Detroit – The future of a U.S. economy re-ordered by global-warming — rather than market — concerns is being played out in microcosm in Michigan this week.
Last year, Washington passed legislation requiring the U.S. auto fleet to meet an average 35-mpg fuel-economy goal by 2020, a mandate designed to reduce greenhouse emissions that is utterly divorced from whatever consumer market tastes might be. Employing an army of lobbyists, the Big Three protested a regulatory burden estimated to cost a staggering $85 billion over ten years. When their protests fell on deaf ears, automakers then demanded that the feds pony up $25 billion to help retool American factories to produce the fuel-efficient cars Washington requires.
A partnership was born.
Now that government has defined the industry’s mission as profitability and eco-responsibility, the feds and automakers are increasingly joined at the hip. Having incurred costs to automakers’ bottom line, the feds are now increasingly obligated to help that bottom line. Already buffeted by high gas prices (which are, ironically, forcing the Big Three to sell less profitable small cars), automakers are now being savaged by the credit squeeze, forcing talk of industry consolidation. So General Motors has called in another favor — a request that $10 million of the $25 billion “auto loan program” to help build more fuel-efficient cars be diverted to a pay the costs of a GM merger with fellow-Detroit automaker Chrysler.
After all, how can General Motors save the planet if it’s in bankruptcy?
Barack Obama has promised an additional $150 billion over ten years to help other industries with the transition costs to a greener future. Let a thousand GM subsidies bloom.