He’s actually saying that higher gas taxes would be better (or, at least less bad) than CAFE. He’s right about that. The Corporate Average Fleet Economy rules are just about the worst way to accomplish their purported goals. They distort the market, they remove most consumer choice, and they will cost you a lot more than higher gas taxes would have.
If you had a choice, would you rather have CAFE, or higher gas taxes? If you were the head of an auto company, would your answer be any different?
Don’t get me wrong. The best thing for government to do would be to get out of the way of the free market. That includes letting the energy market be free. The rationale for this interference — global warming — is a giant scam.