Cafe Standards Are Biased

Virginia Postrel has, in her usual succinct and elegant way, pointed out the deficiencies in CAFE standards for promoting decreased energy use:

I do think it’s ridiculous to bias federal policy in favor of SUVs and against station wagons and minivans. That’s what the Corporate Average Fuel Efficiency (CAFE) standards for fuel efficiency do. But, rather than raise standards for SUVs, I’d prefer to dump CAFE regulation altogether. It’s a ridiculous approach to the issue. If we must have a federal policy to reduce fuel consumption, it should take the form of a hefty gasoline tax, preferably offset by cuts in income or payroll taxes. A tax affects actual fuel use and treats all cars, of all years, equally.

Note Virginia’s important qualification: If we must have a federal policy to reduce fuel consumption.

She also suggests that readers check out her Economic Scene column on CAFE standards from December 2001, a suggestion that I heartily second. A source that lays out the arguments against CAFE standards is this Tech Central Station article from 12 February.