After accepting the position of White House chief of staff under Barack Obama, Rep. Rahm Emanuel said, “You don’t ever want a crisis to go to waste. It’s an opportunity to do important things that you would otherwise avoid.” Emanuel was speaking broadly about the economic crisis, but his statement holds even truer for the crisis facing Detroit automakers.
“It is our hope that [government] actions will restore the pre-eminence of our domestic manufacturing industry so it can emerge as a global, competitive leader in fuel efficiency and in new and path-breaking energy-efficient technologies that protect our environment.”
Rising gas prices earlier this year took a toll on sales of the SUVs and large trucks produced disproportionally by General Motors, Ford, and Chrysler. When the credit crunch hit, many remaining buyers became unable to secure auto loans. Sales plummeted, and the Big Three have been hemorrhaging money. General Motors could run out of cash by mid-2009.
When car companies were profitable, they put up every resistance to government intervention—such as standards for higher fuel efficiency, reduced emissions, and advanced zero-pollution technologies. Now, they are in deep trouble and have come running to Washington for emergency assistance. And it appears they will get it.
In a letter to Treasury Secretary Henry Paulson, Democratic leaders said yesterday “a healthy automobile manufacturing sector is essential to the restoration of financial market stability and the overall health of our economy.” The Democrats urged the Bush administration to use a portion of the $700 billion bailout for the financial industry to rescue American automakers.
The potential Detroit bailout is a once-in-a-lifetime crisis turned opportunity. A grand bargain is in the works: the federal government provides billions of dollars to the automakers, and in exchange, the automakers must retool to produce high-mpg gasoline cars, gas-electric vehicles, clean diesel cars, plug-in hybrids, and all-electric cars.
The Democrats spelled out the deal in their letter: “It is our hope that [government] actions will restore the pre-eminence of our domestic manufacturing industry so it can emerge as a global, competitive leader in fuel efficiency and in new and path-breaking energy-efficient technologies that protect our environment.”
Obama’s Climate Czar, And Hybrid Cheerleader
The new deal for green cars will probably have to wait until after Obama is inaugurated. (Bush has been cool to the idea of a bailout for carmakers.) The responsibility for striking the right deal with carmakers could fall to Obama’s “climate czar,” a new cabinet position that environmentalists hope will be created in the new administration. The definition of this position has not yet been established, but in broad terms, the individual would facilitate initiatives between the Environmental Protection Agency, the Department of Energy, and the Interior Department.
“We should help America’s automobile industry to convert quickly to plug-in hybrids that can run on renewable electricity.”
In effect, this person would become the chief governmental strategist for reducing the emissions of greenhouse gases in the US.
Several names have been circulating throughout the media and blogosphere. The short list includes New Mexico governor and former energy secretary, Bill Richardson, and the former head of California’s EPA, Terry Tamminen. But the leading candidate is Al Gore, former vice president and Nobel Prize winner.
Gore was practically filling out his application for the position with the opinion pieces he wrote this week for The Wall Street Journal and New York Times. He outlined a five-point plan for massive carbon reductions, which included helping, “America’s automobile industry (not only the Big Three but the innovative new startup companies as well) to convert quickly to plug-in hybrids that can run on renewable electricity.”
Gore also called for a nationwide fleet of plug-in hybrids to help solve the problem of electricity storage. He wrote, “Cars could be charged during off-peak energy-use hours; during peak hours, when fewer cars are on the road, they could contribute their electricity back into the national grid.”
Despite a limited choice of gas-electric cars and negligible support from government in the past eight years, more than 1 million consumers purchased a hybrid car. This is a precursor to the next eight years when hybrids could benefit from the full support of government funding, the leadership of a Nobel-winning cabinet member, the eagerness of consumers craving alternatives, and the compliance of an auto industry made to be accountable. The green car revolution is about to shift into overdrive.