Congress looks again at Cash for Clunkers program
We knew it was coming. Right on schedule, House Speaker Nancy Pelosi (D, Calif.) has introduced legislation to Congress that would pay drivers of older vehicles a predetermined sum to replace them with new or newer cars. Depending on the year of the vehicle being traded in, a voucher for up to $4,500 would be granted to the driver. This voucher could be used to purchase a car manufactured after 2004 that has an EPA fuel mileage rating that is at least 25 percent better than industry average for its class. Alternatively, a card for a smaller amount could be redeemed for mass transit fare.
Many in Congress are said to believe such a program could speed up the turnover from older and dirtier vehicles to newer, more fuel efficient models as well as stimulate the economy and provide a boost for the ailing auto industry. If passed, the plan will reportedly cost as much as $2 billion per year to operate and would remove around 1 million older cars from the roads per year.
[Source: Detroit News Photo: Jot Powers - CC 2.5]
Reader Comments (Page 1 of 1)
nads 12:20PM (1/16/2009)
Just wait till C.A.V.E. (Citizens Against Virtually Everything) here's about this.
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Ian 1:06PM (1/16/2009)
Ok, so one thing I don't understand... The original article in the Detroit News says that trading in a 2002 or newer vehicle will get you the $4500 credit, but that trading in a 1998 or older vehicle will only get you a $2000 credit. Is that not backwards? If someone is driving a 1998 or older vehicle, it means they are generally less able to afford a newer one... Why then are they proposing giving less to people who are driving older cars? what could be the rationale there? Seems to me that these are the folks that will need the most help to get a newer fuel-efficient vehicle, while those who have a 2002 or newer vehicle would apparently need less help.
Oh, and a little critical aside: the trade-ins have to get 18 mpg or less, so basically, only big trucks or sports cars qualify for this credit...
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ErmengardeTenderstone 10:44AM (7/17/2009)
Good points you raise. I have to wonder that they don't pay MORE for the older cars, as they are more likely to be less efficient or less maintained, causing more pollution.
But in general the program makes more sense than a lot of things that come along. It will get the auto industry picking up, so there's jobs, environmental considerations that are always good. But my cynical side says hey, if they want my '84 Crown Victoria station wagon even the full $4500 isn't going to convince me. My old classic is a real gem, and parts are way less expensive than newer cars, etc.
Lots of folks, once their warranties run out, might not be able to afford the high costs of replacing parts on newer vehicles. One would have to go on faith that their financial situation will improve enough to afford that when the time comes, otherwise they won't maintain their vehicles and we're back to square one, with polluting vehicles. I guess for the interim though, it certainly would be a boost to the economy and save some jobs. I'd like to see lots of folks take advantage of such a program.
paulwesterberg 1:18PM (1/16/2009)
I have a feeling that this plan would send 1 million gas guzzlers per year to mexico.
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steve 1:21PM (1/16/2009)
I know rich people who drive clunkers. Do you mean to tell me that the government is going to give these people more money.
What a stupid idea.
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nardvark 1:23PM (1/16/2009)
They're rich BECAUSE they drive clunkers. Living within (or below) your means has the amazing affect of letting you accumulate wealth.
Would you rather that the government give money to people who have overspent? Apparently Congress thinks so, since we're going to bail out homeowners...
Rich 1:21PM (1/16/2009)
Looks like I'm gonna keep driving my 22 year old car. The proposed rules require the old car to have an EPA rating below 18mpg. I don't know what the EPA numbers on my car would be but I've never got below 22mpg with it and avg 25.
So, from my POV, the gov't has missed the mark again. It rewards those that bought gas hogs in the past by giving them money today.
Those of us that were concerned with fuel economy and pollution just got the short end of the stick.
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Phil L. 9:27AM (1/19/2009)
Rich -
You can see what the original EPA rating for your car was when new at http://www.fueleconomy.gov. Click on "Find and compare cars..."; they go back to 1985.
PENNY FLAHERTY 7:03PM (5/06/2009)
I'm with you on this one. The government is again rewarding those that make the most mistakes.
Scott K. 2:36PM (1/16/2009)
This whole thing is a bad idea. So people who didn't care about fuel economy get free money to incent them to buy something more efficient, but people like me who considered it then and now, get nothing? We keep our cars for a while - one for 6 years and we are looking to replace the one I've had for 12 years near the end of the year - and because they both average at least 27 mpg, we wouldn't qualify. While somebody who purchased a gas hog just a few years ago could get a credit so they could be incented to care about fuel economy? Ugh.
Who knows how much of my taxes are going to companies that made bad decisions about fuel efficient vehicles (among other things) and now they want me to pay more for individuals who made bad decisions about fuel efficient vehicles? Ugh again.
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noz 3:55PM (1/16/2009)
Scott,
Why are you surprised? You don't the government is in bed with these companies? These people are morally bankrupt and the rot and corruption goes right to the top and down to the average joe.
David G 3:59PM (1/16/2009)
In the 80's I lived in South Africa and violent crime was exploding partly because AK47's were plentiful after the Angolan wars. So the government, in all their wisdom, offered cash for guns and were paying 6,000 South African Rand ($600) for an AK. The problem is that the guns only cost R1,000 on the black market and so one AK quickly became 6, 36, 216 ... the program didn't last long. This policy is just as stupid.
Here's the thing though ... to make a real impact on the environment in the next two decades, something must be done about the klunkers. Tesla roadsters ain't the answer. So I can empathize with this idea but IMO, the right approach is for Obama to extend tax subsidies to EV conversions. Such policy, if managed correctly, could have a greater environmental impact than all other green initiatives planned for the next decade combined.
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TB 4:50PM (1/16/2009)
Are there THAT many 73 Cadillac Eldorados on the road these days that THIS is the way to take care of the problem?
They should just give better tax credits to people who buy more and more fuel efficient cars.
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David G 5:15PM (1/16/2009)
TB -
People are keeping their cars for a VERY long time - average age of cars on the road in the US is around 9 years and growing annually. If nothing is done about the existing gas guzzlers then there is little chance that green car sales will have an impact on the environment in our lifetime.
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terrence_bethea 10:42AM (1/19/2009)
No one wants to admit (publicly) that the best way to reduce pollution is to (drive less and drive more efficient vehicles). The former is easy to do. When you INCREASE the cost of fuel people drive LESS. Despite being regressive (low income bear the brunt), the tax is otherwise fair b/c people are compelled to pay for what they use. Unfortunately no politician that wants to keep his cushy job would advocate for fuel taxes sufficient to force people to reduce consumption.
Accordingly, policymakers keep going to the latter approach which is extremely complex. It disproportionately benefits people with the means to purchase new vehicles. It subsidizes people that made bad decisions in the past (SUVs, trucks, fat coupes).
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Kiersten 12:08PM (1/18/2009)
(knock on wood)
I bought my 1997 Mercedes C280. When I drove it home, it had
6 miles on the odometer. 11 years and 160,000 miles later,
I'm still driving it daily. It gets about 22mpg in mixed city/highway
and 27mpg on interstates. It has been surprisingly reliable.
It only need two reparis in 11 years. One was a leaky oil pan
which was replaced under warranty. The other was a bad
A/C compressor, which cost me $460 part&labor to replace.
Under Congress' new plan, I will only get $2000 if I trade it in?
This doesn't make any sense to me at all. I have recently been
given two quotes by the local Mercedes dealers. One offered me
$4300 for trade-in, or $3900 if I simply want to sell them my car.
The second dealer offered $4100 in both cases.
What incentive do I have to sell the US goverment my reliable
and relatively-fuel-efficient old Mercedes? Definitely not $2000.
Wait... I just realized that Congress doesn't always come up with
plans that make sense.(common sense or financial sense) :)
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James D 9:47PM (1/24/2009)
What a crock.. I'll be driving my old dodge - or 1 of three Studebakers- w/out parade lic plates till the next world war- Why not penalize the idiot mfg's.. who produce 200= hp brand new "clunkers"..?some of which just might last 5- to 10 years, dammit people- wake up.. You can still build a deck made of wood ->right.?.. and if the engine fails -in any of them- cant I use a few mules to hitch up and drag the damn thing..? My legal .02 worth- 'nuff said.. remember - Ms. Snow and the ISTEA - B.S.?, Lets not let politics totally ruin OUR country... Good day-
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Tom A. 9:01PM (1/29/2009)
What seems like a better solution to me would be to give everybody with a year 2002 or older a voucher to buy a NEW GM, FORD or Chrysler vehicle ONLY regardless of the model (midsize car, compact car, hybrid, truck or crossover) they are buying if the Goverment is truely trying to stimulate the economy with this idea. In turn it would help dealers sell cars, part suppliers make parts for new cars and the US auto manufactures build cars. Seemslike a win win to me. But it should be used for domestics autos only since the majority of their components to build the cars are manufactured in the US. Most of the import cars that are built in the US are created by parts manufactured in their country now ours. And yes proof of crushing your old car is a must to qualify. It is stupid putting in qualifications that your old vehicle has to get worse then 18 mpg and that you need to buy a super mileage car. That just drops down the number of people willing to and able to do so.
But I guess we'll see how serious they are at stimulating the economy with this or are they just doing it halfway as always.
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Andrew Yu-Jen Wang 9:53PM (3/09/2009)
Speaking of the U.S. Congress:
The U.S. Congress does not like George W. Bush—Bush committed too many crimes.
George W. Bush committed hate crimes of epic proportions and with the stench of terrorism (indicated in my blog).
George W. Bush did in fact commit innumerable hate crimes.
And I do solemnly swear by Almighty God that George W. Bush committed other hate crimes of epic proportions and with the stench of terrorism which I am not at liberty to mention.
Many people know what Bush did.
And many people will know what Bush did—even to the end of the world.
Bush was absolute evil.
Bush is now like a fugitive from justice.
Bush is a psychological prisoner.
Bush has a lot to worry about.
Bush can technically be prosecuted for hate crimes at any time.
In any case, Bush will go down in history in infamy.
Submitted by Andrew Yu-Jen Wang
B.S., Summa Cum Laude, 1996
Messiah College, Grantham, PA
Lower Merion High School, Ardmore, PA, 1993
“GEORGE W. BUSH IS THE WORST PRESIDENT IN U.S. HISTORY” BLOG OF ANDREW YU-JEN WANG
_________________
I am not sure where I had read it before, but anyway, it goes kind of like this: “If only it were possible to ban invention that bottled up memories so they never got stale and faded.” Oh wait—off the top of my head—I think the quotation came from my Lower Merion High School yearbook.
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ROCK WEB MEDIA 11:22AM (6/22/2009)
I don't qualify because my car already gets good gas mileage. But my dad swears by the car buying process here:
http://excarsalesman.typepad.com/
I have a feeling dealers are going to automatically increase prices because of the increased demand (artificial) for great MPG cars. So the thousands of savings from this bill for consumers is not entirely accurate.
With the price increase, I'm certain some markets you'll come out even as if they never offered this voucher. It is poorly written legislation.
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