This Friday is the deadline for public comments on the stricter vehicle efficiency standards from EPA and the Department of Transportation. The docket is likely to be overrun with statements for and against the regulation that would make cars and light trucks 30 percent more efficient in 5 years.

From an economic perspective, the social benefits of the rule outweigh the costs. The environmental, health, and energy security benefits -- most especially from reducing the tailpipe emission of greenhouse gases -- could more than double the estimated costs to manufacturers of installing more fuel efficiency technologies: social benefits could total over $800 billion, compared to around $400 billion in compliance costs.

But there will also be the straight up savings to consumers, who will spend a fraction of the current cost of filling their tanks. The benefit to Americans' pocket books could reach as high as $2 trillion.

Sources here and here (PDF).

This line item alone swamps the price tag on the rule making it overwhelmingly justified -- but some opponents of the rule may want the EPA to nullify these savings.

Their argument goes something like this: Consumers have the option to buy more fuel efficient cars right now, and they do not. Therefore, there must be something about having bigger, heavier, more powerful cars that benefits American consumers. Since this regulation could limit their ability to buy these larger, those citizens would have to do without something they value.

Opponents of stricter fuel standards admit that it is almost impossible to value that preference for bulkier cars, but they might try to convince the agencies that it is at least as much as the fuel savings we'd see at the pump. Since consumers could have those same fuel savings today by buying a Prius or an Insight, but forgo those cars for an Explorer, then the lost consumer benefit would need to be at least that amount.

But how consumers choose and value cars is more complicated than that. A car's newness, size, and power are valued not just for their functionality, but for their relation to the others in the parking lot. Consumers value horsepower not just for speed but as a status symbol and for the ability to out-accelerate others at a traffic light. People don't necessarily want a big car, they just want a bigger car.

The problem with prestige goods is they don't actually increase welfare or status. If Smith buys a bigger car, Jones has to buy a bigger car as well to catch up; relative to average car size, neither has really moved ahead. By devoting resources to conspicuous features like size, less visible features like fuel efficiency and financial savings are sacrificed.

The proposed CAFE regulations correct a market failure and accomplish what the non-cooperative marketplace cannot: fuel efficiency increases, Americans get the value of fuel savings, and consumers do not have to risk their positional status, since over time the entire fleet's average size and power will shift.

This is one of the chief reasons to regulate: to increase consumer welfare by doing what the market can't on its own. It might take consumers some time to grow accustomed to the new vehicle options, but relatively quickly they will be just as happy with their new, more fuel-efficient models, and they will be thrilled by the trillions in savings at the pump.

Related Links:

Time to Speak Out Against the Biggest Polluters

Why won’t Lisa Jackson/Nancy Sutley visit a mountaintop removal site?

Can EPA regulations on CO2 be blocked?

Related Links:

Approaching Copenhagen with a Portfolio of Domestic Commitments

Climate Denial Crock of the Week: The big mist take

What Do Coal and Dirty Dorm Rooms Have in Common?

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Approaching Copenhagen with a Portfolio of Domestic Commitments

Obama headed to Copenhagen, sets the bar for success

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Approaching Copenhagen with a Portfolio of Domestic Commitments

Obama headed to Copenhagen, sets the bar for success

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Approaching Copenhagen with a Portfolio of Domestic Commitments

Obama headed to Copenhagen, sets the bar for success

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Washington Times: “Obama digs in on global warming”

Approaching Copenhagen with a Portfolio of Domestic Commitments

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Approaching Copenhagen with a Portfolio of Domestic Commitments

Obama headed to Copenhagen, sets the bar for success

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Approaching Copenhagen with a Portfolio of Domestic Commitments

Obama headed to Copenhagen, sets the bar for success

Related Links:

Approaching Copenhagen with a Portfolio of Domestic Commitments

Obama administration officials grateful for early spring

Capturing the massive social benefits of fuel efficiency requires regulation

Related Links:

Capturing the massive social benefits of fuel efficiency requires regulation

Former Washington Gov. Locke would bring a strong voice for oceans to Commerce

The players: Obama’s people

Lisa Jackson.

EPA Administrator: Lisa Jackson (not officially announced)

Background on Jackson.

Some enviros have been critical of Jackson -- get the story.

Steven Chu.

Secretary of Energy: Steven Chu (not officially announced)

Background on Chu.

Watch Chu talk about climate change and renewable energy.

Carol Browner.

Energy Czar: Carol Browner (not officially announced)

Background on Browner.

Browner, who was EPA administrator during the entire Clinton administration, has been a long-time acolyte of Al Gore.

Nancy Sutley.

Chair of Council on Environmental Quality: Nancy Sutley (not officially announced)

Background on Sutley.

Hillary Clinton.

Secretary of State: Hillary Clinton

Clinton -- who will be overseeing international climate negotiations -- had a strong climate and energy platform during her presidential run.

Read a 2007 interview with Clinton.

Bill Richardson.

Secretary of Commerce: Bill Richardson

Richardson will be charged with creating jobs, both green and otherwise, and with overseeing the National Atmospheric and Oceanic Administration. He had an ambitious climate and energy platform during his presidential run, and has been an advocate for clean energy and climate action during his tenure as governor of New Mexico. In nominating him, Obama cited his experience as secretary of energy in the Clinton administration.

Read a 2007 interview with Richardson.

Janet Napolitano.

Secretary of Homeland Security: Janet Napolitano

Napolitano has spoken out against the border wall that divides Arizona from Mexico; the wall has been found detrimental to the environment.

James L. Jones.

National Security Advisor: James L. Jones

Some environmentalists are worried about Jones, noting that he serves on the board of Chevron Corp. and is head of the U.S. Chamber of Commerce's Institute for 21st Century Energy, which is often at odds with enviros over energy issues.

Read up on Jones' energy views and how they may or may not matter within the National Security Council.

Peter R. Orszag.

Director of the Office of Management and Budget: Peter Orszag

Read about Orszag's views on curbing greenhouse-gas emissions.

Rahm Emanuel.

Chief of Staff: Rahm Emanuel

Emanuel -- who will be charged with running the White House and implementing the president agenda -- got high marks from the League of Conservation Voters during his time in the U.S. House.

Secretary of Interior
Raúl Grijalva, Democratic representative from Arizona
   Grist profile of Grijalva
   Conservation scientists endorse Grijalva Mike Thompson, Democratic representative from California
   Background on Thompson Kevin Gover, director of the Smithsonian Institution's National Museum of the American Indian
   Background on Gover David Hayes, a partner at the law firm and lobby shop Latham & Watkins
   Background on Hayes Brian Schweitzer, governor of Montana
   Rick Bass profiles Schweitzer, 2006 Jamie Rappaport Clark, Fish and Wildlife Service director under President Clinton and current executive vice president at Defenders of Wildlife
   Grist Q&A with Rappaport Clark, 2005 Jay Inslee, Democratic representative from Washington state
   Grist interview with Inslee, 2007 Tony Knowles, former governor of Alaska John Kitzhaber, former governor of Oregon Ken Salazar, Democratic senator from Colorado and former executive director of Colorado Natural Resources Department

Secretary of Agriculture
Charles Stenholm, former Democratic representative from Texas Dennis Wolff, secretary of agriculture for Pennsylvania Tom Vilsack, former governor of Iowa
   Grist interview with Vilsack, 2007 Tom Buis, a former aide to Sen. Tom Daschle and president of the National Farmers Union Stephanie Herseth Sandlin, Democratic representative from South Dakota and former director of the South Dakota Farmers Union Foundation Jim Leach, former Republican representative from Iowa Collin Peterson, Democratic representative from Minnesota and chair of House Agriculture Committee John Salazar, Democratic representative from Colorado Sanford Bishop, Democratic representative from Georgia Progressive activists have offered up an alternative list of names

Secretary of Transportation
Earl Blumenauer, Democratic representative from Oregon Steve Heminger, executive director of the Metropolitan Transportation Commission for the Bay Area Ed Rendell, governor of Pennsylvania James Oberstar, Democratic representative from Minnesota and chair of the House Committee on Transportation and Infrastructure Peter DeFazio, Democratic representative from Oregon and chair of the House Subcommittee on Highways and Transit Janette Sadik-Kahn, commissioner of the New York City Department of Transportation Jane Garvey, former head of Federal Aviation Administration Mortimer Downey, deputy transportation secretary under President Clinton

Related Links:

Approaching Copenhagen with a Portfolio of Domestic Commitments

Obama administration officials grateful for early spring

Capturing the massive social benefits of fuel efficiency requires regulation

High gasoline prices have spurred Americans to sharply curtail their driving in recent months and the resulting sustained dip in fuel sales has helped bankrupt a federal fund for major transportation projects across the country. The Highway Trust Fund, which is paid for almost entirely through money generated by the federal gasoline and diesel taxes, will be $8 billion in the (pot)hole by the end of September; the huge deficit will delay highway payments to states, could cause a big dip in construction jobs, and may impact future highway projects. Just this summer officials were projecting the fund wouldn't be depleted until at least October and that the debt would only exceed $5 billion sometime in 2009, but they seem to have underestimated the impact of high gas prices. Earlier this year, President Bush had adamantly opposed a spending bill that would provide $8 billion to prop up the highway fund, preferring instead to shift money from a federal mass-transit fund to make up the shortfall. However, faced with the enormous deficit much sooner than thought, Bush reversed course and has agreed to support the legislation.

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Obama headed to Copenhagen, sets the bar for success

Obama going to Copenhagen

Officials at the U.S. EPA have criticized their counterparts at the U.S. Transportation Department lately over the DOT's proposed fuel-economy standards for vehicles of 31.6 miles per gallon by 2015. The EPA has said the DOT used an unreasonably low figure for future gasoline prices -- $2.42 a gallon in 2016 and a high of $3.37 a gallon -- which skewed the final cost-benefit figures in favor of lower fuel-economy standards; the 2007 energy bill mandates that automakers meet a standard of 35 miles per gallon by 2020, but the legislation allows the DOT to set the interim standards. "EPA has several concerns with the methodology used to determine the relative benefits and costs of the alternatives analyzed," said EPA's Susan Bromm in flawless bureaucratese (the shared language of all U.S. federal agencies). The EPA also criticized the DOT for putting what it said was too low a value on the societal benefits of reducing greenhouse-gas emissions, saying that the DOT calculated only the costs to the U.S. and not to other nations of the world that are also impacted by climate change.

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Obama headed to Copenhagen, sets the bar for success

Obama going to Copenhagen

Related Links:

Capturing the massive social benefits of fuel efficiency requires regulation

Top 25 reasons to give a damn about climate change

General Motors to start repaying government loans

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Obama headed to Copenhagen, sets the bar for success

Obama going to Copenhagen

Related Links:

‘Copenhagen Diagnosis’ offers a grim update to the IPCC’s climate science

Capturing the massive social benefits of fuel efficiency requires regulation

Make the kids pay: The economic effects of climate change on future generations

Related Links:

Capturing the massive social benefits of fuel efficiency requires regulation

For public transportation to survive, we all need to ... drive more?

Sen. Ben Cardin answers Grist’s questions on public transit and mountaintop removal mining

Related Links:

Capturing the massive social benefits of fuel efficiency requires regulation

For public transportation to survive, we all need to ... drive more?

Sen. Ben Cardin answers Grist’s questions on public transit and mountaintop removal mining

A federal appeals court has rejected the Bush administration's fuel-economy regulations for 2008-2011 model light trucks and SUVs. In the scathing tone that the Bushies are becoming quite familiar with, the judges declared that the regulations did not consider the economic impact of vehicle emissions' contribution to climate change, and ordered the Transportation Department to come up with new, tougher standards. The court also asked for an explanation of why the agency considers light trucks and SUVs in a separate category from passenger cars, saying the distinction "overlooks the fact that many light trucks today are manufactured primarily for transporting passengers." Enviros had petitioned the appeals court less than a month after the regulations were announced in March 2006; subsequently, 11 states joined the lawsuit. While we always love to see climatic injustice smacked down, this specific issue may become moot if Congress passes -- and Bush OKs -- an energy bill with tougher fuel-economy regulations.

Related Links:

E.U. pushes China further after pledge to slow carbon intensity

Obama headed to Copenhagen, sets the bar for success

Obama going to Copenhagen

According to Rep. Henry Waxman (D-Calif.), head of the House Oversight and Government Reform Committee, the Bush administration has been quietly lobbying members of Congress and state governors to oppose California's strict greenhouse-gas emissions rules for cars. In December 2005, the state submitted a request to the U.S. EPA for a waiver it needs to implement its standards. Since then, the EPA has been stalling, promising a ruling that's been nearly two years in the making. Waxman's committee uncovered emails between officials at the U.S. Department of Transportation and the White House Council on Environmental Quality and conducted interviews of DOT staff, all of which he says point to a concerted campaign approved by the White House and led by Transportation Secretary Mary Peters to gather opposition to California's standards. In a letter to the CEQ demanding a condemnation of the lobbying, Waxman wrote, "The administration is trying to stack the deck against California's efforts to regulate greenhouse-gas emissions from motor vehicles. It suggests that political considerations -- not the merits of the issue -- will determine how EPA acts." California's pending standards would cut greenhouse gases from new cars by nearly 30 percent by 2016; 11 other states have adopted California's rules, but no one can act on them until California's waiver is granted.

Related Links:

December 19—the day after COP15

E.U. pushes China further after pledge to slow carbon intensity

Obama headed to Copenhagen, sets the bar for success