Gas prices are now a major concern for many people. Prices here in Madison are at $2.69 a gallon while they are higher around the state and around the nation. Recently, the [Bush Administration](http://www.theledger.com/apps/pbcs.dll/article?
AID=/20050816/ZNYT01/508160403/1001/BUSINESS “Link to NY Times article”) agreed that it will not raise fuel efficiency standards for pickup trucks, big SUVs, and minivans. People in various groups–including that inveterate junk mailer, the Sierra Club–railed against this idea. Their position is that the government ought to force industry to produce large vehicles that get better gas mileage.
Quite frankly, the Sierra Club is dead wrong in their approach to this issue.
The problem with increasing Corporate Average Fuel Efficiency (CAFE) standards is that it takes entirely too long to have any effect. In addition, it only affects new vehicle purchases. It does nothing to get fuel guzzling behemoths off the road that have been purchased in the last ten years.
If the Sierra Club was truly interested in getting more fuel efficient cars on the road it would be a big player in the oil market. Nothing is going to get SUVs off the road faster than gas prices moving towards four of five dollars a gallon. In addition, higher gas prices not only discourage people from buying new SUVs, they discourage them from buying and driving old SUVs.
For instance, a Ford Excursion has a 44 gallon fuel tank. At current prices ($2.69/gallon), it costs $118.36 for an Excursion owner to fill up their tank. Annecdotal reports place Excursion gas mileage in the single digits. So, if we’re generous and assume that means 9 mpg, an Excursion can travel 396 miles on a tank of gasoline.
Our 1998 Saturn wagon, for comparison, gets about 31 mpg on the higway and 29 mpg in the city. It has a 12.5 gallon fuel tank. If we were to run that tank dry and fill it up at $2.69 per gallon, it would cost us $33.63. Assuming we were doing highway driving, we could then travel 387.5 miles on a tank of gasoline.
If someone is dumb or wealthy enough to spend $118-plus every time they fill up their tank, then let them. Most people simply cannot afford that for very long, no matter how much credit card debt they rack up.
So, if the Sierra Club is really interested in getting SUVs and other mosters off the road, they ought to be buying up oil as quickly as possible to drive up the price. As long as they don’t put the oil into the market, they can create artificial shortages that further drive the price of oil (and hence, gasoline) upwards. If you want to change how people act, hit ‘em where it hurts–in the pocketbook.