WHY THE U.S.A. SHOULD PROMISE HIGH TAX ON FUEL IN THREE TO FIVE YEARS, RIGHT NOW.
In my humble opinion, Lee Iacocca was absolutely right when he proposed again and again to double the price of fuel. The U.S.A. car industry would have not been so much in trouble back in 2009, if they had listened to Lee.
Perhaps looking ahead and taking a medium or long-term view on strategic choice is not fashionable in the auto-industry and related government policies. A report in the annual publication of the British «Guild of Motoring Writers» anticipated the first dramatic Fiat crises around 1998 four to five years earlier. The same was true for the easy-to-anticipate failure of the Fiat-GM alliance when it was announced in a number of printed magazines published around the world. It simply could not work and it didn’t.
However, nobody (at Fiat) wanted to know and nobody listened.
All they wanted to hear were the (their?) pros and nobody questioned the cons.
In our scenario, it is easy to anticipate the cons of a sudden and dramatic increase of the fuel prices in the .U.S.A. but perhaps by managing and planning such a hike could turn a harsh challenge into an opportunity.
Today it is time to take position on the North American car industry once again, after the dramatic developments five years ago and the courageous decisions led by President Obama that indeed rescue the sinking giants.
Under the current circumstance, with Russia apparently determined to restore the Cold War climate and the car industry electric and autonomous drive, President Obama, his administration and members of the Congress should be considering some of the following strategic policies as a way to steer private and public transportation developments of the Nation.
Indeed, the American car industry is not just about the renaissance of GM and Chrysler (still in the making). There is Ford, which has to be credited for having sailed through the rough waters of the post-prime collapse, and there are all the “foreign labels” that produce in America cars for the Americans (and some export markets). They are also fighting to keep the industry and the economy running and deserve attention.
In addition, there are the car buyers, car dealers, car sales and service business. In other words: the market, the environment; and the strategic need to save energy.
Well, America had a great chance to design a new policy in 2009, a real policy, for private and public transportation, for the conservation of energy, and of the environment, based on the experience gained by other nations. Pity they did not catch that train.
The administration could have driven (and still can do it today) the market and the car industry towards more sensible, safe and efficient passenger cars by letting the free market organise itself with medium term plans, by simply announcing that in three years (or five, if this is actually needed) the price of gasoline will be increased by 50% (or any significant value) and that a couple of years later the price will be increased another 20 or 30 per cent (or similar) as a consequence of a tax on fuel. The income would be invested in the expansion or updating of the overall transport infrastructure and for incentive to replace old big cars with new, fuel-efficient, passenger cars, new fuel-efficient (hybrid) buses, subways and trains.
This would give American drivers enough warning and time to make plans and prepare themselves for quite higher fuel prices and, at the same time, will immediately steer the design and engineering of new American cars in a clear, unquestionable direction (rather than zigzagging according to the oil prices, decided by forces that no nation seems to be able to control).
The government would simply steer the transportation industry towards much more fuel-efficient vehicles and the use of additional energy sources such as diesel, LPG, CNG, and plug-in or on-board-recovered electricity.
The fuel budget for the average American family will be unchanged if the gasoline is twice the price but their cars need half the fuel. We all know that American too can have top cars with double mileage. (The new turbodiesels powered Audi, BMW or Mercedes-Benz and the latest hybrids, not to mention the latest EVs are just the beginning.)
The announcement of such a policy and its destination, will only make the development consistent and will accelerate the expansion of the car, MPV, SUV and trucks to choose from; with monster SUV replaced by smaller ones at faster speed. Chrysler, Ford and GM will be convinced that there is only one way to move ahead.
As soon as the Detroit’s big are ready with the new cars, the Administration could well launch an incentive plan for scrapping old gas-guzzling vehicles of all sorts, to be replaced with modern, nimbler safer and cleaner American cars, lorries and buses. Just as many European countries have been doing in the past.
Above all it is time for the U.S.A. to offer its citizens an attractive and practical alternative to driving alone and with nothing to carry. If more people commute to work on comfortable and attractive public transportation, there will be less cars on the road and driving cars on more selective criteria, might bring back some of our freedom and pleasure to drive, while contributing to the environment.
Airplanes are all right but can the U.S.A. prosper without a proper and efficient railways system, now that bullet trains are operating in Japan, China and throughout Europe? Can metropolitan areas such as Los Angeles prosper without an efficient metro system the like of New York? Building a railway network these days is easier and faster that it used to be when the Nation was still in the making.
Even better the U.S.A. could lead the world by creating a complete new individual transportation system designed according to the vision and criteria applied to products, services, and utilities developed by the new generation in the silicon valley.
How cans such a dynamic and powerful nation as the U.S.A. do without these vital infrastructures serving all citizens?
I think Americans can do a lot better than serving as police force for the entire world and it is perhaps time to put public money in something useful for their own people. Perhaps some of you, my American readers, remember that there used to be a very fast and efficient “Tram” (or train) serving the Los Angeles – San Diego communities. It was bought over (I am told by an American fellow) by GM, Firestone (or was that Goodyear?) and Esso (or Shell?) only to be stopped, in favour of land consuming highways and millions of car doing millions of miles day after day.
Now, how wrong am I? Please do not hesitate to make your point. I am eager to read your comments.