Clunker cash faces Senate obstacles


When the Cash for Clunkers program put the pedal to the metal and ran through $1B in just a week, the House quickly redirected another $2B in unspent stimulus funding to it. But in the Senate, it faces stiffer opposition from both the left and the right.

President Obama was pleased with the House action, saying, “I want to thank leaders in the House of Representatives for working quickly and in a bipartisan way to pass legislation that will use Recovery Act funds to keep “Cash for Clunkers” going.  This program has been an overwhelming success, allowing consumers to trade in their less fuel efficient cars for a credit to buy more fuel efficient new models. It has given consumers a much needed break, provided the American auto industry an important boost, and is achieving environmental benefits well beyond what was originally anticipated.  The program has proven to be a successful part of our economic recovery and will help lessen our dangerous dependence on foreign oil, while reducing greenhouse gas emissions and improving the quality of the air we breathe.  I urge the Senate to act with the American consumers in mind to pass this important legislation.”

However, at least one Senate Republican threatened to scuttle the added funding. Jim DeMint (R-SC) said on “Fox News Sunday” that the government should not be in the used car business and called the program “a great example of the stupidity coming out of Washington right now.” However, he stopped short of calling for a filibuster.

The more serious threat may come from the left, where some, led by Diane Feinstein (D-CA) want stricter environmental qualifications tagged to the program. They would raise the efficiency standard for qualifying new cars from 22 mpg up to 24 mpg, and would lower the efficiency standard for qualifying clunkers from 18 mpg to 17 mpg.

Tweaks to the bill are problematic, since although the Senate is in session this week, the House has already begun its August recess.

RBR/TVBR observation: This program is a unique hybrid that provides stimulus to two ailing industries, both of which play unique roles in the American societal framework; it provides direct stimulus to citizens; and it helps to protect the environment. It took off and was dramatically expanded in Europe, so it should be no surprise that the same demand exists here as well. Senate, go for it!