More Cash for Clunkers, But What About Eco Benefits?

Cash For Clunkers Truck

Less than one week after it launched, the Car Allowance Rebate System—or
Cash For Clunkers“—has almost run through its $1 billion in funding. Congressional leaders scrambled Friday to extend the program before the
August recess—but Senate leaders like Dianne Feinstein of California may
be reluctant to add further money to a program many felt had lost its environmental benefits.

The House of Representatives passed a $2 billion extension in a decisive
vote, but as the bill moves to the Senate, it’s unclear whether that
amount will be changed or where the money will come from.  The House legislation
aims to use funds previously designated for renewable energy projects as part of President Obama’s stimulus bill.

White House spokesman Robert Gibbs assured reporters that enough money was
left to last through the weekend. But later that same evening the National Automobile Dealers Association advised its members to suspend their participation in the program until further notice.

In a joint statement with Republican Senator Susan Collins of Maine, Senator Dianne Feinstein demanded that any extension of the program include higher levels of fuel economy improvements, as well as vouchers to help lower-income drivers purchase fuel-efficient used cars. The two Senators have also requested figures from the Department of Transportation that might shed some light on the environmental effectiveness of CARS.

Currently, consumers must trade in a car getting 18 mpg or less EPA combined city/highway rating—or SUVs and light trucks that number is 16 mpg. For a mileage improvement 4 mph, consumers can receive a voucher from the dealership for $3,500 towards a new car. An improvement of 10 mpg qualifies for a $4,500 voucher.

It remains to be seen whether the Senate will agree to Feinstein and
Collins’s demands, or if the White House is eager to reallocate such a
significant portion of the money many had called President Obama’s “Green
New Deal.” But with activists already crying foul over the original
CARS program, any permanent reallocation of renewable energy funds to
boost an industry so long at odds with environmentalists, is likely to
lead to a fight in the Senate.

An extension could fail to get out of the Senate because an unlikely coalition of fiscal conservatives and liberal Democrats aren’t interested in providing more subsidies to automakers. Senator John McCain is said to be considering a procedural block on Monday’s vote, making every Democratic vote essential to the survival of CARS. If the existing environmental benefits of the program can be both established and enhanced, as Senator Feinstein has called for, the bill’s chances could greatly improve.

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  • nycsolar

    Ridiculous. There are constant complaints on how much “green projects cost.” This is one of the worst green projects that rewards people who bought irresponsibly in the past. If we took the money we threw at AIG, and put it into protecting the environment we would have solved our environmental crisis.

  • Samie

    nycsolar this was to get cars off the lot period. Lets not confuse what it is w/ the original plan or intent. As I said I suspect the clunkers program was offered as a way to get the major auto manufactures to agree to new CAFE regulations. In defense of the program it was originally set for 4billion & you have to get those backed up less fuel efficient cars off the lot before expecting the auto industry to start advancing in more fuel efficient technology.

    Here is where its troubling, I see expansion of jobs or hours for those in the auto business as well as supporting various recycling business, but to many they don’t see the extra benefit from wages. It seems troubling that if I may speak politically we will see a pattern of folks like McCain who oppose extra funding for this program w/c has some merit if you think how we are going to pay for 9 years of Fed spending in the near future. But for whatever spending, justified or not from now to 2010 & 2011 we will see greater popularity in the slash & burn politics. As many know this type of politics goes too far w/c results in backwards thinking & deregulation of almost everything. So the point is while we need support for production of full hybrids, EV’s, batteries, updating the grid & renewable energy those things could get swept under the rug if a majority of Americans think Obama & Demos in Congress are handing out money w/o regard to the future debt so I’m not saying there is no benefits to this program but Congress & the President need to be extremely careful in how money is allocated from now to the next cycle of elections if they want to stay in power.

  • tw8

    “Heap o’ doin’ over a little cow-dab”.
    I sharpened my spreadsheet, made some well-reasoned assumptions about percentages of the 250,000 vehicles new to the road that would be in each category of vehicle type and mileage improvement and ran out the total gallons saved for a year of operation at 12,000 miles per vehicle per year.
    And the answer is: About one-third of one DAY of US gasoline consumption! So in their 10-year lifetime they will give us three good days of extra gasoline. That little perk only cost US(us!) 83 cents per gallon.

  • moishe k

    trade your 18 mpg suv for 20 mpg suv get $3500

    trade a 20mpg for a 30 mpg get $ 0000000000

    maybe we need to trade in low IQ Senators for higher ones

  • ACAGal

    MoisheK has a good point. I drive an old Volvo Turbo. I have thought about trading it in for an EV/hybrid, but the Volvo is too fuel efficient for the cash for clunkers deal. It would take a sizable bribe to detach me from my Volvo, but I have a hard time thinking of my old Volvo as fuel efficient.

    How did so many vehicles get to be such gas hogs?

  • robertg222

    It must be good eco. There is no way that taking a car off the road and replacing it with a better mileage car is bad. That best thing about this plan is that you can still get a better car that is practical and not just an eco box.

  • BoilerCivicHy

    Now, you are talking.

  • BoilerCivicHy

    So robertg222, in your estimation adding 3 billion dollars in new debt, long term, is a good idea for a program that does nothing more than reward mediocrity? This is a great program for our newly government owned car companies, and a pretty good deal for some people who had bought awful fuel inefficient vehicles, but its a bad deal for anyone who is planning to live in America for the forseeable future. Even at a low interest rate, 3 billion dollars cost Americans 6 billion dollars over 30 years.

  • JohnM

    This program does 2 things well. First, destroy wealth by paying above market price and then crushes and melts it. The energy cost of recycling, mining, and building a car far exceeds a few mpg.
    Financially, the government borrows money from abroad to pay for the destruction of capital. Then, an individual borrows more to buy a car made abroad.

  • Made in USA

    Cash for Clunkers. YES
    help auto workers with jobs.
    help people with cars.
    But how many jobs do we help when alot of these cars come from Japan.

  • MJ77

    Forget the economy or the envorment for a minute.(even though the plan helps both) This plan is about oil independence. With the current 1 billion dollar plan it will save 75-100 million gallons of gas a year in this country. Granted that’s a drop in the bucket but if increased to 3 billion you are talking about some real savings.

    Now is the time to start raising the gas tax and lets get serrious about this!

  • Lothan

    Trade in a 16mpg truck for an 18mpg H3 and get a $3500 subsidy to buy that F-ing H3!!???? YES, you can actually buy a Hummer with this plan!

    That is what is wrong with this country. As$hat republicans who changed the bill at the last minute and significantly reduced the required mpg improvement to get the credit and the pu$sy democrats who allowed them to do it.

    It should be 3,500 credit for a 10mpg increase and a 5000 credit for a 15mpg increase.

  • viagra

    as a consequence of you for your report and it helped me in preparing my college assignment.

  • jimhenry

    You don’t need a voucher, dealers will apply a credit at purchase


  • damien

    Is it just me or the government seems to waste these money when they could do so much more to improve the environment and its citizens welfare. I have nothing against the program itself except the fact that they destroy so many well functioning cars when they could make auto donations and help poor people get their own car. From my point of view this is an unnecessary waste, if they really wanted to protect the environment they could just as well change the car’s engines with more efficient ones.

  • Jessicasmith

    whatever benefits they can get at least they still have some the benefits. For me if God has given me enough blessings then of course I need also donate some of what I have and give it to them.
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