A Challenge The Auto Companies Should Have Taken On Long Ago

Thanks to the fact that we have Barack Obama in the Oval Office, California and other states can now go ahead and enact strict pollution laws that go above and beyond what Bush's EPA enacted. Naturally, the bailed-out auto companies are complaining about having different standards to meet in the U.S. instead of one set by the federal government. The costs of achieving California's goal of 42.5 MPG in ten years are obviously more than the low numbers CAFE requires now, but these are changes U.S. companies should have foreseen.

From TPM:

David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich., said he doesn't believe the EPA will approve all the waivers asked for by the states. To do so would be economically unworkable.

"If the industry is in total shambles, you can have any regulation you want — it's not doable," he said.

Cole said the additional regulations would have to be implemented "in a way that's achievable in the industry."

Environmental organizations said Obama's approach would help the companies in the long term, forcing them to produce fuel-efficient cars coveted by more consumers. Roland Hwang, a senior policy analyst with the Natural Resources Defense Council, estimated that a more efficient car would save its driver $1,000 to $2,000 in fuel costs over its lifetime, offsetting some of the upfront cost.

Unfortunately they still see the problem in the short-term instead of the future of automobiles. As Hwang pointed out in the article, the demand is with the more environmentally-friendly vehicles than the gas guzzlers U.S. automakers put out now. Besides, I though that the market is where companies that innovate succeed and those that languish die, or does that not count for the execs at GM, Chrysler and others?

The problem with their bankruptcy and/or death is that it would put millions of Americans out of work, so what we need to do is fund them so that they build green enough so that they meet the high demands of states like California. The costs may be tough in the beginning, but in the end, the benefits pay out ten-fold.