Generally it's a sports car that turns heads on the highway. This week it was all those jalopies headed to the dealership.
The overwhelming success of the Cash for Clunkers program, which provides rebates for those who want to upgrade to more fuel efficient, new vehicles, shows Democratic Congressional action on clean energy is good for the economy, energy independence and consumers.
Today we voted to extend the Cash for Clunkers program with $2 billion in additional funding. And I spoke on the House floor with my colleagues to ensure that these funds will not be permanently drawn away from other important clean energy initiatives.
Here in Congress, creating a successful program usually takes a while to get up to speed, but the Cash for Clunkers program is like a race car that went from zero to 60 in three seconds -- showing the pent-up demand for more fuel efficient vehicles is huge.
This program -- the first part of the Waxman-Markey Bill to become law -- has exceeded even the highest expectations. Consumers are trading in old gas guzzlers, large SUVs and pickup trucks for new vehicles that are 69 percent more fuel efficient than their clunker, saving $750 a year on gasoline on average. That means less carbon pollution and less foreign oil from the Middle East.
By empowering consumers, the program is racing past our expectations for fuel economy improvement. Here are just a few of the early returns:
--Roughly two thirds of deals have resulted in consumers receiving $4500 credit, which applied to only the most fuel efficient trades.
--During the week that the 'Cash for Clunkers' program was launched, GM's small car sales increased 54.8 percent over the preceding week.
--Toyota moved 78 percent of their Cash for Clunkers volume on vehicles that together average 30 mpg, and 39 percent of volume on the Corolla and Prius, which together average 39.5 mpg.
--Ford has seen an average of 7 mpg improvement on Clunkers trades, which represents an estimated annual fuel savings of 228 gallons per customer. The 28 mpg (EPA) Ford Focus is nearly 30 percent of all Ford's Clunker sales.
--Mazda, as of yesterday, saw 57 percent of transactions reported by dealers to be for the purchase of the MAZDA3, the brand's most fuel efficient model at 27 mpg (EPA).
With Clunkers in the win column, now is the time to move on other provisions in the Waxman-Markey Clean Energy Jobs legislation that will stimulate other areas of the economy. The steel industry will see a bump from wind turbine construction. Manufacturing workers will be needed back on the line for solar production. And contractors will be put back on the clock making efficiency retrofits for building and homes. As Clunkers demonstrates, smart energy policy is what the U.S. economy needs to get back on its feet.
Follow Rep. Ed Markey on Twitter: www.twitter.com/markeymemo
It does sell some cars now, but the "clunkers" would have been scrapped shortly anyway (they are clunkers). So it does get people buying, but giving them money to buy anything would do that.
In the end we will have another $3 billion in debt and we will have encouraged more consumption over savings and investment....which is how we got here in the first place.
For the government, this probably is a success, it is as good as it gets.
Assuming that's the case, how much of an increase in car sales volume are we going to see over a benchmark rate of 200,000 cars per quarter? Well at an average of $4000 per vehicle in the program, and 3 billion dollars total funding, 550,000 cars. Not including how much the government wastes on the program itself, including a website that the dealers can't seem to log into easily, a car costs me the taxpayer additional $5500 per unit to get sales going now. That's best case scenario. A good use for my money that I dont have anyway?
I don't think so.
Now, don't we as taxpayers own a lot of these cars to begin with? So we're borrowing money to sell the cars for the car companies that we borrowed money to keep out of bankruptcy and then borrowed more money to buy ownership in through the bankruptcy we were trying to avoid?
Confusing? That's your federal government for you.
If there was any real commitment to the environment it wouldn't take a bribe to get there.
AND, with your tax structure, the poor are going to pay for the handouts to those who can afford to trade in the clunkers. Welcome to business as usual, Detroit.
NOW IF $9000 IN REBATES DON'T GET YOU TO BUY A NEW CAR, I DON'T THINK ANYTHING WILL....
THIS IS A PSYCHOLOGICAL BOOST TO THE AMERICAN CONFIDENCE...IT'S A LOT BETTER THAN "NO,NO,NO.... AND LET TALK ABOUT THE WAR ON TERROR AND WMD"S EVERYDAY... DON'T FORGET... OBAMA MUST FAIL OR IT'S THE END OF THE WORLD.. OR WATCH OUT, HE'S ABOUT TO KILL GRANNY..........
REPUBLICANS HAVE BE SUBSIDIZING BUSINESSES ALL ALONG.. THEY CALL IT ALL THE TAX BREAKS THAT YOU WANT
If you believe this type of program will get our economy going then I'm guessing you would support the same program for every industry right? The auto companies aren't the only ones hurting . . .
Subsidize flat screen TVs . . . Subsidize video games . . . Subsidize golf rounds . . . Subsidize washing machines . . . the list goes on forever.
I mean, haven't we learned from the bubble economies of the last 10 years enough to know this is exactly how all this stuff starts? You create an artificial rise in demand and then once the Government is out of money . . . POP.
It''s not the worst program, although that bar is not exactly high.
I know a large amount of people who are trading in their so called clunkers to cash in on the "free" government money. In most cases the trade in value of their clunker is about equal to the clunker cash.
In some cases they reduction of the trade in and the net effect on the reduction to the new car sales price and its impact on sales tax, escaped peoples consideration.
Regardless, selling cars and improving MPG is a good thing.
BTW, $3500-$4500 for 1-5 more MPGs seems like a stiff price to pay.
The premise of this piece is disingenuous: You are comparing a simple, straightforward incentive program that is rightfully successful ($4500 for your old car for a more fuel efficient one) to the bizarre contraption of a piece of legislation that you and Rep. Waxman cobbled together in which the incentives and disincentives are unclear and the net effect of the legislation is debatable. Rather than attempt to link your piece of crap legislation with a very well-designed one, for marketing purposes, why don't you go back and re-work your legislation so it will actually save energy and reduce carbon emissions rather than play "inside baseball" games with carbon permits etc. Issue a carbon tax, incentivize renewable energy, build energy and transport infrastructure....but don't visit a monstrosity on the American and world publics.
Your anecdotal evidence is not compelling. A business could only trade in one vehicle per business using the cars system, and that still benefits the environment, the auto industry, the car dealers, etc. Who cares if they are Republicans? I wouldn't want a government program that tried to benefit only Democrats, anyway. Do you think health care reform would only be utilized by liberals? One billion or even three billion is a tiny drop compared to the short term costs of healthcare reform. Keeping people employed (by helping the auto and dealer industries) means fewer people will need subsidized health care. The taxes and fees from these sales will be going back into the state coffers, meaning more money for healthcare and other necessities.
It was necessary to restrict it to new cars to reduce the possible avenues for abuse. The people who use the system have to invest some of their own money into the price of the car so the money is targeted to people who really needed a new car, but were holding off because they were worried about the economy. Otherwise, you would just be subsidizing free upgrades with no real consumer money going into the economy.
Really?
http://www.youtube.com/watch?v=waj2KrKYTZo
Destroying perfectly good cars for what? To make you feel good. This is insanity.