In 2010, President Obama directed EPA and the National Highway Traffic Safety Administration to propose emissions regulations for vehicle model years 2017 and beyond. The Final Rules for Corporate Average Fuel Economy (CAFE) and Greenhouse Gas, approved by Obama, mandate automobile manufactures produce a fleet average of 54.5 miles per gallon (mpg) for light-duty vehicles by 2025. The Obama directive on vehicles for 2025 came shortly after the administration already increased mpg standards to require a fleet average of 35.5 mpg by 2016.
On Monday, U.S. Environmental Protection Agency (EPA) Administrator Scott Pruitt released the Midterm Evaluation of Light-Duty Vehicle Greenhouse Gas Emissions Standards for Model Years 2022–25. The EPA evaluation reports current fuel economy standards for light-duty vehicles are too stringent and claims auto manufacturers would likely need to increase vehicle costs to reach these unrealistically high (possibly unattainable) fuel economy levels.
For decades, California has set its own greenhouse gas emissions and fuel efficiency standards, which other states have also adopted, and California policymakers have indicated they would like to continue imposing a higher standard than what EPA plans to permit. A special exemption in the Clean Air Act allows the Golden State to request in-state environmental regulations that are more severe than federal rules. Connecticut, Maine, Maryland, New Jersey, Oregon, Vermont, and six other states currently match California’s standards—including its zero-emissions vehicles standard.
Since 2012 in California and other states, large vehicle manufacturers have been forced to sell “compliance cars,” electric vehicles (EVs), produced solely to meet the zero-emissions vehicles standard quota. Even though manufacturers lose money on these electric cars, they continue to produce EVs as a result of the mandate.
In addition to being costly, EVs expose humans, animals, and plant life to three times more toxicity than traditional combustible-engine vehicles, recent research from Arthur D. Little finds. The construction of lithium-ion battery packs used in EVs results in higher carbon-dioxide emissions than those produced when traditional cars are manufactured. And because electric cars have very limited driving range (less than 100 miles), the batteries must be recharged often—consuming electricity from fossil-fuel-fired power plants. The limited range, lack of public charging stations, and hours-long recharge sessions virtually necessitate dual-ownership of EVs and traditional cars, especially for long-distance travel.
Pruitt has said he might reject California’s next waiver and impose a reasonable national standard on emissions and fuel standards. “Cooperative federalism doesn’t mean that one state can dictate standards for the rest of the country. EPA will set a national standard for greenhouse gas emissions that allows auto manufacturers to make cars that people both want and can afford — while still expanding environmental and safety benefits of newer cars,” Pruitt said.
In 2017, the Alliance of Automobile Manufacturers (AAM) requested Pruitt reconsider Obama’s increased standards, citing electric vehicles’ low sales figures and the $200 billion in compliance costs that must be paid by automakers. AAM claims these costs act as barriers to achieving the 2025 fuel economy goal.
States should not increase mpg standards and onerous regulations on automobile emissions to appease environmentalists. Instead, they should remove these burdensome rules on manufacturers, making cars consumers actually want readily available and more affordable.
What We’re Working On
Budget & Tax
Income Equality Is Unfair
In the latest installment of Heartland’s Flashes of Freedom video series, Yaron Brook, chairman of the board of the Ayn Rand Institute, debunks many of the myths surrounding income inequality. Brook highlights how corporate cronyism and welfare programs, not income inequality, stifle socioeconomic mobility.
States Might Bring Back Unpopular Obamacare Individual Mandate
In a new op-ed in the Washington Examiner, Heartland’s State Government Relations Manager Charlie Katebi explores a movement to revive Obamacare’s individual mandate in several states. For instance, Connecticut is considering fining families up to $10,000 if they don’t buy insurance. Other state proposals would reestablish the Obamacare penalty of 2.5 percent of gross income or $695 per adult, whichever is greater, for residents who choose not to purchase “qualifying” health insurance.
Louisiana Should Open Voucher Program to Military, Bullied, and Foster Care Children
Heartland Policy Analyst Tim Benson writes about a Louisiana proposal to expand school voucher program eligibility for low-income students. The proposal would allow children of active-duty military personnel stationed in Louisiana, children in foster care, and students who are “the victim of bullying” to enroll in the program. Benson argues an expansion of the state’s voucher program would be a commonsense solution, especially in light of the far-reaching educational and economic benefits school choice programs have on communities.
Energy & Environment
Connecticut Governor’s Climate Bills Are Costly and Unnecessary
In this Research & Commentary, Policy Analyst Tim Benson discusses two proposals from Connecticut Gov. Dannel Malloy (D) that would require the state to reduce its greenhouse gas emissions by 45 percent below 2001 levels by 2030 and increase the state’s renewable portfolio standard to 40 percent of electricity generated by 2030. Benson contends instead of increasing costly energy mandates, Connecticut policymakers should repeal them, thus decreasing the cost of energy. Less expensive electricity bills allow consumers to purchase more goods and services, thereby raising living standards.
From Our Free-Market Friends
Tax Rebates Are a Form of Corporate Favoritism
The Independence Institute examines taxpayer-subsidized incentives Colorado bureaucrats doled out to politically connected private companies. Many Colorado cities allocate close to $1 billion per year to corporations in rebates and incentives. For example, in 2017 the City of Longmont offered a $6.5 million package (which included rebates for building permits and plan review fees) to the J.M. Smuckers Company to build a new manufacturing plant. The Colorado Constitution bans municipalities from giving public dollars to companies. Unfortunately, courts have stopped enforcing the ban, which increases the tax burden on Centennial State residents and businesses.
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