New Report Sheds Light on Obama Administration Campaign to Strong-Arm Auto Makers in Mileage Negotiations

August 10, 2012

Career experts sidelined as environmental extremists forced action with dire consequences for consumer safety, cost and price

WASHINGTON - House Committee on Oversight and Government Reform Chairman Darrell Issa (R-CA) today released a report documenting the Obama Administration’s unprecedented action to extract agreement from auto makers for strict new mileage standards.

The report sheds new light on the extent to which the Obama Administration strong-armed auto manufacturers at the expense of consumer choice, safety and affordability.

“In the wake of a massive taxpayer funded bailout of General Motors and Chrysler, the Obama Administration took aggressive action to force a rulemaking process that reflects ideology over science and politics over process and law,” Chairman Issa said.

“Pleas from career technical experts about passenger safety and consumer choice were ignored by the White House to appease overzealous environmental extremists as this process was forced through,” Chairman Issa said.

Key findings of the report include:

*   Standards set by the Obama Administration will hurt American consumers by increasing the cost of automobiles and limiting vehicle choices.
*   Obama Administration standards require high gasoline prices—as high as $5 or $6 per gallon—to support consumer acceptance of required technology.  These standards also have negative safety consequences, possibly leading to as many as 240 more fatalities per year as a result of vehicles designs necessary to meet these standards.
*   Standards appear to be based on unrealistic assessments of the rate at which the market will accept new technologies, as well as the rate at which the new technologies will become available.
*   Negotiations were led from inside the White House, which heavily relied on leverage obtained during the Auto Bailout, and from industry’s fear of regulation by the California Air Resources Board.  The White House elevated the role of the U.S. Environmental Protection Agency- supported by environmental extremists—and marginalized the National Highway Traffic Safety Administration, the agency designated by Congress as the responsible party.
*   The White House heavily favored the interests of the “big three” domestic firms and at the expense of foreign automakers—including manufacturers which employ U.S. workers.

Oversight Subcommittee on Regulatory Affairs, Stimulus Oversight and Government Spending Chairman Jim Jordan (R-OH) said, “Back in October, our subcommittee took a look at the way the Obama Administration was imposing its green energy agenda on a process reserved for NHTSA officials. Our predictions were correct – safety concerns were pushed aside, consumer choice was reduced and the future of auto manufacturing changed. We now have proof of this failed process and of the power-grab that has become a trademark of this administration.”

Rep. Mike Kelly (R-PA), owner of Mike Kelly Automotive in Butler, Pa., concluded: “There is an old saying that if you are not at the table you are on the menu. When the Obama Administration negotiated the new CAFE standards, they sidelined the statutory rulemaking process that had been in place for decades in favor of a political process whereby special interest groups and "czars" helped shape an industry standard that will adversely affect consumers on a sweeping scale. The new CAFE standards will limit choice, compromise safety, and increase costs for millions of Americans who are already struggling to get by in the Obama Economy. The American consumer was not given fair representation at the CAFE negotiation table, and they have since been put on the menu.”