In 2012, the Obama administration, with the support of the major auto manufacturers and the United Auto Workers, set in motion the audacious goal to nearly double fuel efficiency standards for autos and light-duty trucks by 2025. This move guaranteed that US automakers would, at minimum, remain competitive with foreign brands. It set in motion a wave of innovation with an emphasis on building smaller, more efficient vehicles.
One thing was missing, however; a carbon tax that would serve as an economic incentive to drive demand for smaller vehicles. Most economists and climate scientists agree that the simplest and most effective way to reduce carbon pollution is to tax it. Had a carbon tax been in place, the cars and the workers who assemble them would now be in great demand. Instead, cheap gas has consumers favoring larger and less efficient S.U.V.s and crossovers produced beyond our borders. In order to remain viable, G.M. is forced to cater to those consumers.
In August, despite strong opposition from the auto industry, the Trump administration moved to freeze current fuel standards, thus weakening a policy that would have significantly reduced carbon pollution while fostering innovation and job creation. Once again, G.M. and other domestic companies are in the precarious position of not being prepared for a sudden increase in oil prices like the 1973 Arab oil embargo that drove consumers to more fuel-efficient imports and nearly destroyed our domestic auto industry.
As the recent news about G.M. illustrates, the ramifications of our failure to deal with climate change go well beyond dirty air.