CONGRESS began regulating automobiles just 20 years ago, with the first auto safety legislation. Since then it has built an immensely complex and expensive structure of rules on exhaust emissions and fuel efficiency as well. What, precisely, has it accomplished?
Four economists -- Robert W. Crandall, Howard K. Gruenspecht, Theodore E. Keeler and Lester B. Lave -- have worked out a series of useful answers in a study just published by the Brookings Institution. Perhaps it won't be the last word on the subject, but it's an illuminating guide to some of the choices now confronting federal policy makers.
Safety regulation has been a clear success, the authors found. Dozens of standards imposed by the government have made a dramatic improvement and, they calculate, are currently saving at least 13,000 lives a year. The cost, which averages about $600 per car, is hardly excessive. The auto safety standards have become a model of beneficial interference in the market by public authority.
The fuel efficiency standards are another matter. Congress voted them in 1975, after the first oil crisis, in response to the low and declining gasoline mileage of American cars. But by the time they took effect the automobile manufacturers were moving rapidly to catch up with the swing in their customers' demands. The four authors find that the fuel standards had no effect at all until 1982, when gasoline prices began to drop and buyers' tastes began to shift back toward bigger cars. The effect of the law over the past several years has been to require the manufacturers to keep raising the prices of the big cars to discourage sales.
General Motors and Ford have petitioned the Transportation Department to keep the mandatory average at 26 miles per gallon next year, instead of moving it back up to 27.5 miles. It's a reasonable request and ought to be granted. Raising auto prices is a grossly inefficient way to try to conserve fuel. If Congress wants to hold down consumption, the right way to do it is to tax gasoline.
The exhaust emission regulations have certainly reduced the pollution that cars pour into the air. Whether there is any substantial effect on human health is still an open question. Smog can make eyes burn, and it can aggravate the discomfort of people with respiratory illnesses. But it is hard to show that auto pollution produces more than temporary effects on health. The case for a clean-up from the pollution levels of the early 1970s was, and is, persuasive. But most of the improvement in emissions had been achieved by 1979, while most of the present high cost of emissions control has been incurred in making the relatively small gains since then. Is that high cost worth the modest additional gain in cleanliness? Probably not.
The four authors point out that regulation has been most successful where, as in the safety laws, Congress gave the administrators much flexibility to react to new data and circumstances. It has been less successful in the cases -- emissions and fuel efficiency -- in which it has legislated arbitary standards reaching many years into the future. It is a fair judgment that these two decades of regulation have produced safer and cleaner cars than the industry was likely otherwise to have designed -- but, in regard to pollution, progress cost much more than was really necessary.