Should a Car Czar Be Part of the Solution?
We have seen the CEO’s of the “Big Three” show up in Senate hearings begging for financial assistance. Once they traveled by corporate jet and the second time via hybrid vehicles.
They are asking for billions of dollars in loans to that they can make up for their own failings as industry leaders. It looks like the government might just provide some funds. If they do one of the proposals is that there be a “Car Czar” appointed to represent the government and oversee these companies in order to ensure that they use these funds appropriately. This could be a disaster.
By appointing a “Car Czar” the government would be, in effect, running the three corporations. This is counter to everything that capitalism stands for. We don’t need the government running automobile companies. In fact, we should not want it.
Nor do I want to see legislators or bureaucrats trying to determine what automotive technology is the best solution for the evils of the internal combustion engine.
We have already seen what happens when a fuel substitute for gasoline is subsidized by well meaning governments. Ethanol, on the surface, appeared to be promising. That is until the production of corn for conversion to ethanol impacted the price of corn used for food products and animal feed. Not to mention the reduction in available energy by volume that came with ethanol.
Not that it is a bad idea to search and hopefully find a replacement for the 100 plus year old technology that is currently the primary automotive propulsion – gasoline (yes, and diesel fuel). Petroleum-based energy will not last forever so there is no time like the present to be investigating alternative.
Edison once told Henry Ford that in a few years he could develop a battery technology that would make the gasoline engine outmoded. We are still searching for the best battery solution for cars.
No, a government Car Czar should not be running our car companies. There is all ready a system in place for all businesses that should ensure that they are run appropriately. It is the freedom for failure. When business are run under a faulty model or with foolish management (or both) they will fail. We have bankruptcy laws in place that give businesses a second or third chance. But I do not want to see the government running private enterprise. The two must be kept as separate as church and state.
Let the car companies find their way back to running profitable businesses. A year or two ago they were able to show profits. Right now their market has shrunk considerably. People aren’t just avoiding buying certain cars; they can’t afford to buy much of any new cars. Those that would usually get a loan to purchase a new car are finding out these days that in most cases they are out of luck trying to get a loan.
Let the car companies run themselves. Let the boards wake up and smell the petroleum. Have them find new or inspire existing leadership to get the companies back on track.
Thinking Out of the Box
Now is the time to really think out of the box on the automobile business. Do we really need the kind of dealer network where the big car companies use to just stuff the channel with inventory? Should dealerships become much more involved in not just selling product, but market research? Should the service centers become more closely aligned with the manufacturing side? How can buyers influence the product and how can the car companies do a better job in design?
If the government wants to promote more energy efficient automobiles then the cost of gasoline must be at a level that make it profitable to design and produce alternatives. Right now the cost of producing more energy efficient cars raises their true price to a level that is not acceptable by the buying public. The CAFÉ (corporate average fuel economy) standards are not helping things. Perhaps the government should artificially raise the cost of gasoline in this country. All automotive fuel 87-89 octanes (using current pump formula) should cost $3.00 a gallon and all 91-93 octanes should cost $3.45 a gallon no matter what. The difference between actual market price and the sale price would become tax revenue split between the federal government and the state governments. This would keep the cost of gasoline high enough to inspire users to find more efficient vehicles and provide tax revenues that would or could be used to fund research as well as improved infrastructure. Such a fixed price would allow users of cars to adjust their budgets without wondering if the cost of gasoline was going to sky rocket in the summer or become to cheap to care about in the winter. It might seem expensive, but at least it would be a constant. The fixed price should be good for five years and then revisited for appropriateness or revision.
Notice I have not included aviation, marine, or diesel fuels. We need to be sure that commerce is facilitated by reasonable fuel costs.
The last thing I want is to see our federal legislature try to determine what technology is appropriate to replace petroleum-based fuels.
Should battery technology be it? Should it be Lithium-Ion? Nickel-Hydride? Lead-Acid? Something else?
Is public transportation really an efficient way to move people? Does it really save fuel or the environment? Why, in some environments, is their so much resistance to using public transportation?
Is the real issue that there are 6.5 billion humans on a planet that can only sustain 2 billion in equilibrium?