go after the 1 or 2 issues that cause 80% of your problem
I didn't argue that you shouldn't go after the biggest problem. The point is that your calculations get thrown off, not that "the idea should be totally abandoned because you aren't dealing with 100% of the issue."
Interest goes both ways though.
Yes but interest is a bigger factor in an upfront capital expenditure (buying a new car) than it is with an expense paid over the life time of the car. People might not have to borrow to pay for fuel, and even if they do, the borrowing occurs over the whole lifetime of the vehicle. If you have a car for 10 years you pay the cost of the car upfront and pay interest for the life of the loan. If you borrow money for the fuel you don't borrow the whole cost upfront when you get the car and pay interest on it for the lifetime of the vehicle. If the government subsidizes the vehicle purchase than, since the government generally doesn't pay off its debt, it tends to roll over the principle and thus pays the interest cost indefinitely. The interest on the fuel, if any, will not be for as long of period.
Not true. Prius hybrids cost $25-30K depending on where and when you buy it.
Priuses get subsidies. Also if your replacing all vehicles you would be replacing not just cares comparable to the Prius but larger, faster, and more luxurious cars. Also the Prius is neither a "plug in hybrid" nor a flex fueled vehicle.
4 - Your ignoring the cost of the flex fuel. Your calculating a 75% reduction in oil use, but the cars are "flex fuel" burning some mix. If they are burning ethanol or bio-diesel or whatever you have to count the cost of that fuel, which may be more than the cost of gasoline.
That is true and that may completely offset the cost savings to American consumers.
It may, when combined with the cost of replacing the vehicles, and the extra cost involved in making vehicles "flex fuel, plug-in hybrids", do much more than offset the cost savings to American consumers. This factor is huge. Since alternate fuels tend to be more expensive there is no saving to cancel out the additional capital cost for all the new vehicles. Its a huge hole in your plan.
Enriching American farmers will have a multiplier effect on our economy, which will boost our standard of living, create jobs, etc.
Subsidies don't generally have a positive multiplier effect. The money spent does indeed get spent again or invested, and thus it has a multiplier, but so would the same money if it was never taxed away or used for the subsidy. In this case you wouldn't only be subsidizing the vehicle, but also the fuel Ethanol received subsidies, and most alternate fuels are more expensive than gasoline, so they would either have to receive subsidies, or be mandated, or people would tend to still use gasoline and you wouldn't get the 70% reduction you want.
5 - If cars become more fuel efficient or otherwise cheaper to operate you may get an increase in miles driven, esp. if your subsidizing the cost of the car (so more people might have cars).
Nice try, but this is not true. Miles driven has proven to be remarkably inelastic in the face of fluctuating gas prices.
Total miles driven, isn't very elastic, esp. in the short run, but its not totally inelastic. Its a relatively minor factor, but it is still a factor. In any case that's only one of the two factors I mentioned. Your also subsidizing the cost of the vehicle which might lead to more vehicles and indirectly to more miles.
Of course, each person would only get one of those incentives.
What about people with multiple vehicles?
Or what about someone who takes the incentive for one vehicle but buys a conventional vehicle as well (or are you going to outlaw them)?
And what about the additional cost for future vehicles. (Not the whole cost of the vehicle but the incremental cost involved in making it a flex fueled plug in hybrid? |
