What Are CAFE Standards?

Economy car

Economy car

Too-yummy milk

Too-yummy milk

Vegan burgers

Vegan burgers

What are CAFÉ standards?

First, some boring explanation of how they operate in the automotive markets, then a couple of examples how such insanity would work in foodstuffs.

Government, prodded by greens, forces the Big Three automakers to sell a gas-sipper for every gas-guzzler they sell. Often people want more guzzlers. What does Detroit do? Discount the sippers in price, sometimes to unprofitable levels. CAFÉ, (Corporate Average Fuel Efficiency) standards are a bane to the auto industry, one of the causes of their troubles. CAFÉ standards do little to aid the environment and harm car buyers and car makers.

The entire “fleet” of vehicles sold by a given manufacturer has to achieve a certain MPG rating. These ratings are set to go up under new administration rulings. “These new standards include an increase in fuel efficiency targets to 35.5 miles per gallon for new passenger vehicles and light trucks by 2016, four years earlier than required under the 2007 energy bill.” So if you are Ford Motors, and 50 customers want to buy F-350s, you have to find 50 customers to buy the Focus, so that their mileage ratings can be averaged and comply with the government commanded MPG .

How would this work with milk? Some government Czar, of which we have a proliferation these days in the Obama administration, determines that the health of Americans would improve if fewer people drank whole milk. Every time Safeway sells a gallon of whole milk they have to sell three gallons of skim in order to achieve an average milkfat content of less than 1%. What if few consumers want skim? Tough. Safeway cannot set prices based on consumer demand, only on government regulations. They will reduce the price of skim to $1.00, a money-losing price, and raise the price on whole milk to $5.00 to mute demand. It is market interference on steroids. People, stores and farmers cannot decide what items are worth and what to produce. Government is the dictator, dictating results.

How would this work with hamburgers? McDonald’s could be forced to sell a tofu-burger for every meat burger, if the health Nazis decide to write regulations to this effect.

It aint a pretty picture.

That’s how CAFÉ standards work.

When did we give government so much power? Can we take power back?


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