automobile is much more than a mere means of transportation for most Americans, it is nothing less than an expression of self. This fact is manifest in the phenomenal growth of SUVs as a mode of personal transportation. In less than a decade, consumer demand transformed the once-utilitarian quarter-ton truck into a living room on wheels, complete with CD and DVD players. Why? Because many of us rejected the boring uniformity foisted on passenger cars by the need to meet arbitrary CAFE targets.

The cramped interiors, banal styling and feeble performance that accompanied the CAFE standards were an anathema to those of us brought up on 1957 Chevys and 1963 Corvettes. Moreover, as any automobile salesman can tell you, fuel efficiency doesn’t even register as a factor influencing car-buying decisions. It’s small wonder that Detroit found a way around the rules.

So what to do?

The real answer is to make the most of the oil resources we have while developing petroleum alternatives to fuel our transportation sector — and the energy bill, albeit imperfect by any measure, does take steps toward doing just that.

In fact, the market is already addressing this issue. Recently introduced “hybrid” electric vehicles that combine a small gasoline engine with electric motors to achieve high mileage while maintaining the power and accessories Americans want are selling well beyond expectations. While hybrids were introduced by Japanese auto manufacturers, the rest of the industry is rushing to bring their own models to market — including, you guessed it, SUVs.

The next step may be to combine the hybrid concept with alternatives to petroleum such as natural gas or fuel alcohol. This would maintain consumer choice but eliminate the need for oil. Eventually, of course, work on hydrogen-powered electric vehicles may bear fruit, providing a virtually limitless source of transportation fuel.

What is clear is that market forces will direct us to the alternatives that make sense. It may even be that the ultimate answer will lie in a variety of technologies depending on the application. Whatever it is will likely surprise the Times editorialists. But then, neither the editorialists at the Times nor their Brie and Perrier devotees understand markets very well. If they did, they would understand why their approach is doomed from the start.

Milton R. Copulos is president of the National Defense Council Foundation and served on the National Petroleum Council for 12 years.

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