I guess I should write my reps today to discourage passage of this bill. It is crazy.
$3500 - $4500 is a pretty big incentive. It will cause all sorts of behavior modifications, and they won't all be the intended ones. Here's an example:
What Congress 'wants':
Joe trades in his old low-mpg truck for a newer higher mpg truck. Congress acts like they made the world a better place.
What Congress may get:
Joe was also planning to buy a new reasonably high-mpg family car, to replace their old reasonably high-mpg family car (neither fit the "clunker" definition). Joe is a bright guy, so he:
1) "trades up" his old "clunker truck" for a new family car. Gets $3,500 or $4,500 of our money.
2) Buys an old truck similar to his old one, from someone who could not take advantage of the rebate (they can't afford a new vehicle). Or maybe one just outside the "clunker" category. IOW, there is really nothing to "tie" the clunker to the replacement.
In the end, nothing changed much mpg wise. Taxpayers are out $4,500.
Used car market has less supply, so poor people are being hurt. That's the part that really stinks - I bet there are a group of poor who just need a car to get to work, or to the train station. Mpg isn't a big factor if you don't drive much, but the cost of the vehicle may be a deal breaker for them.
I guess it would increase demand for new cars (although in this case, Joe was going to buy that new family car anyhow), but if those new cars are replacing functioning old ones, is that really "good" for the country in the long run? We are just shuffling money from the people (taxpayers) to the people (people who bought low mpg cars), through the govt.
And of course, none of my family vehicles meet the proposed <18mpg combined rating. I am thinking about replacing some of these cars soon, it burns me to think that had I shopped for a lower MPG car years ago, I could be many thousands $ ahead. That's just great.
As other's have said - rewards the 'bad' behavior. How about giving all us higher mpg car buyers some $ - wouldn't we use it to stimulate the economy?
-ERD50