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EPA’s Successful Case against Kia and Hyundai Driven by “Social Cost of Carbon”

EPA’s Successful Case against Kia and Hyundai Driven by “Social Cost of Carbon”

The use of lawfare will now drive implementation of “global warming” prevention rules.

A settlement reached in early November between the EPA and two car manufacturers may have as much impact on the economic health of the country as the recent wave election that ushered in a Republican Senate.

Essentially, the result of this legal case means that rules to prevent “global warming” will be implemented by the use of “lawfare” instead of science and technology.

On November 3rd it was reported that Hyundai and Kia will pay a record combined $100 million penalty for overstating fuel economy estimates for many of their vehicles.

The South Korean automakers had already agreed to pay consumers for the difference in estimated fuel costs, when the discrepancy was discovered by the Environmental Protection Agency in 2012.

The civil fine and other penalties announced Monday are in addition to those direct payments to vehicle owners.

The vehicles involved were the Hyundai Accent, Elantra, Veloster and Santa Fe and the Kia Rio and Soul.

The automakers overstated fuel economy figures for their vehicles by an average of six miles per gallon, the EPA said.

And while the mainstream media was reporting this as a big win for the environment against an evil big business, a closer look at the origin of the problem points to vague regulatory language — a hallmark of bureaucrats who want to promote an agenda than actually address valid technical concerns.

Hyundai, which owns both marques, defended itself, stating that it had genuinely misinterpreted the EPA’s complicated rules regarding testing.

…Hyundai has conceded to pay the penalties so that they can move on and avoid further litigation.

Although the EPA has not revealed whether other automakers are being investigated with the same vigour, the agency has been more stringent in its audits. Just two weeks ago, BMW was instructed to reduce mileage estimates on four Mini Cooper models. In June, Ford cut gas mileage and efficiency ratings on six of its models; no punishment was meted out and the American automaker only sent ‘goodwill’ cheques to about 200,000 owners and lessees of the vehicles. Why, then, were Hyundai and Kia the only ones singled out for public condemnation? Although there were many more cars involved in the Hyundai and Kia saga, it seems unfair that BMW and Ford got away with barely a slap on the wrist.

The reliability of EPA standards has long been questioned. Consumer Reports has shown that 55% of hybrid cars and 28% of cars with turbocharged engines fall short by 10% or more in independent testing. The EPA itself has acknowledged the shortcomings of its testing standard and proposed conducting future audits in actual on-the-road situations to verify figures. Considering that consumers rely on the EPA to look out for their interests and refer to their ratings to make car purchasing decisions, perhaps the EPA should reexamine its testing standards and guidelines, and consider auditing more than the “10 to 15%” of cars; you know, pay attention to the plank in its own eye and all that.

I suspect those in charge of implementing these rules at the EPA have no intention of reconsidering the test paramters. Interestingly, when the EPA’s case looked like it was poised for a big win, the California Air Resources Board CARB joined in as a co-plaintiff and will receive $6,343,400.

But there is more than money at stake here. As Katy Grimes of The Flash Report points out, the settlement is a roadmap for bureaucrats who want to punish businesses based on “the social cost of carbon”.

Ostensibly the CARB joined in to the Hyundai, Kia lawsuit settlement to mitigate future anticipated damage to the state’s air quality. But there is a deeper agenda; when a settlement such as this is reached, it essentially codifies into law what those settling outside of the legislative/regulatory process agree to — such as the “value” of carbon. –

“Greenhouse gas emission laws protect the public from the dangers of climate change, and today’s action reinforces EPA’s commitment to see those laws through,” said EPA Administrator Gina McCarthy. “Businesses that play by the rules shouldn’t have to compete with those breaking the law. This settlement upholds the integrity of the nation’s fuel economy and greenhouse gas programs and supports all Americans who want to save fuel costs and reduce their environmental impact.”

Given that the ARB is faced with outrage over the “social cost of carbon,” it appears they just will take the settlement approach and avoid any real air pollution mitigation… otherwise known as a government shakedown.

So, while the nation experiences a deep freeze, it looks as if the settlement may ultimately chill the already sluggish economic recovery while it warms the hearts hearts and lines the pockets who are using carbon dioxide to fuel their political agenda.


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It’s called the socialist view of the law. Seriously, there is a belief in collectivist countries that the law is not a set of rules, but a means for binding people nonconsensually as if we are all actually vassals with tribute to pay.

It’s not the least bit unusual anymore for me to encounter bureaucrats remembering feudalism fondly as a time when economic and political power were combined in a single entity. Plus people by and large could be forced to do as they were told.

It’s no accident that from regulating school lunches to what we drive through illusions like the social cost of carbon to the real Common Core K-12 implementation, scratch away the surface explanation and it is personal behavior being targeted. Meanwhile truly dysfunctional behavior gets tolerated, celebrated, or a book advance.

    bvw in reply to Robin. | November 23, 2014 at 1:26 pm

    Robin: socialist is sorta of right, but yeah well, not really. EUROPEAN socialist, yes. Specifically GERMAN SCHOOL. See Phillip Hamburger’s book on Administrative Law for the history.

    Speaking from my own read on history I note that there was a native American form of socialism rooted in the second Great Awakening, that climaxed, so it seems, in the Death of Garfield, with some carry over into Roosevelt, Teddy. But it was overwhelmed by the German variant with the arrival of Wilson in in Chief Executive. THAT socialism reached its apex with the Nazis, but maybe our own American Federal Administrative state and the crony establishments academic, legal and corporate have surpassed the Nazis in carrying through the concepts of the German socialists. Sad. Yet we are not German. We are Americans, like the Brits during the Battle of Britain we will fight this off, somehow. And like the Germans viewed the Brits as brothers, at least close cousins (see the royals dang it), and that battle of WWII almost as a civil war — our administrative state plutocrats view themselves as Americans, yet they are not Zombie-statists, maybe. American in ideal and heritage? no.

If the performance does not match the promise there will be consequences? Does this apply politicians?

Even in teh New Obamic Empire, there are important differences in things and things…

From TheCorner this morning—

George Stephanopoulos asked Obama in an interview airing on This Week about an analogy that many of the president’s critics have drawn: “How do you respond to the argument, a future president comes in, wants lower taxes. Doesn’t happen. Congress won’t do it — he says I’m not going to prosecute those who don’t pay capital gains tax.”

Obama didn’t respond to the question and continued with his talking points, prompting Stephanopoulos to press him again: “So you don’t think it’d be legitimate for a future president to make that argument?

“With respect to taxes? Absolutely not,” the president replied.

This is a fairly straightforward case of manufacturers deceiving their customers.

The EPA and CAFE mileage numbers are determined by lab tests, not by somebody actually driving the cars. The tests have never been terribly accurate. And, adding to the noise and confusion, the tests and the standards change every few years. But at least when comparing cars of the same model year in any particular market niche, customers can use these figures to make estimates of the car’s relative costs of operation.

Misstating the mileage numbers is as deceptive as any other lie by a manufacturer, such as deceptions about the terms of the warranty or the list of standard included features. Such deception is not legitimate business, and squashing it is a legitimate function of government.

The government is not telling the consumer what sort of car he must buy ‒ he can still drive a gas eater if he can afford it.

The government is, to a considerable degree, telling the manufacturers what sorts of cars they can sell ‒ that’s what the Corporate Average Fuel Economy is about. (And, oddly enough, the way the mileage is measured for the EPA estimate on the sticker in the car’s window is not the way it is measured for CAFE compliance ‒ but that’s government for you.) However, that’s not really the issue in this case.

Carbon hysteria doesn’t really come into it.

    Ragspierre in reply to tom swift. | November 23, 2014 at 12:31 pm

    “Greenhouse gas emission laws protect the public from the dangers of climate change, and today’s action reinforces EPA’s commitment to see those laws through,” said EPA Administrator Gina McCarthy. “Businesses that play by the rules shouldn’t have to compete with those breaking the law. This settlement upholds the integrity of the nation’s fuel economy and greenhouse gas programs and supports all Americans who want to save fuel costs and reduce their environmental impact.”

    Honest to gawd, Tom, I really wonder about your reasoning ability sometimes.

    Or even your reading.

    I own a Kia Sorrento. It is a diesal 4WD. It has the best mpg that I have ever had in a car, especially on the open road.

    How does one know whether or not the car manufacturers lied to their customers? It is a question of where and how the cars are driven.

    When the speed limits are lowered to something like 25-30 mph that means the car is going to be less efficient on fuel economy. On top of that if one is constantly hitting the brakes that will cause the car fuel efficiency to not be as good.

    To make my point a little clearer, we had a trip from the NSW Central Coast to Armidale recently. The car did great when we had stretches of road where we can drive 100 kph (it is kilometres here in Australia). The average fuel consumption on the car at the start of the journey was around 7.7. During the trip we were stuck behind a very slow moving vehicle that was a wide load and we were on a very steep incline when that occurred (there is a lot more to that part of the story and trip and I remain horrified over what I saw). The fuel efficiency of the vehicle was affected because of this episode and the average, having gone down began to rise again to the 7.7. On the way home to the Central Coast we had a much better trip and the fuel efficiency was improved. I am talking seeing the average drop to around 6.5 kph.

    When we first purchased the vehicle we also did a very long trip from NSW to Victoria ending up on the Great Ocean Road. The fuel efficiency during that trip was also very good. The 7.7 is ok for the short distances.

    In the past we have owned Fords as well as Toyotas, Nissan and Mitsubishi. Not one of these vehicles have given us the level of fuel efficiency as we have seen in the Kia Sorrento.

    It is all about how the car is driven. If the car is used in city traffic and for short distances then the fuel efficiency is usually terrible. I know for a fact that the Ford I drove would at best give me a rate of about 10 kph but that was open road driving. For the rest of the time, in city driving it averaged around 17 kph which is not good at all. The Mitsubishi was the worst of these cars. Even the Nissan Tiida is not fantastic as far as fuel efficiency is concerned but then again I only have short trips to and from the shopping centre on most days.

    No it’s a straight forward case of complicated, contradictory regs and tests that have no basis in the real world.

    stevewhitemd in reply to tom swift. | November 23, 2014 at 6:03 pm

    Tom makes a couple of good points this time —

    1) the EPA ratings are indeed a lab test and not an open road test. I recall that complaints about that a few years ago caused the EPA to revise their testing somewhat to account for this, but that revision wasn’t too successful.

    2) lying about the EPA rating is indeed deception and should be punished as such. Sometimes when it comes down to a dispute between a big corporation and the government, the government may indeed be right (hey, it could happen).

    3) if one doesn’t like the EPA regs, because they penalize inappropriately auto makers who otherwise would bring other (better?) cars to the U.S. market (like diesel Kias) then fine — but the place to change those regs is with the Congress.

    But a note to Tom: our suspicion that the EPA has it in for anything related to carbon appears, by the preponderance of evidence, to be warranted. The EPA may be right this time but I still wouldn’t trust them.

This scientist points out how desirable more CO2 is, in the real world. Greenhouses spend money to increase CO2 since it is so beneficial to plants. We get better fruits and vegies and everything that grows, along with greater “biodiversity” as CO2 increases. And desertification has been reversed over the last 100 years in places, apparently due to CO2 increases.

My studies on this subject show the tiny amount of “greenhouse gas” CO2 is not a driver of climate, AND the miniscule amount man can reduce their output is even more insignificant. AND man would do better if we warm a little, rather than cool down to the long term norm.

A Google search of “ICCC9” will bring up a lot a short and instructive video on the insanity of the AGW lies. Whether it is the UN gangsters, or the carbon trade brokers, or the Solyndra style “donors” … the core of AGW dogma is as corrupt as Obamacare’s true intentions.

Why the next President, should the Republic survive till that time, should make Phillip Hamburger (“Is Administrative Law Lawful?” .. clue: NO!) his chief of staff and then after some years of tear-down of that selfsame administrative state, appoint him to the Supreme Court.

What’s the penalty for overstating health economy estimates and running trillion dollar deficits in perpetuity? The climate science is not settled, and, in fact, cannot be settled in the scientific domain. However, the devaluation of capital and labor caused by accruing debt at a rate exceeding current growth, and reasonable future growth, is well established.

Note, children, the article has nothing but rank speculation that The Bureaucracy has it in for anything releasing carbon.

It may be true … and probably is … but it still has nothing to do with this case.

Hyundai published fake numbers which just happened to encourage sales of their cars. And were caught.

That’s about it. Not much there for the Fever Swamp to moan about, really.

    Ragspierre in reply to tom swift. | November 23, 2014 at 2:49 pm

    Well, hell, Tom…

    let’s give you ANOTHER chance to get it.

    “Greenhouse gas emission laws protect the public from the dangers of climate change, and today’s action reinforces EPA’s commitment to see those laws through,” said EPA Administrator Gina McCarthy. “Businesses that play by the rules shouldn’t have to compete with those breaking the law. This settlement upholds the integrity of the nation’s fuel economy and greenhouse gas programs and supports all Americans who want to save fuel costs and reduce their environmental impact.”

    Did she say “carbon”? No. WTF do you THINK she meant?

    Do you want to TRIPLE-down on reading and irrational?

    The numbers from Hyundai are not fake. Those figures are achievable when the car is taken on the open road.

    Kia and Hyundai are the same vehicle under different badges. They are very fuel efficient cars and they enjoy a good reputation in Australia.

    The diesel version is better than the petrol car with the fuel efficiency being very good.

    The VW Golf, which is sold in the USA as a VW Rabbit also has good fuel efficiency in the diesel version. There are other cars that are the same.

    The technology inside the Hyundai and the Kia is vastly improved over the Ford, Mitsubishi and the Holden. This improved technology means that there is also improvements with regard to emissions from the vehicles. Those emissions by the way are not CO2 but are carbon monoxide. The real improvement came when legislation was introduced to remove lead from petrol. The end result has been the lowering of carbon monoxide in the air and that has seen improvement in regard to health concerns.

    Asia has led the way in regard to improving this technology and new engines etc have been developed to meet the legislative requirements This includes producing vehicles that are able to cope with the requirements to use or add ethanol to the fuel mix.

    Both of our current vehicles, the Nissan Tiida and the Kia Sorrento cope with the legislative requirements in Australia. The Kia is the diesel and can only take diesel, but the Tiida is a petrol car and the technology within the car means that it can cope with ethanol being added to the fuel. On the other hand, our previous vehicle, a Ford Falcoln could not cope with the ethanol mix. The fuel efficiency was not great… and with the Mitsubishi that we once owned, if I used fuel that had ethanol the fuel injectors clogged and getting them cleaned cost me a lot of money.

    I applaud most of these improvements that have produced clean air. There was a time when I suffered from the dirty pollutted air… and this includes my first trip to New York where I ended up with a shocking headache caused by clogged sinuses. On my return to Manhattan Island, the difference in air quality was noticeable. The most likely reason is that lead was removed from petrol meaning that there is less carbon monoxide in the air than there was in 1985 when we had our first visit.

      Ragspierre in reply to Aussie. | November 23, 2014 at 3:57 pm

      See, Aussie, you are inadvertently teasing us.

      We CANNOT buy a diesel Hyundai product here, just like the several EXCELLENT diesels that are built all over the world, because of our crazy regulations.

      Some of our domestic producers have WANTED to market fine, efficient diesels, but they can’t meet the specs imposed by the idiots in the regulatory state. So, every year or so we are treated to an announcement that never gets to market. They can meet the specs one year, only to see the goal-posts moved.

      Like so much else, it isn’t about what they pretend. They really don’t want people driving private vehicles. Unless, of course, it is THEM driving. (c.f., Obama’s motorcades.)

Has the EPA audited Government Motors and Chrysler?
GM still hasn’t fixed the power steering in my daughters car like they were supposed to after the recall.

The EPA is a rogue agency which has always run on its own agenda, driven by ideologues and private environmental crusaders, with a blatant disregard for the law.

The ideal solution, just to line them all up and shoot them, seems impractical, however efficient and beneficial to the nation. But they need to be reined in, and forced to conform to their mandates and the letter of the law.

What will the EPA do with all that money? Buy ice cream cones for polar bears?