Amalio – Would there be any guarantee they could make public tranportation products more efficiently, better, or cheaply than firms already in that business?

Meanwhile, traffic congestion increases and so does air pollution in the LA basin.

Many of the vehicles produced in Detroit lead the quality rankings every year.

All vehicles sold in the U.S. must meet the pollution standards set by the EPA. A Cadillac must meet the same standard as a M-B S-class; a Chevy Malibu meets the same standard as a Honda Accord.

Corporate Average Fuel Economy…all manufacturer’s, foreign and domestic, must meet CAFE standards under pretty stiff monetary penalties.

The great misunderstanding is over SUV’s, which are used as cars by the buying public, but which have always been treated as light-duty trucks (upon which they are based) by the government regulators.
There are several things that explain the popularity of SUV’s:
1- The downsizing of vehicles in the 80’s brought a realization among the car-buying public that size does matter. In a crash, the small-car always loses (ATBE).
2- The luxury-taxes of the late-80’s restricted the ability of businesses to write-off the costs of luxury cars (at that time you couldn’t write-off anything over $30K), but put no restriction on commercial (including light-duty) trucks. This brought an explosion of the luxing of trucks starting with the Suburban (begetting the Tahoe, Escalade, Explorer, Excursion, Navigator, etc).
This allowed the self-employed, among others, to have a nice ride, even a “performance” ride, and still get to write it off as a business expense (and even one for his wife too, as long as he had her listed as an officer in the company).
3- Trucks also, have a different CAFE standard than do passenger vehicles (cars). This is because of the nature of the beast. These vehicles are designed to haul stuff – large amounts of it in some cases. BTW, who do you call when you need to move a refrigerator? Your brother with the 3/4-ton pick-up, or your aunt with the Prius?
4- And, that is another reason why they are wide-spread – people like having something they can load the entire family into for a vacation, and hitch the boat to the back for that week on the river.

Prices….If Detroit can un-load these uncompetitive labor agreements, you will not see any lowering of prices. What you will see in an increase in the profitability of the corporations that build these vehicles.
Who knows, they actually might start reporting a profit, instead of the mind-boggling, multi-Billion $ losses they have been having.

http://www.rallycongress.com/no-bailout-for-the-auto-industry/1409/

NO BAILOUT FOR THE AUTO INDUSTRY
Nancy Pelosi, with the help of Barney Frank, wants to bail out yet another failed sector of the economy. It is not government’s role to reward incompetent, overpaid executives pursuing a failed and anachronistic business model. The American auto industry is in trouble because it produces a shoddy, polluting, gas guzzling product at noncompetitive prices driven by trade union benefit packages. It is a waste of taxpayer money to try to shore up an industry that needs to be radically restructured. The Big Three should be allowed to fail and file for reorganization under Chapter 11 of the Bankruptcy Code. They will not cease to exist, but will be restructured under the supervision of the bankruptcy courts. Congress cannot do a better job than the courts. The courts will supervise the reorganization of the industry without being tempted to reward lobbyists, campaign contributors and unions for their political and financial support.
Congress must allow the economy, existing laws and judicial bodies to resolve the Big Three’s financial problems and not throw more taxpayer money away under a hasty and ill conceived bailout.

BTW, I know that Ford at least makes fine, compact, hi mileage cars. I know this from cruising on the autobahn in a Ka [youtube movie for a year or so.