I'm just going by memory, but I seem to recall that about ten years ago, the Chairman of Ford Motor Company, Bill Ford Jr., got in a lot of hot water with his own people. He publicly reflected on the wastefulness of the Ford Expedition/Lincoln Navigator, an SUV about the size of a canal barge, and wondered if his company should be making smaller, more energy-efficient vehicles. His alarmed advisors quickly set him straight—the big SUVs and pickup trucks were where all the profit was. Bill quieted down.
Sometimes, though, if your job is to set the direction of a big company, it's best to go in the direction you actually think is best. Ford, hemorrhaging money, has just announced that it's putting the introduction of the next-generation F-150 full-sized pickup truck on hold for several months, and it has been forced to temporarily shut down its huge SUV plant in Wayne, Michigan. Right down the road, the plant that builds the compact, high-mileage Ford Focus is running on Saturdays and overtime and still can't produce enough cars to meet demand.
"Capitalists" are funny. They love "the market," which they think is infinitely self-correcting. Maybe so, but what they leave out of that faith is one small detail: that the adjustments, when left to the market alone, are often painful—both for people and companies.
Another detail that capitalist apologists love to leave out is that people who have money and power like to hold on to the money and the power, and they don't mind if they have to manipulate markets to do it. If you don't believe that, do a little research on the demise of the streetcar in America, or watch this. A certain amount of regulation is necessary to keep free markets free.
People, of course, will do what they need to. Sales of automobiles and "personal trucks" are down by double-digit percentages. Big, low-mileage vehicles are suddenly so unpopular that some dealers aren't even accepting them as trade-ins. General Motors is thinking of selling off the Hummer franchise entirely (although who would buy it at this point isn't clear). Meanwhile, four of the ten hottest-selling cars are hybrids. The best, most high-profile hybrid, the Toyota Prius—just that one model—is outselling all the cars sold by each of the following five carmakers: Volvo, Jaguar, Audi, Lincoln, and Acura!
Normally, a hot-selling car model has a "mean time before sale" of slightly less than a month. That's the time it sits on a dealer's car lot before it sells. (Dealers love it when a model's turnover is less than a month; it saves them a ton of overhead and inventory-associated costs.) The current mean time before sale of the Ford Focus is a mere 11 days. That's really hot. Know what it is for the Prius? barely four days. Close to instant turnover. Almost unheard of.
The Prius has one very appealing property besides high mileage in general: it actually gets better gas mileage in city driving than it does on the highway. That's because it uses electrical power for more of its driving in the city.
The coolest thing about the Prius is something I think we urgently need to adopt as a high priority for our vehicle engineers to work on. When you start up a conventional gasoline-powered, internal-compustion-engined car and just let it sit there, unmoving, it both burns gasoline and emits pollution. No matter what your political persuasion or attitude towards big business, I think this is something we might all be able to agree on: that's stupid. The Prius, sitting still, uses no power and emits zero pollution. If you live (or have ever lived) in a city where you often have to sit in traffic—I mean sit, not moving at all—you can surely see the wisdom in such a principle. To begin with, let's at least try to stop burning car fuel when it's not doing us any good. Make sense?
That ol' can't-do spirit
A very unpopular idea I've long advocated is a large gasoline tax. Why? Because it would inspire people to do exactly what they're doing now—respond to high prices by conserving and adjusting their gasoline use—but it would keep the extra money we pay in the country. Go back a couple of years to when gas was $2 a gallon. If the Federal government had had in place a $2-a-gallon tax on gas, gas would have been $4 a gallon, and people would be responding to it like they're responding now: by buying smaller cars and driving less. It would have dampened demand for oil and presumably suppressed the big run-up in oil prices that we've witnessed. But the "extra" money we would have been paying would have been going to our own government—that is, staying home. (Now, granted, our government isn't very responsible about spending our money, but let's leave that aside for the moment. At the very least, the money would stay here.)
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Instead, what's happened? Gas prices have increased to $4 a gallon anyway. But instead of staying in America, the extra $2 per gallon we're all paying is going to the Saudis and Venezuela's Hugo Chavez and the rest of the countries from which we import our oil. And we're suffering regardless.
And what if suppressing demand wasn't enough to stop the rise in oil prices? Well, in that case, the government could use the tax buffer to oversee a slower and more orderly increasing in gasoline pricing, allowing all sorts of businesses and individuals to adapt to higher prices with less anxiety, less disruption, and less pain.
Makes sense to me. (Of course it really only makes sense if "less pain" is one of your objectives.)
In reality, a $2-a-gallon gas tax back when gas was $2 a gallon would have been enormously unpopular. You can get an indication of just how unpopular by considering John McCain and Hillary Clinton's proposed "gas tax holiday," whereby they proposed eliminating the relatively paltry current gas taxes for the summer, to bring consumers "relief." That's not the way to solve the problem. But as pandering, it's compelling. High gas taxes would provoke a hue and cry of protest that would be deafening. It would spell the doom of any politician who implemented or supported it. It just would have been a much smarter thing to do than what's actually happened. America would be richer right now because of it.
It's no one's fault that we didn't institute gas taxes. It can't be done here done. It's easier and more expedient to let all that money go to the Saudis and the multinational oil companies. A shame, but that's the way it has to be.
From sea to shining sea…literally
Lately, as I'm sure you've heard, politicians want to extend offshore oil drilling to the nation's whole shoreline instead of just the western half of the Gulf of Mexico. And of course Republican politicians have long clamored for drilling in the Arctic Wildlife Refuge.
Those are nice ideas if they could solve our problems...but they can't. New offshore oil rigs take an average of 12 years before they start producing, and it's not like there are huge reserves under the narrow continental shelves. We're talking minor percentages of world production at best. And do you know how long all the oil in the Arctic Wildlife Refuge would supply the oil needs of the United States? Assuming we could extract every drop geologists think is there?
Eight months. That's it. I wish it weren't so, but that's just not going to solve the ongoing problem.
Meanwhile, still, nobody talks about conservation for conservation's sake. (Well, nobody who matters—not the MSM, not the candidates.) Apparently, conservation for the sake of conservation is "environmentalism" and therefore unacceptable; the only conservation that's responsible and principled is conservation undertaken as a rational response to market forces. That is, you can modify your behavior because it hurts in the pocketbook not to, but you shouldn't modify your behavior because it's the right thing to do to prepare us as a nation for an inevitable future.
Ironically, it's not until the "free market" is unleashed on the problem of conserving fuel will we solve our gas-prices-and-global-warming problems. Those are both big problems. The negative consequences of each are enormous. But the people in power are the nice people of the oil and natural gas industries, and they're not about to give up their money and their power willingly. They want to keep their good thing going for as long as there's one more dollar in profit to be wrung from it.
One possible solution I can envision is this. The big problem with solar farms like the one in Ontario pictured here is that they only generate electricity during the daylight hours, and that's not when we most need or use electricity. They shut down at night after the sun goes down. And one big problem with electric cars is that it takes a long time—hours—to charge them up. And the only time most people reliably don't need their cars for hours on end at home is in the middle of the night. People usually envision charging electric cars while they sleep.
I don't know where you are as you read this, but most productive Americans spend their days in either some sort of factory or some sort of office. And a significant part of their driving is their commuting to and from that factory or office. And what does your car do while you're working? It just sits there waiting for you to go home, doesn't it?
So why not establish the custom of letting workers charge their electric cars while they're at work, while solar farms are producing electricity?
Think of the advantages. Government could help companies offer the service. Companies could provide the convenience to workers (subsidized or not) as a perk. And the power would be consumed during the daytime, when solar farms are producing it. Instead of roadside gas stations, what if "normal everyday standard behavior" was that you'd drive to work, hook up your car to the charger, and go inside to sit at your desk—knowing your car would be ready to go again with a full charge by quitting time—or, more likely, by lunch?
Another really obvious solution is partially electric cars that will go the distance of the average commute on electrical power and that have a small, 3-cylinder gas or diesel engine for longer distances. The huge majority of commuters drive less than 80 miles a day on their commute. So design cars that run on electricity for the first 80 or 100 miles and then switch to a small engine for longer trips. (This certainly isn't my idea—there are a number of people who have been advocating for this approach for years. One guy in particular. I wish I could remember his name so I could Google him. The old neuronal filing system isn't what it used to be.)
I have to admit to a little car-enthusiast red blood, too. Electric cars are inherently faster than gasoline-powered cars, because they have 100% of their torque available 100% of the time.
Another idea. A big problem of small cars is that they don't carry enough luggage for longer, more extended trips like vacations. But why drive around an enormous van all year long just because you need it twice a year when the whole family drives to the Dells? Why shouldn't every car come with a custom-designed cargo trailer to be used only when needed, and left in the garage the rest of the time?
Well, enough about all that. I'm out of my element proposing possible solutions to technical problems—I don't really know what the technical problems are, or what is required for their solution. (I'm just a vision guy.) The point is that preparing for the future is important. Maybe more important now than ever. We should all be imagining 2018 right now.
In 1998, Bill Ford wanted to prepare for 2008. They should have let him. It would have been better for business.
(The cars pictured belong to my friends Dan and Barb. For anyone who might not recognize the license plates, see here.)