We had high hopes when Al Hubbard, the President's economic adviser, predicted that the energy section of the State of the Union address would "knock your socks off." Well, it didn't live up to that description, did it? Noting pre-speech leaks yesterday (see below) I predicted that "polite applause" would be the proper reaction, nothing more.
However, this morning the White House followed up with an Executive Order—which was the kind of action we have been suggesting—and the EO does, after all, direct the Federal Government to "Reduce Oil Consumption in Fleet Vehicles. The President...has directed Federal agencies to purchase plug-in hybrid vehicles when commercially available."
There are also directives related to making use of alternative energy and renewable power. But our emphasis in the energy issue has been plug-in hybrid vehicles (PHEVs) because the technology is already close to production quality. Ford has a car, the Edge, that the company had touring around the Capitol yesterday. GM has the Volt, though it’s still in the mock-up stage; that is, the thing can't run yet.
The Ford Edge
Ford apparently spent $2 million to build the Edge. That is not surprising. It must have cost a pretty penny to custom-make the first television, after all. To get the Ford or GM product from the custom built stage to assembly line production—and in the process lower prices for consumers—will take many and varied inputs. Among them is the prospect of certain customers. That's where the government comes in.
We note that the Executive Order does not direct the federal agencies to offer the car manufacturers government purchase of a certain number, only "to purchase plug-in hybrid vehicles when commercially available." That leaves a pretty big loophole. How much more impressive it would have been to say, we will buy the first 50,000 plug-in hybrids as soon as they become available. (The federal government purchases about 100,000 non-defense vehicles a year, so this would be a reasonable, but strong promise.) Anyhow, specificity would have been more impressive.
Can the White House start getting specific now with the GSA and the Postal Service? Could it also dispatch representatives to the various state capitals and city halls recommending that they make comparable state and local purchase commitments? Shouldn't the state of Michigan be first in line? Imagine the prospect of various combined levels of government pledging purchases that would fully justify Detroit's going into plug-in hybrid production as early as a year from now.
Despite these reservations, my applause for the energy program—as measured by one of the Frank Luntz applause meters that someone was probably using on test audiences last night—is registering more enthusiasm the more I learn about the President's intentions.