A $20 billion bailout for automakers?
America's automotive "Apollo Project"?A bipartisan group of US senators is proposing a $20 billion package to help automakers achieve "the goal of transitioning 85 percent of America's new motor vehicles to non-petroleum-based fuels within 20 years."
The bulk of the money goes to automakers to both retool and to develop new battery-orientated technologies, including hybrid cars and electric vehicles. Additionally, in the short term, the plan would also significantly increase tax credits for hybrids and hybrid conversions. Of course, the plan also offers a few billion more for biofuels.
While there is a dire need for such an "Apollo Project", from where will the money come? Who is going to ensure that the tax money isn't wasted on pork and boondoggles with few conclusive results - Congress? Perhaps I'm just grumpy from driving more than 2000 miles in the last 36 hours, but I can't help but ask, do automakers deserve such a bailout?
Labels: Congress, hybrid tax credits, Hybrid Vehicles
posted by Dahcredyns at
8:24 PM
9 Comments:
Glad you are home safe from your journey!
The money always comes from the Federal Reserve and is created out of thin air, thus adding to our money supply and diluting the strength of our dollar, resulting in inflation. A sneaky form of taxation.
Anyway, I do think this is a very worthwhile expenditure of funds as long as there is verbiage constraining automakers to produce the cars we want. For myself, I want to see EV's and PHEV's only. All the rest is merely a waste, IMO. The hybrid tax incentive plan will help us greatly to afford the "new" technology. Obviously, none of this is new and has been proven for 15 years or so...
Did you know that 13 of 16 of your last blog titles have been questions?
John Stewart questions the use of question marks: http://www.jibjab.com/view/140423
(Note: I'm not trying to flame or anything - just putting it out there that there might be a little more oomph in the power of your blog posts with a few more declaratives)
jabroni,
and isn't that the cruz of the issue? so, we create another bureaucracy to submanage the dealings of another bureaucracy. crazy.
duerra-
Thanks for the editorial insight. I guess I'm not declaring anything. I'm trying to ask those that participate in this blog to participate.
I'll check out the john stewart link - i'm sure its pretty funny.
Also, i'll try to be more declarative now and then and see what the responses are like. Thanks for caring to notice.
Are car makers actually developing the battery systems for these EVs and PHEVs? If not, shouldn't some these billions go to those smaller companies? I'm not saying that automakers don't have their work cut out for them, but there must be other parties who could use that money to accelerate the production of mass-market EVs and PHEVs.
What would happen if those $20 billion went straight to consumer incentives towards purchases of hybrids, PHEVs and EVs? What size incentives would that produce?
I'm coming around to the idea of incentives, because in order for GM, Ford, and Chrysler to prevent ALL of those incentives going straight to the Prius, they would have to have high quality hybrid type cars consumers want. They can't just stick a battery in the trunk of a Pinto, build 20,000 and call it a day.
In the true spirit of theoretical capitalism the Federal Government has no business bailing out the automakers. As the conservatives like to say 'let the market sort it out.'
On another note, I am against a bailout because the US automakers are primarily responsible for their current state of economic affairs. They obviously learned nothing from the oil embargo of in 1973. Because they were myopic and accoustomed to marketing gas-guzzling autos for the US market, the Japanese were able to capture a significant portion of the US market by responding with more fuel efficient cars. A portion of the market the US never got back.
Once again they have been myopic and unable to respond in a timely fashion.
I am not an economist but I remember the term of relative economics of scale (or something like that) from my macro economics course. It argues that everyone, including Americans, would benefit financially if the automaker who could produce cars the most efficiently should do so. That is to say, let the Japanese and Koreans make the cars and Americans stick to agriculture.
Interesting comments.
In terms of the US focusing on agriculture and Asian automakers focusing on auto manufacturing, I think that's an interesting argument.
Yet, I think that advanced automobiles, particularly EVs, PHEVs, etc. could still fit in well with American manufacturing. However, to think that US automakers can make cheaper, small cars more competitively than many parts of Asian - and soon India - seems silly.
Post a Comment
<< Home