Tag Archives: UWA

How much does the $25,000,000,000 bailout of Detroit cost?

(I’m talking about the proposed second bailout. We already gave Detroit a $25 billion bailout in September.)

Over the next few years, several Plugin Hybrid Electriv Vehicles (PHEVs) will come on the market, from Toyota, Nissan, and other manufacturers.

(You’ve heard more about the Chevy Volt than any others, in a desparate attempt by GM to make up for lack of innovation with an expensive marketing push. We were making plug-ins a century ago, when they competed against flex-fuel vehicles. GM’s position on innovation is better shown by the EV-1, where GM threatened to sue Western Washington University for driving theirs)

So how much does the $25,000,000,000 bailout of Detroit cost?

Well, consider than such a plug-in electric vehicle can achieve greater than 100 miles per gallon in normal driving conditions. Swap out the standard gasoline engine with one capable of running an 15% ethanol blend (E-85), and you should get about 500 miles per gallon of gas (with the bulk of the power typically coming from either electricity or ethanol).

So how many vehicles capable of 500 miles per gallon could we subsidize with the funds needed for the $25 billion bailout? How many PHEV-E85s could we help America purchase for the money that is going to go into saving the skins of people ot put the Detroit Three in this mess?

If we make the provide a subsidy of $1500 for each plug-in ethanol-burning electric, that means we could subsidize the purchase of 1,666,667 500 mile per gallon of gas vehicles for the cost of the Detroit Bailout.

President George Bush and President-Elect Barack Obama have a choice: investing in saving GM and the UAW, or invest in freeing ourselves from foreign oil.

Bush’s job seems easier: all he needs to do is hold tough through January 20, by which time GM should declare bankruptcy.

Obama has to choose between investing in the future or investing in the latest and greatest in 1950s ideas.

I hope both of them are up to the job.