Tough love for US car industry?

2009-01-27 06:38:22

By James Coomarasamy

BBC News, Washington

President Obama has asked the Environmental Protection Agency to look into

allowing California to increase fuel efficiency standards for cars.

Is this request part of a patchwork of measures that will create a cleaner

environment and green jobs?

Or - as its critics contend - will it help to create a patchwork of fuel

standards that will end up costing even more jobs in America's struggling car

industry?

The battle lines were drawn some time ago and they remain as clear as ever, but

today the battle cries have been much louder on one side of the debate.

For environmentalists, the president's action is an unequivocal cause for

celebration - a sign he means to walk the walk on the green agenda and overturn

years of indifference.

Tough love

There has certainly been rejoicing from California's green (Republican)

Governor Arnold Schwarzenegger and its Democratic senators, notably Barbara

Boxer.

She has tended to live up to her name, when environmental officials from the

Bush Administration have testified at her Senate Environment and Public Works

Committee.

In the other corner, there have been cautious words from the car manufacturers.

General Motors, which has announced another 2,000 job losses at plants in

Michigan and Ohio, released a statement pledging support for policies which

support "meaningful and workable" solutions and targets.

The statement went on to say: "We look forward to contributing to a

comprehensive policy discussion that takes into account the development pace of

new technologies, alternative fuels, and market and economic factors."

A few caveats there, although a less combative than usual reaction from an

industry whose request for a multi-billion dollar federal loan has reduced its

political leverage.

Ohio Republican Senator George Voinovich was rather more direct: "The federal

government should not be piling on an industry already hurting in a time like

this."

But is it a case of "piling on", or - as the Obama administration would have it

- of offering the industry some much-needed tough love?

By forcing the pace (or helping California to force the pace) of fuel

efficiency standards, are the federal authorities jump-starting the car

industry's efforts to regain its place as a global innovator and prolonging its

survival?

Whatever the case, Barack Obama is spending some of his political capital here,

on an issue which he emphasised on the campaign trail and - at several points -

in his inaugural address.

Economic impact

As the US economy has grown worse, opinion polls suggest that green issues have

slipped down the public's list of concerns.

A survey for Pew Research Centre found that, while 56% of Americans saw the

environment as a top priority a year ago, 41% hold that view today.

The percentage of those who see job security as a top priority has, by

contrast, gone from 61% to 82% in the same poll.

And those findings suggest that, in the short term at least, this initiative

will be judged as much on its economic as on its environmental impact.

Will the retro-fitting of cars, to meet the new fuel standards, really create

the number of new, green jobs that the administration hopes it will?