Jack Kemp: Closing Down the Hard Times CAFE

On Point No. 48

Congress soon will decide whether to continue the “freeze” on existing CAFE (Corporate Average Fuel Economy) standards that have been in place for several years. It is an important question, because CAFE is a classic example of a law conceived with “good intentions” that ends up demonstrating government's inability to plan our future for us. The old Law of Unintended Consequences is as alive as ever.

CAFE was enacted in the midst of the 1970s “energy crisis” – It was supposed to reduce America’s use of “foreign oil” by forcing auto manufacturers to increase the miles-per-gallon average of their product lines as a whole (i.e. gas-guzzlers in the fleet have to be balanced off with super-efficient subcompacts). That’s kind of an obsolete goal in this era of energy abundance and low prices. So now CAFE advocates are switching arguments, saying that CAFE helps “save the planet” by reducing fossil fuel emissions, which some scientists link to the global warming hypothesis. The Sierra Club, for example, argues that tightening CAFE is the most important step we can take to control global warming.2 Thirty-one senators have written to President Clinton urging tougher CAFE standards, asserting that “America’s cars and light trucks are responsible for 20 percent of U.S. carbon dioxide pollution, which causes global warming.”3

Time out, folks! First of all, carbon dioxide is not a pollutant; it’s a fundamental part of the life-process on earth and critically important to all plant life. Second, raising CAFE standards would have virtually no impact on carbon dioxide emissions, since they would apply only to newly manufactured cars rather than the fleet of cars already on the road. Third and most important, countless studies prove that even the existing CAFE rules cost lives by requiring manufacturers to downsize cars for fuel efficiency. Smaller cars are more fuel efficient, but they are also less safe in nearly every type of collision, whether involving a single car or multiple cars.

Even the National Highway Traffic Safety Administration, which runs the CAFE program, concedes that “weight reduction is probably the most powerful technique for improving fuel economy.”4 CAFE is responsible for about half the reduced weight of the average new passenger car, and has helped double fuel economy. Small cars have less mass to absorb collision forces, as well as less space to protect the occupant. As the Insurance Institute for Highway Safety says, “When it comes to size, the safety message is clear – bigger is better.”5 Ralph Nader used to agree, arguing that “larger cars are safer.”6 But big cars aren’t PC anymore, and Naderites back CAFE rules that makes cars “unsafe at any speed.”

CAFE’s ideological advocates won’t even acknowledge the safety issue. Even though a 1989 Harvard-Brookings study found that CAFE increases car occupant deaths by 14 to 27 percent (which the Competitive Enterprise Institute estimates translated into 2,600 to 4,500 deaths in 1997 alone); even though an independent review by USA Today estimated CAFE’s overall human toll at 46,000 lives lost since its enactment; and even though a federal appeals court in 1992 found that NHTSA was consciously evading the safety issue; CAFE advocates, and particularly NHTSA, have continued wantonly and deliberately to conceal CAFE’s lethal cost.7

But what about the consumer? Congressional proponents of even tougher fuel efficiency rules claim consumers are being denied new fuel-saving technologies. That’s nonsense: It’s the government itself that delays new technologies by imposing rigid rules on auto production that are not only anti-safety, but don’t really do anything to save fuel. After all, if cars become more fuel-efficient, the unit cost of driving a certain distance goes down, other things being equal. If driving costs less, you’re likely to drive more, and burn more fuel. An old supply-sider like myself could have predicted that if you reduce the marginal cost of an activity – like driving – you’ll get more of it. But that choice should be up to consumers, not dictated by government policies that mandate reductions in the unit cost of burning fuel.

CAFE has lots of other unintended effects, like keeping older gas-guzzlers on the road longer (by raising the cost of new cars), driving large-car consumers to buy vans and SUVs instead. It also gives Japanese producers a built-in advantage (since they had an early lead in the small car market), as well as ready entry into the larger-car market where they had been at a disadvantage (since CAFE affects fleet averages in fuel efficiency). But that’s the kind of silliness you expect when state planners try to administer an entire industry. The real issue is that CAFE kills. It’s not about energy or global warming; it’s about government power and its irresponsible exercise.

Killing CAFE will save lives. People want safe and efficient cars. The market will provide them with those products so that they can make responsible decisions about the trade-offs. CAFE is not about giving consumers choice, but about forcing them into choices that can be lethal to them and their loved ones. The Sierra Club urges CAFE boosters to send in pictures of their children in support of CAFE since “our future is riding on them”.8 If we’re going to do something “for the children” let’s safeguard their lives by closing down CAFE once and for all.

1 Jack Kemp is a distinguished fellow at the Competitive Enterprise Institute and co-director of Empower America.

2 Sierra Club Global Warming and Energy Campaign: CAFE Campaign, (http://www.toowarm.org/CAFE/cafe.html).

3 Letter by Senator Dianne Feinstein (D-CA), .et al., to President Clinton, May 24, 1999 (http://vehicleschoice.org/café/feingor1.html).

4 NHSTA, Model Year 1989 Regulatory Impact Analysis, IV-15.

5 Insurance Institute For Highway Safety, Shopping for a Safer Car: 1995 Models.

6 “Be Safer in the ‘90s: New Warnings from Ralph Nader,” Woman’s Day, Oct. 24, 1989, p. 32.

7 R. Crandall and J. Graham. “The Effect of Fuel Economy on Auto Safety,” Journal of Law and Economics, April 1989, p. 97, 111.

8 Sierra Club, “If You Care About Children, You Should Care About Global Warming,” Sierra Club Global Warming Campaign (http://webm333d.ntx.net/ACTION/pictprez.html).