First, Do No Harm to Motorists

First, Do No Harm to Motorists

Six Reasons Not To Raise CAFE Standards
June 12, 2007

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Sam Kazman explores why Congress should focus its attention not on making C.A.F.E. standards more stringent, but on scrapping them and, at a minimum, avoid making them worse.

Invoking global warming and high gasoline prices, politicians are on an energy-efficiency kick. Numerous proposals to boost efficiency standards for a huge array of items—from furnaces to appliances to cars—are on the table. The Senate may soon take up one of the most prominent of these, the Renewable Fuels, Consumer Protection, and Energy Efficiency Act of 2007 (S. 1419).

In the case of automotive standards—known as CAFE, for Corporate Average Fuel Economy—the controversy involves not whether to raise the standards, but by how much. The debate sounds like a political poker game. “27.5 mpg is too low; let’s raise it to 30.” “I’ll see your 30 and raise it to 35.” “I’ll match your 35 and throw in light trucks.”

But experience with CAFE and other government efficiency standards demonstrates that these programs have often produced disastrous results. For these reasons, Congress should focus its attention not on making these standards more stringent, but on scrapping them. At a minimum, it should avoid making them worse.

CAFE has many things wrong with it. It raises new car prices, forcing some consumers, especially those with low incomes, to hold on longer to their old cars. It restricts consumer choice, since manufacturers are forced to pay more attention to what the law requires rather than to what consumers want. It is highly questionable at a time of rising gas prices. And worst of all is CAFE’s lethal impact on auto safety. When these are taken into account, the case for making this program even more stringent falls apart entirely.