Memorial Day celebrations, once solemn national occasions, have lapsed into nothing more than an excuse for family gatherings and vacation excursions. While there's nothing wrong with that, it is sad that most Americans have no inkling of the sober history that surrounds this federal holiday.
In the aftermath of the bloody Civil War, a couple of army generals decided it would be appropriate to honor those soldiers who had sacrificed their lives to save the union as well as their Confederate combatants. They also saw it as a way to heal a nation that had been torn asunder by the war.
The generals, John A. Logan and John Murray, issued a proclamation on May 5, 1865, declaring a "Decoration Day" of remembrance and reconciliation. The reason for the name was that it had become a common practice for families to decorate the graves of fallen soldiers.
Many of the northern states adopted official holidays in recognition of the proclamation. Gradually, somber ceremonies marking the day were held at all national cemeteries, including Gettysburg National and Arlington National.
It wasn't until after World War II that the name was officially changed to Memorial Day, which had come into common usage in many parts of the country. In 1967, Congress passed a law declaring Memorial Day to be an official federal holiday.
Now that you know the history, it's more important to recall the reason we mark this day. A total of 1,343,812 American soldiers have been killed in all the major wars fought in this country and overseas since the Revolutionary War. The bloodiest was World War I, which claimed the lives of 364,800 military men and women wearing the U.S. uniform.
These brave men and women gave up their lives to protect our freedom and those of our allies. Whether or not you agree with the reasons for every war, you can at least honor those who willingly put their lives in jeopardy as part of their duty as soldiers representing our nation.
Count me as one of those patriotic Americans who is grateful for the sacrifices of our military as well as those, who must deal with the cruel loss of love ones taken too soon from their grasp. Take a moment this Memorial Day to remember the sacred soldiers and their grieving families.
Let's return Memorial Day to the reverent position it once occupied in America.
Saturday, May 28, 2011
Monday, May 23, 2011
Inconvenient Truths About Big Oil
Nothing spurs political demagoguery quite like consumer anger over surging gasoline prices. For confirmation, you have to look no further than President Obama and the Democrats' recent attacks on the oil industry, especially after some of the largest firms posted record profits.
Wary of voter backlash, the president has led a chorus of criticism on everything from the industry's pricing policy to its tax breaks. His party stepped into the breech launching a bill aimed at ending the so-called tax subsidies. Appropriately, the effort was defeated last week in the Senate by Republicans and a handful of Democrats.
Like many issues bubbling to the surface, the facts have been lost in a tide of rhetoric that goes unchecked by the mainstream media. The public is left to assume that most of the information it is getting from the president and his sycophant allies represent a fair and balanced assessment of the situation.
Unfortunately, the one-sided distortions repeated over and over have convinced too many Americans that the real villain is the very industry that supplies the oil, instead of the politicians who erect barriers to production, refining and distribution of this precious commodity.
Some record-setting is in order. Here are just a few facts designed to blunt the misinformation that passes as truth:
1. Most of America's oil does not come from Saudi Arabia or the Middle East. About 40 percent of the oil Americans use is produced in our own country or offshore. The U.S. imports 32.5 percent of its oil from two countries, Canada and Mexico. Only 17 percent of U.S. oil is imported from the Persian Gulf, including Saudi Arabia, according to the U.S. Energy Information Administration (USEIA). However, because of skyrocketing demand, whatever happens in the Middle East impacts the cost of crude oil. In fact, any disruption in oil production anywhere in the world causes prices to spike. Globally, oil demand hit a record 88.3 million barrels a day in late 2010. Gasoline demand is rising 11 percent annually in India and eight percent in China. A report by energy consultant Wood MacKenzie predicts 85 percent of the world's future demand for oil will come from developing countries.
2. Big oil does not set the price of a gallon of gas at the retail pump. The American Petroleum Industry (API) calculates that only five percent of the retail gas stations in the country are owned and operated by the world's largest oil companies. That means most of the outlets for gasoline are operated by independent retailers with no connection to so-called big oil. Those retailers set their own fuel prices, even if the signage on the pump sports a logo for an oil company. The USEIA estimates that 24 percent of the cost of a gallon of gasoline is made up of taxes, refining costs, distribution and marketing. The remaining 76 percent of the cost is for the crude oil. Of course, those are nationwide averages. For example, taxes are a larger share of the cost in California, which tacks on 63.9 cents on every gallon at the pump. Blaming big oil for sticker shock at the pump is like fingering the farmer for the cost of popcorn at the movie theatre.
3. Oil company profits are not only reasonable, but lower that most industries. Profit margins for the oil industry average 8.2 percent. That means for every $1 in revenue the big oil companies receive, they keep a little more than 8 cents in profit. For comparison's sake, General Electric 's profit margin is 11 percent. Coca Cola has a 21 percent margin. Procter and Gamble weighs in at 14 percent. Microsoft pockets 32 percent of every dollar it takes in. Meanwhile, America's oil companies are among the country's largest taxpayers, contributing an estimated $100 million per day to the U.S. Treasury, according to API. In fact, the industry's income taxes average 48.4 percent of its revenues, compared to 28.1 percent for the Standard and Poor's industrial firms.
4. Oil companies do not receive tax subsidies. During the debate over the Senate bill to eliminate tax benefits for the industry, Democrats kept characterizing oil companies' breaks as a subsidy. Although it may seem trivial, the distinction is important. Farmers receives subsidies, which guarantee a price floor for their crops. Oil companies, like most businesses, receive offsets to the taxes they owe. These concessions allow the companies to write off some exploration costs against their tax bill. Although some may argue the breaks are unfair, the nation's tax code is replete with examples of similar concessions for virtually every industry that operates in the United States. Even with these so-called breaks, the oil companies have paid a total of $59 billion in taxes over the past five years. Oil companies pay their fair share of business taxes, based on credible evidence.
5. Oil companies invest heavily in exploration with no guarantee of success. A 2006 study found that the five major oil companies invested $765 billion in technology, production and exploration during a 15-year period and generated net income of $662 billion. In that same study by Ernst and Young, the overall industry, consisting of 57 of the world's largest oil firms, sunk $1.2 trillion into finding and bringing oil to market, which generated $900 billion in net income. All those billions and trillions of dollars are weapons to politicians who use them to bludgeon the industry over its "bigness." Yet, if you strip away the zeroes, it means that for every $1 dollar the industry invests it returns 90 cents in net profit. Bloomberg News recently reported that six out of ten times that oil companies drill, they come up empty handed. Most investors would run from odds of that kind.
Of course, politicians never let the facts get in the way of finding a convenient scapegoat for whatever ails Americans. It is always easier to assign blame than to deal with complex issues that can't be discussed in a 10-second soundbite for the evening news.
Instead of political grandstanding, President Obama and the Democrats need to come to grips with the certainty of increasing global demand for oil. America needs leadership that gives our country every advantage in the race to secure the fuel that drives our economic engine.
The president would do well to remember that pointed fingers don't drill oil wells. Oil companies do.
Wary of voter backlash, the president has led a chorus of criticism on everything from the industry's pricing policy to its tax breaks. His party stepped into the breech launching a bill aimed at ending the so-called tax subsidies. Appropriately, the effort was defeated last week in the Senate by Republicans and a handful of Democrats.
Like many issues bubbling to the surface, the facts have been lost in a tide of rhetoric that goes unchecked by the mainstream media. The public is left to assume that most of the information it is getting from the president and his sycophant allies represent a fair and balanced assessment of the situation.
Unfortunately, the one-sided distortions repeated over and over have convinced too many Americans that the real villain is the very industry that supplies the oil, instead of the politicians who erect barriers to production, refining and distribution of this precious commodity.
Some record-setting is in order. Here are just a few facts designed to blunt the misinformation that passes as truth:
1. Most of America's oil does not come from Saudi Arabia or the Middle East. About 40 percent of the oil Americans use is produced in our own country or offshore. The U.S. imports 32.5 percent of its oil from two countries, Canada and Mexico. Only 17 percent of U.S. oil is imported from the Persian Gulf, including Saudi Arabia, according to the U.S. Energy Information Administration (USEIA). However, because of skyrocketing demand, whatever happens in the Middle East impacts the cost of crude oil. In fact, any disruption in oil production anywhere in the world causes prices to spike. Globally, oil demand hit a record 88.3 million barrels a day in late 2010. Gasoline demand is rising 11 percent annually in India and eight percent in China. A report by energy consultant Wood MacKenzie predicts 85 percent of the world's future demand for oil will come from developing countries.
2. Big oil does not set the price of a gallon of gas at the retail pump. The American Petroleum Industry (API) calculates that only five percent of the retail gas stations in the country are owned and operated by the world's largest oil companies. That means most of the outlets for gasoline are operated by independent retailers with no connection to so-called big oil. Those retailers set their own fuel prices, even if the signage on the pump sports a logo for an oil company. The USEIA estimates that 24 percent of the cost of a gallon of gasoline is made up of taxes, refining costs, distribution and marketing. The remaining 76 percent of the cost is for the crude oil. Of course, those are nationwide averages. For example, taxes are a larger share of the cost in California, which tacks on 63.9 cents on every gallon at the pump. Blaming big oil for sticker shock at the pump is like fingering the farmer for the cost of popcorn at the movie theatre.
3. Oil company profits are not only reasonable, but lower that most industries. Profit margins for the oil industry average 8.2 percent. That means for every $1 in revenue the big oil companies receive, they keep a little more than 8 cents in profit. For comparison's sake, General Electric 's profit margin is 11 percent. Coca Cola has a 21 percent margin. Procter and Gamble weighs in at 14 percent. Microsoft pockets 32 percent of every dollar it takes in. Meanwhile, America's oil companies are among the country's largest taxpayers, contributing an estimated $100 million per day to the U.S. Treasury, according to API. In fact, the industry's income taxes average 48.4 percent of its revenues, compared to 28.1 percent for the Standard and Poor's industrial firms.
4. Oil companies do not receive tax subsidies. During the debate over the Senate bill to eliminate tax benefits for the industry, Democrats kept characterizing oil companies' breaks as a subsidy. Although it may seem trivial, the distinction is important. Farmers receives subsidies, which guarantee a price floor for their crops. Oil companies, like most businesses, receive offsets to the taxes they owe. These concessions allow the companies to write off some exploration costs against their tax bill. Although some may argue the breaks are unfair, the nation's tax code is replete with examples of similar concessions for virtually every industry that operates in the United States. Even with these so-called breaks, the oil companies have paid a total of $59 billion in taxes over the past five years. Oil companies pay their fair share of business taxes, based on credible evidence.
5. Oil companies invest heavily in exploration with no guarantee of success. A 2006 study found that the five major oil companies invested $765 billion in technology, production and exploration during a 15-year period and generated net income of $662 billion. In that same study by Ernst and Young, the overall industry, consisting of 57 of the world's largest oil firms, sunk $1.2 trillion into finding and bringing oil to market, which generated $900 billion in net income. All those billions and trillions of dollars are weapons to politicians who use them to bludgeon the industry over its "bigness." Yet, if you strip away the zeroes, it means that for every $1 dollar the industry invests it returns 90 cents in net profit. Bloomberg News recently reported that six out of ten times that oil companies drill, they come up empty handed. Most investors would run from odds of that kind.
Of course, politicians never let the facts get in the way of finding a convenient scapegoat for whatever ails Americans. It is always easier to assign blame than to deal with complex issues that can't be discussed in a 10-second soundbite for the evening news.
Instead of political grandstanding, President Obama and the Democrats need to come to grips with the certainty of increasing global demand for oil. America needs leadership that gives our country every advantage in the race to secure the fuel that drives our economic engine.
The president would do well to remember that pointed fingers don't drill oil wells. Oil companies do.
Thursday, May 19, 2011
Exposing The Five Biggest Immigration Lies
President Obama's recent speech on immigration reform serves as an unfortunate example of the deliberate obfuscation and political pandering by Democrats on this volatile issue. His remarks were replete with factual errors, unsupported claims and downright lies.
Despite this deplorable performance, the president's words escaped scrutiny in the mainstream media. His speech was reported without any of the fact-checking that television, print and radio reserve for those opposed to immigration reform.
But the president has not been the only party guilty of a disinformation campaign on immigration. Various Hispanic activist groups, human rights organizations and even the churches are responsible for heaping one falsehood on top of another to engender sympathy for those who break the law.
If the country is going to have a serious national conversation on immigration reform, facts need to replace fiction. There is plenty of credible evidence available on immigration. President Obama, of all people, should be able to secure the facts, since his own federal government has produced reams of data on the issue.
Yet he and other Democrats cater to their Hispanic constituency by sacrificing truth. It is time to expose the grievous lies that are being perpetuated by the president, Democrats, activists and their allies in the media. Here are the five biggest intentional untruths being spread:
AMERICA IS NOT A WELCOMING COUNTRY ANY MORE: This one has gained traction because churches, especially the Catholic Bishops, have claimed Christians are ignoring Jesus' call to welcome the stranger if they oppose reform. In his speech, the president echoed this theme, accusing some Americans and political leaders of demonizing immigrants. The facts are that no country on earth has admitted more immigrants in its history than the United States. According to a Census Bureau survey in 2009, there are 38,517,234 immigrants living in the U.S. In just the last three years, a total of 2,410,167 immigrants have gained citizenship, reports the Homeland Security's Office of Immigration Statistics. The United States has some of the most liberal immigration laws in the world. Meanwhile, our neighbor to the south, Mexico, has some of the most restrictive. For instance, Mexico regulates immigration to maintain what it calls a "national demographic balance." In other words, too many foreigners living in one section of the country are "deemed harmful to the national economic interests." Immigrants must also show they have income needed for subsistence for themselves and their dependents before they can be granted citizenship. Ironically, Mexico's own president had the gall to complain about strict U.S. immigration laws.
MEXICANS ONLY RECOURSE IS TO ENTER THE U.S. ILLEGALLY: Of all the lies, this one is the most insidious became it has no basis in fact. Again using the government's own statistics, more Mexican immigrants were granted citizenship than any other group during the past three years. A total of 410,507 Mexicans became legal citizens by following the law. In his speech on the Texas border, the president claimed that "high fees and and the need for lawyers" were excluding worthy applicants for citizenship. Mexicans now account for 29.8 percent of all foreign born residents in the United States, by far the largest immigrant group. Apparently, it can't be too hard to gain citizenship. By the way, there are 67,000 Americans living in Mexico, where the impediments to citizenship are much higher.
AMNESTY IS THE ANSWER TO THE IMMIGRATION PROBLEM: Government estimates put the number of illegal immigrants living in the U.S. at 10.8 million. The truth is that figure is only a guess, since there has never been any credible count. Whatever the number, granting amnesty would not stem the tide of Mexicans illegally crossing the U.S. border. Most Americans forget the nation has already granted amnesty once before. In 1987, there were 2.7 million undocumented lawbreakers given amnesty under the Immigration Reform and Control Act. The law was designed to encourage future immigrants to follow the legal steps to obtain citizenship, instead of opting for illegal entry. Obviously, the law has failed miserably. In the 24 years since the law was passed, undocumented workers have more than quadrupled. Granting amnesty will only encourage Mexicans to continue to ignore U.S. laws in hopes one day they too will be given a free ticket to citizenship.
AMERICANS WANT TO SHIP ALL THE ILLEGALS BACK TO MEXICO: President Obama again raised this specter in his speech, even though he well knows that not a single poll has shown that the majority of Americans hold this view. He said it would be "logistically impossible and wildly expensive" to deport illegal immigrants and would "tear at the very fabric of the nation." This is fear mongering at its ugliest. The Center for Immigration Studies continuing research on the topic indicates that "voters generally reject extremes of mass deportations." In fact, in its most recent study, the center found only 20 percent of voters supported such an approach. Deportation has not been championed by any credible politician. The president should be ashamed of himself for using such a despicable political scare tactic to dupe Mexicans into believing Republicans sanction deportation.
THE BORDER IS NOW SECURE, SO REPUBLICANS NEED TO STOP OPPOSING REFORM: This one falls under the category of damnable lies for its sheer audacity. The president claimed in his speech that the border is "more secure than ever." Even his own non-partisan Government Accountability Office disagrees. It found that only 44 percent of the border with Mexico is under operational control of the Border Patrol. That means 56 percent is wide open for exploitation by illegal immigrants. The Department of Homeland Security contends it has completed (as of January) 643.3 miles of fence along the 1,951-mile border the U.S. shares with Mexico. That covers less than one-third of the border. Undaunted by these facts, the president touted his administration's "record" deportation of illegals. But the administration used bogus methodology to artificially inflate the numbers, counting 19,000 immigrants who had exited the previous fiscal year. As for Republican opposition, the president had an opportunity two years ago to pass immigration reform legislation with majorities in both the House and Senate. Yet his own lack of leadership doomed the effort to failure. Shifting the blame to Republicans is a vain effort to veil his own political ineptness.
Americans should demand that the president, Hispanic activists, religious organizations and the media stop the lies about immigration. Only if we stick to the facts can the nation grapple with reform in a rational and clear headed way. Otherwise, the country is doomed to make changes that will only worsen the problem.
Despite this deplorable performance, the president's words escaped scrutiny in the mainstream media. His speech was reported without any of the fact-checking that television, print and radio reserve for those opposed to immigration reform.
But the president has not been the only party guilty of a disinformation campaign on immigration. Various Hispanic activist groups, human rights organizations and even the churches are responsible for heaping one falsehood on top of another to engender sympathy for those who break the law.
If the country is going to have a serious national conversation on immigration reform, facts need to replace fiction. There is plenty of credible evidence available on immigration. President Obama, of all people, should be able to secure the facts, since his own federal government has produced reams of data on the issue.
Yet he and other Democrats cater to their Hispanic constituency by sacrificing truth. It is time to expose the grievous lies that are being perpetuated by the president, Democrats, activists and their allies in the media. Here are the five biggest intentional untruths being spread:
AMERICA IS NOT A WELCOMING COUNTRY ANY MORE: This one has gained traction because churches, especially the Catholic Bishops, have claimed Christians are ignoring Jesus' call to welcome the stranger if they oppose reform. In his speech, the president echoed this theme, accusing some Americans and political leaders of demonizing immigrants. The facts are that no country on earth has admitted more immigrants in its history than the United States. According to a Census Bureau survey in 2009, there are 38,517,234 immigrants living in the U.S. In just the last three years, a total of 2,410,167 immigrants have gained citizenship, reports the Homeland Security's Office of Immigration Statistics. The United States has some of the most liberal immigration laws in the world. Meanwhile, our neighbor to the south, Mexico, has some of the most restrictive. For instance, Mexico regulates immigration to maintain what it calls a "national demographic balance." In other words, too many foreigners living in one section of the country are "deemed harmful to the national economic interests." Immigrants must also show they have income needed for subsistence for themselves and their dependents before they can be granted citizenship. Ironically, Mexico's own president had the gall to complain about strict U.S. immigration laws.
MEXICANS ONLY RECOURSE IS TO ENTER THE U.S. ILLEGALLY: Of all the lies, this one is the most insidious became it has no basis in fact. Again using the government's own statistics, more Mexican immigrants were granted citizenship than any other group during the past three years. A total of 410,507 Mexicans became legal citizens by following the law. In his speech on the Texas border, the president claimed that "high fees and and the need for lawyers" were excluding worthy applicants for citizenship. Mexicans now account for 29.8 percent of all foreign born residents in the United States, by far the largest immigrant group. Apparently, it can't be too hard to gain citizenship. By the way, there are 67,000 Americans living in Mexico, where the impediments to citizenship are much higher.
AMNESTY IS THE ANSWER TO THE IMMIGRATION PROBLEM: Government estimates put the number of illegal immigrants living in the U.S. at 10.8 million. The truth is that figure is only a guess, since there has never been any credible count. Whatever the number, granting amnesty would not stem the tide of Mexicans illegally crossing the U.S. border. Most Americans forget the nation has already granted amnesty once before. In 1987, there were 2.7 million undocumented lawbreakers given amnesty under the Immigration Reform and Control Act. The law was designed to encourage future immigrants to follow the legal steps to obtain citizenship, instead of opting for illegal entry. Obviously, the law has failed miserably. In the 24 years since the law was passed, undocumented workers have more than quadrupled. Granting amnesty will only encourage Mexicans to continue to ignore U.S. laws in hopes one day they too will be given a free ticket to citizenship.
AMERICANS WANT TO SHIP ALL THE ILLEGALS BACK TO MEXICO: President Obama again raised this specter in his speech, even though he well knows that not a single poll has shown that the majority of Americans hold this view. He said it would be "logistically impossible and wildly expensive" to deport illegal immigrants and would "tear at the very fabric of the nation." This is fear mongering at its ugliest. The Center for Immigration Studies continuing research on the topic indicates that "voters generally reject extremes of mass deportations." In fact, in its most recent study, the center found only 20 percent of voters supported such an approach. Deportation has not been championed by any credible politician. The president should be ashamed of himself for using such a despicable political scare tactic to dupe Mexicans into believing Republicans sanction deportation.
THE BORDER IS NOW SECURE, SO REPUBLICANS NEED TO STOP OPPOSING REFORM: This one falls under the category of damnable lies for its sheer audacity. The president claimed in his speech that the border is "more secure than ever." Even his own non-partisan Government Accountability Office disagrees. It found that only 44 percent of the border with Mexico is under operational control of the Border Patrol. That means 56 percent is wide open for exploitation by illegal immigrants. The Department of Homeland Security contends it has completed (as of January) 643.3 miles of fence along the 1,951-mile border the U.S. shares with Mexico. That covers less than one-third of the border. Undaunted by these facts, the president touted his administration's "record" deportation of illegals. But the administration used bogus methodology to artificially inflate the numbers, counting 19,000 immigrants who had exited the previous fiscal year. As for Republican opposition, the president had an opportunity two years ago to pass immigration reform legislation with majorities in both the House and Senate. Yet his own lack of leadership doomed the effort to failure. Shifting the blame to Republicans is a vain effort to veil his own political ineptness.
Americans should demand that the president, Hispanic activists, religious organizations and the media stop the lies about immigration. Only if we stick to the facts can the nation grapple with reform in a rational and clear headed way. Otherwise, the country is doomed to make changes that will only worsen the problem.
Tuesday, May 3, 2011
Electric Car Sales Run Out Of Gas
Sales of electric cars have flat lined, despite intrusive federal government efforts to fuel consumer demand. Disappointing results are particularly a blow to the president, who has championed the alternative fuel vehicles by providing billions of taxpayer dollars in research funding and tax credits.
For the first quarter of this year, the much ballyhooed Chevy Volt recorded 1,210 sales. The automaker couldn't even sell the paltry 1,800 Volts it manufactured in the first three months. The sales numbers look puny when compared with the total Chevy sales of 416,505 during the quarter. Since its introduction last year, Volt sales stand at 1,536 units. No wonder General Motors has lowered its annual production estimate to 10,000 of the electric-gas hybrid Volt, down from its original 60,000.
Chevy's competition in the category, Nissan's all-electric Leaf, has not fared any better. The Leaf turned in sales of 471 vehicles, despite heavy promotion. In all of last year, 19 Leafs limped off the showroom floor. By comparison, sales of Toyota's Pirus hybrid topped 100,000 in just a single month during the first quarter.
Sales figures for electric cars must be particularly worrisome for the administration in light of soaring gas prices, which are creeping toward $5 a gallon in some parts of the country. Afterall, sticker shock at the gas pump was supposed to send consumers scurrying to car showrooms to snap up the electric vehicles, the "green" alternative hyped by Obama.
In fact, the president took advantage of the government's bailout of General Motors to compell an early roll out for the Volt. The media did its part, breathlessly reporting that the electric cars would revolutionize the auto industry. All that was needed for a perfect storm was careening gas prices. But even that hasn't helped sales.
The problem is that consumers saw through all the hyperbole. Electric cars are no bargain because consumers quickly learned the range on a single charge was less than advertised. Popular Mechanics measured the range at 33 miles for the Volt, despite GM's claims of 40 miles. After the lithium-ion battery charge is exhausted, the gas engine supplies electricity to power the vehicle. This means the Volt is neither all-electric nor all-gas powered, putting it in a quandary with demanding drivers.
But that wasn't the only issue for consumers. The electric cars required 10 to 12 hours of charging on household current to rev up the vehicle. Not only is that costly, but the cars were consuming electricity generated by plants pumping carbons into the air. Weren't electric cars supposed to reduce carbon emissions?
Consumers also have turned up their noses at a $7,500 tax credit offered by the Obama Administration. The credit was designed to provide the incentive consumers needed to swap their gas guzzlers for the not-so-sleek electric cars. Consumers weren't duped, opting for stylish, powerful, gasoline vehicles. As proof, GM sold 19,000 gas gulping Camero sports cars in the first quarter, dwarfing sales of electric cars produced in the U.S.
Tepid consumer reception is a rebuke for the president's scheme to use the power of the government to force electric cars down the throats of a skeptical public. Besides tax credits, the administration has committed $2.4 billion to research electric car batteries. Another $115 million has been spent on solving the problem of limited battery range with research aimed at building charging stations in metro areas.
What this illustrates is that government intervention in private industry is bad policy. The government has no business promoting one type of car over another. Consumers will vote with their pocketbooks to decide the winners and losers in the automobile industry. The public doesn't need its government spending taxpayers' dollars to influence consumer decisions.
Unfortunately, this lesson will likely be lost on the Obama Administration, which views government as the solution not the problem.
For the first quarter of this year, the much ballyhooed Chevy Volt recorded 1,210 sales. The automaker couldn't even sell the paltry 1,800 Volts it manufactured in the first three months. The sales numbers look puny when compared with the total Chevy sales of 416,505 during the quarter. Since its introduction last year, Volt sales stand at 1,536 units. No wonder General Motors has lowered its annual production estimate to 10,000 of the electric-gas hybrid Volt, down from its original 60,000.
Chevy's competition in the category, Nissan's all-electric Leaf, has not fared any better. The Leaf turned in sales of 471 vehicles, despite heavy promotion. In all of last year, 19 Leafs limped off the showroom floor. By comparison, sales of Toyota's Pirus hybrid topped 100,000 in just a single month during the first quarter.
Sales figures for electric cars must be particularly worrisome for the administration in light of soaring gas prices, which are creeping toward $5 a gallon in some parts of the country. Afterall, sticker shock at the gas pump was supposed to send consumers scurrying to car showrooms to snap up the electric vehicles, the "green" alternative hyped by Obama.
In fact, the president took advantage of the government's bailout of General Motors to compell an early roll out for the Volt. The media did its part, breathlessly reporting that the electric cars would revolutionize the auto industry. All that was needed for a perfect storm was careening gas prices. But even that hasn't helped sales.
The problem is that consumers saw through all the hyperbole. Electric cars are no bargain because consumers quickly learned the range on a single charge was less than advertised. Popular Mechanics measured the range at 33 miles for the Volt, despite GM's claims of 40 miles. After the lithium-ion battery charge is exhausted, the gas engine supplies electricity to power the vehicle. This means the Volt is neither all-electric nor all-gas powered, putting it in a quandary with demanding drivers.
But that wasn't the only issue for consumers. The electric cars required 10 to 12 hours of charging on household current to rev up the vehicle. Not only is that costly, but the cars were consuming electricity generated by plants pumping carbons into the air. Weren't electric cars supposed to reduce carbon emissions?
Consumers also have turned up their noses at a $7,500 tax credit offered by the Obama Administration. The credit was designed to provide the incentive consumers needed to swap their gas guzzlers for the not-so-sleek electric cars. Consumers weren't duped, opting for stylish, powerful, gasoline vehicles. As proof, GM sold 19,000 gas gulping Camero sports cars in the first quarter, dwarfing sales of electric cars produced in the U.S.
Tepid consumer reception is a rebuke for the president's scheme to use the power of the government to force electric cars down the throats of a skeptical public. Besides tax credits, the administration has committed $2.4 billion to research electric car batteries. Another $115 million has been spent on solving the problem of limited battery range with research aimed at building charging stations in metro areas.
What this illustrates is that government intervention in private industry is bad policy. The government has no business promoting one type of car over another. Consumers will vote with their pocketbooks to decide the winners and losers in the automobile industry. The public doesn't need its government spending taxpayers' dollars to influence consumer decisions.
Unfortunately, this lesson will likely be lost on the Obama Administration, which views government as the solution not the problem.
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