Thursday, August 16, 2018

Look at what else the VSG is up to

His Majesty Donald J. Trump, VSG (very stable genius)
In this photo a (now former) adviser told Trump that Jeff Bezos' shares are worth over $75 billion
At the Heritage Foundation blog, Nicolas Loris writes: Trump’s Rollback of CAFE Mandates Is a Big Win for Car Buyers, Consumer Choice. Loris has a pretentious academic title at Heritage and presumes to be an economist. He has a master's degree in economics from George Mason University. That does not make him an economist. Nevertheless, the title of his essay is correct, to a fault.

Loris explains:
The Trump administration recently proposed the Safer Affordable Fuel-Efficient (SAFE) Vehicles Rule. The proposed rule offers modifications to Obama-era Corporate Average Fuel Economy (CAFE) standards with a “preferred alternative” for model years 2021 through 2026.

Without a doubt, the Trump administration’s proposed revision is a welcome victory for consumers’ wallets and for consumer choice.

The Obama administration implemented fuel-efficiency mandates that would force auto manufacturers to have a fleetwide fuel-economy average of 54.5 miles per gallon by 2025. The new rule’s “preferred” change would maintain the existing fuel-economy mandate through 2020 (increasing to 37 mpg) and keep the level at 37 mpg through 2025.
Loris might be right. Easing fuel efficiency standards might make automobiles less expensive. However:
  • Assuming that the laws of supply and demand still work, easing fuel standards increases gas consumption which makes gas more expensive.
  • This, in turn, makes us more reliant on imports from places that don't particularly like us.
  • Giving auto manufacturers a pass causes them to be less innovative. Innovation often provides superior products at a reduced cost.
  • More gas consumption means more pollution. According to a study by the esteemed Lancet Commission, in the United States air pollution control pays off at a rate of 30-1. Every dollar invested in air pollution control generates thirty dollars of benefits. Since 1970 the U.S. has invested about $65 billion in air pollution control and received about $1.5 trillion in benefits.
I am not an economist. Let us assume, just for the moment, that none of that is true. Then the question becomes how much more we are willing to pay for a vehicle to be friendlier to our environment. Pollution makes us ill. After all, people die prematurely because of pollution.

However, all of the above is true. It's kind of a pay it now or pay more later proposition. Meanwhile the administration's proposal looks like another case of: If the Kenyan illegal immigrant did it, it must be undone because white people are always smarter. Trump is just that crazy.

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