Congress intros voucher plan for gas guzzlers

[Auburn85 438]

http://www.dailygazette.com/news/2008/aug/13/0813_printt/

By JIM ABRAMS, Associated Press Writer Jim Abrams, Associated Press Writer

WASHINGTON – Congress is mulling a proposal to pay people to get rid of those old gas guzzlers sitting in their driveways.

Under legislation introduced Wednesday in both the House and Senate and called the "Cash for Clunkers" program, drivers could get vouchers of up to $4,500 when they turn in their old fuel-inefficient vehicles for scrapping and buy vehicles that get good gas mileage.

People could also turn in their old cars for vouchers that could be used to ride public buses and trains.

The bill, said Sen. Dianne Feinstein, D-Calif., "would be an important part of helping getting America's struggling automobile industry back on its feet, and help consumers who are concerned about covering the cost of buying a more fuel-efficient vehicle."

Taking gas guzzlers off the road, added Sen. Susan Collins, R-Maine, a co-sponsor, "would reduce our dependence on foreign oil, decrease greenhouse gas emissions and stimulate the economy."

The bill envisions the program operating for four years and encouraging the retirement of up to one million vehicles a year, saving between 40,000 and 80,000 barrels of motor fuel a day by the end of the fourth year.

Drivers would be eligible for reimbursement for purchase of a new or used vehicle with a fuel economy rating that exceeds federal targets for that class of vehicle by at least 25 percent. The vehicle must have a manufacturer suggested retail price of less than $45,000 and be a model year 2004 or later.

The vehicles turned in must be drivable, registered in the United States and have a when-new fuel economy rating of less than 18 miles per gallon.

In the first year of the program, a person trading in a vehicle that is model year 2002 and later would be eligible to receive $4,500 for purchase of a new vehicle, $3,000 for purchase of a used vehicle or $3,000 for transit fare credit. For model year vehicles 1999 to 2001, drivers would get $3,000 for the purchase of a new vehicle. Those who trade in vehicles that came out in 1998 or before could get a credit of $2,000 for a new vehicle.

"This is an even better trade-in offer than they could get from any car dealership," said Sen. Charles Schumer, D-N.Y., also a co-sponsor.

A person could obtain no more than one voucher in any three-year period. Dealers and scrap recycling companies could also get payments of $50 per vehicle. Initial estimates set the cost of the program between $1 billion and $2 billion a year.

[bigsixfive 341]

I'm guessing that many people enticed by this $4500 probably shouldn't be in the market for a new car. So in an attempt to get "America's struggling automobile industry back on its feet" in a time when personal fiscal responsibility is crucial, they're going to encourage people to trade in their severely devalued vehicle for a severely overvalued vehicle and more than likely accrue negative equity.

Question: How do those that "we" elect perform even the simplest of tasks in everyday life? You've got to wonder how people like Feinstein really make it past 9 AM every morning when stuff like this is seriously proposed.

[autigeremt 7,550]

As a free American (freedom with an anchor), I will continue to drive my SUV until it dies. I have two kids, and they ride horses. I need the space for them and their friends.

Keep the 4,500 and bail someone else out with it.

[quietfan 233]

When will it end? We have to face the fact that it's just not financially possible to buy our way out of every unwise decision that's been made in the last 5-10-20 years through gov't bailouts, stimulus packages, etc. Unfortunately, that means economic pain for many. I would hope that the pain can be fairly shared between rich/poor, private/corporate, however. ("Fairly shared", of course, also meaning the greedy SOB's who profited the most off bad decisions should suffer the most...)

I can't see any reason nor any fiscally sound method for buying old clunkers off the market. A plan I would endorse, however, is heavy penalties on the purchase of new gas hogs. Save the vouchers for those who have legitimate needs--job, large families, handicaps, etc.--that require larger, less efficient vehicles. Individuals who still insisted on buying battleships because of mere personal choice or hobbies would still be free to buy them, but price the hogs high enough to provide a real incentive for changing that way of thinking.

[bigsixfive 341]

I can't see any reason nor any fiscally sound method for buying old clunkers off the market. A plan I would endorse, however, is heavy penalties on the purchase of new gas hogs. Save the vouchers for those who have legitimate needs--job, large families, handicaps, etc.--that require larger, less efficient vehicles. Individuals who still insisted on buying battleships because of mere personal choice or hobbies would still be free to buy them, but price the hogs high enough to provide a real incentive for changing that way of thinking.

Why add penalties? Let the market establish the price. There's already penalties built into those types of vehicles: they're more expensive to purchase, and more expensive to drive. When gas went up, people couldn't afford them and quit buying them. Then you've got situations where people rely on trucks and SUVs for a living, and an additional penalty only takes more of their profit, which ultimately raises costs down the road. Want to see a sudden jump in construction? Add a fee to the cost of a truck. On top of all that, who is collecting the penalty? The government. Do you REALLY trust that they'll do the right thing with that money? What about the precedent established that the government can inflate the price of things it (and by it, I mean the 550 or so people running the show with the 8% approval rating) deems unsafe, unclean, unfit, or PROFITABLE - are you willing to give them free reign? (Actually, who am I kidding, that precedent was set long ago.)

[otterinbham 0]

This country is in big, big trouble.

[quietfan 233]

I can't see any reason nor any fiscally sound method for buying old clunkers off the market. A plan I would endorse, however, is heavy penalties on the purchase of new gas hogs. Save the vouchers for those who have legitimate needs--job, large families, handicaps, etc.--that require larger, less efficient vehicles. Individuals who still insisted on buying battleships because of mere personal choice or hobbies would still be free to buy them, but price the hogs high enough to provide a real incentive for changing that way of thinking.

Why add penalties? Let the market establish the price. There's already penalties built into those types of vehicles: they're more expensive to purchase, and more expensive to drive. When gas went up, people couldn't afford them and quit buying them. Then you've got situations where people rely on trucks and SUVs for a living, and an additional penalty only takes more of their profit, which ultimately raises costs down the road. Want to see a sudden jump in construction? Add a fee to the cost of a truck. On top of all that, who is collecting the penalty? The government. Do you REALLY trust that they'll do the right thing with that money? What about the precedent established that the government can inflate the price of things it (and by it, I mean the 550 or so people running the show with the 8% approval rating) deems unsafe, unclean, unfit, or PROFITABLE - are you willing to give them free reign? (Actually, who am I kidding, that precedent was set long ago.)

But I don't think the current market prices are adequate incentive to reduce impulse buying of inefficient vehicles for frivalous reasons. ...as demonstrated by the number of SUV's, King Cabs, Hummers, etc. I see driven by people I know have no real need for them. (i.e., personal friends, acquaintances, students in my classes, etc., that I know personally. I'm not judging every stranger I see on the road-he/she may need it.)

For those that do have need--construction, farming, large families, etc.--that's where my voucher plan comes into play. My vouchers would simply be exemptions from the larger artificial penalties (okay, taxes)I'd impose, not government subsidies on the actual cost of such vehicles.

As for what I'd do with the money--use it to repair infrastructure, re-tool factories, and/or subsidize development of energy-efficient technology. Government may not have the best record of money management, but there's really no other institution in our society qualified or empowered to take on such large projects on a national level. (...Not that some areas of the private sector--banks, much of Wall Street, Detroit, etc.--are winning any awards for money management these days either.)

[autigeremt 7,550]

This country is in big, big trouble.

AMEN! It's like having a child who has made very, very poor choices. You have helped them enough, and now it's time for them to learn their lesson on their own.

Of course, we are only talking about our country.

[autigeremt 7,550]

I can't see any reason nor any fiscally sound method for buying old clunkers off the market. A plan I would endorse, however, is heavy penalties on the purchase of new gas hogs. Save the vouchers for those who have legitimate needs--job, large families, handicaps, etc.--that require larger, less efficient vehicles. Individuals who still insisted on buying battleships because of mere personal choice or hobbies would still be free to buy them, but price the hogs high enough to provide a real incentive for changing that way of thinking.

Why add penalties? Let the market establish the price. There's already penalties built into those types of vehicles: they're more expensive to purchase, and more expensive to drive. When gas went up, people couldn't afford them and quit buying them. Then you've got situations where people rely on trucks and SUVs for a living, and an additional penalty only takes more of their profit, which ultimately raises costs down the road. Want to see a sudden jump in construction? Add a fee to the cost of a truck. On top of all that, who is collecting the penalty? The government. Do you REALLY trust that they'll do the right thing with that money? What about the precedent established that the government can inflate the price of things it (and by it, I mean the 550 or so people running the show with the 8% approval rating) deems unsafe, unclean, unfit, or PROFITABLE - are you willing to give them free reign? (Actually, who am I kidding, that precedent was set long ago.)

But I don't think the current market prices are adequate incentive to reduce impulse buying of inefficient vehicles for frivalous reasons. ...as demonstrated by the number of SUV's, King Cabs, Hummers, etc. I see driven by people I know have no real need for them. (i.e., personal friends, acquaintances, students in my classes, etc., that I know personally. I'm not judging every stranger I see on the road-he/she may need it.)

For those that do have need--construction, farming, large families, etc.--that's where my voucher plan comes into play. My vouchers would simply be exemptions from the larger artificial penalties (okay, taxes)I'd impose, not government subsidies on the actual cost of such vehicles.

As for what I'd do with the money--use it to repair infrastructure, re-tool factories, and/or subsidize development of energy-efficient technology. Government may not have the best record of money management, but there's really no other institution in our society qualified or empowered to take on such large projects on a national level. (...Not that some areas of the private sector--banks, much of Wall Street, Detroit, etc.--are winning any awards for money management these days either.)

I like the tone of your submission. My only, internal dyanamic, based on free society principal is this.....why do we penalize people in this country who want to choose what they want to drive everyday? I like the idea of letting families have a voucher, as I would consider it for mine. But.......government should not impose it's political agenda on people by way of their choices. I know it's not realistic anymore, but that's where I stand on it. Let the market drive them to fuel friendly vehicles. Make them more cost effective.

[DKW 86 8,222]

Co-Dependent Forever...

[80Tiger 909]

When will it end? We have to face the fact that it's just not financially possible to buy our way out of every unwise decision that's been made in the last 5-10-20 years through gov't bailouts, stimulus packages, etc. Unfortunately, that means economic pain for many. I would hope that the pain can be fairly shared between rich/poor, private/corporate, however. ("Fairly shared", of course, also meaning the greedy SOB's who profited the most off bad decisions should suffer the most...)

I can't see any reason nor any fiscally sound method for buying old clunkers off the market. A plan I would endorse, however, is heavy penalties on the purchase of new gas hogs. Save the vouchers for those who have legitimate needs--job, large families, handicaps, etc.--that require larger, less efficient vehicles. Individuals who still insisted on buying battleships because of mere personal choice or hobbies would still be free to buy them, but price the hogs high enough to provide a real incentive for changing that way of thinking.

I agree. Why add penalties? The market will take care of it. Has anyone noticed the price of oil and what happended when demand oupaced supply and then then most recent reversal of this? These were market driven forces. Same will happen with transportation (and it is happening). Government intervention usually has a negative impact.