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Joined 1 year ago
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Cake day: June 13th, 2023

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  • This article summarizes the subsidies I’m talking about. Here’s an excerpt:

    For now, the important point is that trucks generally are more profitable than cars thanks to two big government incentives, both of them historical footnotes.

    The first is the so-called chicken tax, a 25 percent tariff imposed by Lyndon B. Johnson in 1964 on foreign-built work vehicles as part of a chicken-related trade war with Europe. If you’re making a pickup or cargo van in the United States, profits should be higher, because foreign factories can’t come close to undercutting you on price.

    The second incentive lies in the fine print of Corporate Average Fuel Economy (CAFE) standards adopted in 1975, Gerald Ford’s reluctant response to a crippling Middle East oil embargo that sent gas prices soaring. To protect American commerce, work trucks and light trucks were subject to less-strict CAFE standards than family sedans. Trucks are also exempt from the 1978 gas guzzler tax, which adds $1,000 to $7,700 to the price of sedans that get 22.5 or fewer miles to the gallon.