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Toyota
hybrid tax credits and Democrats
Wednesday,
March 14, 2007
Why
haven't Dems taken any action?
Many Democrats in Congress have made global warming one of
their most important political issues - at least in terms
of political speech. Yet, political action is still
lacking.
Most of these hard-talking Democrats and some Republicans
have demanded tough increases in fuel economy that could
severely threaten the viability of U.S. automakers. Fine.
This is an important issue and tough action will be
required. Nonetheless, tough talk and little action
accomplishes nothing.
While government regulation might help, isn't the best way
to change America simply good old competition? Thus,
wouldn't it be a good idea to give tax credits to
consumers to reward those companies taking tough action
now - rewarding both responsible consumerism and
responsible corporations?
Why then, are hybrid
tax credits capped by manufacturer? That doesn't breed
competition, it stifles competition. Besides, shouldn't
the point of hybrid tax credits be to put as many hybrids
on the road as fast as possible? Are we really that afraid
of doing the right thing too quickly?
Case in point
Toyota has achieved their tax credit cap, yet neither GM
nor Chrysler have sold one single full hybrid vehicle. Why
should GM or Chrysler act now when they don't have to
compete for the credits?
While U.S. automakers cry protectionism regarding foreign
automakers, today's hybrid tax credits are no less
protectionist. Yet fuel economy, whether in terms of
global warming or foreign oil dependency, is one of the
greatest issues -maybe the greatest issue - facing
America. Yet, for Congress, however, it's politics as
usual.
Competition breeds
innovation
Toyota's hybrid
cars have made every single automaker deal with hybrid
technology seriously. Toyota's hybrids have made consumers
believe that super efficient hybrid cars, plug-in
hybrids and electric vehicles are possible.
And they are possible. Unfortunately, they just aren't
very profitable. Still, without Toyota's efforts, the
entire fuel economy conversation would still be focused on
only hydrogen and fuel cells - a path to nowhere thus far.
This type of tax-inspired complacency can longer be
tolerated.
Moreover, investment and economies of scale can make
hybrid vehicles more profitable. Consequently, the more
hybrids sold today, the more investments made in hybrid
technology, including next generation hybrid technology.
For example, Toyota has already stated that its third
generation Prius, due out in about a year, will use
lithium-ion batteries - the same batteries that will one
day power not just hybrid vehicles, but plug-in hybrids
and electric vehicles.
Extend Toyota's tax
credits now!
So, why not extend Toyota's hybrid tax credits? Such a
move accelerates not only Toyota's hybrid investment, but
every other automaker's hybrid investment as they strive
to catch Toyota. This competition is the quickest path to
real change in terms of fuel economy.
It is time for Congress to extend Toyota's hybrid tax
credits now. Let's stop talking and start taking some real
action. Foreign oil dependency and/or global warming are
far too important not to take this small action
immediately.
posted
by Dahcredyns at
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