My car does 60 mpg, and it's an average french car. When I was in the US I had a very inefficient car and the funny thing was that despite gas prices being much lover in the US I was spending as much on gas a month than I'm doing now in France for approximately the same commute distance.
The hardest part here is making sure poor people will be able to renew their old inefficient cars with brand new ones. In France the government did that through a program where you could get a fixed amount of money for any 10+ years old car whatever the condition of the car for any new car purchase. It worked very well.
And saying that a bigger car is more secure is total bullshit. Crash-tests proved that a long time ago.