Here in Southern Wisconsin the automobile industry
provides thousands of jobs at our two major
car-manufacturing facilities and through the
local suppliers they depend on. In particular, our area is home to much
of the world's production of light trucks
and sport utility vehicles (SUVs). It is something we view with great pride.
The recent announcement of DaimlerChrysler's
$624 million modernization and expansion plan for the Kenosha
engine plan was excellent news in the effort
to keep good-paying jobs here in Southern Wisconsin. Yet, one great
concern remains. This manufacturing base and
the thousands of jobs associated with it may still be threatened with
the upcoming consideration of increased Corporate
Average Fuel Economy (CAFE) standards. These standards
were included in legislation that was passed
by Congress following the Arab oil crisis of the 1970s. Under this
legislation, Congress set goals to lower our
nation's reliance on foreign oil by mandating that U.S. auto
manufacturers meet higher fuel efficiency
standards.
While higher fuel efficiency standards have
been achieved by automakers, increased regulations may pale in
comparison to the economic and safety ramifications
that lay in store for our communities if fully implemented.
The problem with increased CAFE standards is threefold:
1. Southern Wisconsin could face the loss of thousands of good paying jobs.
2. Evidence suggests that such high fuel efficiency
standards come at the expense of passenger safety, to the
extent that they are life threatening.
3. These mandates have not, and will not, achieve the goal of decreasing oil imports.
While the House successfully included language
to prevent further implementation, the Senate will soon begin their
own debate on whether to allow the U.S. Department
of Transportation to go forward with the increased CAFE
standards for trucks and SUVs. If this effort
is not blocked or delayed, the results could prove disastrous for the
General Motors plant in Janesville and the
DaimlerChrysler engine facility in Kenosha. Noting that 76 percent of
the engines built in Kenosha are produced
for Jeeps and Dodge trucks, DaimlerChrylser Plant Manager Bruce
Coventry recently stated "To meet the new
CAFE standards, DaimlerChrysler could be forced to reduce
production of highly popular Jeep models,
reducing demand for Kenosha built engines. If we build fewer engines,
we will employ fewer people, a downturn that
would affect the local economy." Whether it is restaurants or shoe
stores, other area businesses will also feel
the adverse consequences of such a decision.
In short, further implementation of CAFE would
have a wide-ranging economic impact on our communities and
livelihoods. At the Kenosha DaimlerChrysler
facility alone, over 2,000 jobs, $141 million in annual payroll, $1.7
million in annual state and local taxes, and
355 suppliers and their employees would be placed in jeopardy.
Blocking increased CAFE standards presents
what is likely the final hurdle in ensuring the long-term security of
jobs at the Kenosha engine plant and hundreds
of other jobs throughout Southern Wisconsin.
Also important is the fact that because of
these standards, automakers have been forced to build smaller and
lighter cars, which have proven to be less
safe and have led to far more deaths than larger cars. Because of this,
collision insurance is often much higher for
drivers of smaller cars than for those who drive larger vehicles, trucks
and SUVs.
In 1995, a National Highway Traffic Safety
Agency report noted: "During the last 18 years, the office of
Technology Assessment of the United States
Congress, the National Safety Council, the Brookings Institution, the
Insurance Institute for Highway Safety, the
General Motors Research Laboratories and the National Academy of
Sciences all agreed that reductions in the
size and weight of passenger cars pose a safety threat."
In a 1989 Harvard University - Brookings Institute
study, it was determined that the initial implementation of
CAFE standards that raised standards for normal
cars to 27.5 mpg caused a 14-27% increase in annual traffic
deaths. Considering that the number of car
occupant deaths last year totaled 21,000, unnecessary deaths linked to
higher fuel efficiency standards were in the
area of 2,900 to 5,600. To further implement CAFE standards to
apply towards light trucks and SUVs will only
compound the number of tragedies that could be avoided.
Since CAFE standards were first enacted, fuel
economy has doubled for domestic passenger cars and risen by
56% for light trucks. This, however, has not
led to less reliance on foreign oil. In fact, since 1974 the amount of
imported oil has risen nearly 15%. Why? Because
the price of imported oil, not government regulations, dictates
the amount of foreign oil we bring into the
U.S.
I have met with officials from General Motors,
DaimlerChrysler, local union representatives, and area leaders to
discuss this issue and all agree that further
implementation of CAFE standards would present a major setback to
the region's economy. Many fear such a decision
could lead to the wholesale departure of light truck and SUV
manufacturing jobs in Southern Wisconsin.
In view of the mass layoffs we have witnessed over the last decade,
our region can ill-afford to lose this valuable
industry.
Wisconsin's Congressional delegation must be
united in opposing further implementation of these standards.
Increasing CAFE standards would represent
Washington regulations at their worst: pursuing questionable goals at
great costs in terms of jobs, while failing
to achieve the desired result.
This is not a political issue, this is about
keeping and growing the number of good paying jobs in Wisconsin
communities and saving lives. I urge everyone
to contact their Wisconsin Senators and Representatives to ensure
that they will work to prevent this disastrous
proposal from proceeding.
Further implementation of CAFE standards can
and must be stopped.