Cash For Clunkers – A pretty good idea . . .

Seth Kaplan

Environmentalists tend to be the kind of people who hang on to things.  Keenly aware of the impact of constantly buying new things – whether it be cars, appliances or other “hard goods” – the kind of folks who are CLF members (and are likely reading this) tend to avoid buying new things.  This is especially true where buying something new, like a new car, simply means shifting the use of the old item to someone else.  Driving a new efficient hybrid car is not a satisfying experience if you are aware that your older, less efficient car, will end up back on the road.

However, if you own an older car and want to move to a newer more efficient model while being sure that your old car will be scrapped and taken off the road the Federal Government has a deal for you.

Here are the basic rules for the program, as presented by the Feds:

  • Your vehicle must be less than 25 years old on the trade-in date
  • Only purchase or lease of new vehicles qualify
  • Generally, trade-in vehicles must get 18 or less MPG (some very large pick-up trucks and cargo vans have different requirements)
  • Trade-in vehicles must be registered and insured continuously for the full year preceding the trade-in
  • You don’t need a voucher, dealers will apply a credit at purchase
  • Program runs through Nov 1, 2009 or when the funds are exhausted, whichever comes first.
  • The program requires the scrapping of your eligible trade-in vehicle, and that the dealer disclose to you an estimate of the scrap value of your trade-in. The scrap value, however minimal, will be in addition to the rebate, and not in place of the rebate.

Fortunately, the supply of cleaner and more efficient cars available for sale continues to expand, thanks in large part to the rules requiring a shift in the new car fleet mandated by the rules adopted by the Northeastern states (following the lead of California).   We are proud to note that CLF played a key role in defending those rules in court.

Update (August 6, 2009):

Unless you have been living in a cave you will have heard that the program is on the verge of running out of money and efforts are being made to “refuel it”.

Attempts at looking at the potential environmental benefits of the program range from the skeptical to the mildly positive to the fiercely negative.  A good middle ground was the comment of a leading environmental lawyer reported by CNET News:

“It’s not that it’s a bad idea; just don’t sell it as a cost-effective energy savings method,” Michael Gerrard, director of the Center for Climate Change Law at Columbia University said in an academic journal. “From an economic standpoint it seems to be a roaring success. From an environment and energy perspective, it’s not where you would put your first dollar.”

The critiques of the program have some serious validity.  Would it be better for this money to be spent on public transit operations ?  Would a fundamental change in the funding paradigm that would shift money from roads to transit (as CLF has called for in our Five Steps for the Next Five Years climate vision document) be much better? Absolutely yes.

But my pragmatic bottom line is that this program has far more environmental benefit than so many other things the Federal government does and pays for that it is hard to get worked up about this one.

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