The Long and Winding Road: Automotive Fuel Economy and American Politics

Executive Summary

For more than thirty years, the government of the United States has been trying to reduce the nation’s voracious consumption of petroleum by regulating the fuel economy of motor vehicles. The project has not been a notable success. As of 2007, the average fuel economy of brand new passenger vehicles in this country was, for all practical purposes, about the same as it had been twenty years earlier (under 27 miles per gallon). Counting all passenger vehicles on the road, old as well as new, the average miles traveled per gallon of fuel stood at just 20.4.[1] That fact, combined with a relentless increase in the amount of driving, meant that three decades after Congress initiated the automotive energy conservation program, we were actually consuming more fuel per capita than we had averaged when driving around in the gas-guzzlers of 1975.[2]

Last year, lawmakers congratulated themselves for finally facing up to this disappointing performance; they enacted legislation requiring new cars and light trucks to attain a combined level of efficiency of 35 miles per gallon by the year 2020. The legislators claimed this change would not only advance (somehow) “energy independence and security” but also substantially curb the heat-trapping gases that are warming the earth’s atmosphere. Were the kudos warranted? Thirty-five mpg may seem like a major step compared to today’s 27.5 mpg, but it pales in contrast with the efficiency standards set by the European Union and Japan. The EU’s vehicular fleet is scheduled to average around 50 mpg within the next four years (2012).[3]

Why does America’s effort to moderate the use of oil in automotive transportation continue to fall so woefully short? The following paper tackles this question, proceeding in six segments. First, the essay outlines in a bit more detail the “energy-saving” regulatory regime on which our politicians have fastened for more than a third of a century. Second, I describe this system’s failures—including the fact that its impact on greenhouse gas emissions has been perforce minimal. Third, the paper shows how other advanced nations have achieved far better fuel economy, and hence are able to aim much higher in their prospective efficiency standards. Fourth, I discuss the political reasons for this country’s lag and for Europe’s big lead. Fifth, that analysis segues to some basic reflections about what animates our regulatory politics. Finally, the framework for a more enlightened U.S. policy mix is proposed.