Page last updated at 23:00 GMT, Monday, 26 January 2009

Tough love for US car industry?

By James Coomarasamy
BBC News, Washington

President Obama has asked the Environmental Protection Agency to look into allowing California to increase fuel efficiency standards for cars.

Barack Obama signs an executive order after speaking to the media about green energy and fuel emissions
Mr Obama's ruling could lead to tougher fuel emissions standards

Is this request part of a patchwork of measures that will create a cleaner environment and green jobs?

Or - as its critics contend - will it help to create a patchwork of fuel standards that will end up costing even more jobs in America's struggling car industry?

The battle lines were drawn some time ago and they remain as clear as ever, but today the battle cries have been much louder on one side of the debate.

For environmentalists, the president's action is an unequivocal cause for celebration - a sign he means to walk the walk on the green agenda and overturn years of indifference.

Tough love

There has certainly been rejoicing from California's green (Republican) Governor Arnold Schwarzenegger and its Democratic senators, notably Barbara Boxer.

She has tended to live up to her name, when environmental officials from the Bush Administration have testified at her Senate Environment and Public Works Committee.

The federal government should not be piling on an industry already hurting in a time like this
George Voinovich
Ohio senator

In the other corner, there have been cautious words from the car manufacturers.

General Motors, which has announced another 2,000 job losses at plants in Michigan and Ohio, released a statement pledging support for policies which support "meaningful and workable" solutions and targets.

The statement went on to say: "We look forward to contributing to a comprehensive policy discussion that takes into account the development pace of new technologies, alternative fuels, and market and economic factors."

A few caveats there, although a less combative than usual reaction from an industry whose request for a multi-billion dollar federal loan has reduced its political leverage.

Ohio Republican Senator George Voinovich was rather more direct: "The federal government should not be piling on an industry already hurting in a time like this."

But is it a case of "piling on", or - as the Obama administration would have it - of offering the industry some much-needed tough love?

By forcing the pace (or helping California to force the pace) of fuel efficiency standards, are the federal authorities jump-starting the car industry's efforts to regain its place as a global innovator and prolonging its survival?

Whatever the case, Barack Obama is spending some of his political capital here, on an issue which he emphasised on the campaign trail and - at several points - in his inaugural address.

Economic impact

As the US economy has grown worse, opinion polls suggest that green issues have slipped down the public's list of concerns.

A survey for Pew Research Centre found that, while 56% of Americans saw the environment as a top priority a year ago, 41% hold that view today.

The percentage of those who see job security as a top priority has, by contrast, gone from 61% to 82% in the same poll.

And those findings suggest that, in the short term at least, this initiative will be judged as much on its economic as on its environmental impact.

Will the retro-fitting of cars, to meet the new fuel standards, really create the number of new, green jobs that the administration hopes it will?

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