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Fuel Economy Debate: Market vs. Government

Tuesday, 8 May 2007 | 4:23 PM ET

A Senate panel met Tuesday as lawmakers weigh whether the U.S. government should raise fuel efficiency standards. Automakers argue it would be too expensive. Sam Kazman, general counsel with the Competitive Enterprise Institute, and Philip Clapp, president of the National Environmental Trust, debated the issue on “Morning Call.”

Fuel Economy Standards
Debating whether the government should raise fuel economy standards for automobiles, with Sam Kazman, Competitive Enterprise Institute general counsel; Philip Clapp, National Environmental Trust president; and CNBC's Becky Quick

Clapp said that raising fuel economy standards would help consumers at the pump, reduce oil imports and would be a big step in cutting greenhouse gases. “The auto industry has focused on producing very fuel-inefficient cars, which has hurt their business, increased U.S. oil imports and left the country in a dangerous situation,” he said. According to Clapp, raising fuel economy standards is the “only thing Congress can do.”

Kazman said the market responds faster than the government when it comes to saving gasoline, citing the Corporate Average Fuel Economy standards, or CAFE, enacted by Congress in the 1970s. “CAFE kills consumers. The National Academy of Sciences found in 2002 that because CAFE restricts the size and weight of cars, it reduces vehicle crash worthiness. The notion that Congress has a better idea for how to build cars is crazy,” said Kazman.