Greensburg Daily News
After pump prices reached $3.79 a gallon nationally, Congressman Joe Donnelly fired off a letter to President Obama.
"We must act now to soften the impact high gas prices are having on our
economy," the Indiana Democrat wrote March 26. He urged the president to
release oil from the Strategic Petroleum Reserve and assist efforts to expand domestic drilling.
Such recommendations are good material for Donnelly's senatorial campaign
this fall but ineffective solutions for soaring gasoline costs. The U.S. produces about 5.6 million barrels of oil a day Ð a nine-year high, the president said last month Ð yet Greensburg motorists still pay nearly $4 a gallon.
What we need from lawmakers are initiatives that encourage conservation and put money in our pockets. Lisa Margonelli, publisher of EnergyTrap.org, has such a plan.
Margonelli proposes a federal auto loan guarantee program. Consumers would
be offered notes at 5 percent interest to buy vehicles that get more than 35 mpg.
"This is better than the stimulus programs suggested by either party, as it would increase middle-class disposable income by up to $3,500 while creating jobs in Detroit," she says, "and it would lower fuel imports and greenhouse gas emissions to boot."
According to the U.S. Bureau of Labor Statistics, the average American household spent $178 a month fueling its vehicles in 2010. Gas prices through 2011 increased an average of 74 cents per gallon, or more than 26 percent.
So, the typical family spent $225 a month on gasoline last year Ð and we're on track for a repeat in 2012. America could use another program like Cash for Clunkers, but one that actually helps the middle class.
Cash for Clunkers cost $2.8 billion but benefited only the financially secure. Credit was tight in 2009. Many couldn't qualify for a new-car loan. The oil industry receives about $4 billion a year in subsidies and tax breaks. Low income households get tax credits to retrofit their homes for energy efficiency.
We need an incentive aimed at middle-income workers.
By financing a federal car loan guarantee with a portion of the oil industry's government giveaway, we could drive down fuel costs for wage-earners, reduce oil consumption and increase demand for gasoline-sipping vehicles.