That Makes Me Stabby: Cash for Clunkers Program

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I was okay with the new car tax deduction. It didn’t offer a huge incentive to buy a new car or pose a big burden on the federal budget, but it was a nice bonus for people who planned to buy a new car anyway. Now the House of Representatives has passed a new “cash for clunkers” voucher program, AKA bribe, that is really making me stabby. There’s no telling if the Senate will pass it, but the very idea makes me so stabby that I nearly have the vapors. Someone get my smelling salts.

Cash for Clunkers = Bribes for Getting New Cars

The bill purports to offer an incentive for people to replace their old gas guzzlers with new energy-efficient vehicles. The House defines a gas guzzler as anything getting less than 18MPG. I can completely agree with that – that’s really bad mileage and I can understand people wanting to get rid of them. That’s not the part that makes me stabby.

This is: a “fuel-efficient” car is anything that gets over 22 MPG! 22! And the bonus for gaining a measly 4 MPG? $3,500! If you’re really bold and improve your gas mileage by 10 MPG, you get $4,500.

But wait, there’s more. That’s for standard passenger cars, not SUVS, trucks, or minivans.

Someone hold me back, I’m about to rip my hair out.

If you own an SUV, truck, or minivan that gets less than 18 MPG, you can earn a $3,500 voucher for buying a new SUV that does 2 MPG better. Yes, that’s right, choose an SUV that improves your gas mileage by TWO miles per gallon, and you get $3,500.You get the full $4,500 by buying an SUV that gets an extra 5 MPG.

And if you’ve got a really heavy truck, you only need to improve by ONE MILE PER GALLON.

I think I’m going to cry now.

This is Not about Fuel Efficiency

If the government was really concerned about encouraging people to buy more fuel efficient cars, they have a few options:

  1. Establish the Cash for Clunkers program with minimum improvement requirements of 15 MPG. That would require people to buy cars with a minimum mileage of 33 MPG. For those of you paying attention, that’s 2.5 MPG less than the new fleet-wide minimum CAFE standards that are mandated by 2016.
  2. Increase the gas tax. Want to see people flock to fuel-efficient cars? Make them pay more for gas. It worked when gas prices shot up, it would have a more permanent effect if the base rate was always higher.
  3. Levy additional taxes on gas guzzlers. It’s simple – want to buy a Hummer? Pay a sin tax at purchase. $3,500 sounds fair.

Why This Makes Me Stabby

The House of Representatives wants our government to spend $4 billion to fund this program that will do very little to improve fuel efficiency, reduce our gas use, or reduce our impact on the environment. It’s basically designed to sell all those cars sitting in dealer lots right now so they can start making new ones. How about they just cut the price instead of asking the government for more hand-outs? Reducing the price by $4,500 would do a lot to help move those cars and taxpayers wouldn’t have to get involved.

Potential Upsides

This bill does have potential benefits. I can think of two:

It will stimulate the auto industry. This particular bill doesn’t support any specific car company, in fact it might help foreign automakers more than US automakers. Although you could argue that some fuel-efficient Toyotas and Hondas are built in the US, so they’re American cars anyway and are saving American jobs.

It will get those older, less efficient cars off the road. Once traded-in, the engine, transmission, and some other parts will be destroyed so the cars don’t return as used cars.

Those benefits are not enough to outweigh the downsides for me. I DO NOT support this bill. If you agree, it’s time to call or write your Senator. Urge them not to pass this bill. I will write my Senators just as soon as I stop screaming.

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