looks like some have read their undercover economist...

Either ban them, or tax them.

A simple purchase tax like the VRT we have in Ireland would help.
If you set the purchase tax to approximately the CO2 level / 7 you will quickly have an effect.

There are loads of ways you could tweek the tax, but a hefty tax, payable at the point of purchase will dampen down demand for inefficient vehicles.

Once you give clear signals to the manufacturers, they will respond - in one to two design cycles.

Damn treehugging Liberal!!! Ain't that so Stan?

In the late 80s we had "gas guzzler" taxes on autos and it seemed to work. Passenger cars that got less than 10 mpg were taxed heavily. Some people did not care, but most who were considering a purchase started to look at models that got better mileage. SUVs and pickup trucks were exempt, however.

That implies that if you are wealthy enough to be wasteful that is ok, because there are not as many of you. That is faulty reasoning at best. We should ban vehicles the use too much fuel, but some people call being able to be wasteful ...freedom, which it most certainly is NOT. If you have your freedom at the expense of others, that is just wrong.

For years I've argued against gas guzzlers, but too often the debate goes round and round in circles, and no one ever changed their minds.

While I think sometimes both sides have some merits, I believe the REAL factor in driving the demand for gas guzzlers is probably wealth and prosperity.

Saving energy and protecting the environment are really more like fads than virtues. Display of excesses is always a common denominator for the appearance of success, and I think that will change little; regardless if we run out of fuel, or having to face consequences of environmental neglect. SUVs and non-commercial trucks will continue to be the status symbol and will only be more so if it's banned.

Part of the problem we have dealing with low mileage vehicles in any kind of punitive form is separating out genuine need from want. I'm referring of course to vehicles like pickup trucks. For many, a pickup truck is a necessity, while many buy them strictly for the image (they may have convinced themselves that they need it). When I was a little kid I lived in an isolated town that had about a dozen roads total (all paved). Despite the fact that there were no rough roads anywhere, the town was heavily populated with jacked up four-by-fours (some artistically spattered with mud that they must have dug out of their gardens). Even in the construction business there are a lot of people driving around in pickups that don't actually need them (like a construction manager friend of mine who used to drive a sub-compact until the company provided him with a great whacking pickup that's complete overkill) The question is how to formulate policy that will separate out real need from purely recreational use, wrongly perceived need of just plain old inadequacy compensation.

I remember seeing the documentary the Corporation where he was interviewed. The documentary basically discussed the way corporation work and not work.

As the chairman of Shell, he got a whole bunch of protesters in his front yard and basically his wife gave them refreshments and he talked to them. He got along with them fine. They thought he was good person.

It came down to the fact that he was constrained by the policies that the corporation model presented. That although he, personally, could do good things but as a chaiman was restricted to what he could do with corporate resources to do social good.

With that in mind, it doesn't surprise me that this is his statement. In this respect, I have to agree with hime. Without the prod, the market will not provide what is necessary for the overall good until the they get charged with any damage that the present system creates or until the market costs force them by which time social havoc may occur. They will externalize the cost to the environment and to future generations rather than include them in now and the only way to get them all to do it, is by them agreeing to it as a group (which is doubtful) or by external pressure.

AYM:

I have to disagree. It seems to me that the market is shifting towards higher MPG cars as we speak due to a natural response to higher gasoline prices. No external pressure is needed.
What's a "gas guzzler"? Less than 15 MPG? 20? Even with those numbers, personally, I don't know many people who drive a "gas guzzler" passenger car other than a number of families with a lot of children or folks that need a truck and can't afford to have a small commuter car as well.
There are some that buy for the status, no doubt, but even if you banned them from purchasing such a vehicle, I don't believe they are a big enough percent of the population to have a meaningful effect on oil and gas prices.

Lastly, as Neil posted, who would decide what citizens deserved to have low mpg vehicles? Who decides what constitutes low mpg? I don't know; it just seems like another step towards an ever-increasing bureaucratic and authoritarian state.

Recent studies showing that fine & nano particles from diesel AND gasoline engines cause heart disease may combine with concerns about global warming to reinforce the self-righteous attitude expressed in this article...a frame of mind I find surprising in an oil executive, even if he is an 'ex', driving a Toyota Prius Hybrid & a genuine nice person.

Such a surprising mind set indeed, since this 'ex' is now chairman of Anglo American plc, large stockholder of DeBeers. Because Mark Moody-Stuart is a nice guy, I won't say here what the charity War on Want says about AA plc.

As to gas guzzlers & internal combustion engine (ICE)environmental damage, Electric Vehicles(EVs) need to replace ICE. Lets get electric storage densities way up, electric storage times way down, & EVs way many. Let ICE die(a natural economic death), that people can live. Long live EVs.

tthoms:

Your quote:

"...even if you banned them from purchasing such a vehicle, I don't believe they are a big enough percent of the population to have a meaningful effect on oil and gas prices..."

As a trend, over 50% of all vehicles sold in the US are categorize as trucks, SUVs, minivans, etc. In 2005, I believe Ford F-150 sold nearly 1 million units. Top 3 trucks sold in 2007 are Ford F-150 (still #1), Chevy Silverado(#2), and Dodge Ram 1500(#6). All these are gas-guzzlers and sold to both commercial and non-commercial markets.

I DO believe that if we take the non-commercial trucks off the road and replacing them with passenger cars, it would certainly make a difference, especially if we do it year after year (essentially banning them).

However, I certainly agree that it's a difficult task to do; where do one draw the line, how will the laws be enforced, etc. What people need to realize that there will never be ONE law or regulation that solves all or appease everyone. I think taxing non-commercial gas-guzzlers is a good start, as such large passenger vehicles often have more impact on resources and the environment. Certainly businesses would deserve a break if the vehicle is a full-time service vehicle. I'm aware that such breaks could result in abuse; for example: small business owner declaring his Hummer as a business vehicle. In any case, since I do not think banning them would work, limiting them is by far the best balance.

Believer in "market forces" often think that high gas prices alone is all that's needed to balance the market. However, that would ignore all other factors such as emission controls and resource allocation, even if they are priced upfront into the cost of the vehicle (which will probably never happen).

This is a topic that I don't think will ever be solved in the next decade. Short of fuel rationing or major catastrophes, trucks and SUVs will probably continue to sell quite well for years to come.

tthomas,

welcomed your feedback. Although the market is presently pushing higher MPGs, it is also the existance and threat of regulation that is also pushing higher MPGs. The existance of the Prius is owed to the push and threat of environmental laws in the US in the 90's. The market is not only about laissez-faire, it is based on the social and legal framework in which people operate. Mcdonald's doesn't sell hamburgers in India for example.

The market is also about perception and values. Does the price of gas represent it's true cost? Do the effects from it are truly represented in the cost of the product? If it doesn't, then economic theory says that the subsidized product will be overused and be in over demand. Sounds like gas. If the supply cannot be increased due to whatever contrainsts and price factor has undesirable side effects, then the only way to mitigate other side effects is to affect demand.

Good management, whether by corporation or government, requires anticipation of future changes and events and the environment in which it operates. You can act on them pro-actively or react after the fact. In the case of energy policy, north american democracies seem to want to deal with it after the fact. This has allowed a framework in which companies didn't have the products that were needed when they were needed. How much have the US car companies lost in recent years in earnings and market share. In europe and japan, where energy prices were taxed, products were created that fitted better into a market where energy prices were higher. They gained market share. Did this come out of the blue? No it did not.

Do we let market shocks and what they entail, which may not be conducive to the socio/economic fabric, provide the only prod to private industries? In the end, we will get what we deserve but in doing so, society may have to endure hardships it may not like. We've been doing it the other way. Codling the market, so that corrective forces are hidden until the bubble bursts. The thing is do we want the panic of the bursting bubble.

I'm not saying to restrict vehicles. We exist in a regulated system for a whole lot of variables for a host of reasons but we have freedom within it. The idea is a comprehensive push for efficiency across the board. That will drive innovation towards total higher efficiency. By putting loopholes like trucks in, what happens is that the market will push production of this type especially if profitability for these are higher than the average sedan.

If it's done through fuel taxes. This hurts the consumer and the many ways the consumer contributes to the economy. It might also have effects that transfer differently because the consumer mindset might interprete it differently. Targeting the makers is far better and doesn't create artificial price shocks.

Cars are durable goods. The long term effects of their existance will last quite a while. Although, recent price hikes have created a market for better MPG vehicles, the old ones are still floating around affecting the demand of oil and gas. Utilites have programs to get of old inefficient refrigerators. Nothing like that exists for a car.

Charles S is quite right in that over 50% of vehicles sold are in the light truck segment. I seriously doubt that they are all for business use. The stats are in the bureau of transportation statistics but they are quite buried.

http://www.bts.gov/publications/journal_of_transportation_and_statistics/volume_03_number_03/paper_03/

Sounds utopian. Unfortunately, politicians do not think this way.

Unlike Mr. Moody-Stuart, I suspect that both a regulatory framework, like CAFE or better yet the one proposed by California, will be required as well as either a tax or a cap system that will raise the price of fossil based gas in some predictable way over the coming years. If gas remains relatively cheap there would be less of incentive to buy newer, potentially smaller and/or slower to accelerate cars, for those who like big and fast. The auto companies don't like the idea of stringent CAFE without higher gas because they realize it could well lead to people just sticking with their current gas guzzles and thus create a sales slump. And in families with multiple cars there would be less incentive to choose the most efficient to meet the task at hand... or an incentive to help support increased use of public transport. Some offsetting method needs to be put in place to address any oversized burden placed by higher gas prices on those unable to bear it. We simply have too little time to wait for all the current gas guzzlers to fall apart, forcing their replacement with more fuel efficient ones.

In response to people that point out some genuine need of large pickup trucks, I'd make the point that in many other countries that have construction industries, agriculture and rural places, the need for such large, heavy vehicles is far less. Why can't Americans do the same jobs as other people with similar transport. There are probably many cases where in the U.S. a person working in construction might buy a huge truck for that few times a month that he actually carries a huge, heavy payload... maybe in Europe the same person would have a smaller vehicle and simply pay for delivery. Don't know if that's the answer, but the numbers certainly show that other countries make do somehow with far less need monster pickup trucks.

Then for those business that truly need these large vehicles the cost would simply be passed on to the customers... but there would be a strong incentive to really figure out if the need is genuine or more just for show.

If the intending purchasers still wish to purchase these vehicles after say five consultations with a psychiatrist and a couple more with a financial counselor, Then they should be allowed to. But may be a requirement of say 100 hours of community service each year to show their citizen credentials.

What is immediately curious is the gentleman's blinded view of market monopolization. Shell, Exxon, GM, Texas, Saudi etc. built a transportation industry based on petroleum fuel not because the market selected it uninhibited. But because potential alternatives (electrification, ethanol, LNG, FCs, etc.) were forced to the rear by overbearing industry consortium.

Regulation, direction given by the people via legislation is a necessary part of any market that rightly serves the common good. Its greatest role aside from serving the common good, is to guarantee the marketplace remain open. That is, like a farmer's market, there are plenty of stands selling the widest variety of goods. And that there are always spaces available for new vendors with new ideas and products that we, the people can select from.

In regards to the "citizen creditials" remark...

...y'know I couldn't agree more. I'd love myself an M1 tank and randomly blow up a few cows and maybe a bridge or two. If all I need is 100 hours of community service to do so (heck, I'll do 1000 hours), where do I sign up?

Charles S and AYM:

Thanks for your response. Unfortunately, my rather lenthy reply was for some reason marked as "Spam" by the Typepad software and will eventually be posted when the moderater ever gets around to it.

GR: So how does banning "gas guzzlers" (still not yet defined what a gas guzzler is)"guarantee the market place remains open"? It doesn't. What it does do is promote the ever growing concept that government knows best, and you will be made to conform.

The difference between "overbearing industrial consortiums" and government regulation, is that, today, I can go out and get a propane/NG/E-85(more difficult) conversion for my car, electrify my house with PV, and heat my water with solar heat, and its done, no further consequence other than cost.

Break a regulation, go to prison.

How about, instead of the decades of attempts to force people to comply, we actually take the time to convince people that reducing their oil consupmtion is in their best interest, specifically marketing it to their concerns? It may not be as easy as the "thus spoke Zarathustra" command and control method, but it would preserve freedom a lot more.

"If the intending purchasers still wish to purchase these vehicles after say five consultations with a psychiatrist and a couple more with a financial counselor, Then they should be allowed to. But may be a requirement of say 100 hours of community service each year to show their citizen credentials. "

A perfect example of why people ignore us.

tthomas:

Don't get me wrong. I was not agreeing with the Shell exec re: "gas guzzlers." Who would determine what a "gas guzzler" was? Someone who drives an Accord across Utah at 120 MPH?

Overbearing regulation, like overbearing industry inhibits an open market. e.g. Why will we no longer have analog TV after 2009? Here the regulation costs feds (er... US) $150. per person. Watch analog TV, go to prison? No, I think if it is regulation for the common good - a simple fine works. It did for Howard Stern.

"How about, instead of the decades of attempts to force people to comply, we actually take the time to convince people that reducing their oil consupmtion is in their best interest"

I agree completely. Far better to encourage conclusions than to force them. And by quoting Strauss I assume you are referring to the discovery of the monolith on the Moon (our Moon) in 2001.

Tthoms,

I believe you are inaccurately characterizing what Mr. Moody-Stuart, and almost everyone else, means by banning gas guzzlers. No one that I know of is proposing taking people's property away from them or putting them in prison for using it. Most proposed "bans" on gas guzzlers mean a progressively tightening fleet average for efficiency on new cars. To morph that into throwing people into jail seems very disingenuous to me. Sure, any proposed government action is going to sound terrible if you wildly and falsely extrapolate that it will lead to gulags and Mao suits. The lack of stronger CAFE regulations is not what keeps our country from descending into autocracy or communism.

As for your proposal to simply convince people. I think history has shown that this mechanism is not enough to ensure the common good, especially when the stakes are so high and the time for action getting so narrow. Time and time again, history has proven that large numbers of people will do what is in their short term interests over their long term interests. Human nature is also to not want to make sacrifices/changes if others are not perceived to be doing the same. Further, there will be small numbers of people that will lie, manipulate and cheat to take advantage of any situation they can. Without meaningful regulation there are ample opportunities for the public to be duped into believing they are doing something for the environment when in fact nothing productive is coming from it. The complexities of determining the actual global warming potential for various fuels and power sources is simply too complicated for the consumers to be become properly educated. I believe most people want responsible regulation from their governments.

I think it's important to remember that the US gas guzzler tax effectively created the entire SUV boom and most of the pickup boom of the last 18 years. It was the most counterproductive measure that I can think of in fuel economy. Simpleminded regulations often backfire, sometimes fiercely.

"The complexities of determining the actual global warming potential for various fuels and power sources is simply too complicated for the consumers to be become properly educated."

Wrong! The unmet challenge is for educators working with scientists and verifiable data, not models, do the work necessary to educate people. The US government is meant to be "of, by and for the people." If the people are uneducated because it's too hard or educators too lazy - there is no reason to believe in or accept that government's proclamations.

GR:
Ha! Yes, I can see how my comment might invoke visions of black monoliths and floating fetuses in space. I actually used the term to suggest a dramatic pronouncement from on high to we, the little people. If you like, here's a 2001 analogy.

"Gee, I'd like to buy the vehicle that I think suits my needs"

"I'm sorry, Dave, I'm afraid you can't do that."

Rhapsody:

My response is a direct reaction to GR's proposal that we are the victim of dark market forces and the light and sunshine of regulation will save us. I'm exaggerating here, but my point is still valid. We, as free individuals have it within our power to live completely oil-free if we so desire. It would be difficult, but no one can tell us to do otherwise. When the government starts mandating things, government's ultimate power being the power of the sword, choices become seriously limited.
Why do we pay fines? So we don't go to jail. Why do we go to jail? So we avoid bodily injury or capital punishment. I'm just sayin'...

also:
"Time and time again, history has proven that large numbers of people will do what is in their short term interests over their long term interests."

and
" Without meaningful regulation there are ample opportunities for the public to be duped into believing they are doing something for the environment when in fact nothing productive is coming from it."

Wow. I guess that I have a lot more faith in people than you do. While there are obvious and dark exceptions, history has also shown that Man, left to his own devices, can soar higher and farther than he could bound to some overseer.

The U.S. was founded on the experimental notion that "man can govern himself". This doesn't narrowly mean that people can just vote. It means that people do not need a king, overseer, or committee to make choices for them.

Will some people make the wrong choices? Sure. Let them buy ever more expensive gasoline and send themselves into financial ruin. Those of us that have been more frugal, and have worked to become independant of the oil machine will continue to prosper.

tthoms:

All I see is the standard responses back and forth: "the mob will not do the right thing thus we need gov't" versus "elitist thinking: that people cannot do right by themselves." There is no need to be absolute about each position.

Let's take a more contemporary example, water shortage in Atlanta. I don't live there and I don't know all the details. Is there really just ONE specific cause or group that we can put the blame on? I do not think so. When the scale is large enough, the problem is often very complex.

What I'm leading up to is this: The area is made up of millions of individuals and businesses. Of course, there are probably MANY who are responsible individuals who would voluntarily ration water, but there will always be some who forget or refuse to turn off the sprinklers. There may be a point when everyone will do the right thing, but we may have to wait till it's too late for that to happen.

Some may say that the government is always intrusive. However, when things go bad, then the public look for someone (some entity) step in and take charge.

Say if the government chose to do nothing. It is quite possible that some "responsible citizen" may decide to take the matter into their own hands. Is that what "faith in people" means? I hope not.

I think people who are in favor of regulation is not about forcing their rules onto others, but rather feel that the problem is so big, that we cannot simply rely on randomization of individuals.

@ Charles S:

In the late 80s Los Angeles suffered a debilitating drought. Strict rationing of personal and sprinkler water use was mandated, but with 8 million people obviously unenforceable. So the burden was on getting Angelinos to understand the real impact of the drought and need for personal water rationing. So effective, at the end of the second year, was the campaign to limit water use - the Department of Water and Power applied for emergency assistance. Their revenues, due to lower billable water use, were so depleted they could not meet operating costs.

Moral - with proper education, sincere need, and lack of histrionics - people can and will rise to nearly any occasion. Call it faith or just getting the word out - it can and should be done.

gr:

Yes, I remember the story.

This example really doesn't "prove" one side is better than the other. The truth is, if the government is able to enforce the regulation at a 100% level, then we wouldn't be humans, but robots.

The government has to rely on people and trust that people will comply. At the same time, it has to back up the enforcement with fines and regulations. Otherwise, violators could easily have waste more water than those who volunteer to save.

Encouraging people to go from 30-mpg to a 45-mpg car is great! But a new 10-mpg truck would mean that we need at least TWO people to transition to 45-mpg to tip the scale. We can wish that everyone would comply when it comes to saving fuel, but it may have to be a long wait till that happens.