• Apr 10, 2009
Every single day, the United States ships $600,000,000 out of the country. That's what it costs us to pay for the oil we buy from other countries at $50 a barrel. It is the single biggest cause of our massive trade deficit.
The U.S. uses roughly 20 million barrels of oil every single day, and about 60% of that is imported. About 10 million of those barrels are used in transportation, including the kinds of cars and trucks you and I drive, plus all the planes, trains, heavy trucks and off-road vehicles in the country.

Yet, our entire effort to reduce our dependence on oil is based on Corporate Average Fuel Economy regulations (CAFE). And that only impacts passenger cars and light trucks. In other words, the industry that causes less than 50 of the effort to fix it. No other industry is being regulated to reduce our dependence on oil, and that doesn't look like a very effective approach to me.

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John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
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Let's get something straight. Oil is a poison.
Worse yet, it takes 20 years to turn over the fleet of vehicles in this country. In other words, the last of the 2009 models being sold today will not be out of circulation until 2029. So, for example, when CAFE mandates that new vehicles average 35 miles per gallon by 2020, the full fleet of vehicles in the United States will not reach that until 2040. This is absolutely the slowest solution we could ever think up to try and fix the problem.

While the government says it wants to reduce our dependence on oil, it does everything in its power to keep oil as cheap as possible. We won't even contemplate a tax on imported oil. Instead, we only enact fuel economy rules for cars.

Let's get something straight. Oil is a poison. It poisons our atmosphere when we burn it. It poisons our economy when we import it. So why is our solution to try to and use this poison more efficiently? If something is poisoning you, you stop taking the poison!

If we're going to solve our oil addiction, and solve it soon, we need to take other actions. It's not only unfair to force the auto industry to bear the entire burden, it's not effective. The root cause of the problem is not the cars we drive, it's the fuel we burn. When are we going to address the root cause of the problem?

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    • 1 Second Ago
  • 35 Comments
      emerillovesbam
      • 5 Years Ago
      We need to drill for oil, we have enough oil here in the united states, we need solar, wind, tidal and many others.

      Get rid of the CAFE Standards.
      • 5 Years Ago
      Adam, I would like to know your why you disagree, can you articulate your position?
      • 5 Years Ago
      1) Well, Mr. Smart Guy, what do we burn instead? Or should we just stop driving altogether? And what about all those programs to come up with new alternative energy - bemoaned by many as a waste of taxpayer money? I think we ARE trying. Maybe not hard enough, but action IS being taken. But there's too many conservatives out there for real action to get underway.

      2) Who are you blaming for this reluctance to tax oil? I hope not the government, which is run by politicians who are responsive to constituent demands and political winds. What politician is going to propose a high gas tax? Super ballsy ones, maybe, who have a solid Democratic base - like maybe Nancy Pelosi or Jared Polis, but really? It's political suicide, and that, my friend, is not a government problem or a politician problem but a problem with conservative free-market laissez-faire Ron Paul America.

      3) Are you sure that CAFE is the only thing pushing oil efficiency? Where do those other 10 million barrels go? Power plants? Home heating? I bet there are at least efficiency regulations being put on the producers of home heating units - kind of like Energy Star appliances or something. And hell, if CAFE helps stimulate innovation and is a working program, stick with it. At least it HELPS. I remember a conservative once argued that "since it's inception, miles driven has increased 100% while oil use has increased 60%." Gee, sounds like it's working to me. Even though we drive farther thanks to greater suburbanization and what- not, we're using less oil.

      Sure, raise the gas tax. But you need to convince the people they need to bear this pain, not try to convince Democratic politicians to shoot themselves in the foot. Politicians are responsive. Convince us, and they'll do it. Oh...and good luck with that.
      • 5 Years Ago
      Agreed! Whay are we not using CNG and LPG? Higher octane, gobs of the stuff here, no need to refine it, fewer oil changes shoot lets go get it done!
      • 5 Years Ago
      Calling oil poison is counterproductive. Whatever solution people call for- energy independence, fuel cell cars, electric vehicles, upgraded power grid, more efficient buildings, etc. will require technological advancement and a change in the way we use and consume resources. But don't forget this constant- humanity will never consume less resources. We will only consume more, or we wait to be dominated by those who consume more. The issue at stake is how to consume more and keep the earth relatively clean because to me, it seems like the greenest people in the world are those who are starving in 3rd world countries, along those in 1st world countries who think they have discovered the secrets to life by living life like a monk.
      • 5 Years Ago
      The Oil market is a market that has lost all growth in every market area that substitutes can be used. Americans have to accept market forces, in our economic system. They reacted by searching for substitutes where possible and undertook to develop substitutes where none existed. No one said that creating such substitutes was easy. Nor could be produced on a political demagogues campaign promise whim or schedule. Such is the genius of our economic system. It adapts, sometimes slowly, but it adapts.

      1) US Industry uses less oil than in the 1973 first oil crisis but the economy and population is much greater.

      2) Residential HVAC (heating and cooling) demand is flat and slowly declining. It is at pretty much that same level as in 1973, despite a much larger population, living in much larger but more energy efficient dwellings.

      3) Commercial use HVAC is up since the commercial real estate stock is much larger, but the Oil demand increase is still tiny.

      4) The Utilities have decreased their use of Oil in generating electricity to practically zero. The have converted some plants to other fuels. Or they have built non-petroleum replacements. A tiny smidgen of which are the green loon's asinine ideas of "renewables", whose pollution effects are just not recognized. Wind, the most frequently used, is slowly receiving scrutiny and the pollution and other non-green effects are bring realized. When solar get more common, the loon's will suddenly realize how bad solar is to the environment, too. These facilities produce little electricity, and at very high cost, but it provides "green wash" to mollify the green loons.

      5) Petrochemicals for polymers and pharmaceuticals have switched to other fossil sources, as much as is practicable, and the demand growth for petroleum feed-stocks is essentially static. This is the final true use for petroleum, rather than simply burning it. It is not so price sensitive when you make pharmaceutical drugs. And oil wil be produced for these demands indefinitely. And no one will care.

      6) Only the Transport Sector has shown real growth in demand and that is because there were not any viable substitutes. The only partial answer was to use less per vehicle, hence CAFE, but this was balanced by increases in Transport Sector growth needs. Oil markets are now dependent pretty much on ONLY the Transport Sector for growth.

      It has taken 35-40 years to find a viable substitutes, for the Transport Sector, and it is finally happening. Despite the lefty politicians and their brainwashed little Obamabots, who have been taught to loathe everything American, including its economic system's wonderful adaptability. Not a single left wing government type created any valid substitute, like the electric vehicle, plug in vehicle, or the fuel cell vehicle, or genuine economic hybridization.

      The lefty's only idea of progress is rationing, by direct or indirect taxation, that solves nothing. But does line pockets of the politicians. The government's PGNV that produced a $1,000,000 per copy car, wholly uneconomic, and is typical of governmental committee boondoggling. Nice vehicles, but no reasonable market solution existed at that price.

      The free market and free enterprise that the Obamabots have been taught to loath, provided the impetus and eventually developed true substitutes for the Transport Sector. Governmental weenies never did. Free enterprise developed better batteries. Free enterprise continues to improve the fuel cell. When Fusion power for electrolysis and better cells are available, in 30 years or so, it will be practical. Free enterprise has produced economic levels of hybridization for today, like the Prius. (40 mpg). Free enterprise is developing the much greater fuel efficiencies with higher levels of substitution and hybridization like the Volt, (320 mpge) for a few score months from now.

      Transport Sector substitutes are now on the verge of viability; and Oil demand will collapse a long with prices, as these substitutes are introduced and produced in numbers.

      The US will reduce oil demand much more than the EU, where rationing by taxes has lead to forcing consumers into tiny vehicles everywhere. Meanwhile toxic emissions regulation there has languished, decades behind America, as the consumers elected to purchase smelly, sooty, under-cleansed diesels, in self-defence against their government's taxation.

      American adaptability has cleansed the ICE auto to environmental perfection. In 2008, 56 car models, for sale to everyone in the USA, were rated as PZEV or AT-PZEV models, or pollution free autos,. by their severest critics. Many more have arrived in the 2009 model year. if we didn't ned to migrate from Petroleum availability and price reasons, the pollution job is over. AGW via GHGs is a scientific farce that fewer and fewer scie
        • 5 Years Ago
        CARB did not bring the electric cars. The CARBite idiots have established the Gold Star system for fuel cell vehicles, mandating that auto makers build sufficient numbers of fuel cell vehicles. That is their warped idee fixe.

        CARB is more responsible for wasting money than anything else. They did not create any superior emissions requirements. They only required that federal emissions regulations be implemented more hastily and wastefully. Many times their stricter schedules proved to be hopelessly and incompetently impossible.

        Today the EPA and CARB are equal. There is no CARB regulation in force tougher than in force federal regulations, save the HVOC parked car emissions from evaporation. BFD.

        They have retreated several times after forcing the automakers to waste massive amounts of money to meet impossible schedules. The end result was even further delay in achieving cleanup.

        The federal governments EPA cleanup schedules have NEVER had to be changed or stretched out. They listened to reasonable technical people about how long it would take to develop and then deploy the cleanup equipment that we all wanted. The result still stands. The EPA has created the toughest regime of automotive cleanup of anywhere in the World; and that includes the so-called, oh so concerned, posturing and phony Green Europe that is decades behind the US in achieving clean air.

        Europe is actually marching backward; it's air with all the unclean diesels, is actually getting worse than it used to be. And EU VI regulations for 2014 won't help. US T2B5 diesel regulations are 90 times tougher.

        With California's budget problem is time to thank them all; and give them gold watches, and pension off CARB bureaucrats and close it down. Its job is done, and its time has past.



      • 5 Years Ago
      How about we take it a step further and do the same with all of out imported goods? and not send our money over seas to help another economy instead of our own?

      Its like the US is picking it fights well at least the people with popular belief. Sure lets hate on all the Arabs for getting our oil money but why are we not hating the Chinese? the Indians? the EU? Mexico? or the out sourcing of jobs? They are all getting out money too when we buy imported goods!!

      To me it's all F-ing BS people want to single out oil as poison to our economy and bad bad bad to support the Arabs economy with our money but no one is seeing the bigger picture with the rest of the crap that WE import as appose to producing it withing this nation, to top it of we are capable of producing the majority of the good we import, but we still import then..its not like Oil we cannot out produce oil only reduce our consumption to not need as much...So if people really want to care about this nations economy look at the bigger picture its not just about OIL!!!
      • 5 Years Ago
      I see this talk about OILS this and OILS that... yet no one is regulating the REFINERIES. Big companies like Chevron/Exxon and the such.

      Honestly.. Oil is a lot cheaper now than what it was 5 years ago, yet the price/gallon is way higher... Why is that? Because the people that are really raking in the money are the refineries. That was one of the reasons why OIL went out of proportions. I mean... Oil producing nations said "heck we supply what makes their lifestyle, yet the company that refines OUR product is the one raking in the business... why can't we?" BOOM here we have it. Oil went REALLY up and we have an issue.

      Now if Obama is who he says he is I am sure that he can put pressure for the price of OIL and Gasoline/Diesel to go down and use the leverage to make the car manufacturers produce better automobiles. Why? because they will sell like hotcakes and its an incentive for EVERYONE to move.
        • 5 Years Ago
        they dont charge what ever they want for it... there are things called operating cost and regulatory cost that have to be calculated into the price..
        • 5 Years Ago
        I noticed that I actually wasn't using the average prices for RUG in my previous comment. I was looking at the average price for all grades combined. However, I used the same figures for both today and 5yrs ago, so the comparisons are still valid.

        Just thought I'd mention that since I'm sure someone would have found reason to discount my comment due to that slight oversight.

        For accuracy's sake, here are the correct figures for RUG alone.

        National average prices
        Today(as of 4-6-09): $2.037/gal.
        5yrs ago: $1.999/gal.(averaged from the weekly prices for the whole month of Oct. 2004)
        • 5 Years Ago
        @ Christian de Saint Preux...

        Oil is a good deal or people would find alternatives and make decisions to curtail or eliminate thier use...

        Stage I: Buy a fuel efficient vehicle.

        Stage II: Buy a hybrid.

        Stage III: Buy a scooter.

        Stage IV: Buy a home closer to work and walk or ride a bicycle to work.

        Stage V: Buy a home that derives energy from natural gas, solar panels, a wind generator, or other non-oil sources that is close enough to work so you can walk or ride a bike.

        It is easier for Americans and others the world over to buy the cheap oil and complain about oil company profits than it would be for the same individuals to... ride in a smaller car... pay more for a car up front... inconvenience themselves to ride a scooter in the elements... move to a less desirable home closer to thier work... or pay the insane amount of money to build a home and lifestyle that virtually eliminates your need for oil. The choice is ours my friend! We have chosen oil! Shell oil is ripping me off and I think that stinks too! But the choice is still mine.
        • 5 Years Ago
        Really?
        no one regulates refineries?
        refineries are regulated buy state, local, and federal government to the teeth... where you can build, how you can build, if you can expand, the quipment you use, the blend you produce and the time of year. their are so many regulations on refineries thats why we can pump a lot of oil but not refine it. companies dont want to build new refineries because of the regulatory cost...

        lets think before we post...
        • 5 Years Ago
        quote from Christian:
        - "Honestly.. Oil is a lot cheaper now than what it was 5 years ago, yet the price/gallon is way higher... Why is that? Because the people that are really raking in the money are the refineries. That was one of the reasons why OIL went out of proportions. I mean... Oil producing nations said "heck we supply what makes their lifestyle, yet the company that refines OUR product is the one raking in the business... why can't we?" BOOM here we have it. Oil went REALLY up and we have an issue." -

        Your assumption completely falls flat on its face in light of the facts.

        First, let's look at recent prices. The National average for Regular Unleaded Gasoline(RUG) is $2.09/gal.(as of 4-6-09). The price of crude has been hovering around $50bbl recently(give or take a few bucks).

        So, let's look back roughly 5yrs ago(as you state) to when oil prices were similar and see what the gas prices were then.

        In Oct. 2004, oil prices were also right around the $50bbl range. At that time, the national average for RUG was also right around $2.00/gal.(ranged from $1.98/gal. to $2.07/gal depending on the week).

        So, where is this massive increases in the price/gallon that you mentioned?

        Links I used if you care to verify my research, http://tonto.eia.doe.gov/dnav/pet/hist/mg_tt_usw.htm
        http://tonto.eia.doe.gov/dnav/pet/hist/rwtcW.htm

        Secondly, refineries are hardly where the money is made. The margin on refining is razor-thin and it's very difficult to make much money from the refining side of things.

      • 5 Years Ago
      Well, cars USED to have a severe environmental impact, what with the tetraethyl lead in fuel and all, but now the engines are quite clean-burning, minimizing the environmental impact. Metals and plastics used to make the body panels, interiors, and wheels can now be recycled, except for carbon fiber, I think, and I don't really buy into the whole global warming thing, so cars don't really do much environmental damage. But as for fuels, I am a strong proponent of alcohol fuels. Methanol can allow for ultra-high compression ratios, 19.5:1 in one experimental engine, and can be made fairly easily from carbon rich waste. Certain algae have been farmed to produce biodiesel, and bacteria have been genetically modified to excrete ethanol. I think we should go with whichever alcohol provides the best balance between ease of production and octane rating, so we can extract more power from less displacement, allowing engines to burn less fuel, because fuel economy does matter. Better fuel efficiency means having a decent range on a smaller tank, and a smaller tank means less weight, and less weight is good for almost every aspect of a car's performance. But I believe in keeping the good 'ole internal combustion engine around for hundereds of years to come. We've gone from 1hp 1.0L engines in Karl Benz's Motorwagen to 500hp supercharged 2.5L V8s like in the Caterham RS Levante and the Ariel Atom 500 V8, and the Otto-cycle engine has yet to reach its full potential. Camless engines with electronically actuated valves, variable compression ratio pistons, and six valves per cylinder may soon be on the horizon. Whether burning gasoline, alcohols, hydrogen, or even running on compressed air, the Otto-cycle engine is the best combination of reliability, cost, and durability of any automotive propulsion system out there.
        Frank Hummel
        • 5 Years Ago
        But the ANSWERS to such considerations DO EXIST and, in reality, HAVE LONG EXISTED! People merely seem to be caught up in a propagandistically-imposed TIME WARP that discourages RECOGNITION of REALITIES!

        The Chevy VOLT is really a PROTOTYPE for a whole PROGENY that would soon follow. (GM has ALREADY put in for $2.6 Billion of "Bailout" money to FINISH this initiative, which is NEARLY COMPLETE --- having been "under development" for the last couple of years now alteady --- and also, to EXTEND the concept to the CADILLAC, and also to ANOTHER model. Even so, the EUROPEAN equivalent --- which has been jovially dubbed the AMPERE by ITS developers --- is now actually AHEAD in the "development derby", having just been "unveiled" already at a recent European auto show. One can ALSO be assured that there will shortly surely be initiatives along the same lines forthcoming from ASIA as well.

        For those who may not yet have "caught on" to what the whole “little” initiative is really "all about", the VOLT is an ELECTRIC - I.C.E. "CHIMERA". Mostly, it is an ELECTRIC car, with a battery that will carry it FORTY miles. (And by the way, if you erroneously imagine that no such vehicle can get above 30 miles per hour or get out of the back yard --- well, be advised! The speed record for ELECTRIC-powered cars out at the Bonneville Salt Flats is somewhere north of 400 Miles per Hour. Now how’s THAT for speed and power?)

        Once the battery runs down, a (gasoline-powered) internal-combustion engine (I.C.E.) kicks in (automatically) --- so that you will NOT be stranded off in Limbo. But when that engine DOES run, it is NOT coupled directly to the wheels in the manner to which we are generally accustomed. Rather, it drives a GENERATOR that powers the ELECTRIC motors that actually propel the wheels. (And even THAT, incidentally and secondarily, is actually intrinsically more fuel-efficient than the automotive architecture to which we have all so long been inured.)

        Now FULLY THREE-FOURTHS of all auto usage will "FIT" within a forty mile power budget! You go to the store, the doctor, the bank, and you come home and PLUG THE CAR BACK INTO THE WALL --- THE GASOLINE ENGINE NEVER RUNS! So, perforce, NO gasoline refined from expensive imported oil (or even EQUALLY expensive oil extracted from the 30% of “our OWN” declining Providential-Endowment reserves of the stuff that still persist --- confined now to low-capacity “stripper” wells, or under water, or north of the Arctic Circle, or WAY deep), is consumed --- PERIOD, EXCLAMATION POINT! Now THERE is ABOUT 75% OF FOREIGN (and also other!) OIL INDEPENDENCE FOR YOU! (And when REGENERATIVE BRAKING is eventually “layered in” to the mix, that fraction can increase to UP TO FULLY SEVEN-EIGHTHS --- as presaged by the energy recovery / recycling fraction generally achieved by the Toyota Prius!)

        Sadly, such a concept probably comes across to most people as some kind of "new, alien, exotic" technological notion --- a fact which ITSELF testifies to the tremendous technological IGNORANCE of many, many people. For BOTH the drive "paradigms" incorporated into the “chimera” ARE NOT NEW AT ALL! Battery powered cars have been around since the EARLIEST days of the automobile. And the “I.C.E. fallback” component has been around FOR ABOUT SIXTY YEARS NOW ALREADY, on the RAILROADS and also in the LARGEST SHIPS on the HIGH SEAS. Anybody ever hear of the DIESEL-ELECTRIC LOCOMOTIVE?!

        Moreover, the concept also SIMPLY ELIMINATES the whole elaborate, expensive, troublesome TRANSMISSION and DRIVE TRAIN! There just ISN'T ONE on a Diesel-Electric Locomotive! "We" couldn't BEGIN to engineer a sufficiently heavy-duty CLUTCH for such loads. That is why the ELECTRIC-drive paradigm was developed --- LONG AGO --- for really HEAVY lifting. Notwithstanding the notion that seems to have been generally “cultivated” among “consumers” of automobiles, BIG-MUSCLE machines rely on relatively simple, UNbreakable MAGNETIC-FORCE drive elements rather than on more complex, fallible mechanical ones!

        The mean, nasty, ugly, God's-Honest truth, folks (however unthinkable and even HATEFUL anybody may find it to be), is that there really is no TECHNOLOGICAL reason on God's Blue-Green Earth why this sort of alternative, which really involves only very OLD technology, could not have been implemented in the mere AUTOMOBILE MANY YEARS AGO NOW ALREADY! --- but for the small fact of "our" MISguided (or maybe more like MISBEGOTTEN
      • 5 Years Ago
      Try selling this idea to the greenies in California...
        • 5 Years Ago
        ^What are you talking about?

        SUVs were in demand, people were paying hand over fist for them. Why is it General Motors fault that speculators drove up the oil bubble? When you're low on cash, you don't waste money on a Hail Mary, like the Prius, you go with a money-maker.

        It's easy to look back and say what people should've done, but nobody knew oil was going to rise that far, that fast. I'm still not convinced it'll go back that high, but that's only contingent if we can get the speculators out of the market (and by all indicators, they're still there waiting).
        • 5 Years Ago
        He doesn't need to. I think the bigger challenge would be trying to make Michigan a more powerful buying force and legislative force than California. Until you do that, none of these editorials will matter. Though they are helpful, having read all of them to date, It would appear the big three are now completely un-responsible for their predicaments, all the profitable automakers have no clue, and all the greenies are the devil. I’m all for alternative viewpoints, I’m just curious how many perspectives are left to absolve the big 3 from their responsibilities to run a viable business.
      • 5 Years Ago
      How can it be assumed that the design of the internal combustion engine, with an efficiency of only 30%, has no part to play in the consumption of gasoline?

      The fact is that this issue needs to be resolved with a big picture point of view. Any re-design requires that all aspects of the design, in this case the engine and the fuel, should be addressed.

      I agree that fuel technology needs to be addressed but we should finish the picture, not just draw the outline.

      In addition, I believe that we should strive to reduce consumption well below the 60% of current usage. Attaining that number certainly is a goal but it should not be seen as the holy grail.
      • 5 Years Ago
      I propose that you are not aloud to propose anything anymore.. ever...

      thanks
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