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Sticker Shock on Cars Shows Crushing Cost of Bidenomics

Posted on Wednesday, November 10, 2021
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by AMAC Newsline
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79 Comments
car gas tank stuffed with money

AMAC Exclusive -By Luke Allen

I was recently in the market for a pickup truck after the one I’ve had for decades finally died after 330,000 reliable miles. While I’d heard that new and used car prices were up from just a year ago, to say I have sticker shock from my truck-buying experience would be a significant understatement. The price of a modestly appointed truck in 2021 is now very close to the price of my first house, with J.D. Power estimating the average cost for a new pickup at over $52,000. But it’s not just trucks. SUVs and passenger cars as well, new and used, are all far more expensive today than at any time in recent memory. Purchasing a new car in the year 2000 on average required 66% of a middle-class individual’s annual salary. In 2021, it requires 77%.

An internet search of just why that is will likely lead to the much-lamented “microchip shortage” as a simple reason for the price increases. The Biden administration has also sought to blame “supply chain problems” to avoid taking direct responsibility for the phenomenon. But those explanations alone don’t explain the increase in prices. In fact, the regulatory decisions of the Biden administration may be partially responsible for skyrocketing costs, and may only be making the problem worse.

I saw first-hand how regulatory policy could quickly drive up consumer costs during my time in the energy industry. As I wrote in an earlier piece for AMAC Newsline, ill-conceived energy policies have created electricity price spikes and supply shortages in recent years. As these policies were being enacted, I witnessed no pushback from utility CEO’s I knew and worked with. For them, increased operating costs were simply passed on to consumers. Everyone needed at least some energy, and utility companies simply upped their costs until they were making the same profits while also complying with new regulations. In fact, they may have even used the new regulations as an excuse to upcharge consumers even more, thus actually increasing their profits even as their operating costs went up.

It’s possible that a similar situation may be playing out in the auto industry. Casey Mulligan, Chief Economic Advisor to President Trump, writes in his book that fuel economy standards pushed by environmental groups require expensive component upgrades, materials and new technologies that drive up the costs of cars and trucks for consumers. Some of these regulations tie fuel economy to carbon emissions reduction, meaning consumers pay twice. Gasoline costs more at the pump due to carbon reduction regulations on refineries, and cars cost more because of expensive mandatory fuel efficiency upgrades.

However, while the direct relationship between more regulations and increased costs may be obvious to most consumers, many career regulators don’t see it that way. Take, for example, David Friedman, Director of Cars and Product Policy and Analysis at Consumers Union (the publishers of Consumer Reports) who was formerly Deputy and Acting Administrator of the National Highway Traffic Safety Administration, and before that was Acting Assistant Secretary for the Office of Energy Efficiency and Renewable Energy at the U.S. Department of Energy, both under President Obama. Under Friedman’s leadership, Consumers Union released a report that said rolling back expensive fuel regulations would cost consumers money.

How does Friedman arrive at such a seemingly backwards conclusion? Because in his view, the view of a career regulator, Americans need the government to intervene to save them money by preventing them from burning too much gasoline. Think about that for a moment. In no way does the concept occur to Friedman that if the consumer wants to save money on fuel they might simply drive fewer discretionary miles (like making a grocery list and driving once to the store instead of making several separate trips to purchase a handful of items each time), or carpool, or use mass transit. No, in Friedman’s bureaucratic world, government must step in and force auto manufacturers to spend hundreds of millions of dollars to increase fuel economy of cars lest consumers spend all their budget on gas because they are too stupid to control themselves.

The Trump administration took a different approach, cutting regulations in order to lower costs and allow Americans to make decisions for themselves – and saving Americans $50 billion dollars in the process. Trump targeted stringent fuel economy regulations from the Obama administration in an effort to lower new car prices. But did the automobile manufacturer’s lobbyists resist such a cut? One would assume that auto manufacturers would welcome deregulation as a way to save car buyers money and perhaps increase the number of cars sold. Yet in his book, Mulligan states that the big car companies may have had an ulterior motive. In fact, they may have overcharged consumers for fuel economy compliance from the beginning – the very same situation seen in the utilities sector.

Biden is now making every effort to return to this failed system of perverse incentives and federal government overreach. While claiming that he will make the rich “pay their fair share,” the wealthy individuals with vested interests in car manufacturers may be making out better than ever – and it’s ordinary Americans who are paying the price.

Luke Allen, now a freelance writer, spent 30 years in the energy industry and was an energy policy advisor to two administrations.

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Verl Herriman
Verl Herriman
2 years ago

It’s time to set Biden free he has kill everything

Chris
Chris
2 years ago

Another great article from Luke Allen.
Priced a vehicle lately? There are only a handful of new cars on lots. Used vehicles are commonly sold for more than their original sticker price. Dealerships are actively calling customers from a couple years back and trying to buy what they sold to them.
A cousin went in to look for a new 3/4 ton truck. The salesman told him it was over $80k over his shoulder, he was COMPLETELY not interested in bargaining. Supply is so low, the salesman knew someone desperate enough for a new truck would soon be in and would HAVE to pay the price.
Thanks, Biden

Lawrence Greenberg
Lawrence Greenberg
2 years ago

In the old days (that is, until perhaps two years ago), one would go into a car dealership, take the MSRP, and then begin negotiating down from there. No more. Between July and September, I went to a number of nearby Toyota dealerships (central NJ) looking for a new Sienna (my old one was 12 years old). The Sienna, as it turns out, is in extreme demand and finding even one on a dealer’s lot was unusual. When I finally did find one in the model and configuration I wanted, it worked like this: we started with MSRP, the dealer added $4K as some sort of curious surcharge/fee, and then we negotiated up from there. By the time we were done with all the other add-ons, the final cost was about $9K over MSRP.

Barb304
Barb304
2 years ago

Prices will just continue to go higher and higher! It’s called price gouging/greed and it has the entire world in it’s grip. And the way I see it, it all started the day Biden took office. I pray God will bring our country through the current reign we’re under and lift us out of this ‘swamp’ God Bless America

KDESQ
KDESQ
2 years ago

It is ALWAYS the normal American that pays for everything. The rich don’t care about price, the poor can’t afford it without government help anyway and the middle class pay. The poor do pay much more of their salary to high gas and food prices. Democrats are just evil and the worst possible solution to any problem, because they created virtually EVERY problem we have in this country.

They were and are the present day racists, they never have enough money to spend to fix a problem they created they always need more. They always double down and that is why we have a hug debt problem. They are the reason almost completely. Yes, some rinos have helped in the spending. Trump comes to mind as never wanting to cut anything. They keep interest rates low so they can borrow more money and push the can down the road when the bill comes due.

They have created the healthcare problems in this country with government mandated coverages and having government and third parties pay the freight, hence the hugely inflated costs of medical care. It is NOT the machines and new medicines it is the system and greed.

Back to my original point. The democrats have created 95% of our problems and then tell us they have the solution, just give them more money to solve the problem they created that they NEVER solve.

Stephen Russell
Stephen Russell
2 years ago

So my Nissan Rogue is 25% more on price for being Used?> 116K miles

par
par
2 years ago

No such thing as Bidenomics. It is called political stupidity.

jocko
jocko
2 years ago

YES, joe IS A CANCER LIKE ALL libs AND ARE ALL ENEMIES OF OUR NATION

Hal
Hal
2 years ago

As for the “Shock” …. there’s more to come and continue until the Demoncraps feel comfy that they have take compete control of the Nation to their partisan benefit.

Bob L.
Bob L.
2 years ago

I’m still driving my 1995 Dakota and intend to keep it until either the wheels fall off or I leave it to my grandson. This ’95 truck has more “computer” influence on the truck than I like even though it’s almost all to do with the injectors and ignition. When I bought it, I made sure it had “windup” windows and manual door locks. I did own a 2007 Outback for a few years and really didn’t like how much computer influence that car had, it was smarter than me, did things I didn’t want it to do. I wanted to warm the car up one cold morning so, having two keys, I started it up, pushed the lock and closed door. IT WOULDN’T STAY LOCKED WITHOUT SOMEONE SITTING IN THE DRIVER’S SEAT!!!!! Another thing I didn’t like was, you had to push the clutch pedal down in order to start it. Back years ago, I had to use the starter on an older truck to move it out of harm’s way- that ain’t going to be possible with newer vehicles.

The more computer controls and “gadgets” new cars have, the more they are going to cost and the more it’s going to cost to get them repaired.

PaulE
PaulE
2 years ago

Well this article is actually quite accurate in how it spells out the rationale used by the government for intentionally increasing the price of both gasoline and automobiles, via regulations, for “the consumer’s own good”. That excessive and unnecessary regulations result in higher costs for the consumer is no concern for most career bureaucrats. What matters most is that their policies are enacted to force the consumer to act in the way the government wants. Even if that causes significant economic and societal damage to the country for no good reason.

By the way, if you think cars and trucks cost a lot now, wait a few years for when only EVs are sold and the government outlaws the use of ICE vehicles or increases regulations so much that they become economically oppressive to operate. That will be a real sticker shock to the average consumer. Especially when they see what it costs to upgrade their home electrical service and install their own charging station.

I had a few friends show me their monthly electrical bills after they bought an EV for “the great tax break”, as a second or third vehicle. They were all floored by what their new monthly electrical bills were. They never thought to consider how expensive charging up their EV every night would be. Oops! More “Hi, I’m from the government and I’m here to help”…NOT!!! So strap in and be prepared for the cost of everything, not just gasoline and cars, to rise dramatically. When you put European style regulations and policies in place, you have to be prepared to pay European style prices. What we’ve seen to date, regarding price hikes, is just a tiny taste of what is coming down the road.

Tim Toroian
Tim Toroian
2 years ago

Read the second paragraph of the Declaration of Independence about abuses and usurpations and the remedy.

Willie
Willie
2 years ago

I hope the people that voted for Biden are happy? They have made America into a poor country and it is going to get worse and Biden and the democrats are the problem.I HOPE SOMEONE will have enough guts to impeach Biden,Harris and pelosi or shoot all three and Obama with them. It might be easier just to shoot Obama.

R.J. from Arizona
R.J. from Arizona
2 years ago

Hey! It’s Trump’s fault! It’s Covid! It’s white privilege! The Great Bafoon.

R.J. from Arizona
R.J. from Arizona
2 years ago

Oh,,talked to a car dealer couple of days ago. The new Jeep Grand Wagoneer you can get for 100k if you want bells and whistles.

Robert
Robert
2 years ago

Same thing in the wood industry where unattainable emission mandates (not even scientifically or technologically reachable) required processing and manufacturing companies to spend millions on un-proven assets that could not get to the mandated requirements. Where do those costs end up being transferred to? Why the American consumer of course. All due to the climate myth… All the while China and India get a pass on any such emission requirements. I guess we here in the USA don’t share the same atmosphere as Biden’s dear tyrannical friends…..This country has become a joke under the Democrats and their co-conspirators (communists, the media, Hollywood, big tech, large corporations and industries) who plan to take full control of your thoughts and lives. I can hear them at Davos now, “If they refuse to submit to us, send them all to re-education camps.”

Backwoods
Backwoods
2 years ago

Have you thanked a Biden voter lately.

Hal
Hal
2 years ago

If you wanna to slidin’ in the Biden Commie grindin’ garden of being saddened, just keep on sticking your head under water. Biden is so far out of sidin’ and understandin’ what the Nation’s citizen take pride in …. he is looney. He is a real and current danger to American life.

GunRunner
GunRunner
2 years ago

Well, thank “Unca Joe”, oh, and don’t forget the “Republicans In Name Only”, and the “Never Trump” Republicans! All of them had a big part in this…

Joanne 4 justice
Joanne 4 justice
2 years ago

Be prepared it’s not going to get any
better anytime soon! I expected inflation after COVID OUTBREAK and the extra expenses for stimulus checks!
However , what is really concerning is the crazy unrealistic leadership in the WH administration !
Let’s face facts Folks , Biden and Harris (alone or as a team ) are unable to lead themselves , or our Country, out of a paper bag . Indeed ,they cannot see any further past their entitled do nothing attitude in any way shape or form that would benefit our Country ! !!!!
I pray that the trillion $$$$ bill(s) WILL NOT PASS ! I have absolutely NO faith in them or their evil COMRADES!!!! ALL OF THESE DISHONEST SELF SERVING PEOPLE INTENTIONALLY , TOTALLY IGNORE THE PROBLEMS THEY HAVE CREATED ; AS THEY PROCEED TO manufacture more problems while SPENDING OBSCENE AMOUNTS OF TAXPAYER MONIES $$$$$$$ MUCH OF THE FUNDS DERIVED VIA FUTURE UNCERTAIN TAX REVENUE!!!!
A VERY DISGUSTING PLAN!!!!!

Becky
Becky
2 years ago

It has been clear to me since the 70s that the US government is not our friend. It doesn’t exist to keep us safe while we are “living the American dream”. Instead it exists to enrich itself, it’s cronies, it’s pals, and it’s lobbyists/masters. Always at our expense.
I’m still waiting for US citizens to figure out that NO democrat Communist is safe to elect. Ever. Their only goal, for 5 decades, has been to TAX & SPEND America into oblivion. It’s a relentless goal. And they are doing it RIGHT NOW.

Denise
Denise
2 years ago

And what’s even more disgusting and flat out bordering on treason is the LACK OF “REPUBLICAN ACTION TO STOP THIS DEMENTED PUPPET, WHO’S STRINGS ARE BEING PULLED, ILLEGALLY OCCUPYING OUR WHITE HOUSE!
I became brutally aware of government evil in ’93 when comrade Wm. Jefferson Clinton over saw the 51 day vicious and unbelievable torture, slaughter and burning to death of almost 86 AMERICAN men, women and children in Texas…with the “blessing” of a repulsive “media” who constantly slandered those AMERICAN CITIZENS, and even more repulsive were so-called “americans” probably all leftists, or just ignorant lazy people who bought the BS, who bellowed kill kill kill…using the US military and law enforcement!
Sadly far to many citizens have no clue what our Constitution and Bill of Rights even say. These so-called “representatives” are not kings or rulers, but ignorance of the People’s Power has been over looked, ignored, omitted (as in ALL government controlled schools) or Americans have been to busy pursuing life…it takes time to hold so-called representatives accountable…and it takes more than a few…it takes numbers of people willing to act.
Is anyone so naive as to think this “regime” having left Americans in a terrorist nation and flying UNVETTED Afghani’s into our nation isn’t capable of “reducing the population”? Who’s opened our borders to thousands of illegals, many of whom are vicious gang members?
If you’re not familiar with history, look up the Genocide Chart online. Published in ’95 by Jews for the Preservation of Firearms ownership…It’s not just a few things being destroyed, it’s the freedoms of this nation.

GTPatriot
GTPatriot
2 years ago

Buy a bicycle. We are now Holland. Honestly, I see as many bicyclists (they call it body building) as I see cars. Autos are obsolete in the Biden no-gas economy. Hope you enjoyed your cars.
Your options are $125K Teslas or bikes with umbrellas. So we are “progressive” ?

GTPatriot
GTPatriot
2 years ago

Denise: Please understand that DC republicans are liberals posing as conservatives. There are no more than 5 conservatives in the entire congress. You will never change this by voting. Forget voting. You must take other action

Hal
Hal
2 years ago

I think Joe Hidin’ Biden in inborn/inbred mental stupor thinks he is a “Robin Hood”, when in reality he is a “Robbing Hood.” He, in his dementia, sees himself as a “Fair Knight”, when in reality he is a “Nightmare!” As POTUS or any other state of leadership, he is bent on sinking the ship of state.

Bill
Bill
2 years ago

We can thank the biden administration for this. Inflation is another shameful hallmark of an administration that will long be remembered for its failed policies.

Blondie
Blondie
2 years ago

So glad we got our new truck last year. I can’t wait for the new electric vehicles that will be even more expensive, less reliable and the only thing on the lots. I hope all the Dems need a new vehicle and can’t afford one. I am good for the next 10 years, I just hope there will be gas.

Paul Berardi
Paul Berardi
2 years ago

Parts and labor are relative to pricing!
If a Chevy Cruse weighs 3,000 lbs and sells for $21,000. Thats $7 a lb for parts and labor, yet a 4200 lb truck works out to 29,400 yet that truck is $50,000.

Cost of materials and labor to assemble are all relative!! The profits have always been in higher priced units!

HalB
HalB
2 years ago

Impeach Biden before he totally ruins our great country. The Dems impeached Trump with lies. The GOP can Impeach sleepy Joe with cause. He is incompetent and so is the rest of his administration. We sent in the clowns and it is time to close the curtain on the farce.

Tom
Tom
2 years ago

It’s jiminey cricket carter all over again. The demonrats never have figured out our economy and what makes it tick. They just do the same stupid sh*t over and over again. Career politicians are out of touch and always have been.

Gary
Gary
2 years ago

I still have the sticker from my 2012 Chevy Silverado Z71 LT package and it was almost 44000, that same truck will cost you 60000 now it’s crazy, my first house was only 52000.

Rich
Rich
2 years ago

I guess we will all just have to wait for uncle Joe’s trillion dollar incentives so we can all go out and “buy” a new electric vehicle. If I’m helping the environment it shouldn’t cost me anything.

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