If those numbers are correct then I think most people would be happy with it. But we don't know for sure how much the technology would cost. And consumers are the ones who don't want cars to be more expensive. Companies have influence but it's not a very popular issue, that's why it's not happening. I was referring more to the fact that economists think spending is what gets the economy going. People are spending more, there is a lot more debt, and the FED is forced to print money to alleviate some of the debt. But it's just a downward spiral. This is related to the SUV issue because economists (these days) don't think people saving money on cars and gas is necessarily a good idea. Economists would rather have people spend as much as possible.
I was referring more to the fact that economists think spending is what gets the economy going. People are spending more, there is a lot more debt, and the FED is forced to print money to alleviate some of the debt. But it's just a downward spiral. This isn't true, though. If you spend out of your savings, that dollar becomes several dollars to the economy - that's why spending DOES get the economy going - in fact, it IS the economy. The economy (GDP) is just the sum of all the spending going on. Let's say I have a dollar. If I save it, it contributes nothing to GDP. If I spend it, it becomes someone else's revenues, then someone's salary, then is spent again, becomes someone else's salary, etc. That dollar will become $7 or $8 in GDP. The idea isn't to create debt -- it's that if I spend money, that employs people to produce the new products I am buying, which creates more income for people to buy even more products. Not a dime was printed in the process. Money printing is a bit of a separate issue.
If those numbers are correct then I think most people would be happy with it. But we don't know for sure how much the technology would cost. And consumers are the ones who don't want cars to be more expensive. Companies have influence but it's not a very popular issue, that's why it's not happening. The technology, when mass produced doesn't cost much. rimrocker's article stated: <I>retail prices of vehicles would rise some $1,000 to $2,000, depending on the model,</I> And that was to get to 40mpg -- I'm just talking 25mpg. The costs wouldn't be significant at all. Everything is there -- all that's needed is one simple step by the administration backing the bill and it's done.
But it is investment that goes into the production of goods and the employment of people to produce those goods. Spending is the end result. Growth comes out of investment. Of course spending is important. But how can economists tell consumers to spend when so many are in debt? Yes, demand will drop for many goods of course, but then there will be plenty of demand for future goods. I think the US situation is going to be like Japan's. Interest rates are going to be near 0 but the economy is not going to go anywhere because there is too much debt, and there won't be much investment until that debt is taken care of. Their recession is now over 10 years long I believe.
