Detroit — The presidential fuel follies came careening into Michigan this week, advertising two knights battling over America’s energy future. Upon closer inspection, however, the fix appears to be in: Underneath the rhetorical weaponry, both knights are wearing the same green armor.
Barack Obama arrived first at Michigan State to give a typically grandiose speech outlining his plan for a “complete transformation of our economy.” The Arrogant One has been trying to make up to Michigan since he presumed a year ago to tell her how to make cars (a come-on that went over like a lead balloon) and then blew off her January Democratic primary. Since then, Obama has paid visits laden with armfuls of bouquets and soothing pander.
The Democratic nominee-in-waiting arrived for his speech outlining our post-oil, post-SUV future in three gigantic, gas-guzzling SUVs. Then — taking a cue from Al Gore — Obama mounted the stage to declare a ten-year goal of ending our “addiction to oil” . . . or at least the oil from “the entire Middle East and Venezuela” (he also declared an end to war, and to human aging).
He said he would “not pretend we can achieve (his goal) without cost, or without sacrifice.” And then he pretended that we could, promising that his “new energy economy . . . will create new businesses, new industries, and millions of new jobs. Jobs that pay well. Jobs that can’t be outsourced. Good, union jobs.”
The centerpiece of this new Obamatopia was his prediction that “we will get one million, 150 mile-per-gallon plug-in (electric) hybrids on our roads within six years.” Or approximately seven percent of new car sales. To put this “prediction” in perspective, consider that:
In 2001, Toyota and Honda introduced the first gas-electric hybrid models (the Prius and Insight). Seven years later, there are 16 hybrids on the market accounting for just 3 percent of all vehicle sales. “That’s a real stretch,” said David Cole, director of Michigan’s Center for Automotive Research (CAR), upon learning of Obama’s forecast.
A plug-in car is not yet in production. GM and Toyota are both targeting 2010 for their market debuts, but both companies are struggling with the lithium-ion technology at the heart of those battery-powered vehicles.
Even assuming Obama’s omniscience, an electricity-based market growing that fast will put increasing strains on the U.S. power grid. Yet, in his MSU speech, Obama also called on the “American people to meet the goal of reducing our demand for electricity 15 percent by the end of the next decade.” Considering that the federal Energy Information Agency predicts an 18 percent increase in electricity consumption during that time — even before you add on electric car demand — it’s hard to see how Obama squares his circle.
That was just the beginning. Obama brought a Christmas bag of goodies to Michigan. To purchase all those new plug-in vehicles that don’t yet exist, Obama promised a $7,000 federal tax credit — more than doubling the current federal subsidy. And he promised that they would be built “right here in the state of Michigan,” which begs the question of whether the $7,000 credit would be limited to American vehicles (currently, the $3,000 credit goes mostly to Toyota Priuses made in Japan, the status symbol of American liberals).
He promised $4 billion in guaranteed loans for U.S. auto companies, which sounded impressive until CAR’s Cole reminded a Detroit News reporter that General Motors just lost $15 billion in the second quarter alone.
Perhaps most intriguing was Obama’s proposed wealth transfer from one fossil-fuel giant to another: Big Oil to Big Auto. Obama ripped into Exxon-Mobil for making “the largest profit in the history of the United States. This is the company that, last quarter, made $1,500 every second. That’s more than $300,000 in the time it takes you to fill up a tank with gas that’s costing you more than $4-a-gallon.”
As punishment Obama proposes a windfall profit tax on Big Oil that will, in part, go to “helping the auto industry re-tool.” Heaven forbid that General Motors ever turn a profit again.