SpongeBob's energy policy.
BY CSABA CSERE
APRIL 2003
Some of you might have caught my act in mid-December when NBC's Today Show asked me to appear with Arianna Huffington, the motor-mouthed syndicated columnist. Although Huffington has, in the past, articulated an occasional sensible idea, she is currently in the limelight as one of the founders of something called the Detroit Project, an organization dedicated to the proposition that SUVs are evil.
If you've seen her TV ads—"Drive an SUV, fund a terrorist!"—you know what the Detroit Project is about. During our Today Show encounter, Huffington spewed her anti-SUV bile so breathlessly that I could hardly respond to her numerous crackpot assertions.
Her most glaring logical lapse is the basic notion that anyone driving an SUV is wasting fuel and thereby funneling money to Middle Eastern terrorists. This conveniently ignores several facts.
First, only 12 percent of our total consumption—one gallon of eight—comes from the Middle East. Moreover, only 45 percent of our crude oil is used to make gasoline. Even at the lofty price of $34 for each 42-gallon barrel of crude, that means only about four cents of the price you pay for a gallon of gas ends up in the Middle East, on average.
Second, that four cents per gallon does not go to Bin Laden, Inc. The largest share of it ends up in Saudi Arabia, a country that's no democracy but has a government that's at least on friendly terms with us. The second-largest portion of our Middle Eastern oil comes from Iraq, where oil sales, supervised by the United Nations, pay for the food that Saddam Hussein would not otherwise provide for his country's citizens.
Third, why is Huffington singling out SUVs? They come in all shapes and sizes, and their fuel consumption ranges from very high to miserly, as is the case with other classes of vehicles.
This demonization of SUVs also ignores the sea change taking place as sport-utes shift from the original truck-based designs to the car-based "crossover" variety. These newer designs provide improved ride and handling, as well as better fuel efficiency. It's lunacy to hector the driver of a Honda CR-V—it consumes less fuel around town than a Ford Taurus—for owning an immoral gas guzzler.
Even the name Detroit Project is off the mark. Sure, Detroit was the first to mass-market SUVs and still builds the majority of them, but the imports are coming on strong across the board. They're building the bigger SUVs as well.
The Detroit Project also claims that customer demand for SUVs was artificially created by clever ad campaigns. It would seem that if Detroit marketers could exert such a hypnotic hold on their customers, they might have used this power to prevent more than a third of them from defecting to imports over the past 30 years.
It's also peculiar that the Detroit Project gives a pass to pickup trucks, which are almost exactly the same size and have identical fuel-consumption ranges as SUVs. Moreover, big pickups are much more plentiful than big SUVS—the Ford F-series and the Chevy Silverado have been the bestselling vehicles in the United States for decades.
And what about limos? What could be more wasteful than a large—sometimes grotesquely stretched—vehicle that typically carries a single passenger and spends many hours idling at curbside so its occupant will be spared the trauma of even a moment's thermal discomfort?
Sure, limos are scarcer than SUVs, but they are more egregious wasters of energy than are the mid-size SUVs that satisfy millions of middle-class Americans. Perhaps limos get a pass because they are the preferred mode of transportation in the New York, Washington, D.C., and Hollywood precincts where Huffington finds so many of her fellow travelers.
Huffington claims the auto industry could easily produce hybrid SUVs that achieve 45 mpg, ignoring the fact that the industry barely achieves such efficiency with compact hybrid sedans that cost significantly more than conventional vehicles. She also claims that announcements at January's Detroit auto show of upcoming hybrid vehicles were motivated by recent anti-SUV press, thus demonstrating a complete ignorance of the auto industry's long lead times and knowledge of previous announcements.
It makes no sense to single out SUVs as fuel wasters in the first place, but why single out motor vehicles at all? Why is driving a Ford Explorer somehow worse than air-conditioning a 10,000-square-foot house or heating an outdoor swimming pool or flying in a Learjet 31A that gets less than 3 mpg and carries no more people than a Cadillac Escalade would?
If we as Americans develop a national consensus to reduce our oil consumption for whatever reason—political, environmental, financial—we should establish a policy that provides an economic incentive to discourage all usage of oil-derived products. There are many economically sound ways of discouraging energy uses while preserving the freedom of our citizens to decide whether to allocate their energy dollars to fueling an SUV, keeping a large house comfortable, or driving—or flying—across the country.
Even if we ignore these arguments, surrender to our fury over the terrorist attacks, and adopt the Detroit Project's knee-jerk prescriptions by trading our SUVs for Ford Focuses and Toyota Priuses, what would happen? Our demand for gasoline, and thereby crude oil, would fall, causing supplies to contract and some oil wells to be capped. But they wouldn't be in the Middle East. Oil from that part of the world is dirt-cheap because it gushes forth as soon as you drill a hole in the sand. Production, or lifting costs, as it is known in the industry, is less than $2 per barrel. North American oil, on the other hand, costs more like $10 per barrel to lift because of more intensive pumping and myriad environmental regulations. So, as in the past, when oil production is contracted, the first wells to close would be in North America. That would mean an even larger percentage of America's oil would come from the Middle East. Proving that even SpongeBob knows more about economics and the car industry than Huffington does.
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