Michigan lawmaker says increasing fuel economy standards could destroy Big 3

It didn't take long for Michigan's congressional delegation to start poking holes into Pres. Bush's call for increased CAFE requirements. Rep. Joe Knollenberg, writing in the Detroit News, also noted the efforts that House Speaker Nancy Pelosi and Sen. Barbara Boxer are gearing up to push for tougher fuel economy standards. Knollenberg says an "arbitrary" increase in CAFE "would lead to more job cuts and plant closings." He says Detroit automakers have too much invested in trucks that represent three of the four best-selling vehicles in the nation. He claims the economic pain would "be shared across the country."

Knollenberg wants a bigger tax code instead of improved CAFE numbers. He wants incentives to purchase hybrids, more alternative fuel research and more E85 stations.

I don't think Pres. Bush's proposed CAFE increases are arbitrary. He's asking for a four percent increase in 2010 for cars and 2012. There are also provisions to give bigger vehicles a little leeway over smaller vehicles.

Enough with the tax incentives. They end up getting abused, like the business credit that was supposed to help contractors and others who need fullsize trucks. In the end, lawyers and Wall Street types used it to buy personal Hummers.

There is plenty of time for Detroit to adjust. The Republicans could have instituted more gradual increases during their 12 years while gas prices were low and Detroit was enjoying the profit of their full-size vehicles.

[Source: Rep. Joe Knollenberg / Detroit News]

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