Shopper,
Let's back up for a sec.
I am putting forth the idea that the government force the hand of the automakers to offer a hybrid version of every production vehicle. Subsidies are not part of my plan- Your objections took us there. I'd rather engage in discussion with you about the pros/cons, feasibility and outcomes of my idea vs. yours rather then get stuck talking about a granular detail that may/may not even need to be a part of our ideas like subsidies. Cool?
Your idea is to raise taxes on gasoline so that Americans drive less and consume less and then the automakers will follow suit and start offering more fuel efficient options to accomodate a changing market.
My idea is to expedite the process of providing Americans with more fuel efficient options so that they can drive as much as they do now, pay less and consume less.
I believe my idea is more politically feasible. Either a democrat or a republican POTUS could sell it to the American people because it doesn't hurt them. Gas prices stay the same and the burden is on the automakers to change their behavior. The consumers end up with better options.
Have you considered how your idea would play out politically? Americans would not support senators, congressmen or a president who would vote for voluntary $5/gallon gasoline. So odds are no elected official would support it. And if it did somehow pass, tea party movements would vote out any incumbent who voted yes. Then they would probably try to repeal it. But let's say it passed and it's not repealed. What would your idea look like?
Americans would suffer with $5 a gallon gas. They would stop buying stuff. The economy would tank. Businesses of all shapes and sizes would be impacted by a drop in their sales and by an increased cost of goods.
The automakers would have been waiting around to see how the country responded to the new gas tax because they are a reactive industry. They would respond by phasing out the cars that people like in favor of fuel efficient models they now need.
Consumption would go down and people would drive less- just like you planned. But man, did it suck for everybody!
Here's the way I believe my idea would play out-
Automakers would begin investing in the infrastructure to build hybrid versions of every model in their fleet. Some of them and/or their parts suppliers won't cut the mustard and we'd likely see consolidation, mergers and acquisitions. But I'd imagine the new jobs and lost jobs would be a wash (less people making brackets for fuel tanks, more people making brackets for batteries).
As a worst case scenario, a hybrid version of a model of car would have a slightly higher sticker price but it would be offset by savings at the pump. And uncle sam could offer a tax credit to hybrid buyers which would result in a net savings. Meanwhile, gas guzzlers could carry a modest sin tax which would help cover the cost of those tax credits and which would serve to further motivate consumers to choose the hybrid version of their preferred model.
Americans drive the cars they want to and they aren't forced to cut back on how often/how far they drive but yet- consumption goes down...
I like my idea better.