Wednesday, July 20, 2005

Politics: Tax credits where credits are due?

When my poor Camry died, I fought long and heard with myself whether to be a good liberal and buy a Prius or to be a good democrat and buy a CRV. The Michigan weather and the need for Derby cage-space (and finally the absurd insurance premiums) pushed me towards the CRV, but the hybrid tax credits made it a pretty hard fought battle in my head. And the tax credits made sense, as tax credits are a wonderful way for the government to encourage certain healthy behavior without infringing upon anyone's right to choose in the free market.

The 2005 Honda Accord hybrid gets about the same miles per gallon as the basic four-cylinder model, according to a review by Consumer Reports, a car-buyer's guide, and it saves only about two miles a gallon compared with the V-6 model on which it is based. Thanks to the hybrid technology, though, it accelerates better.

Hybrid technology, it seems, is being used in much the same way as earlier under-the-hood innovations that increased gasoline efficiency: to satisfy the American appetite for acceleration and bulk.

Despite the use of hybrids to achieve better performance with about the same fuel economy, consumers who buy the cars continue to get a tax credit that the Internal Revenue Service allows under a "clean fuels" program that does not take fuel savings into account.
Now, I think it's pretty cool that someone could buy a 4-cylinder with a hybrid engine and get the same power as a 6-cylinder engine, but I don't know if someone deserves the same tax credit as someone buying a fuel efficient commuter vehicle. Time to tweak, one way or another.

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