Political leadership? Congress set to offer up another $1/2 billion for hybrid research
1 million and countingBetween automakers, their banks, suppliers etc. the government is into the US auto industry for $100 billion+. Additionally, the government is handing out $50 billion in loans to help automakers increase fuel efficiency. On top of that, if a Committee OK on hybrid research passes through Congress, another $590 million will go to hybrid research.
Why? Is there really any mystery?
No. I'm not referring to the fact that Toyota has sold more than a million Toyota Prius hybrids. Regardless of Toyota's Prius success it's obvious that hybrids and electric vehicles are over-hyped niche vehicles. They are going nowhere fast.
Unless gas prices rise significantly. How much more research do we really need to validate that point?
Without massive, long term government incentives (including tons of pork and waste) or much higher gas prices, these vehicles will not achieve sufficient economies of scale for many, many years. Ultimately, America's energy policy simply does not support the costs of developing efficient technologies in the real world.
Yet, the cost of gas, for instance, is far higher than the pump price. Why? Unfortunately, it's far easier to spend an extra $500 million on top of tens of billions than it is to show some political courage and to confront the tough issues. It's all about incumbency anyway, right?
Labels: Congress, gas prices, Hybrid Vehicles
posted by Dahcredyns at
7:52 AM
16 Comments:
THEY ALREADY HAVE THE TECNOLOGY AND THERE GOING TO PAY THEM FOR RESEARCH WHAT FOOLS OBAMA IS GOING TO BUT US IN A HOLE WELL NEVER GET OUT
In this particular case it was the House Science and Technology Committee. The President might be supportive of such legislation, but the culprits here are Congresspeople, not the President.
And, while the President might be deserving of some over-spending criticism, I don't think there is any way of arguing the fact that Congress - regardless of which party has been in control - has performed miserably for as long as I can remember.
In my opinion there is such a void of quality members in Congress because it isn't issues - especially the tough issues - that matter most, it's incumbency and party politics.
Thus, it's easier to spend than to take tough action.
Dahc,
Your main point is very valid.
The US Govt spends over $500 billion annually (Mostly in Military costs) to ensure gasoline prices stay low in the U.S. We continue to do this because Americans like low gas prices so they can drive big cars and trucks.
Unfortunately that $500 billion is not recovered in tax revenues.
THIS IS WHY WE HAVE A HUGE FEDERAL DEFICIT AND SUCH A HIGH DEPENDECE ON FOREIGN OIL.
What we need is leadership with the "courage" to address this problem........
The technology is always evolving. Just think about smaller and more efficient batteries.
Though, I don't understand how will we cover the awful deficit holes.
LB - I'm all for money being spent in this direction. I just want it spent wisely and efficiently.
My problem is that if energy prices aren't supportive of these new technologies, such as with today's hybrids, what will all this research money accomplish?
Back in the 90's, the Clinton adminstration gave the Big 3 - I can't remember exactly - something like $1.5 billion to develop hybrid and electric vehicles.
That money, according to some stories, was a big reason that Toyota developed the HSD. Toyota, at least for a second, was actually worried that Detroit might start using long term thinking, rather than just quarterly financial reports, as their gauge for the future.
Of course, that worry was short-lived, as the Big 3 spent that $1.5 billion and then shelved all of the vehicles developed with that money as Toyota went on to sell more than a million hybrids over the next decade.
Well, in this case, we should simply say that Detroit is corrupt. Period. Therefore, we won't approve any money sent in this direction. However, I agree. I'd rather give this money to some startup.
Calling Detroit corrupt isn't all that different than calling America corrupt. The auto industry is the quintessential American industry, or at least it was not that long ago.
Nonetheless, I think some of Detroit can be saved. Ford, for instance, has already proven itself worthy of a chance.
So, i don't think everything should be about only startups.
Nonetheless, if consumers are the key to the American economy, as well as the key to ending foreign oil dependency, for instance, then I believe that somehow more - most - 'government incentives' need to be consumer-based.
Give consumers, not the companies, the power. Make the companies compete for the incentives in the most democratic way possible, via consumer choices.
If, for example, a new, unlimited tax credit through 2015 for any vehicle achieving a combined 50 mpg were announced tomorrow, Detroit would instantly put much more focus into such a segment of vehicles, as would consumers if the tax credit offset the difference between say a hybrid and a non-hybrid.
I'm not claiming that's a perfect plan, but I think a seriously new approach is required when it comes to government funding.
We need higher taxes on gas or a oil import tariff to push efficiency and reduce demand for oil.
At the same time this extra revenue needs to go towards research into Battery, Hybrid, and renewable Energy technology.
I would disagree with the statement that all America is corrupt. Only large corporations are lobbying their interests through Congress. Even Google opened an office in Washington DC for this purpose. But smaller business have to compete.
Small businesses have lobbying groups as well, and as small businesses become big businesses, such as Google, they act just like every other corporation does.
That, however, doesn't mean they are corrupt. They are simply using the system.
That's why I'm suggesting a model of government that rewards innovation through the consumer. Perhaps that's not the right approach, but I don't just think our current system is broken. It's the wrong system.
Still, I don't disagree that you have a point regarding the need for help for small businesses.
Ok,
I agree that corrupt is not a correct term. They are abusing the system.
$1/2 billion is peanuts! If you want to see pork, look at our military. Obama wants to cuts many outdated projects and congress won't kill them because they mean jobs in most congressmen districts. Gates wants to kill these programs and congress just won't do it.
Take the 1/2 billion and add it to the cash for clunkers program. It looks like that program is going to run out of money fast.
I just read that had to suspend the program already for fear they may have already used up the money...
This shows how effective a consumer based incentive is.....
I'm with you Zendude.
Smurf - I agree with the incentives argument, but I'm not sure I support the cash for clunker program. I heard that now many of these clunkers might get shipped to China now.
Ultimately, I'd have preferred some stricter requirements that would have pushed consumers into more fuel efficient vehicles.
This post has been removed by the author.
Chad,
The clunkers have to be destroyed and scrapped in order for the auto dealers to get the Gov't vouchers....
I've been reading that 9 out of 10 of these vehicles are large trucks. Good riddance I say...
I'm glad to see Congress found more money for cash for clunkers.
They need more of these programs, and they should pay for them with a gasoline tax increase....
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