Drivers Face New Taxes to Help Make Up Cost of Move to Electric Cars

Who will foot the bill for the Government’s ‘green revolution’? The taxpayer, of course. Reports suggest that drivers face new taxes to help make up £30 billion of the ginormous cost of moving to electric cars. The Times has the story.

Traffic jams could paralyse the road network in coming years, a report said this week, with low-emission vehicles, which escape fuel duty, making it cheaper to drive. The report by the Tony Blair Institute for Global Change, a think tank, recommends the introduction of road pricing. Motorists would be taxed on the size of their vehicle and the time they used the roads, with higher charges during peak hours.

The report said that Rishi Sunak, the Chancellor, is facing a black hole of £30 billion in lost taxes because people in electric cars no longer pay fuel duty or vehicle excise duty. Asked whether the Government was considering road pricing, the Prime Minister’s spokesman said that Johnson would not “seek to place burdens on hardworking families”, but added that taxes needed to reflect the rising number of electric cars.

“We need to ensure that the tax system encourages the uptake of electric vehicles and that revenue from motoring taxes keeps pace with that change,” the spokesman said. “We will set out our further plans in due course.” …

The report said that drivers would spend a third more time in traffic jams because of the move to electric cars, costing the economy an estimated £121.5 billion annually.

Worth reading in full.

Fewer Cars Produced Last Month by British Factories Than in Any July Since 1956

Demand for new cars may not have fallen too far over the past year of lockdowns, but staff absences caused by the ‘pingdemic’ and problems in supply chains means car manufacturers have recently been struggling to keep up. In July this year, the U.K. car industry produced fewer cars than in any other July since 1956. The Guardian has the story.

U.K. carmakers made 53,400 vehicles in July, a 37.6% drop when compared with the same month in 2020, according to data from the Society of Motor Manufacturers and Traders (SMMT), the industry’s lobby group. …

Manufacturers around the world have struggled to keep producing because of problems in their supply chains, most notably in the months-long delays to computer chips, or semiconductors, that are used to control everything from windscreen wipers to electric car batteries within the car.

Some analysts expect the chip shortages to last until next year, holding back the recovery of the car industry.

U.K. production over the course of 2021 is up by 18% compared with the first seven months of 2020, when car factories were shut for long periods during the first national lockdowns. Yet at 552,400 units, it is 29% below the 774,800 it reached over the same period in 2019 before the pandemic.

No large carmaker has been spared, and buyers are being forced to wait months for some new cars. German carmaker Volkswagen last week warned that it may have to scale back production further, after Japanese rival Toyota said that it would cut output by 40% in September.

Jaguar Land Rover and Nissan, the two largest manufacturers in the U.K., have both previously been forced to cut production because of shortages.

During June and July manufacturers also had to contend with increased levels of employee absences, as more and more workers were ‘pinged’ by their NHS apps when they had come into contact with people who later tested positive for coronavirus. …

Mike Hawes, the SMMT’s Chief Executive, said U.K. carmakers still faced “extremely tough conditions”.

“While the impact of the ‘pingdemic’ will lessen as self-isolation rules change, the worldwide shortage of semiconductors shows little sign of abating,” he said.

Worth reading in full.

Should We Ban Cars?

As I’ve noted before, one of the main justifications for lockdowns has been the “externality argument”. This is the argument that government is justified in restricting our freedom in order to prevent us from harming others – which we might do by transmitting a deadly virus. As Richard Dawkins put it:

You can argue over whether masks, handwashing, banning groups etc are effective. What you can NOT argue is that you are personally entitled to take the risk as a matter of individual liberty. You risk other lives as well as your own. It’s just elementary epidemiology.

However, it seems the same exact argument could be made about the use of private cars (or seasonal flu, for that matter). In 2016, there were 181,384 casualties on Britain’s roads, including 1,792 deaths. Many of these victims will have been entirely blameless road users – cyclists, pedestrians and others – who just happened to get hit by a careless driver. 

What’s more, according to a 2012 paper published in the journal Environmental Science & Technology, emissions from road transport cause 4,900 early deaths in Britain every year, and that’s not even counting the impact on conditions like asthma. How would Richard Dawkins put it?

You can argue over whether buses, trains and bicycles etc are convenient. What you can NOT argue is that you are personally entitled to drive a car as a matter of individual liberty. You risk other lives as well as your own. It’s just elementary transportology.

Of course, someone might say that 7,000 deaths from car accidents and emissions is a lot less than the number who would have died from COVID-19 in the absence of lockdowns – so the analogy doesn’t really work. There are several responses to this.

First, the average age of those who die in car accidents is much younger than the average age of those who die of COVID-19, meaning that each fatal car accident takes away more total life-years. And in any case, there’s not much evidence that lockdown did prevent a large number of deaths.

Second, even if lockdowns could have prevented a lot of deaths in the early months of the pandemic, the situation now is completely different. In fact, the age-standardised mortality rate in the first five months of 2021 was actually lower than in 2018. 

Third, by rejecting the analogy on the grounds that 7,000 deaths is “too few” to matter, one is implicitly conceding that the externality argument isn’t an absolute. In other words, there is some level of externalities that society should tolerate, so long as the benefits to other parties are large enough. 

The question then becomes: are the externalities of COVID transmission sufficiently large relative to the benefits of personal freedom (including the freedom to attend school or operate a small business) to justify lockdown? And it’s by no means clear the answer to that question is in the affirmative.