Again, good on paper. But the current energy bill, if enacted, would give even more subsidies to the energy companies, and encourage consumption over conservation. Digging the whole deeper.
And good in reality. Even a bill as big, and mostly negative as the current energy bill is swamped by the effect of the increases in price over the last few years, and by the eventual increase in price as oil becomes more scarce. Subsidies divert resources, and can slow economic adjustment, but the forces behind the eventual transition to other sources of energy are to big, even if they are very slow. As large and mostly dysfunctional as this energy bill is it is small compared to these forces.
There would be a similar lag if your plan was implemented.
Not much of one. Look at auto sales in the last month because of automaker incentive; very impressive. If people could buy a brand new Dodge Neon with a $4-$5K tax credit, I imagine you would sell a lot of those efficient cars and retire a lot of old clunkers.
The auto sales last month are a blip on the scale of If you are trying to replace a significant portion of the cars on the road. There will still be significant lag.
Incentives can have a fairly dramatic quick effect if they are large and temporary. People buy now to avoid losing the chance to get the incentive. The effect is reduced over time (in the sense that the incremental effected sales are reduce, obviously the total number of sales effected by the incentives grows, even if one or two are added in some month that's one or two more than the month before). Your proposed incentives are large enough to have a major sustained effect, but it would be a slow one compared to the size of the transition that you want.
Of course to me that's a side issue. I'm against the plan lag or no lag, but there would be a lag.
Part of the lag would be a lag in availability of a much greater number the more fuel efficient cars. Until they become more available a lot of the incentive will wind up going to dealers and manufacturers of the cars rather than to the consumer. (assuming the incentive is large enough to quickly and strongly change buying patterns). That doesn't mean the effect is wasted (the extra money for fuel efficient cars going to the manufacturer increases their incentive to produce such cars) but it does show some of the complexity in real world implementation and response.
Tim |
