Editorial: Auto Bailout Is About Power, Not Efficiency

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By Bart King As I write this, the CEO’s of the three biggest American auto companies are en route to Washington D.C. in hybrid vehicles. ‘For Sale’ signs have been hung in the windows of the corporate jets that delivered them to the feet of Congress a few weeks ago, when they first asked for a federal bailout. But their penance is not limited to the revocation of VIP flight privileges. Whether they know it or not, they are atoning for the hubris of an entire nation that led its signature industry down a dead-end road. Despite rising gasoline prices around the world throughout the 1980’s and 90’s, U.S. car buyers and makers opted for increased power, rather than efficiency – an indulgence that was made affordable by suppressed fuel prices due to the enormous size of the U.S. market. But since the beginning of the new century, the United States has lost its market dominance, as millions of drivers in China and India adopted the American dream of auto ownership. Other factors contributed as well, but in the last two years U.S. drivers have been required to pay per-gallon prices on par with the rest of the world – […]

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