As you can tell by reading the comments, my article on hybrids generated a ton of interest and comment. On top of the actual comments, we’ve had a bunch of discussion on our super-secret internal email list. Given the quality of the discussion in the aforementioned article, we’d like to give everyone a chance to continue the conversation.

For those of you who missed the first edition, I basically argued that hybrid automobiles only start to make sense for the typical American driver (as defined by the DOT) when gasoline reaches the economically crippling $10 a gallon. Mere “European” gas prices won’t cut it. Inflation, which is largely driven by gas and commodity prices these days, will not make matters any better as it increases prices across the board. If anything, hybrids are even more screwed.

So what do the 12 Angry Men have to say?

Angry Overeducated Catholic
Right, in fact hybrids in general (even at the SUV level) aren’t yet worth it economically. But they may be worth it for early adopters (who by definition buy such goods before it is economically rational to do so), nerds, and greenies.

Of course it would be far more worth it for the greenies to drive their old, decrepit, smog-producing VW minivan to a rally for greatly increased use of nuclear power, which would do far more to reduce fossil fuel emissions and oil dependencies than any number of hybrids.

But you can’t drive a pro-nuclear rally around to show off to your hippy friends, so that doesn’t work out…

Status good is spot on. (Note: Strictly speaking economists don’t use the term “status good” but such things would be a type of Veblen good.)

Mildly Piqued Academician
Right, in fact hybrids in general (even at the SUV level) aren’t yet worth it economically.

Well, not accounting for externalities. And “worth it” is tricky. It ain’t just gas mileage, or no one would ever get the add-ons to a car… or buy anything but the basic economy vehicle that gets you around.

But they may be worth it for early adopters (who by definition buy such goods before it is economically rational to do so), nerds, and greenies.

Right. If the nerds and greenies (big overlap there, obviously) need to justify their purchase, they can go right ahead. Fundamentally this is no different than the lawyer justifying his purchase of an Infiniti as a sign of having “made it.”As David Brooks has noted, it’s become acceptable to spend lots of money on high end “basics” such as a fancy kitchen among the bobo class, aka the current upper class.

Status good is spot on.

That’s true. But many other goods fall into that camp. Early adopter markets are quite important for the eventual broadening of the market. When fleet vehicles such as taxis, cop cars, etc., end up going hybrid you’ll see a big shift. Third gen hybrid may well push this as it will be cheaper, smaller, and better. In this case, the early adopters did
the rest of the world a big favor. πŸ™‚

Angry Overeducated Catholic
Well, not accounting for externalities. And “worth it” is tricky. It ain’t just gas mileage, or no one would ever get the add-ons to a car… or buy anything but the basic economy vehicle that gets you around.

Right. I meant in simple economic analysis based on fuel efficiency. As you say, very few people buy their car for entirely (or even primarily) economic reasons. Otherwise the Fusion, Milan, and Altima could not all successfully compete—being the same car with different shells and options. Fortunately (for them) external options make a difference.

Right. If the nerds and greenies (big overlap there, obviously) need to justify their purchase, they can go right ahead. Fundamentally thi is no different than the lawyer justifying his purchase of an Infiniti as a sign of having “made it.”

Yes, and there’s nothing wrong with either. Both also signal to one’s peers that one is a member in good standing of the group and agrees with the aims and beliefs of the group, and such signals are of great importance to us naked apes.

As David Brooks has noted, it’s become acceptable to spend lots of money on high end “basics” such as a fancy kitchen among the bobo class.

Yes indeed. Or to spend lots of extra bucks on organic food at faux farmers’ markets like Whole Foods. I suspect part of this a legitimate interest in these things and part is a desire to be able to consume conspicuously without appearing to be a wasteful and evil conspicuous consumer.

That’s true. But many other goods fall into that camp. Early adopter markets are quite important for the eventual broadening of the market.

Yes, and there’s nothing at all wrong with status goods—together with other luxury goods they form a huge component of the economy, after all.

When fleet vehicles such as taxis, cop cars, etc., end up going hybrid you’ll see a big shift. Third gen hybrid may well push this as it will be cheaper, smaller, and better. In this case, the early adopters did the rest of the world a big favor. πŸ™‚

Exactly. If hybrid tech pans out the early adopters will be those who kept it alive long enough to do so. And if it fails, they’re the ones who took the risk (and loss) to give it a try. Entrepreneurs of consumption, as it were… πŸ™‚

Mildly Piqued Academician

Yes, and there’s nothing at all wrong with status goods—together with other luxury goods they form a huge component of the economy, after all.

They always feel a little “dirty” though… Why else would bobos go through so much trouble putting on counter-cultural airs? Why else would people like Richard Nixon famously go on about wife Pat’s “good Republican cloth coat” in the Checkers speech? Honestly I think that the argument that bobo-ism represents nothing more than changing tastes of the upper class is spot on.

Angry New Mexican
So, to paraphrase AOC from the comments of the original article are hybrid car owners
“driving around the block displaying your Goreon commitment to the admiring public,” like the folks who shop at Whole Foods (evidently including Obama… no wonder the wacky left opposes The Clinton Restoration(TM))? Are they really interested in engaging in self-promoting faux-greenery, namely saving the planet without sacrifice (or at least without their sacrifice… the opposition to Tata Motor’s ultra-cheap car betrays this hypocracy)?

Or on the other hand, are folks who buy hybrid just crazy first-adopting geeks (I can relate, I bought a 1st gen Iomega Zip Drive back inthe day), who will eventually help move the technology to the mass market?

Only time will tell… Readers, what’s your call?

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ObFascism Tag: Boboism is nothing new. Adolf Hitler practiced it personally—put on of being a “man of the people” while living in luxury himself—and it’s a part of the denouement of previous romantic movements.

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