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It's looking increasingly likely that the United States will soon have its own Cash-for-Clunkers program. According to The Detroit News, two bills are currently competing for Congressional votes, and while they would both offer sizable rewards for turning in older vehicles, they vary in what new cars and trucks would qualify for the program.

One bill, sponsored by Rep. Betty Sutton (D-Ohio) would give the largest voucher – up to $5,000 – to purchasers of new vehicles made in the United States. Slightly smaller amounts would be granted for other vehicles made in the rest of North America, and no cash would be granted for the purchase of foreign-made cars. All cars would need to manage at least 27 mpg to qualify, and trucks would need to hit at least 24 mpg.

The other bill, sponsored by Rep. Steve Israel (D-New York), would offer up to $4,500 for the purchase of a new vehicle, assuming that the vehicle being traded-in gets 18 mpg or less, and the new vehicle's fuel efficiency is at least 25% better than average for its class. No distinction would be made based on the vehicle's country of origin.

According to Rep. Israel, the two sides are 90% of the way to an acceptable compromise. Even after an agreement is reached on a final bill, policymakers will need to figure out how to come up with the (up to) $4 billion that the program is expected to cost – not to mention how to handle the resulting lot-fuls of so-called clunkers.

[Source: The Detroit News | Image:: dave_7, CC2]


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  • 48 Comments
      • 5 Years Ago
      While I'm sure it's well intentioned, it's idiotic. I don't know a single person that drives such an old, beaten down, gas guzzler that is in such bad shape that a 4,500-5,000 rebate would be a huge increase over what the car would be worth anyway. If I did, I certainly wouldn't council them to buy a new car in this economy. Who drives $1000 beaters that can/should be buying a car?

      All this creates is a ridiculous secondary market of idiots buying cars on Craigslist for as little as possible just to trade them in. If there's ownership rules stating that you have to own them for some period of time it's even worse. Encourage people who are likely to be the least likely to afford a car to buy a new one.

      What happens to all these cars after they're traded in?
      • 5 Years Ago
      oh i hope they go the 5k route...ill be waltzing my butt right into a ford fusion hybrid if they do!

      i wonder if it will be a tax rebate (boo) or you get a check in the mail for 5k
        • 5 Years Ago
        If this is truly about reducing pollution and oil use, then I should get $5,000 for trading my Neon into to get a scooter or motorcycle that will beat a hybrid in mileage.
        • 5 Years Ago
        I'm gonna be really pissed if the 18mpg requirement for your existing vehicle stays...seems really warped to be giving people who went and bought an Escalade $5000 free while penalizing everyone else.

        I'm all for the requirement that the new car be fairly efficient and made in the US, but otherwise I'm gonna be really angry that people who drive huge luxo-barges get a tax credit while anybody who bought a Civic or an Aveo gets nothing.

        I'd be happy if it includes my parents car though, they need a new one fairly badly and money's pretty tight so 5 grand would be a huge help.
      • 5 Years Ago
      If you ever needed proof that members of the US Congress are the biggest dumbasses on the planet, this it!

      A majority of GM, Ford and Chrysler vehicles that meet the mileage requirement are made in Canada or Mexico. So how does this help save or create American jobs?

      The most vehicles actually made by US workers meeting the mileage requirements come from Toyota, Honda, Nissan and Hyundai, but it looks like these will be exempted.

      What a bunch of IDIOT!

      Just send every taxpayer a check for $3500 and let them do what they want. Buy a car, pay off debt, down payment to buy a house, buy appliances, whatever. Just stop micromanaging our lives.
        • 5 Years Ago
        Why not just let people keep their money in the first place?

        Collecting, and then re-giving back the money, COSTS money, and giving it back to other people is wealth re-distribution, by it's definition.

        You said it, they are a bunch of idiots. I agree. But why give them money, to give it back, or to spend on someone else?

        I can give my money away just fine, in a sense of charity. I don't need the government to give it to someone else for me. Government charity is not charity at all, it is theft. IRS comes with the point of a law-enforcement gun, and steals it from you, before you even see it most of the time.

        Cash for clunkers is a PONZI SCHEME. Just as much as Social Security, or B. Madoff. The first people get their money, until the money runs out, and then everyone else loses. That just hasn't gone to the end of the line in other countries. It doesn't work permanently, ever.

        And throwback, You have the beginnings of the right idea, but this is a program that is not part of the government's enumerated powers, and should be cut. So why pass it in the first place? This is part of the tripe that the government shouldn't be involving itself in.

        There is already a market mechanism, it is called a used car dealership, or a salvage yard, depending on the car's condition. They perform a service, by sorting through reclaimable equipment, or scrapping what is not reclaimable. They will pay people what their older cars are worth, based on what they can reclaim, or re-sell.

        Government involvement and subsidy is going to screw everything up, and cost us to do it. That is what they almost ALWAYS do. Government is the PROBLEM, not the solution.
        • 5 Years Ago
        Good points DJ.

        I like this line, "Even after an agreement is reached on a final bill, policymakers will need to figure out how to come up with the (up to) $4 billion that the program is expected to cost "
        How about cutting spending? I know too radical an idea.
        • 5 Years Ago
        Because rebate checks worked last year, right? Give it a rest man.

        Cash for clunkers has worked in every country it's been implemented. It will work here too.
      • 5 Years Ago
      Whose tax money are these Dems going to use?
      The tax money that's left after the bailout?or the money they're going to print that will cause runaway inflation?
      jim
      • 5 Years Ago
      so if i want to buy an old gm b-body or g body or any old car with a v8 then i have to shell out $5000 to compete with the us governments "bid" this sucks
        • 5 Years Ago
        @jim
        Why would you want too?????????

        Baby Boomers with visions of Resto mods dancing in their heads have priced the average person out of the market anyway.

        There is nothing affordable about V8 powered American cars and most of the cars available at a price you're willing to pay are 4 door sedans and rust buckets anyway.

        Not many people are going to luck up and find a pristine
        '69 Mustang Mach 1 like was found recently and was bought for a song compared to its value.

        What about the guy that has 100's of Mustangs rusting in his backyard????

        I'm sure there some crazy old guy that has a bunch of B and G bodied cars, what's stopping you from searching the internet or the local paper and buying one?

      • 5 Years Ago
      I guess I'm screwed. I'm driving a 9 year old Chevy Prizm that gets 36-39 mpg. There is not much out there available that can beat my car for mpg. When they say the car has to be made in America does that mean manufactured here or it has to be a domestic big 3 automaker?
        • 5 Years Ago
        Wow... genius at work.

        Your badge engineered Toyota-errr Chevy isn't nearly as safe as the current model Corolla. I guess if you know its a left turn at the Nelson's mail box is how you get to the movie theater, you don't need Navigation. You especially don't need it if a vacation too you is up to Lake Michigan. Putting your finger in the wind won't tell you who's got the cheapest gas on your route, but if you never leave home I guess that's okay too.

        Oh and it runs QUITE a bit dirtier than a current car with current technology converters, PROGRESS continues to move forward, its not static.

        The only thing you can complain about is the massive weight gain of modern cars, but eh whatever, the Lotus Elise is tiny and LIGHT, you want a light car, buy one of those and don't get near any big rigs.

        If the complaint is cost of new cars, well I could be a Conservative and say get a better paying job, but I'm not Conservative, they are like a bad head cold. I say tell Congress to bump the min wage up and call it a LIVING WAGE. Pass Univ health care, make the tax code fair and MAYBE you can afford that new car.

        Keeping an old tired car for reasons unknown is quite hilarious.

        If I was adopt your way of thinking, my old 486 IBM and 28.8 Modem would be just fine...





      • 5 Years Ago
      So my question is if/when this passes, will I be eligible having already turned in my old car for a new one in the weeks ahead?

      I'd be pretty upset if I missed out because I couldn't wait to get rid of a car that has a near-blown head gasket. (Pontiac, I hate you.) This should be a retroactive rebate.
      • 5 Years Ago
      Is this going to be a real voucher open to all, or is it another one of those discriminatory vouchers that only certain tax brackets can use?
      • 5 Years Ago
      "....policymakers will need to figure out how to come up with the (up to) $4 billion that the program is expected to cost..."

      Easy! Simply print more money. Make those money presses work 24x7, push'em hard, don't let up for one instance, print, print, print.....

        • 5 Years Ago
        They shouldn't even bother with presses. Just give every American a color printer and a USB drive loaded with a PDF of a $100 bill. Same effect but much more efficient
      • 5 Years Ago
      It doesn't matter much now, because a new compromise bill is coming out. But the Israel/Schumer version of Cash for Clunkers was really lame. Hardly any cars would be worth turning in under it.

      First of all, contrary to what the article here says, a vehicle would have to get less than 18 mpg to qualify, not 18 or less as it said here. I'm assuming that is based on the combined city/highway fuel economy rating by the EPA. According to the EPA's fueleconomy.gov website, even a 1990 Ford Crown Voctoria wouldn't qualify. That car got 20 mpg average based on it's sticker back then, now with the new calculation it would be 18, but either way it's not less than 18 as the Israel bill would require. If a old Crown Vic doesn't qualify, that pretty much limits it to SUVs and trucks only.

      Secondly, the voucher value of a 2002 or new car would only be $4500. What SUV that new is going to be worth less than $4500? In virtually every case the trade in value would be more than the voucher, so the owner would be better off trading it in. A similar case can be made for the $3000 for 1999 to 2001 vehicles. It would only be worth it to get the $2500 for a 1998 or older vehicle, and even then it would likely have to be a lot older than 1998 to be worth less than $2500.

      So it would only be of use if you drive an SUV that's older than about a 1995 model.
      • 5 Years Ago
      The best comment I've seen about the stupidity of this is, "If we're going to pay people to junk their old cars and buy new ones in order to support the auto-industry, why don't we pay people to burn their houses down and build new ones in order to stimulate the home construction industry?" After all, the home construction industry is in even worse shape than the auto industry.

      This is an instance of the 'broken windows fallacy', folks:

      http://en.wikipedia.org/wiki/Parable_of_the_broken_window

        • 5 Years Ago
        What do you think insurance companies are doing with their bailout money?
      • 5 Years Ago
      This is a horrible way to waste money and guarantee no car becomes a classic. These lawmakers are using "green" for an excuse to ruin everything.
        • 5 Years Ago
        Waaaaaaaaaaahhhhhh!
        • 5 Years Ago
        "GET THE POINT YET? THIS NEVER ENDS WELL"

        Except in Germany where it's working great.

        And guess what? The SVX was a piece of crap but if you insist on owning one, there's plenty of parts available in Japan.
        • 5 Years Ago
        No, but they may be crushing my future parts car.

        I want to buy a Subaru SVX. There were only 15,000 of them imported, and they were unique, and shared comparatively few parts with other Subarus, and almost none with other cars outside of Subaru.

        Why would I buy an SVX if I know that all of the used-part sources are crushed, because people took my money to buy other cars via government taxes, to pay for a newer car. Subaru is no longer making parts, they are getting scarce, and Subaru doesn't make newer coupes for me to choose from.

        Now extrapolate that to OTHER cars that might be similarly rare, and scarce to find parts for...

        But more fundamentally, why should I be asked to pay more taxes, or suffer more pending future inflation, for the government to pay other people for their old cars?

        The government is also funding GM and Chrysler, including GM's new "confidence" scheme... or should I say con game.

        And they are bailing out people's mortages, except for the people I know who are going bankrupt due to medical costs, and losing their home... the husband and father in that household is chronically ill, but still working, and making too much money to qualify.

        So they take my money away, so I can't buy the car I want, and can't afford to help my friends, family, or anyone else charitably, as well... and it all gets funnelled through a socialist wasteful government, and they get rich for undermining the foundations of a free country.

        it is going to get to the point where if I can't beat them, I'll join them. I want my government car, my government house, and my government this, that, and the other thing... less people earning and contributing, and more people collecting and sapping from them...

        GET THE POINT YET? THIS NEVER ENDS WELL, and this is just a symptom of a larger flesh-eating, possibly terminal disease.
        • 5 Years Ago
        @mk

        I have an idea of how you avoid your SVX quandry.....don't buy an obscure 12+ year old Japanese car! LOL

        This bill is two-pronged:
        1) Give a monetary reason for people to buy a new American made car (Hondas and Toyotas count too).
        2) It takes old cars which are less safe (structurally and wear-wise) and presumably less efficient and higher polluting off the road.

        I'm all for both of these things if it will keep people building cars in this country (domestic or not) employed.
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