America is going green. Recently, President Joe Biden unveiled plans to accelerate the transition toward electric cars. The move — neatly packaged as the American Jobs Plan — is being sold as a way to “unify and mobilize the country to meet the great challenges of our time: the climate crisis and the ambitions of an autocratic China.” In recent years, Beijing has fared well in the race to build, and sell, green technology.
No more. Instead, expect the American Jobs Plan to help us “out-compete China” and, more important, “reduce the impacts of climate change for our kids.” Victory won’t come cheap of course. The White House pegs the total cost of the plan at $2 trillion. Then again, with more than $28 trillion in national debt, $2 trillion seems like a bargain.
The White House wants $174 billion of that directed toward boosting electric car sales. Fossil fuel use in transportation is significant, and gas-guzzling autos are one reason why. Electric cars — admittedly cleaner by almost every metric — offer relief. Well, they would if people could actually afford them. Forgoing gas is pricy, preserving the status quo less so. Which explains why only 2% of autos sold annually are powered by electricity.
Norway and electric cars
The answer purportedly lies in subsidies. Nothing — we are told — woos consumers like handouts do. Just look at Norway, where the local government has been doling out generous incentives for electric car purchases since the early 1990s. The result? Just over 54% of all new cars sales there are electric, a global record, and up from a mere 1% of the overall market a decade ago.
Impressive stuff. At least it would be were it not for a few minor — yet important — details. For one thing, Norway’s electric car experiment has cost billions, and the majority of the vehicles sold have been to households that also own gasoline-powered cars. Put simply, consumers seem to treat electric cars as complements, not substitutes. More worrying, electric car owners still rely heavily on gasoline-powered cars to get around. The average Norwegian household drove 7,500 miles in 2018, a mere 515 of which were in electric cars.
Don’t blame the Vikings just yet. Americans aren’t any better. Take California.
Incentives for purchasing electric cars in the Golden State are among the most generous in the country. Local residents can get up to $7,000 in rebates when they buy or lease an electric car. That’s in addition to the up to $7,500 tax credit offered by the federal government.
Yet a recent study examining electric car use in California found these vehicles are driven 5,300 miles annually. That’s less than half the nationwide average. According to the authors, this finding, “raises questions about transportation electrification for climate policy.”
Questions like, why must taxpayers foot the bill for assets that aren’t used very much? Is doing so really the wisest use of our hard-earned capital? Shouldn’t we stop throwing good money after bad? You don’t need a Harvard MBA to figure out the answers.
Lead with ‘science and truth’ Biden
The electric car embrace is nothing more than political point scoring. A recent Pew Research Center poll found that two-thirds of Americans say too little is being done to address climate change. Getting elected to (and staying in) office these days clearly entails burnishing green credentials.
For many politicians, this means propping up electric cars. Never mind that doing so does little to meaningfully address climate change. In their rush to tout their “green cred,” proponents of electric car subsidies seem to consistently neglect an inconvenient truth: While the case for using an electric car is strong, the case for subsidizing one is weak.
President Biden says his $174 billion investment will help “win the (electric vehicle) market.” We don’t need to win the electric vehicle market. What we need is clean air, clean water and healthy communities. Electric cars should help. But they’re not — at least nowhere near the extent proponents claim. This reality warrants acknowledgement, and public policy should reflect this reality.
During the 2020 presidential campaign, Biden promised that his administration would lead with “science and truth.” Now’s his chance.
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