Fuel economy grows as a campaign issue, making some Michigan Dems nervous
It seemed oddly off-message: John Kerry stood before an audience of thousands of California liberals yesterday at a rally at the University of California at San Diego, roasting the petroleum-hungry Bush administration for letting gas prices escalate.
“I’ll use real diplomacy to do what George Bush hasn’t — pressure OPEC to start providing more oil! We’ll stop diverting oil to the Strategic Petroleum Reserve until gas prices get back to normal,” said the Democratic presidential contender, who in 1993 voted for a gas-tax hike and in 1994 spoke in favor of a 50-cent increase in the gas tax as a method for reducing the federal debt and America’s oil demands.
President Bush’s campaign team has been quick to pounce on this seeming contradiction; they’ve launched a TV attack ad on the issue that begins running today in 18 battleground states: “Some people have wacky ideas, like taxing gasoline more so people drive less. That’s John Kerry,” says the advertisement.
Wacky as the Bushies may consider the notion of a gas tax, the president’s own top economic advisor, Gregory Mankiw, backed a 50-cent gas-tax increase in 1999.
Still, the Kerry campaign says such a tax is not part of its program: “Even though the senator considered the 50-cent gas tax as a possibility, he declined to vote for it on the grounds that it may be potentially too damaging for the economy and pose too much of a challenge for the working families that would have to struggle to fill their tanks,” said Beth Viola, an environmental strategist for the Kerry campaign.
But while advocates of the gas tax may be distressed that Kerry’s support has, uh, run out of gas, they will be heartened to hear that the candidate is sticking to his guns on another proposal dear to the hearts of enviros: cranking up automobile fuel-economy standards by 50 percent over the next decade. In fact, this plan itself may be a good long-term mechanism for lowering gas prices: When Americans reduce their oil demands and lower imports, the result is generally a greater surplus of oil on the global market and lower prices. Plus, on an individual level, the owner of a fuel-efficient car spends a lot less money at the gas pump.
But Kerry’s plan for revamping Corporate Average Fuel Economy standards — which would require auto companies’ fleets to get an average of 36 miles per gallon by 2015, up from 24 mpg today — has thrown Democratic leaders in Michigan, a critical swing state, into a twitter.
Wolverine state pols and industry bigwigs in Detroit have argued for years that tighter CAFE standards would trigger epidemic job loss in the automotive sector. As Danny Hakim reported last week in the New York Times, Michigan Gov. Jennifer Granholm (D) has been talking with the Kerry team, pressing it to scale back its CAFE plan.
Photo: U.S. Senate.
Sen. Carl Levin (D-Mich.) has also been an outspoken critic of Kerry’s belief that Congress should boost CAFE standards. In a Senate hearing on a proposed CAFE amendment to the energy bill in July 2003, he argued, “The senator from Massachusetts … is simply wrong.” Levin was concerned that a tightening of CAFE standards would result in car safety hazards and job losses, and would discriminate against American auto manufacturers who produce and sell a full line of vehicles compared to European and Japanese manufacturers who sell primarily lighter vehicles.
Not surprisingly, Granholm and Levin emphasize tax incentives as a good way to spur development and sales of more efficient vehicles.
Such incentives in fact are a key component of the Kerry platform. He proposes to invest $1 billion a year to help the auto industry gear up to build more efficient vehicles, and he wants to give tax incentives to buyers of cleaner cars.
But Kerry has no plans to capitulate on stricter fuel-economy standards: “Look, he’s certainly willing to hear them out, but he’s not going to walk into Michigan and say he doesn’t support the kind of stronger CAFE standards he’s been arguing for decades,” said Viola. “He owns his record, he’s proud of it, and he’ll defend it.”
Viola adds that Kerry is trying to emphasize a longer-term view: “Simply put, Kerry is trying to strike a balance between Detroit’s short-term economic concerns and the longer-term reality” that the U.S. auto industry will soon be losing jobs to the Japanese and European manufacturers leading the global race to develop fuel-efficient cars.
Indeed, Kerry was one of the only presidential primary candidates to argue for CAFE standards in Iowa, where a strong United Auto Workers base might be expected to offer resistance.
“You have to tell the truth and let the chips fall where they may,” he told Grist in an interview during the lead-up to the primaries. “But the truth, in this case, should be appealing to UAW’s workers: I believe I can put them to work. I believe I can have them working making cars; they can just make cars that are more efficient. “
One of Kerry’s senior campaign strategists, who spoke to Muckraker on condition of anonymity, said, “There is a lot of closed-door conversation going on right now about fuel-economy — clearly it’s one of the top issues given concerns about spiking gasoline prices, national security, energy independence, global warming, you name it.” But Kerry is trying to address the issue in a way that emphasizes the advantages to industry, not the threats. “We understand why Gov. Granholm and others are getting pressured by industry to resist plans like this, but still we’re determined to help them understand why it’s necessary in the long view,” said the strategist.
According to Dan Becker, a global warming expert at the Sierra Club, Kerry’s CAFE plan may not cause him much electoral trouble. The Sierra Club commissioned a poll of 650 likely voters in Michigan in 2002 and found that a surprising 77 percent supported ramping up CAFE standards to 40 mpg over 10 years. And of 150 United Auto Workers households polled, a whopping 84 percent supported such standards.
“Clearly the voters and auto workers seem to understand the simple premise that Michigan’s industry leaders and politicians do not: Better technology is better for jobs than old technology,” said Becker.
Still, the issue reverberates well beyond Michigan: The Bush administration has made it very clear that it plans to use Kerry’s CAFE proposal as proof that a Kerry administration would sabotage the economy. Scott Stanzel, press secretary for Bush’s reelection campaign, told the New York Times last week that Kerry’s fuel-economy plan would lead to 450,000 lost jobs and $170 billion in “lost economic output” between 2003 and 2020, citing figures from the federal Energy Information Administration.
The Kerry campaign counters that these statistics are entirely off-base, citing a recent study commissioned by 20/20 Vision and conducted by Management Information Systems, which concluded that raising CAFE standards to higher levels could create up to 300,000 jobs.
“We absolutely believe that investing in new technologies and building the cars of the future will not only create jobs, but keep those jobs at home,” said Viola.
The Bush team wants the electorate to believe that strict CAFE standards will export American jobs overseas. The Kerry team argues that lax fuel-efficiency standards essentially outsource the clean-energy industry to America’s global competitors and that the full energy and ingenuity of U.S. workers should be marshaled behind the industry of the future. That’s an argument enviros think Kerry can win.