June, 2009

America’s New Fuel Economy Cartel: Trading Freedom for Barrels of Oil

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In a lovely May 16, 2009 Rose Garden setting, President Obama announced stricter fuel economy/carbon emission standards for the U.S. fleet. The new fuel economy rules, which also form the first national carbon dioxide emission standards, require the 2016 U.S. auto/light truck fleet to achieve an average economy of 35.5 miles per gallon. Stated in the simplest terms, the car fleet will have to meet a 39 mpg average; trucks, 30 mpg. The stricter standards are about the same as previously required for year 2020 by rules adopted in 2007 during the Bush Administration, but the starting date arrives four years earlier.

While the fuel efficiency goal is the same for Mr. Bush and Mr. Obama, the Obama rationale is different. Mr. Bush seemed driven by concern about Middle East turmoil and energy security. The Obama standards are motivated apparently by pursuit of the new Holy Grail, carbon emission reductions and climate change mitigation. As it turns out, reducing tailpipe carbon emissions from internal combustion engines maps directly to requiring more efficient fuel consumption.

On stage with Mr. Obama for the Rose Garden announcement was what amounts to a newly sanctioned fuel economy cartel and perhaps one of the largest gatherings of Bootleggers and Baptists ever to assemble for a presidential announcement. Anticipating the unusual gathering, Obama Press Secretary Robert Gibbs, in advance of the meeting, gave a Bootlegger/Baptist forecast: "You will see people that normally are at odds with each other in agreement with each other."