Toyota worked on its hybrid fleet, using research and development to answer the challenge posed by environmental regulators. Ideally, this is the response of companies to regulation, and the prosperity of Toyota and the failure of GM was once viewed as a cautionary tale. As consumers do not always buy what is 'good for them,' and good for the environment, regulatory pressures are required to eliminate or tax products and foods that harm the environment, such as gas-guzzling cars, corn-fed beef and pesticides. This makes using these products either illegal or more expensive and costly for consumers, thus creating an artificially higher demand for more environmentally-friendly products and increasing the incentive for companies to provide other products.
The problem with viewing regulation as a solution to environmental and economic problems, however, is that R&D does not always yield the expected returns on investments. Toyota's efforts to create hybrid cars now seem overly hasty. Regulatory efforts to improve the American diet have met with political roadblocks, as advocates of conventional farming and subsidies for American cash crops have powerful interests in Congress. Additionally, simply because regulations are put into place does not mean that effective new technology will come and consumers will alter their habits quickly enough for a satisfying short-term payoff of environmental improvement and economic expansion.
There is a solution to overconsumption, of course, but it is not necessarily a politically palatable one, or one which will stimulate the economy: to buy less and to use less. Car pooling, public transportation, biking, and other low-cost methods are also ways to use less fossil fuel....
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