Offering financial incentives to encourage people to trade in fuel inefficient cars for newer models that get better gas mileage is a good concept. Unfortunately, the “cash for clunkers” provision in a recently passed federal spending bill falls far short of the target of significantly reducing fuel consumption. Fortunately, lawmakers can — and must — improve the program when it is set to expire this fall.
The shortcomings in the program, now called the Consumer Assistance to Recycle and Save, or CARS, include the fact a gain of only 2 miles per gallon is necessary to get a voucher and that purchases of used vehicles aren’t covered. It defies common sense that someone could get a voucher to buy a large sport utility vehicle but not a used small car, especially in a program that is estimated to cost $1 billion by November, when it is set to expire.
For this reason, the program has rightly been called a handout to carmakers. A provision to limit the program to only American-made vehicles was dropped after it was pointed out that this violated trade laws.
When lawmakers reconsider the program, they should return it to its environmental focus. This can be done by adopting more stringent standards that were proposed in the Senate by Sens. Susan Collins and Dianne Feinstein, a California Democrat.
Under their “Cash for Clunkers” provision, which was supported by Sen. Olympia Snowe, someone buying a car that gets 13 miles per gallon more than the trade-in would get a voucher worth $4,500. To qualify for a voucher, the clunker must get 17 miles per gallon or less and the new passenger car must get at least 24 miles per gallon and a new light truck must get 20 miles per gallon, the current average for these vehicle classes. Used cars would be included.
This is more stringent than the CARS program that was adopted. Therefore, it would do more to reduce fuel consumption — saving Americans more money at the pump — and to reduce pollution.
Sen. Collins, who voted for the supplemental appropriations bill, which included more than $100 million for military operations in Iraq and Afghanistan, despite the weaker clunkers provision, said she received assurances that an extension of the CARS program would reflect the Senate language.
Lawmakers now have until November to see how the program works. If consumers don’t take advantage of it, it should probably be dropped. But, if there is significant demand, it should be strengthened.