The Stone City

Words Made to Last

Wednesday, August 31, 2005

It's the Economy

Kevin Drum points to a National Academy of Sciences study purporting to show that CAFE worked. The NAS study:

....Between 1975 and 1984, [automotive] technology improvements were concentrated on fuel economy: It improved 62 percent without any loss of performance....Thereafter, technology improvements were concentrated principally on performance and other vehicle attributes. Fuel economy remained essentially unchanged....

Mr. Drum then says:

So CAFE does what it was designed to do. What's more, CAFE is almost certainly more effective than gas taxes at reducing gasoline consumption. During the period from 1979-1982, for example, gasoline prices doubled and CAFE standards were rising. The result was a 15% drop in oil consumption worldwide and a drop of about 20% in the United States.

The glaring omission in this reasoning is the state of the economy. 1979-1982 was also the time of a recession which cost President Carter his job, and strengthened in the first years of the Reagan administration. 1975-1984 spans this period, and the extra years it adds weren't very good ones (except the last).
Thereafter, as America became steadily richer, people could afford to spend money on performance cars and the gasoline to feed them. This simple observation clearly vitiates the conclusion Mr. Drum shows.