Is California Too Big to Fail?
California will go bankrupt, muni and state debt will spike, the federal government will backstop humanitarian programs and very possibly all state and local debt, and eventually, California will figure out whether it wants higher taxes or lower spending. But we will not actually make the world a better place by enabling the lunatics in Sacramento to pretend they can have both.
Keith Hennessey digs through the massive existing literature on the effects of the CAFE standard proposals so that you don't have to. He finds a notable lack of the rainbow unicorn farts and pixie dust that have typified admin rhetoric.
Understanding the President’s CAFE announcement
What's especially notable is that using the government's own research, the previous Bush proposal maximized net social benefits (whatever you think of the claimed benefits or the calculation thereof, the Bush admin DID maximize return against costs) whereas the Obama revisions push past the max social benefit peak and into zero-or-negative net-benefit territory, even perhaps into reduced benefit versus no CAFE increase at all.
In other words, societal net benefit is pushed aside as the proper metric in favor of special interest group empowerment. Which, as always, means we will be paying for a lot more than we get, while the favored are rewarded.
Let's also not forget that part of the price tag of smaller vehicles is paid in increased traffic fatalities and injuries. The first round of CAFE standards over a third of a century ago has cost roughly 3,000 American lives PER YEAR since it was implemented. For every 100 pounds of reduced fleet size resulting from the new plans we can expect an increase of roughly 250-300 additional traffic deaths, with that number increasing with each additional 100 pounds of fleet size reduction--there will be an increasing "rate of return" in additional fatalities as minimum possible size is approached.
The laws of physics are not subject to revision by Congress or the White House.