A Transportation Resolution
On December 31st, each year, Americans around the country sit back and take stock of the year. Sometimes memories are full of happy moments, sometimes bitter disappointments. Regardless, we will look forward to the next year with anticipation and high hopes. New Year’s resolutions are a chance to remake our lives and restart the clock. Missteps can be corrected, mistakes can be forgiven, and ultimately, we can do more than just accept the life we have; we can envision the life we want.
As a country of driving enthusiasts, the bailout of GM and Chrysler is a likely addition to any discussion of the current economic crisis. The automakers are dying, and GM and Chrysler are in need of an ambitious New Year’s resolution. This is a defining moment: The New Year reminds us of a refreshed sense of possibilities and how we, the American consumers and taxpayers, can participate in resuscitating the nearly bankrupt Detroit automakers.
In the final weeks of 2008, the White House announced that it would make emergency bailout loans available to American automakers. Despite this ostensibly sudden action, the warning signs of stagnation in these companies’ outdated business models have been visible for years. The manufacturers have failed to address the necessities of the evolving automobile market, the realities of the climate crisis, and the demands of the American consumer for more fuel-efficient vehicles. The American auto industry is deeply sick, and only with dramatic, visionary, systematic reforms will the manufacturers have any hope of recovery.
GM and Chrysler have consistently put the brakes on developing more fuel-efficient electric and hybrid technology, while simultaneously spending millions marketing large, inefficient cars to the American consumer. They continue to obstruct, through litigation and lobbying, plans by individual states — led by California — to improve their own tailpipe emissions standards. The two auto giants have recklessly gambled not only the future of the planet, but millions of jobs and retirements checks, with a short-term strategy to sustain profits for top executives and shareholders.
While the Bush administration asserted its reluctance to capitulate to auto manufacturers’ demands for the bailout, the administration has, for years, collaborated with Detroit’s relentless opposition to improvements in fuel economy and emissions standards. Now, also in response to the industry crisis, the White House revealed that it would not finalize national gas mileage standards, called corporate average fuel economy (CAFE) standards, which the administration had proposed at 31.6 miles per gallon by 2015. That proposal was grossly insufficient and the Obama administration now has a golden opportunity to take the gas mileage standards back to the drawing board.
The White House bailout also does nothing to address the real ills of Detroit automakers, or the need for a holistic overhaul of our transportation strategy. The bailout terms hint at the automakers’ failures by stating the need to “facilitate the restructuring of our domestic auto industry.” So, let us take “restructuring” to its fullest potential and invest in retooling Chrysler and GM so they may become financially viable. We need inspiration, innovation, and most importantly, a resolution, to build and promote cleaner and more efficient vehicles.
Resolution - Part 1
The $17.4 billion in government loans to Chrysler and GM must include explicit conditions and safeguards. The Obama administration (or Congress if the next president fails to act) should immediately issue a waiver, allowing states to implement their own greenhouse gas emissions standards for motor vehicles. The loan conditions should also require any automaker receiving funds to end involvement in lawsuits that block these state revisions and submit plans for accelerating production of fuel-efficient models. Finally, the loans should be paired with an upward revision of the proposed CAFE standards.
Resolution - Part 2
Instead of awarding billions to the uninspired automakers, the taxpayers should purchase one of the failing Big Three. We can then begin a project with the fervor and ambition of the Apollo program, not only for a fleet of electric, low-emissions and clean vehicles, but for the trains, buses, and light-rail systems that must be the core of future transportation. As Ed Humes eloquently points out, the anti-regulatory interests who will scoff at such a notion are simply wrong: It wasn’t the free market that brought us the space program, the GI bill, or the internet, but well-designed government programs.
It is part of the American narrative to aim for our goals with resolve and determination. Redesigning the American auto industry may seem like a tall task, and it is. But we must approach this imminently rough terrain as a chance to challenge the limits of our innovation and creativity. There is no doubt that energy-efficient cars and trucks, hybrid technology, and improved public transportation are a part of the future; the question is: When will we embrace the future rather than postpone it? At the Center, we'ill be redoubling our efforts and use of cutting-edge, effective legal strategies in 2009 to transform this New Year’s resolution into U.S. transportation policy. Please join us.