America built smart cars on dumb road funding



On Friday, in an open letter to the 119th Congress, I joined more than 100 economists and public policy experts from universities, think tanks, and businesses across the country urging practical reform of the Highway Trust Fund. Our message is straightforward: Congress can — and should — take incremental, bipartisan steps now to put the fund on a stable, sustainable path.

The Highway Trust Fund long embodied a simple user-fee compact: People who use the roads pay for them. That bargain delivered predictable funding and reinforced fiscal discipline.

Congress has repeatedly patched the shortfall with transfers from the general fund, which papers over the problem while weakening the principle that made the system durable.

Now the system is fraying. Fuel taxes have not kept pace with inflation, rising construction costs, or improved fuel efficiency. Electric and hybrid vehicles — a growing share of the fleet — often contribute little or nothing through fuel taxes. Congress has repeatedly patched the shortfall with transfers from the general fund, which papers over the problem while weakening the principle that made the system durable.

Congress does not need to solve every long-term challenge in one bill. It can make meaningful progress in the next surface transportation reauthorization, which lawmakers must pass by Sept. 30.

First, lawmakers should reinforce the user-pay principle by ensuring all road users — including drivers of electric and hybrid vehicles — contribute a fair share through transparent, enforceable mechanisms. Fairness demands no less. When some users effectively get an exemption, the burden shifts to everyone else or to taxpayers at large.

Second, Congress should improve price sensitivity. Heavy commercial vehicles impose disproportionate wear and tear on highways and bridges. User fees should better reflect vehicle weight and road impact. That change would improve fairness and send clearer economic signals about infrastructure costs. A system that reflects actual use and damage is more rational — and more defensible.

Third, legislators should evaluate a transition from per-gallon fuel taxes to mileage-based user fees. A well-designed road-usage charge would ensure payments reflect miles driven and vehicle characteristics.

Any transition must preserve the core user-pay principle while avoiding disproportionate burdens on low-income households, small businesses, and farmers. State pilot programs show mileage-based systems can protect privacy and maintain public trust. Congress should build on that experience rather than delay modernization.

Fourth, Washington should reduce reliance on general-fund bailouts and set clearer expectations for revenue reform in the next major reauthorization cycle. Temporary patches undermine fiscal responsibility and create uncertainty for state planners and private investors.

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Photo by Chris Kleponis/Polaris/Bloomberg via Getty Images

Revenue reform alone will not secure the system. Transportation infrastructure now depends on digital systems that guide vehicles and manage logistics. America’s economy relies heavily on GPS-enabled positioning and timing. Disruptions to systems overseen by the U.S. Department of Transportation would ripple across freight networks, emergency services, and daily commutes.

China and Russia have shown the capability to interfere with satellite systems and GPS signals. A prolonged outage would cost billions of dollars per day. Vehicles sold in the U.S. should incorporate tested backup positioning technologies to guard against such threats.

Supply-chain security also demands attention. Chinese firms such as BYD and CATL dominate global battery production. The concentration of manufacturing — and embedded telematics — in companies subject to influence by the Chinese Communist Party raises legitimate concerns about espionage and strategic vulnerability.

The U.S. should expand domestic battery production and charging infrastructure, reducing dependence on foreign-controlled systems that can compromise data security and resilience.

Finally, Congress should pursue sensible federal deregulation to reduce the needlessly high cost of transportation projects — and require state and local partners to do the same. Streamlined permitting, faster reviews, and fewer duplicative requirements would stretch every Highway Trust Fund dollar and deliver projects faster.

These proposals are not partisan. They are practical steps rooted in fiscal responsibility and national security. A stable source of funding for roads is not merely a budget issue; it is essential to economic competitiveness, national mobility, and public safety. By reinforcing the user-pay principle, modernizing revenue mechanisms, protecting digital infrastructure, and strengthening supply chains, Congress can signal a shared commitment to safeguarding America’s transportation future.

The 119th Congress has an opportunity to restore the Highway Trust Fund’s integrity. Lawmakers should seize it.

Farewell to fake fuel efficiency stats, hello to tough future for EVs



Fake fuel economy has got to go.

That's the message of a recent decision by the Eighth U.S. Circuit Court of Appeals. Sent to the scrap heap: a Biden-era Department of Energy rule that critics say wildly inflated the fuel economy ratings of EVs — giving them an unfair regulatory advantage over gasoline and hybrid vehicles.

The court's ruling was clear and direct: Federal agencies cannot manipulate timelines or definitions to advance a policy agenda without proper authorization from Congress.

This is a major correction to how the U.S. government measures vehicle efficiency, with consequences for automakers, consumers, and the future of the EV market.

Efficiency inflation

The case was brought by 13 Republican attorneys general, who argued that the DOE's formula for calculating EV efficiency was misleading and legally indefensible. The court agreed, ruling that the Biden administration overstepped its authority by continuing to use an outdated, artificial formula that inflated electric vehicle performance under federal fuel economy standards.

At stake is the credibility of how America measures vehicle efficiency — a key driver in regulatory decisions that shape everything from automaker product lines to what cars consumers can buy.

For years, the DOE's so-called petroleum equivalency factor has been used to translate electric power into miles-per-gallon equivalents. But the formula wasn't based on realistic energy comparisons. Instead, it massively overstated how far an EV could travel on the energy equivalent of one gallon of gasoline — often rating electric cars above 100 MPGE, regardless of actual energy costs or grid efficiency.

Credits as currency

Rather than immediately fixing this issue, the Biden administration's DOE planned a slow phase-out of the inflated metric between model years 2027 and 2030. That delay allowed automakers to continue claiming exaggerated efficiency numbers — and collecting fuel economy credits that made it easier to comply with the federal Corporate Average Fuel Economy standards.

Why does that matter? Because those credits act as a form of regulatory currency. A company that racks up credits through high-efficiency vehicles can use them to offset the sale of less efficient models or even sell them to other automakers.

In other words, the inflated EV math didn't just look better on paper — it saved automakers millions of dollars in potential penalties while giving policymakers a talking point about "historic progress" in fuel efficiency that wasn't based on real-world performance.

A direct rebuke

In its 3-0 decision, the Eighth Circuit ruled that the DOE had gone beyond its legal bounds. Agencies can't rewrite laws through policy tweaks, the judges said, even under the guise of "phasing out" old rules. The DOE was required by statute to eliminate the flawed formula entirely — not stretch it over several more years of inflated numbers.

The court's ruling was clear and direct: Federal agencies cannot manipulate timelines or definitions to advance a policy agenda without proper authorization from Congress.

That's a significant rebuke not just to the DOE, but to a broader pattern of regulatory overreach that has characterized much of Washington's EV push.

For the states that brought the lawsuit, the decision represents a major win for transparency, accountability, and consumer protection.

Pivoting on EVs

The implications for automakers are enormous. For years, inflated EV efficiency numbers helped carmakers meet federal fuel economy targets and avoid costly fines. Without that regulatory buffer, the industry will need to adapt quickly.

Automakers may now lose the valuable fuel economy credits they've relied on to remain compliant with CAFE standards, forcing them to find new ways to meet efficiency goals. That shift will require genuine engineering improvements — advances in aerodynamics, weight reduction, and hybrid technology — rather than relying on inflated paper-based advantages.

This change could also prompt a broader reassessment of electric vehicle strategy. If the regulatory math no longer tilts in favor of EVs, many manufacturers may slow their rollout plans or diversify their portfolios to include more hybrids and high-efficiency gasoline models.

The timing is significant: EV demand has cooled, dealer inventories are building up, and consumer interest has leveled off. Automakers such as Ford, General Motors, and Volkswagen have already scaled back or delayed certain EV programs in response to slower-than-expected sales and ongoing infrastructure limitations.

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Justin Sullivan/Getty Images

Consumer transparency

For everyday drivers, this ruling doesn't ban EVs — but it brings more honesty to the system.

Consumers deserve accurate information about vehicle efficiency, cost of ownership, and environmental impact. Inflated fuel economy ratings distort that picture, making EVs appear more efficient than they are when accounting for charging losses, battery manufacturing, and electric grid emissions.

Now, car buyers can make more informed choices — whether that's a hybrid, plug-in hybrid, or traditional gasoline vehicle.

In the long term, this ruling could encourage a broader mix of technology rather than a forced, one-size-fits-all transition to battery electrics.

The fight to come

This case isn't just about EVs. It's about how much power federal agencies should have to rewrite laws without Congressional oversight.

For decades, Washington has leaned on regulatory agencies to shape environmental and energy policy — often through complex formulas that most Americans never see. But as the Eighth Circuit emphasized, the ends don't justify the means.

Even if the goal is cleaner transportation, the process has to respect legal boundaries. When agencies overreach, courts must intervene to restore balance.

This decision reinforces an important principle: Policy must be grounded in law, not ideology. And in a country that values free markets and consumer choice, regulations should enhance transparency, not distort it.

The ruling leaves several key questions unanswered, but it is likely just the beginning of a much larger policy fight. Congress could attempt to step in by rewriting the laws that govern fuel economy standards, giving the DOE clearer authority to define how electric vehicle efficiency is calculated. However, such legislative efforts would almost certainly face significant political gridlock in an already divided Congress.

Much-needed realism

Automakers, meanwhile, are expected to take a hard look at how they allocate their research and development budgets and how they plan future vehicle lineups.

Companies heavily invested in electric vehicles have shifted strategies, focusing more on hybrids, plug-in hybrids, and improved gasoline technologies — especially in markets where EV sales have already shown signs of slowing or flattening.

Finally, the court's reasoning may open the door to further challenges that could include renewed scrutiny of EPA emissions standards and federal tax credits, both of which critics argue have tilted the market in favor of electric vehicles rather than allowing consumer demand and market forces to guide the transition naturally.

The Eighth Circuit's decision is a defining moment for the future of American automotive policy. It doesn't kill the EV market — but it forces it to stand on its own merits.

Electric vehicles have their place in the market, but consumers deserve truthful efficiency data and honest cost comparisons. Inflated numbers and creative accounting don't serve innovation — they undermine it.

This ruling restores some much-needed realism to the national conversation about the future of mobility. It's a win for transparency, for accountability, and most importantly, for consumers who want to make decisions based on facts rather than politics.

Fudged figures wildly exaggerate EV efficiency



It's quasi consumer fraud on a global scale.

The Environmental Protection Agency’s electric vehicle mileage ratings are misleading millions, inflating EV efficiency and hiding the true energy cost of driving green. And it all comes down to one little number.

The EPA’s MPGe calculation violates basic physics, specifically the second law of thermodynamics, which states that no energy conversion process is 100% efficient.

It’s time to pull back the curtain on the EPA’s Miles Per Gallon equivalent figure, a metric that’s been covering the truth about EVs for years. This flawed foundation overstates efficiency while shortchanging hybrids and traditional cars. This isn’t just a technical glitch; it’s a distortion that could sway your next car purchase and sabotage the resale of your electric car.

Stick with me as we dig into the numbers, uncover the truth, and explore why this scam happened. And make sure to share this with anyone who’s ever wondered if EVs are really as green as they’re made out to be.

MPGe: A flawed metric

The Obama administration EPA introduced MPGe to help consumers compare the efficiency of electric vehicles to traditional gas-powered cars. It’s supposed to represent how far an EV can travel on the energy equivalent of one gallon of gasoline.

On paper, it’s a tidy way to level the playing field. For example, the EPA rated the 2011 Nissan Leaf at 99 MPGe, suggesting it’s nearly three times as efficient as a typical gas car getting 35 MPG. Sounds amazing, right? But here’s the catch: The EPA’s calculation assumes a perfect world, where gasoline is converted to electricity with no energy loss.

That’s not just optimistic — it’s physically impossible.

The EPA’s methodology takes the energy content of a gallon of gasoline (115,000 BTUs) and divides it by the energy in a kilowatt-hour of electricity (3,412 BTUs), arriving at a conversion factor of 33.7 kWh per gallon. Using this, it calculates how far an EV travels per kWh and converts it to MPGe.

The problem? This assumes 100% efficiency in turning fossil fuels into electricity at power plants, ignoring the messy reality of energy production. According to the EPA’s own data from October 2024, the average efficiency of fossil-fueled power plants in the U.S. is just 36%. That means 64% of the energy is lost as heat, friction, and other forms of energy waste before it ever reaches your EV’s battery.

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Getty Images/Xinhua News Agency

The Department of Energy’s reality check

Contrast this with the Department of Energy’s approach, which accounts for real-world power plant efficiencies and the fuel mix used to generate electricity. The DOE also factors in the energy required to refine and transport gasoline for traditional cars, creating a fairer comparison.

When you apply the DOE’s methodology, the numbers tell a different story. That 99 MPGe Nissan Leaf? It drops to a much humbler 36 MPGe — still respectable but far less impressive. This is roughly equivalent to a good hybrid like the Toyota Prius or even some efficient gas cars like the Honda CR-V. Suddenly, EVs don’t look like the runaway efficiency champions they’re made out to be.

So why does this discrepancy matter? The EPA’s inflated MPGe figures create a false impression that EVs are seven times more efficient than gas-powered cars, which can mislead consumers and policymakers. It’s not just about bragging rights; these numbers influence fuel economy standards, tax incentives, and even what cars automakers prioritize. If you’re shopping for a car, you deserve the truth about what you’re getting — not a rosy picture that glosses over real-world energy costs.

A violation of physics

The EPA’s MPGe calculation violates basic physics, specifically the second law of thermodynamics, which states that no energy conversion process is 100% efficient.

Power plants, whether coal, natural gas, or oil-fired, lose significant energy as heat during electricity generation. Transmission lines and battery charging add further losses. By ignoring these, the EPA’s MPGe paints an unrealistically efficient picture of EVs.

Meanwhile, gas-powered cars and hybrids are judged strictly on their tailpipe efficiency, with no such generous assumptions. This double standard tilts the playing field, making EVs appear far superior when the reality is different.

The Biden administration’s push for EVs, including stringent emissions standards aiming for 67% of new car sales to be electric by 2032, amplifies the issue. These policies rely on MPGe to justify EV mandates, but the DOE’s more realistic calculations suggest hybrids and efficient gas vehicles could achieve similar reductions in fossil fuel use without forcing a wholesale shift to EVs. The DOE’s method shows that EVs, while efficient in their own right (using 87%-91% of battery energy for propulsion compared to 16%-25% for gas cars) don’t deliver the massive efficiency leaps MPGe suggests when you account for the full energy cycle.

'Lightning' in a bottle?

The EPA’s inflated MPGe figures aren’t just a technical oversight — they have real-world consequences. Federal fuel economy standards, like the Corporate Average Fuel Economy rules, use MPGe to determine compliance. High MPGe ratings allow automakers to offset less efficient gas-powered vehicles with fewer EVs, which sounds good but can mask the true environmental impact.

For instance, the Ford F-150 Lightning electric pickup was credited with 237.7 MPGe under old rules, but a more realistic DOE estimate drops it to 67.1 MPGe — still efficient but not a miracle worker. This inflates automakers’ fleet averages without necessarily reducing fossil fuel use as much as claimed.

Consumers feel the pinch, too. EVs are often marketed as the ultimate green choice, but the EPA’s numbers obscure the fact that most U.S. electricity (about 60% in 2024) comes from fossil fuels like coal and natural gas. In regions heavy in coal production, like parts of the Midwest, charging an EV can produce as much greenhouse gas as a gas-powered hybrid. The EPA’s Beyond Tailpipe Emissions Calculator, developed with the DOE, lets you check emissions by zip code, revealing how your local grid affects an EV’s true environmental impact. This is critical information the MPGe figure conveniently ignores.

Hybrids, which combine gas and electric power, often get shortchanged in this narrative. A hybrid like the Toyota Prius can achieve 50 MPG or more in real-world driving, rivaling the DOE’s adjusted MPGe for many EVs without relying on a charging infrastructure that’s still spotty in rural areas. Yet, the EPA’s MPGe metric makes hybrids look less impressive, potentially steering buyers away from a practical, cost-effective option.

Policy or politics?

The Biden administration’s aggressive EV agenda, including the 2024 emissions standards aiming for a 50% reduction in light-duty vehicle greenhouse gas emissions by 2032, leaned heavily on MPGe to justify its goals. These rules projected that EVs could account for 35%-56% of new vehicle sales by 2030, a target that shrunk after pushback from automakers and unions worried about job losses and consumer choice. The administration also adjusted DOE’s EV mileage ratings in 2024, gradually reducing them by 65% through 2030 to better reflect real-world efficiencies, but the EPA’s MPGe figures still dominate public perception.

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Lauren Fix

Critics argue this focus on EVs, propped up by inflated MPGe, prioritizes political goals over practical solutions. The Trump administration’s EPA, under Administrator Lee Zeldin, has since moved to reconsider these rules, citing overreach and costs exceeding $700 billion. It argues that mandating EVs limits consumer choice and raises costs for all vehicles, as automakers offset EV losses with higher prices on gas-powered models. Recently, President Trump signed into law the removal of the EV mandate, and this is a win for consumer choice.

Transparency and choice

So is the EPA’s MPGe a deliberate scam? Not exactly, but it’s a misleading metric that overpromises EV benefits while undervaluing alternatives. And it's been tricking almost everyone for years!

The EPA’s methodology needs to be corrected. The honest numbers would let consumers compare EVs, hybrids, and gas cars on equal terms. The Beyond Tailpipe Emissions Calculator is a step in the right direction, showing how local grids affect EV emissions, but it’s underutilized compared to the flashy MPGe sticker on new cars.

You deserve to know the true energy cost of your vehicle — whether it’s plugged in, filled up, or both. The EPA’s MPGe has skewed perceptions, making EVs seem like a silver bullet when hybrids and efficient gas cars often deliver comparable benefits without the infrastructure headaches. With the Trump administration now removing EV mandates and reducing CAFE standards, there’s a chance to reset the conversation. Policies should prioritize innovation and consumer choice, not inflated metrics that favor one technology over another.

This isn’t just about car shopping; it’s about the future of transportation and energy. It's better to tell consumers the truth and not inflate MPGe figures that can mislead you into purchasing a vehicle that doesn’t go the promised distance. Hybrids, efficient gas cars, and EVs all have a role to play, but only if we judge them fairly.

Share this article with friends who are car shopping or curious about the EV hype — it could save them thousands and spark a conversation. The EPA must ditch MPGe and give drivers the unfiltered truth about vehicle efficiency.