So they've now just approved $2 bill more for this program...(initially they had set aside $1 bill). And am I the only one that thinks this thing is a horrible idea?

7/31/2009 1:43:36 PM

I doubt you're the only one, but it's meant steady business for dealerships, better cars for people and businesses who otherwise might not be able to afford them (thus improving their productivity), and fewer emission-heavy cars on the road.

I mean, you can debate the constitutionality of it, but if you're gonna spend a bunch of money, might as well directly stimulate consumers and industry.

7/31/2009 1:51:58 PM

I think it's fantastic the government is encouraging consumer debt.

7/31/2009 1:54:28 PM

At least we may see a government program that actually ends.

7/31/2009 1:55:33 PM

i get a whopping 21 mpg combined according to the epa, so im not eligible.

7/31/2009 1:59:50 PM

I love the program. Sure, they're just straight up doling out money, but they seem to be doling it out to the right people in the right places. I mean, they're gonna dole it out no matter what so...

7/31/2009 2:03:43 PM

I don't know a lot about this program, but with how slow other stimulus money has gone out vs how well this program has gone, I think it seems to be one of the more effective government stimulus plans out there.

7/31/2009 2:03:52 PM

Effective at what, though?

All most consumers will end up with is a car loan.

Unless they lease, in which case they'll end up with.....nothing.

7/31/2009 2:07:29 PM

I just don't get how they think this is a good idea?
Taxpayers paying for people driving (or pushing) older beat-up cars that may have gotten $100 if they sold em, to buy brand new cars...with the intention that the fewer gas guzzlers on the road, the less pollution, less oil needed etc.
Except that these people couldn't afford to buy a new car to begin with and while not allowing one to buy a Ferrari, they are still allowed to buy a car up to something like $45,000. And since I'm guessing the whole, 'you need to have really good credit thing' isn't important (which I would think they would have had to assume since these people have crappy cars) then they're putting people who can't afford new cars....in new cars.....with the gov'ts blessing. Isn't that sort of what they did with the housing market?

And the last time they had a car/incentive program that I know of, it was the state of Arizona offering up HUGE rebates on people who bought SUVs and had their engine replaced to accomodate alternative fuels. What happened with that? Well every gov't vehicle got in on that, every gov't official got first dibs for them and their families, and by the time it was there for the regular ole tax payers, the money ran out. Not to mention that these cars didn't HAVE to use alt fuel...they just could if they wanted to and considering that there were few gas stations that carried it, most people just used the regular old gas like before.

So I'm just not understanding how anyone in govt can actually promote this. I'm pretty sure they've given enough money to bail out the auto industry and now they're dragging in banks who are going to have to deal with a massive amount of repos...and ins companies who are going to end up paying through the asshole when these people, who couldn't afford the cars they bought, now can't afford their insurance...

7/31/2009 2:15:53 PM

How is this a bad idea?

1) Fights the Recession:
It encourages consumer spending on durable good by effectively subsidizing their purchase (by paying people with "clunkers" more than they would have been able to sell them for on the open market).

2) Fights Global Warming:
The program is targeted at getting cars with bad gas mileage off the road. This means people more people be driving more fuel efficient vehicles.

3) Downward Pressure on Gas Prices:
The people who use this program to purchase more fuel efficient vehicles will likely be using much less gas than they were before (at least in the short run). This means lower gas prices for everyone, which means more money to spend on goods that were not largely imported (another plus for boosting aggregate demand for an economy in recession).

Way to Go, Obama!

7/31/2009 2:25:08 PM

I wish it had applied to used cars as well, though I'm still not eligible.

7/31/2009 2:34:38 PM

.2% of a trillion and you think thats a horrible idea?? ppl getting a 4500 tax credit is a horrible idea?? what planet do you live on?

7/31/2009 2:51:06 PM

^^^^I don't know that you can accurately pre-judge this program, based on what sounds like a fairly different program from the description you gave, in McCain's state.

7/31/2009 2:57:53 PM

My parents have a super beat-up Jeep.

They're planning to replace it with a new Civic, Sonata, Focus, etc...

Had it not been for this rebate, they would have waited a lot longer to buy another car, and they definitely would have bought another used, possibly gas-inefficient vehicle. They're not going to use a loan. This program inspired them to inject straight cash money into the economy that they would have otherwise held on to. I don't see how that's bad.

And I'm not clear that people having car loans is the worst thing in the world, especially considering it gets dealerships some business and gets some gas guzzlers off the road.



I dunno. I think this is just another case of people getting pissed off because other people are getting some free monaaay!

7/31/2009 3:13:35 PM

Quote :

"I think this is just another case of people getting pissed off because other people are getting some free monaaay!"

I think you're right, this is the problem. But it's not "free" money. It's money paid for by taxes. And I'm sure people are very happy other people (your parents) are getting a deal with their tax money when they can't because they bought gas efficient cars to begin with.

7/31/2009 3:52:46 PM

Wait a second. This is a tax rebate. Like the one for houses.

This is a refund of individuals' taxes-- not taxpayers' (collectively speaking) taxes


Although I do sympathize with you in that it rewards previous stupidity. I'm on the verge of wanting a new, efficient car. The problem is I currently have an old, efficient car. I'd be much happier with a simple rebate for fuel efficient cars.

7/31/2009 4:17:26 PM

Quote :

"And since I'm guessing the whole, 'you need to have really good credit thing' isn't important (which I would think they would have had to assume since these people have crappy cars) then they're putting people who can't afford new cars"

ahhh baseless assumptions! NICE!

7/31/2009 4:25:25 PM

I found out this week I need $750 to replace more parts in my car, on top of the $300 I've already spent in the past month. Unfortunately, my car is a 2000 and it gets 30mpg.

Damn you Oboma, you Evil Kenyan Wizard!

Oh, actually, I caught the best baseless assumption coming from Rush yesterday. Apparently they're gonna take all these "clunkers" (which must still run, remember), fix them up real nice, and give them to...Acorn!!!!!

[Edited on July 31, 2009 at 4:26 PM. Reason : .]

7/31/2009 4:25:32 PM

As ^^^^ said, the money isn't free.

Leases shouldn't have been included. I'd rather the government just give money straight to the dealers than encourage consumers to engage in long term car rental agreements.

Car loans are great if you can get a low rate and short term. Otherwise, they're not so great. Hopefully, "the right people in the right places" have the income, savings, and credit to secure a favorable loan.

Used cars should have been included. There are plenty of used cars that meet the MPG requirements of the program and make better financial sense than a new car. Not to mention, it would broaden the field of eligible people (to those who probably need it most).

^^^ This is different from the first-time homebuyer tax credit. The tax credit has no restrictions on what type of home you can buy and (more significantly) the house tax credit is payable directly to the consumer.

I haven't bought a car since the rebate program began, but I'd be very surprised if dealer fees, transportation costs, etc. hadn't magically increased to give dealers a cut of the rebate.

7/31/2009 4:33:24 PM

Quote :

"Wait a second. This is a tax rebate. Like the one for houses. This is a refund of individuals' taxes-- not taxpayers' (collectively speaking) taxes"

Riiiiiiight. That might hold some water if we weren't running a deficit. But we are.

7/31/2009 4:42:44 PM

There's no such thing as a free lunch, sure, but this money's gonna get spent...might as well direct it towards a struggling industry and get some gas guzzlers off the road. Maybe they should have just cut a check to everyone so people can go out and buy SUVs (if they can afford it) or Jimmy Buffet margarita makers (if they can't). That would certainly be the fairer thing to do.

Quote :

"Although I do sympathize with you in that it rewards previous stupidity. I'm on the verge of wanting a new, efficient car. The problem is I currently have an old, efficient car. I'd be much happier with a simple rebate for fuel efficient cars."

Previous stupidity? You have an old, efficient car but you're trying to buy a new one. I think that's stupid, and I'm gonna be so pissed if you ever get rewarded for it!!!!

7/31/2009 4:45:16 PM

^WTF are you talking about?

That person's quote is the reason this law is so stupid...

Person A buys a 1992 Toyota Camry 10 years ago. Now it's a POS but efficient. Person B buys a 1992 Suburban 10 years ago. Person A cannot get a rebate even though they have been driving a fuel-efficient car for 10 years, but Person B can... what don't you understand?

7/31/2009 5:32:26 PM

^come on man, don't you know personal responsibility means nothing in this country?

I can think of a much better use of that money if clean emissions is your goal: "Give people with older cars in need of some reconditioning a $4000 voucher to have the emissions/exhaust systems overhauled/replaced".

That way the people receiving this rebate (or whatever it technically is) aren't put in debt and you're putting money back into the economy at mechanic shops all around the country. You're also not destroying thousands and thousands of functional automobiles (talk about wasteful).

But no, this is just another form of a bailout for automakers.

[Edited on July 31, 2009 at 5:33 PM. Reason : k]

7/31/2009 5:33:23 PM

why won't someone think of the mechanics

7/31/2009 5:42:55 PM

http://money.cnn.com/2009/07/29/autos/clunker_tips/?postversion=2009073013

Quote :

"If you're trading in a basic truck, van or SUV -- in other words, not a heavy-duty truck or big passenger van -- you can get a $4,500 credit for purchasing a new truck or van with fuel economy that's better by 5 mpg or more. You can get a $3,500 credit for a 2 to 4 mpg improvement. ... Big trucks (Category 2): If you're trading in a bigger truck -- a truck with a wheelbase of 115 inches or a van with a wheelbase of 124 inches -- you're eligible for a $4,500 credit for buying a similar vehicle with a 2 mpg improvement or a $3,500 credit for buying one with a 1 mpg improvement. Really big trucks (Category 3): If you're trading in a truck with Gross Vehicle Weight Rating (GVWR) of 8,500 to 10,000 pounds, all you have to do is buy a new one. Fuel economy doesn't even factor into it."

Wow, I'm sure glad we've just pissed away $3 billion to get all those "clunkers" off the road.

7/31/2009 5:57:56 PM

dude 3 billion is like .00000002 of gdp

[Edited on July 31, 2009 at 6:16 PM. Reason : .]

7/31/2009 6:15:38 PM

Your math is a little off there. Just like your facts, most of the time.

7/31/2009 6:16:46 PM

your math is a little misleading as well. i'm not saying this is the best program in the world, but if you'r trading in a truck for a newer better mileage truck, that's probably one of the better trades.

say you go from 12 mpg to 15 mpg. not only will your new car likely emit cleaner emissions in general, but it will also travel 25% further on a gallon of gas. the same cannot be said for a small car that goes from 30 mpg to 35 mpg. marginally improving the gas mileage of large cars will help a lot more than improving the gas mileage of small cars.

7/31/2009 7:02:10 PM

Cash for clunkers is so retarded. Buying a vehicle with high mpg should be a reward enough in of itself.
Besides after the disaster of the credit market should not we be encouraging THRIFT????????
Encourage drivers to use a vehicle as a means of transportation not encouraging Average Joe to go out, get rid of his perfectly good 1999 Pontiac Grand Am, and taking on debt by getting a new Ford Mustang??

Jesus fucking christ.

The bill is even a failure at the whole MPG thing. A truck owner only needs to find a model with a paltry 2mpg increase in fuel economy to get $3500 of my hard paid tax money.

8 years ago Bush was handing out "Get out of TAxes free card" to all the rich trust fund babies getting their estate and capital gains taxes lightened. Today its Liberal Obama giving every guido and welfare queen $3500 to use as down payment for a car lease/loan they can't afford.


Lets not forget that the pimply environmentally and fiscally responsible pizza delivery kid is getting punished for his 1992 honda civic since its not elidgeable; whereas Billy Bob that had to get a 1992 F250 is getting rewarded for his gas guzzling decision with a rebate if he chooses to accept it for another vehicle.
The rebate should be available to anyone that wants to trade in their vehicle for a "fuel efficient" one at the VERY LEAST.

[Edited on July 31, 2009 at 7:29 PM. Reason : l]

[Edited on July 31, 2009 at 7:30 PM. Reason : l]

7/31/2009 7:26:03 PM

Quote :

"your math is a little misleading as well. i'm not saying this is the best program in the world, but if you'r trading in a truck for a newer better mileage truck, that's probably one of the better trades."

Please explain to all of us how 2 mpg is a trade worth $4500. No really, this should be a laugh riot. I get the argument about working on the margins - I've made it here myself before. But when you go as low as 1 to zero, it kind of moots the whole point of the "more efficient vehicles" argument.

Meanwhile, the only reason you find the math "misleading" is because it's "inconvenient." The facts are all there and I even provided my source. You've given us a whole lot of nothing.

[Edited on July 31, 2009 at 7:32 PM. Reason : .]

7/31/2009 7:28:55 PM

the numbers you have left out are the actual impact of gas saved per mile traveled for different sizes of vehicle given a particular decrease in gas mileage. my current car gets around 29mpg. If I got a new car that improved that gas mileage to 35mpg, I would go from 3.45 gallons per 100 miles to 2.85 gallons per 100 miles or a 17% reduction in consumption.

Let's do the same math with a two mpg improvement on a large vehicle:

say going from 13 mpg to 15mpg:

7.69 gallons per 100 miles -> 6.67 gallons per 100 miles (a 13% reduction in consumption).

so not only is gross amount of fuel saved more for the 2mpg improvement, the percent saved isn't all that different either. this stuff should be done a log scale anyhow -- but that would be too complex for a bill i figure.

and i can't argue what the cost is one way or the other. but even if the efficiency doesn't improve much, the emissions possibly could. But also, this obviously wasn't just an environmental move. it was an economic one meant to boost lagging car sales while also getting an environmental benefit.

[Edited on July 31, 2009 at 7:55 PM. Reason : .]

[Edited on July 31, 2009 at 7:55 PM. Reason : .]

7/31/2009 7:53:24 PM

Let's go from 10 to 10 mpg. Total savings: zero.

Huh. Not working quite so well.

But with regards to improvements on the margins - once again, I'm not saying that all marginal improvements are created equal. In fact, I've said that already. What I'm saying is that this program doesn't really account for that very well at all. Rewarding people for tiny improvements in mpg is fairly ludicrous , especially given that it comes at the expense of those who chose to drive more efficient vehicles from the get-go. Particularly given the fact that a fuel tax would do the job just as well, without punishing the responsible.

The real point is that the "reward" schedule is entire nonsensical. Take this gem:

Quote :

"If the car you're purchasing has EPA-rated fuel economy -- again, this is combined city and highway mileage -- of 10 mpg better than your trade-in, you're eligible for a $4,500 credit. If gets 4 to 9 mpg better, you're eligible for a $3,500 credit. You could also trade in your car to get a new truck or SUV. In this case, with only a 2 mpg improvement, you would get the $3,500 rebate. With a 5 mpg improvement you'd get $4,500."

Why, exactly is it now, that you can set a lower bar to buy a new SUV from trading in a car than you do for trading in for another car?

And we have absolutely zero guarantees on emissions. What this amounts to is basically a giveaway to people who A) Drove crappy cars to begin with, B) Automakers who made crappy cars to begin with.

Fantastic. Just the people we wanted to reward.

And let's not even get into the impacts on the used car market. You know, the kind poor people actually tend to buy.

[Edited on July 31, 2009 at 8:16 PM. Reason : .]

7/31/2009 8:12:46 PM

Quote :

"There's no such thing as a free lunch, sure, but this money's gonna get spent...might as well direct it towards a struggling industry and get some gas guzzlers off the road."

That's about the only reason I can go along with this program. At least it stimulated some buying and economic activity, which is far more than we can say about the porkulus bill

7/31/2009 9:01:36 PM

There is no authority in the Constitution for the federal gov't to give out money to people so they can buy merchandise. It doesn't matter what the good intention is, the gov't is not supposed to manage the economy.

7/31/2009 11:33:31 PM

Quote :

"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."

Are you one other those guys who doesn't accept the 16th Amendment as valid?

7/31/2009 11:35:36 PM

It'd prolly be a silly thing to ignore the 16th, in general. I mean, it kind of explicitly says "we can do this, so fuck off." Now, should the 16th amendment have been passed? That's a different story. I think there was a good reason for ensuring that taxation was proportional to population, namely to prevent the kind of shit we are engaged in now, what with class warfare and the like.

8/1/2009 12:13:46 AM

No, people like Earthdogg literally don't accept the 16th Amendment.

Something about Ohio (?) never officially ratifying it, or something.


They're kind of like old-school birthers, so you should be right at home with them.

8/1/2009 12:19:55 AM

This country is doomed.

Do you realize what a lousy investment a new car can be? The thing depreciates 20% every year. You pay far more insurance. You pay interest on the loan. You pay principal on the car loan which could have been put towards your mortgage. No wonder there is a debt crisis, the government is actively promoting it.

If that weren't enough, the dealerships are required to destroy the old cars, many of which are in good shape. Sick!!

http://www.youtube.com/watch?v=waj2KrKYTZo

[Edited on August 1, 2009 at 1:42 AM. Reason : -]

8/1/2009 1:30:00 AM

my honda dealership has stopped participating in the program. It seems that the govt hasnt paid them like they were supposed to and its hurting thier books. I told the sales lady, now she knows how healthcare works.

I remember last year medicare was updating their computers. We didnt get a medicare check for almost 3 months.

8/1/2009 5:13:28 PM

my honda dealership has sold 10000 cars since monday.

8/1/2009 5:16:03 PM

yet another government program that passes me by because when I bought my current vehicle (back in '99') I was actually concerned about the mpg I got. Same with my wife. Now, we are both at the point to where we will need to buy a new car, as mine is a '99 and hers is a '96, but guess what, both of our cars get at least 19 mpg's combined.

[Edited on August 1, 2009 at 5:20 PM. Reason : asdaf]

8/1/2009 5:20:23 PM

DO AWAY WITH WASTEFUL GOVERNMENT SPENDING. NO MORE HANDOUTS!!!!!

.....


I don't get the handout!

8/1/2009 5:26:11 PM

Quote :

"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration. No, people like Earthdogg literally don't accept the 16th Amendment. "

You're bringing up the 16th amendment in response to my statement?

The 16th amendment says nothing about giving the government permission to spend money. It only refers to the gov't's authority to collect money. There is nothing in the Constitution granting the federal gov't any authority to spend taxpayer money on giving car-buyers a rebate.

You should've thrown Clause 1, Sec 8 at me instead. But the General Welfare clause does not give the gov't an open-ended mandate to do whatever it wants. If it did, there would be no need to enumerate any responsibilities of the Congress at all. Instead Sec 8 would simply say "Go For It!"

8/1/2009 10:29:31 PM

Quote :

"It only refers to the gov't's authority to collect money."

Which would naturally include refunds on collected money, no?

8/1/2009 11:16:21 PM

fyi the 2 Billions that the house passed is not necessarily guaranteed. Sens McCaskill and McCain are planning on opposing it when the Senate does its solo session next week

8/1/2009 11:19:43 PM

Quote :

"my honda dealership has stopped participating in the program. It seems that the govt hasnt paid them like they were supposed to and its hurting thier books."

They were probably talking about the fact that the federal gov't just said that the rebates will be considered taxable income for the dealerships.

Boo-hoo.

8/1/2009 11:22:08 PM

Eh, maybe but I'll go with other reasons.

Some dealerships are overwhelmed with paperwork and don't have the resources or knowledge necessary to process all of it. I'd imagine many will pull out of it. From what I've read, the submission is a PITA and many deals are getting rejected with no reasons given.

8/1/2009 11:38:41 PM

This is a give away to people who already own cars and trucks that are too big and for people who live beyond their means. Cars that are, if you will, big beyond the driver's means. If this bill ever accidentally made someone use less oil, that minuscule amount will be canceled out by people trying to own more wasteful stuff in hopes that the government will do this kind of bonehead thing again.

The classifications in this bill (big truck, bigger truck, and grande) are following in the great heritage of SUV legislation, laws built to completely f*#@ the world as fast as possible. The argument is that larger cars should be held to lesser regulations because they allow the consumer to 'consume' more. Right, b/c a truck with a larger wheelbase can haul more, so we should limit emissions on a basis of hauling capacity and not just by the vehicle... or something like that.

After all, everyone already has cars for the most part, so if we want a market growing faster than just the replacement rate then we need to increase consumption. So we need to get people to buy MORE car, consume MORE car, and then we'll decrease emissions based on the amount of car we get. Meaning we'll never decrease emissions and never decrease oil consumption.

Until of course, it runs out. But I'm not worried, the industry lobbying groups and my politicians assure me that I have nothing to worry about for at least another 50 years. I'm sure that's an honest assessment. I'm sure that modest improvements in efficiency for the time being (or replacing that 'credit' with buying a larger car that uses the same amount of gas) is more than enough for now.

I'm sure we don't have anything to worry about, especially now that the dirty speculators that pumped up the prices of oil last summer are scared away. That will never happen again, all the signs are showing that oil and everything else will cost the same and be just as abundant 10 years from now.

Yep, sure looks good to be a truck driving American right about now.

[Edited on August 1, 2009 at 11:58 PM. Reason : ]

8/1/2009 11:53:34 PM

The government is awful and I hate it. I'm voting Libertarian from now on.

8/2/2009 12:10:13 AM

Quote :

"Some dealerships are overwhelmed with paperwork and don't have the resources or knowledge necessary to process all of it. I'd imagine many will pull out of it. From what I've read, the submission is a PITA and many deals are getting rejected with no reasons given."

I agree. Dealing with Medicare is a huge pain and they will reject claims for no good reason. I suppose its a cost saving measure bc if you dont have a good insurance girl you will miss getting paid for that service entirely. Ask your evil doctor how many people they have just dealing with insurance. Its ridiculous. The auto dealers are just getting a taste.

8/2/2009 10:11:35 AM