Congress may soon decide to increase the
standards for fuel economy imposed on manufacturers of vehicles
sold in the United States. This would be a
mistake.
In
1975, Congress reacted to the 1973 oil embargo imposed by the
Organization of Petroleum Exporting Countries (OPEC) by
establishing the Corporate Average Fuel Economy (CAFE) Program as
part of the Energy Policy and Conservation Act. The goal of the
program was to reduce U.S. dependence on imported oil and
consumption of gasoline. Advocates also hoped it would improve air
quality. But the evidence shows that it has failed to meet its
goals; worse, it has had unintended consequences that increase the
risk of injury to Americans. Instead of perpetuating such a
program, Congress should consider repealing the CAFE standards and
finding new market-based solutions to reduce high gasoline
consumption and rising prices.
There is significant pressure on Members
of Congress, however, not only to continue this failed program, but
also to raise fuel efficiency standards even higher. The current
CAFE standards require auto manufacturers selling in the United
States to meet certain fuel economy levels for their fleets of new
cars and light trucks (pickups, minivans, and sport utility
vehicles, or SUVs). The standard for passenger cars is currently
27.5 miles per gallon; for light trucks, it is 20.7 mpg.
Manufacturers face stiff fines for failing
to meet these standards based on the total number of vehicles in
each class sold, but compliance is taken out of their hands. The
government measures compliance by calculating a sales-weighted mean
of the fuel economies for the fleets of new cars and light trucks a
manufacturer sells each year, and it measures domestically produced
and imported vehicles separately.
Clearly, the CAFE program has failed to
accomplish its purposes. Oil imports have not decreased. In fact,
they have increased from about 35 percent of supply in the
mid-1970s to 52 percent today. Likewise, consumption has not
decreased. As fuel efficiency improves, consumers have generally
increased their driving, offsetting nearly all the gains in fuel
efficiency. Not only has the
CAFE program failed to meet its goals; it has had tragic even if
unintended consequences. As vehicles were being made lighter to
achieve more miles per gallon and meet the standards, the number of
fatalities from crashes rose.
Politicians should stop distorting the
marketplace with unwise policies and convoluted regulations and
allow the market to respond to consumer demand for passenger
vehicles. In addition to free-market considerations, there are
other compelling reasons to reject the CAFE standards. For
example:
- CAFE standards endanger human lives;
- CAFE standards fail to reduce consumption;
and
- CAFE standards do not improve the
environment.
HOW CAFE INCREASES RISKS TO MOTORISTS
The
evidence is overwhelming that CAFE standards result in more highway
deaths. A 1999 USA TODAY analysis of crash data and estimates from
the National Highway Traffic Safety Administration and the
Insurance Institute for Highway Safety found that, in the years
since CAFE standards were mandated under the Energy Policy and
Conservation Act of 1975, about 46,000 people have died in crashes
that they would have survived if they had been traveling in bigger,
heavier cars. This translates
into 7,700 deaths for every mile per gallon gained by the
standards.
While CAFE standards do not mandate that
manufacturers make small cars, they have had a significant effect
on the designs manufacturers adopt--generally, the weights of
passenger vehicles have been falling. Producing smaller,
lightweight vehicles that can perform satisfactorily using
low-power, fuel-efficient engines is the most affordable way for
automakers to meet the CAFE standards.
More
than 25 years ago, research established that drivers of larger,
heavier cars have lower risks in crashes than do drivers of
smaller, lighter cars. A 2000 study by
Leonard Evans, now the president of the Science Serving Society in
Michigan, found that adding a passenger to one of two identical
cars involved in a two-car frontal crash reduces the driver
fatality risk by 7.5 percent. If the cars differ
in mass by more than a passenger's weight, adding a passenger to
the lighter car will reduce total risk.
The
Evans findings reinforce a 1989 study by economists Robert Crandall
of the Brookings Institution and John Graham of the Harvard School
of Public Health, who found that the weight of the average American
automobile has been reduced 23 percent since 1974, much of this
reduction a result of CAFE regulations. Crandall and
Graham stated that "the negative relationship between weight and
occupant fatality risk is one of the most secure findings in the
safety literature."
Harvard University's John Graham
reiterated the safety risks of weight reduction in correspondence
with then-U.S. Senator John Ashcroft (R-MO) in June 2000. Graham
was responding to a May 2000 letter distributed to Members of the
House from the American Council for an Energy-Efficient Economy
(ACEEE) and the Center for Auto Safety. Graham sought to
correct its misleading statements, such as its discussion of weight
reduction as a compliance strategy without reference to the safety
risks associated with the use of lighter steel. For example, an SUV
may be more likely to roll over if it is constructed with lighter
materials, and drivers of vehicles that crash into guardrails are
generally safer when their vehicle contains more mass rather than
less. Further, according to Graham, government studies have found
that making small cars heavier has seven times the safety benefit
than making light trucks lighter.
The
evidence clearly shows that smaller cars have significant
disadvantages in crashes. They have less space to absorb crash
forces. The less the car absorbs, the more the people inside the
vehicle must absorb. Consequently, the weight and size reductions
resulting from the CAFE standards are linked with the 46,000 deaths
through 1998 mentioned above, as well as thousands of injuries. It
is time that policymakers stop defending the failed CAFE program
and start valuing human lives by repealing the standards.
WHY CAFE FAILS TO REDUCE CONSUMPTION
Advocates of higher CAFE standards argue
that increasing miles per gallon will reduce gas consumption. What
they fail to mention is the well-known "rebound effect"--greater
energy efficiency leads to greater energy consumption. A recent
article in The Wall Street Journal noted that in the 19th century,
British economist Stanley Jevons found that coal consumption
initially decreased by one-third after James Watt's new, efficient
steam engine began replacing older, more energy-hungry engines. But in the ensuing
years (1830 to 1863), consumption increased tenfold--the engines
were cheaper to run and thus were used more often than the older,
less efficient models. In short, greater efficiency produced more
energy use, not less.
The
same principle applies to CAFE standards. A more fuel-efficient
vehicle costs less to drive per mile, so vehicle mileage increases.
As the author of The Wall Street Journal article notes, "[s]ince
1970, the United States has made cars almost 50% more efficient; in
that period of time, the average number of miles a person drives
has doubled." This increase
certainly offsets a portion of the gains made in fuel efficiency
from government mandated standards.
WHY CAFE STANDARDS DO NOT IMPROVE THE
ENVIRONMENT
Proponents of higher CAFE standards
contend that increasing fuel economy requirements for new cars and
trucks will improve the environment by causing less pollution. This
is incorrect.
Federal regulations impose emissions
standards for cars and light trucks, respectively. These standards
are identical for every car or light truck in those two classes
regardless of their fuel economy. These limits are stated in grams
per mile of acceptable pollution, not in grams per gallon of fuel
burned. Accordingly, a Lincoln Town Car with a V-8 engine may not
by law emit more emissions in a mile, or 10 miles, or 1,000 miles,
than a Chevrolet Metro with a three-cylinder engine.
As
noted by the National Research Council (NRC) in a 1992 report on
automobile fuel economy, "Fuel economy improvements will not
directly affect vehicle emissions." In fact, the NRC
found that higher fuel economy standards could actually have a
negative effect on the environment:
Improvements in
vehicle fuel economy will have indirect environmental impacts. For
example, replacing the cast iron and steel components of vehicles
with lighter weight materials (e.g., aluminum, plastics, or
composites) may reduce fuel consumption but would generate a
different set of environmental impacts, as well as result in
different kinds of indirect energy consumption.
Nor
will increasing CAFE standards halt the alleged problem of "global
warming." Cars and light trucks subject to fuel economy standards
make up only 1.5 percent of all global man-made greenhouse gas
emissions. According to data published in 1991 by the Office of
Technology Assessment,
A 40 percent
increase in fuel economy standards would reduce greenhouse
emissions by only about 0.5 percent, even under the most optimistic
assumptions.
The
NRC additionally noted that "greenhouse gas emissions from the
production of substitute materials, such as aluminum, could
substantially offset decreases of those emissions achieved through
improved fuel economy."
CONCLUSION
The
CAFE program has failed to achieve its goals. Since its inception,
both oil imports and vehicle miles driven have increased while the
standards have led to reduced consumer choice and lives lost that
could have survived car crashes in heavier vehicles.
The
CAFE standards should not be increased. They should be repealed and
replaced with free market strategies. Consumers respond to market
signals. As past experience shows, competition can lead to a market
that makes gas guzzlers less attractive than safer and more
fuel-efficient vehicles. That is the right way to foster energy
conservation.
Charli E. Coon, J.D., is Senior Policy
Analyst for Energy and the Environment in the Thomas A. Roe
Institute for Economic Policy Studies at The Heritage
Foundation.
Endnotes