(Cross-posted at Fairfax County Democratic Committee)
Given that Monday brings a Special Session and more talk of transportation and tax policy, my mind has been awash lately with musings about tax policy, our Commonwealth, and the terms of the debate. I've got lots of ideas, but here's one thing that occurred to me today.
Earlier today, I drove out to the Coordinated Campaign HQ at Anderson Road while moving a desk to my office in the City of Fairfax before returning to Mt. Vernon. Coming back, I pondered the fact that this 40 mile trip actually cost me about $12 in my minivan, while if I could have used my Honda, this trip would have cost me $4.
Information Makes a Difference
The Washington Post also ran an article the other day about hybrid owners have noticed that their cars also alter how they drive on the road - this is something I've known for four years now. My hybrid tells me both my exact gas mileage at any second (you can watch if fluctuate by pumping the gas) and your average mileage per tank. Soon after I bought it, every day became a challenge to keep my average per tank as close to 50 MPG as possible. Very quickly you notice that when you stomp the gas, turn on the A/C, or go up a hill, your MPG plummets, ruining your average MPG.
You see, when you're getting 50 MPG, a 10% drop = 5 MPG or 70 less miles out of a 14 gallon tank of gas - That's real money. However, if you're driving a car that gets 20 MPG a 10% drop in gas efficiency only saves you 2 MPG or 18 miles out of a 14 gallon tank of gas. Big deal. Who cares? Keep driving like a jerk. It doesn't really make much difference, right?
Should Everyone Buy a Hybrid? Depends on what you drive now...
This brings me to my broader point. From a public policy point of view, our leaders ought to focus their efforts in an efficient fashion so that we get the biggest bang for our buck and so that not everyone is impacted unfairly. While we can look at changing everyone's behavior, sometimes that's more difficult than changing the behavior of a smaller group of people which are responsible for the bulk of the harm. Sometimes we can actually make a much bigger difference by focusing on a smaller group of people. Let me explain.
Before I bought my Civic Hybrid, I drove a Honda Accord. I was getting 31 MPG. So I went from 31 MPG to 50 MPG - a difference of 19 MPG or an increase of 66%.
Suppose I drove a 2008 Hummer H3 and got 18 MPG. Suppose I upgraded to a 2008 Honda Accord and got 31 MPG. That's an increase of 13 MPG or an increase of 72%. What's the big deal you ask? Let me explain.
Suppose I drive 15,000 miles per year. Here's what that means.
Comparison of Car Upgrades |
||||||||
| MPG of First Car | MPG of Second Car | Difference | Proportionate Increase | Car #1 Gals. Per 15,000 Miles | Car #2 Gals. Per 15,000 Miles | Gallons Saved | Money Saved | |
| Accord to Civic | 31 | 50 | 19 | 61.29% | 484 | 300 | 183.9 | $735.48 |
| Hummer to Accord | 18 | 31 | 13 | 72.22% | 833 | 484 | 349.5 | $1,397.85 |
| Difference | 13 | 19 | 6 | 10.93% | 349 | 184 | 165.6 | $662.37 |
You see, in the United States, we measure everything wrong. Miles per gallon is a crappy measure. To give people a meaningful basis of making comparisons, we should not be looking at miles per gallon, we should be looking at gallons per mile, and we should probably be looking at gallons per 100 or 1,000 miles. Then people can truly understand their choices.
Check out the following from a British journal.
In The MPG Illusion, published in the US journal Science yesterday, Richard Larrick and Jack Soll at the university's Fuqua School of Business describe how the use of miles per gallon is misleading and causes people to grossly misjudge the environmental impact of upgrading to a new car.The two management professors stumbled across the problem while working out the true fuel efficiency of different cars in a car-sharing scheme. They found people often believed - mistakenly - that a 10mpg improvement in fuel efficiency always corresponded to the same fuel saving.
"The reality that few people appreciate is that improving fuel efficiency from 10 to 20mpg is actually a more significant saving than improving from 25mpg to 50mpg for the same distance of driving," said Larrick. Likewise, replacing a car that does 10mpg with one that appears only slightly more efficient at 11mpg saves as much fuel as upgrading from a 33mpg car to a 50mpg car....
In a series of experiments, Larrick and Soll asked volunteers to study a series of cars whose fuel efficiencies were given in miles per gallon. When they were asked which upgrade would save the most fuel, they invariably made the wrong decision. In one test, most people believed that upgrading a car from 34mpg to 50mpg would save more petrol than replacing an 18mpg car with a 28mpg vehicle. In fact, the latter saves twice as much fuel.
"Miles per gallon is misleading and can play tricks on our intuitions," said Soll. . . . "Changing the way we express efficiency would help the car companies make clear to buyers where there are gains to be made." When the tests were repeated using gallons per 100 miles, the volunteers correctly picked the greenest option from those available.
The General Assembly and Congress should pass legislation mandating the following
1 - Car efficiency be expressed in gallons per 1,000 miles.
2 - All cars should provide real time feedback as to your gas mileage.
3 - Tax incentives should focus on getting people out of gas guzzlers as opposed to simply promoting hybrid ownership.
Hybrid ownership is a good thing. I invested in mine in August, 2004 and I have never looked back. However, as a society, we will make the biggest difference getting the cars with the lowest mileage off the road. That is the most efficient policy. While the hybrid might be a good choice for me, it's not the best choice for everyone.
In terms of Monday, none of this will get us more roads or rails built (in fact it would probably reduce tax revenue because people would be paying less taxes per mile driven), but it will certainly make our world better for our children. As my partner Chap Petersen points out, we need to talk about more than just building new roads, it's time to start changing the conversation in Richmond.
In Europe, they report fuel economy in terms of liters per 100km. Essentially along the lines of what you are suggesting, I guess.
I'm not sure clear why it hasn't caught on here. Perhaps because our existing standard encourages people to make poor choices - e.g. buy SUVs'/Trucks - which have substantially bigger profit margins for automakers.....
Consumers aren't all to blame for this. If you watch car commercials with a critical eye, you can see how blatant the manufacturers are in trying to push all of these themes. In a sense it all comes down to trying to upsell the consumer. For most people a small car is more than adequate for transportation purposes, and in reality profits are very low for small cars - profit margins are much higher on expensive cars. Thus the question is how you get people to spend 2-4 times as much for a far more expensive car, and they have become quite proficient at manipulating consumers through heavy advertising.
this does conversions between metric and imperial units. With firefox, the buttons don't quite line up under the boxes they are supposed to be for. I suppose you could crib the javascript so you can make your own calculator..
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I've got a friend who has a 2 year old non-hybrid manual Civic. His regular driving pattern results in an average of just about 40 mpg - which is pretty good for a non-hybrid with reasonable performance and comfort. At 40 mpg he would use 25 gallons per 1000 miles. If he traded his regular civic for Scott's hybrid Civic, which is getting around 50 mpg, my friend would then be using 20 gallons per 1000 miles. He drives quite a bit (around 20,000 miles per year), so at a savings of 5 gallons per thousand he'd end up with a total savings of 100 gallons per year.
In today's prices that would equate to about $400. I believe hybrid siblings currently cost a few thousand more than the regular version (for any make/model). Meaning a savings of $400 per year really doesn't justify the extra expense for people who get reasonably good fuel economy now.
Point being, publishing the numbers in the manner Scott describes would be great for those who drive vehicles with horrible fuel economy since they'd clearly see the big savings that could be had by upgrading. Just the opposite occurs at the other end of the spectrum, with people who get pretty good mileage now seeing that they'd gain very little and therefore can't justify the extra cost of a minor improvement.
No question that upgrading to hybrids is good for anyone, but if you back up and look at things on a macro level, the biggest gains are made by those on the low end because they are starting off from such a poor position to start.
Also from a sociological point of view, it's probably also unrealistic to get someone from a Hummer into a hybrid - you might be able to get them into a 30 MPG car though which gives all of us (and them) a better net gain for the environment.
And when "Detroit" starts producing 100+ mpg cars everyone will have ample incentive to buy one.
I propose VA impose a "guzzler" tax on any vehicle that gets less than 20MPG. Those who want to keep driving their Hummer, Navigator, Escalade, etc can do so by paying the new annual tax. This is one way to push for fuel economy.
Eric Cantor admits that we may have enough oil offshore for the next 20 years. What happens then if we don't regulate usage beginning today?
But then you have all of the jokers who suddenly need "work trucks" - i.e. SUVs. How do you tell which needs are legitimate and which ones are fabricated just to get around the guzzler tax?
If Virginia was serious about encouraging people to buy more efficient vehicles an annual guzzler tax might be fairly effective. Although I think it would need to be a scaled approach - rather than just draw a line at 20 mpg. Some sort of inverse proportion to the rated mpg.
But then again, doesn't a gasoline tax push a similar outcome? It wouldn't catch Hummer drivers who only commute 2 miles to work, but for the most part a gasoline tax increase provides the same incentive - the less fuel efficient the vehicle the more gasoline required and therefore more tax paid (all other things equal).
Plus, the gasoline tax addresses tax collection in a less painful manner. I think most people hate, really hate, writing a tax check to the government once a year. Why was the personal property tax on cars so hated? Not only was it a tax, but every year you had to write a juicy check to the government - and that sucked. But if you pay a few dollars every time you fill up it is not as painful. If I have to pay, I'd much rather do it incrementally than one lump sum per year.
I'm starting to feel very self-conscious about driving it, while other higher economical cars as well as hybrids go by. I can't help but think of what their perception is, but that's a not a bad thing, for I hope, money willing, to replace it with something more efficient while meeting the drive-ability my occupation requires. HP + FWD + HI-MPG = ? Could use some suggestions.
On a personal note, I had replaced the suv with a more fuel efficient car decreasing gas consumption by ~ 55%, and the new car is still under its break-in period.
They have hybrid minivan's in Japan - they don't have any here. Why not?
All of these vehicles, including SUV's, could be engineered to be more efficient. Detroit just doesn't have the right incentives to do so.