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Wasted Fuel, Time, and Opportunities

July 7, 2008

The dangers of an energy business model based on the assumption that oil would always be cheap, abundant, and reliable have been known since the Eisenhower administration.

Now, with gasoline prices cruising well past $4 per gallon, lawmakers and other observers of energy politics look back with regret at missed opportunities to tighten motor vehicle fuel economy standards, better known as CAFE (Corporate Average Fuel Economy).

The frankest of those interviewed for a New York Times article published July 6 was retiring Senator Pete Domenici, R-NM. An opponent until last year of boosting CAFE standards, Domenici wishes he hadn't listened to what he called Detroit's "baloney" that the market would shift to fuel-efficient cars in its own good time.

Kudos to Domenici. On the other hand, Congressman John Dingell, D-MI, says he has no regrets about fighting CAFE. Detroit just gave the consumers what they wanted, Dingell argues. Yes, but Detroit whetted the appetite for gasoline gluttony with clever marketing that equated guzzlers with power, status, and the American way of life.

Conservatives who should have known better dismissed conservative virtues such as efficiency, stewardship, and saving resources for the future.

In the July 6 article, former House Speaker Newt Gingrich went so far as to predict that painfully high prices won't broaden public acceptance of tougher CAFE standards. Big, thirsty vehicles, he opined, are a form of social expression.

Perhaps, but there are many forms of social expression that are less risky. Watercolor painting, for example, doesn't weaken the U.S. economy, tie U.S. security to dangerous regimes, or fill the atmosphere with greenhouse gases. Besides, there is no cosmic law that stylish vehicles must be powered by gasoline-fueled internal combustion engines.

It took $3-per-gallon gas for Congress last year to muster enough courage to face down Detroit and the UAW and push through a CAFE increase that will save 1 million barrels of oil per day by 2020. Now, with gasoline above $4 per gallon, the personal transportation market is shifting rapidly. People are driving less. Transit systems are reporting standing-room-only buses. Consumers are snapping up fuel-smart vehicles, leaving inefficient SUVs and pickups to molder on dealer lots. Household solvency trumps social expression any day of the week.

Automakers are scrambling to catch up. General Motors promises that the Chevrolet Volt, a plug-in hybrid electric car, will be ready for sale by 2010. If the Volt does what it promises and finds consumer acceptance, it could be the leading edge of a technology shift that would up-end the personal transportation market every bit as dramatically as the personal computer transformed the workplace.

Much more besides commercializing plug-in hybrids must be done to dig ourselves out of the energy hole that we have spent the better part of a century digging ourselves into. Still, the silver lining of the $4 gasoline cloud is that the necessity of a new, cleaner, more robust energy economy is going mainstream.

"Told you so" would be fun to say. "Better late than never" would be more constructive .