Adjusting the fuel-economy equation

IS the Reagan administration irresponsibly tinkering with the federal government's long-term commitment to conserving energy through requiring more fuel-efficient automobiles? Yes, say consumer and environmental groups, the Chrysler Corporation, and some members of Congress. And it's bad policy, they argue.

No, say Environmental Protection Administration and Department of Transportation officials. Only minor, justified adjustments are involved, they contend.

General Motors and Ford have fallen behind gasoline-consumption standards set during the oil-crisis period of the Carter administration. Facing sizable fines, they have asked DOT to reduce the miles-per-gallon standard for the 1986-89 model years from 27.5 m.p.g. to 26 m.p.g. Meanwhile, the EPA announced Wednesday that adjustments in its fuel-economy testing procedures have improved the Ford and GM figures.

This means that, at the least, the pending fines will be reduced.

Chrysler, which is in compliance with the 27.5 m.p.g. standard, is crying ``foul.'' So is US Rep. Edward Markey (D) of Massachusetts, whose energy conservation subcommittee will hold hearings next month on the issue.

The dissenters say that agency decisions are influenced by the Reagan administration position that fuel prices and supply should be determined in the free marketplace. That meant long lines at gas stations in the 1973-74 Arab oil boycott period; it means somewhat lower prices and an offer to clean your windshield in the current period of plentiful crude oil.

Chrysler spokesmen say Ford and GM neglected the fuel-economy rules to respond to the recently revived passion of American consumers for larger, more powerful autos. They say that the EPA revisions and the contemplated DOT lowering of the miles-per-gallon standard reward the Big Two automakers for not playing by the rules, while penalizing No. 3 Chrysler for obeying them.

If DOT lowers the standard, it is almost sure to be challenged in Congress and in the courts.

Important issues are involved. One is whether it is in the long-term public interest to let the free market decide how much of a finite energy resource is consumed, and at what cost. Another is whether it is wise -- in what could actually be a rather short period of apparent plenty -- to retard or abandon energy-conservation policies, although they provide no short-term rewards.

Any resources expert will tell you that the marketplace certainly can make energy policy: When oil, or diamonds, or uranium, or any other finite resource, becomes scarce, the people and nations who are wealthy will be able to acquire it. The rest will just have to make do.

The question is not whether free markets can more effectively allocate limited resources at any moment. It is whether the mileage requirements remain an effective compromise between letting free markets function and letting consumers choose the models they want -- and at the same time effectively prolong the useful life of the world's petroleum reserves.

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