Who Should Determine What Fuels Our Cars/Trucks?

How do you define "free market". Yesterday, I argued the "free market" should determineif cars and trucks are powered by diesel fuel or by the conventional gasoline most vehicles currently use.

This baffled some of you.

Michael e-mailed me,"Why cry free markets in some spheres yet welcome government intervention in others?"


I'm not welcoming anything. Do I think it's reasonable for Washington to push for greater mileage from the vehicles being built? Yes. If CAFE standards were never increased in the past, it's unlikely auto makers would have built the more fuel efficient models we now have. Do you really want to go back to the days where cars and trucks lumbered along at 12 mpg?

Brian wrote me,"Mandating mileage requirements is anti-free market. Basically, from what I have seen so far, Obama is completely anti-free market. The hypocracy (sic) of your statement floored me."

This e-mail may get at the heart of why people don't like the new fuel standards. Many people feel President Obama is anti-free market. Fair discussion, and one we should have, since I see valid points on both sides of the argument. But let's be clear, pushing auto makers to make more fuel efficient cars is not anti-free market. Anti-free market would be the President telling auto makers they MUST build a particular model, or they can NOT build some other model.

Which is why I scratched my head when John wrote me, "I find it funny that you bring up the free market in your article. Shouldn't the free market dictate the type of car a person buys? Gas prices go up, people buy more efficient cars. Pretty simple stuff. The government should just let the market determine what type of vehicles are bought and sold."

Will the new fuel rules stop the auto makers from making SUVs? No.

Will the new rules tell auto makers they must build sub-compact cars, even if they are unable to sell the pint-size models? No.

Do the new fuel rules command Americans to buy a small sedan instead of a large sedan? No.

If you want to buy an SUV, you'll still be able to buy one. The difference is that sport utility vehicle will now get far better mileage.

Make no mistake, I understand there are people who don't like the idea these higher CAFE standards will ultimately mean the cost of vehicles will go up another $1,300. By the way, that is the government estimate. Is it written in stone costs won't go higher? No. In fact, I wouldn't be surprised if we look back in 2016 and find the costs to auto makers come in far higher than the current estimates.

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