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Feds To Offer Cash For Your Clunker
coondoggie sends along a NetworkWorld piece that begins, "The government... wants to motivate you to get rid of your clunker of a car for the good of the country (and the moribund car industry). A 'Cash for Clunkers' measure introduced this week by three US Senators, two Democrats and a Republican, would set up a national voucher program to encourage drivers to voluntarily trade in their older, less fuel-efficient car, truck, or SUV for a car that gets better gas mileage. Should the bill pass, the program would pay out a credit of $2,500 to $4,500 for drivers who turn in fuel-inefficient vehicles to be scrapped and purchase a more fuel-efficient vehicle."
My '93 Corolla gets 34mpg. Not too many cars made today get better than that.
To encourage car owners to scrap cars before 10 years, we have
1. Road tax increases for cars > 10 years old
2. Rebates for cars unregistered before 10 years
The majority of the cars on the roads here are 10 years old. Cars unregistered are either scrapped or exported to another country for resale.
Here in BC, they have a ScrapIt program, where you 'sell' your car to a scrapyard, and in exchange you get either a big discount on a bike, bus passes for a number of months, or a relatively small amount of cash. So it encourages switching/using a alternate form of transportation.
Of course, when I put my car into ScrapIt, I resold the bus passes and bought another car...
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I don't get how this will 'help' the economy or the ailing auto industry either. The government is willing to foot (tax payer) money to sell an old car (for probably more than it's worth) to by a new car (that isn't guaranteed to be American). There are sooo many things fundamentally wrong with this that it just stuns me. First off, most eco-friendly cars cost 20k+ out the door and cars >20k would probably result in a relatively minuscule drop in CO2 emissions. Also if the government is willing to foot vouchers whose value is more than the car in question, wouldn't that just exacerbate the economic problem by introducing unnecessary spending of tax dollars? Third, if the cars are no American (as most low-cost eco friendly cars are) then how is that helping the economy? Maybe someone smarter than me can explain how this is a 'good' idea?
>>If this was about reducing emissions, they would pay more to get older, dirtier, and less fuel efficient cars off the road.
The sad fact is, older (10+ year old cars) are at least, if not more, fuel-efficient than modern cars. I drive a '98 Buick Regal. The equivalent 2009 model has 1MPG less efficiency than my model. Let alone cars like the early 90s Civic hatchbacks, which still have MPGs which are only reached, if at all, by hybrids nowadays. Do we really want to remove a 94 Civic from the road and replace it with a lower-MPG modern Civic?
Such a scheme worked here in Ireland, but it was about the era of the dot-com boom, and also the start of cheap credit (and we all know where that led...)
However, it has meant that once and for all we got rid of all the bangers. This allows the government to get away with bringing in a "National Car Test" to ensure cars are a certain operational standard. As a result, most cars on the road are no older than 10 years. The few "bangers" nowadays are maybe 15 years old and they have at least passed the NCT.
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This reminds me of a program the police had in California to reduce guns by offering several hundred bucks, no questions asked, for each firearm turned in by a citizen. People were going out to Walmart, buying all the cheapest rifles in stock, and exchanging them for bundles of cash. I think the program went bankrupt (having burned through all the taxpayer money available) without actually reducing the number of weapons owned.
He who lights his taper at mine, receives light without darkening me.
I'm also afraid a little over this required scrap clause. It might cause us to lose more of some classic cars that can and SHOULD be restored.
Someone might have what is currently a 'junker' GTO or Camaro...and with this, the car is scrapped, and a piece of history is lost.
If they have to do this law, maybe they can make some provisions that antique and historically valuable cars can be saved if they are to be restored.
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
Foreign makes have better fuel efficiency and more variety to choose from.
Not really (...)
Actually, pretty much all companies that operate in both US and EU markets have different models for each market, with a BIG difference in fuel efficiency. This includes american companies... At least, Ford has a decent market share in Europe and the cars it sells here are "european" cars, meaning that they go by european standards of size and fuel-efficiency... But even the asian car-makers sell huge boxes in the US that nobody would buy here in europe.
By the way, last I read the auto fleet in europe is currently about TWICE more fuel-efficient than the US fleet... although the numbers themselves are not that impressive. I think it's about 14 vs 7 km/l.
No, he's right. Take my example. I'm in the market for a new(er) car, but I'm not going to go out and take out a loan for the whole sum. But, if I had a somewhat sizeable lump of money, taking out a loan is more reasonable.
I can afford taking a loan for 100% of the car, but I just plain *don't want to*. A loan for 60-70% of the car OTOH, makes a lot more sense to me.
You're absolutely right. But it gets even worse. Here's a stupid situation I could hypothetically be in soon: I drive an old car that is probably qualified to be traded in under this bill. Suppose it breaks down, and the repairs would cost $1000. The car isn't really worth that, so without this bill, I probably would have junked it. WITH this bill, since the "Cash for Clunkers" program requires the car to be in working condition, it's now to my advantage to get it repaired, trade it in for my $2500-$4000 federal money, and then it gets sent to the junkyard anyway. Building things just to destroy them - THAT is government destroying an economy.