The High Cost of Low Fuel Bills

New efficiency standards for cars may cost lives

President Obama has declared that auto companies' fleets must average 54.5 miles per gallon by 2025, almost double the current 27.5. Standing at his side when he made the announcement were executives from the Big Three automakers.

The New York Times reported: "It is an extraordinary shift in the relationship between the companies and Washington. But a lot has happened in the last four years, notably the $80 billion federal bailout of General Motors, Chrysler and scores of their suppliers, which removed any itch for a politically charged battle from the carmakers."

Right. They're happy to agree to stupid rules, since they are now dependent on government favors. Obama said that under his new rule, "everyone wins. Consumers pay less for fuel, the economy as a whole runs more efficiently." 

Sounds impressive, but he didn't mention the costs. The Center for Automotive Research says the new standard will raise the price of cars by about $7,000. You'd need to save a lot on fuel to break even.

But that's not the worst of it. The new rules will kill people. Sam Kazman of the Competitive Enterprise Institute explained this on my Fox Business show last week. The MPG standard "has been killing people for the last 30 years," Kazman said. How can that be?

"It forces cars to be…made smaller and lighter….They are simply worse in just about every type of auto collision." The National Highway Traffic Safety Administration actually backs Kazman up. It estimates that smaller cars are responsible for an additional 2,000 deaths each year.

Imagine that—a government safety agency promotes a rule that kills people. 

"Think about the minute risks that agencies like Environmental Protection Agency go into a tizzy about….If any private product had a death toll one fraction of what the miles-per-gallon rules cost, that product would have been yanked off the market years ago."

Do we at least end up using less gasoline and saving money? No, given the increased upfront cost of the car. "It is not clear that it saves people money," Kazman said. "If these technologies in fact save people money, you don't need a government law to force them down people's throats." 
Right. We're not stupid.

Bob Deans of the Natural Resources Defense Council, one of America's biggest environmental groups, came on my show to say that Kazman and I are wrong. "Cars like the Chevy Cruise—42 miles per gallon—get top marks on safety. The Ford Focus, more than 40 miles per gallon—top marks in safety. We're getting safer cars, and they're not coming at the expense of fuel efficiency."

Deans added: "By increasing that gas mileage for our auto fleet, we can cut our oil consumption in this country by 4 million barrels per day by 2030. That would almost wipe out our OPEC purchases daily. It will make our country stronger."

But we use oil for lots of things. If we cut gasoline use by a third, unlikely as that would be, we'd still only reduce our fossil fuel use by 7 percent. That does not make much difference for $7,000 a car and 2,000 extra deaths each year.

"It's not necessarily a smaller car that we're talking about," Deans replied. "You look at Chevy Malibu. That is a 3,400-pound car. It's not a small car. It's getting 33-miles to the gallon. We believe Detroit can do this."

Maybe they can. Maybe they can't. If they could, I'd think they would do it to meet consumer demand. They'd do it without government forcing it on us. 

"New technologies can make cars safer," Kazman acknowledged. "The point is, if you put the technologies in a large, heavier car, that car will be safer still….None of the proponents of these standards would acknowledge (the lives lost). It's always win-win, and that is nonsense."

Life involves tradeoffs. If we want to minimize deaths from auto accidents, we may use more fuel than we might otherwise use. Who should make that decision, the government? Or you and I? In the land of the supposedly free, that really should not be a tough question. 

John Stossel is host of Stossel on the Fox Business Network. He's the author of Give Me a Break and of Myth, Lies, and Downright Stupidity.

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