This Week in the Mercury
Wednesday, August 5, 2009
Transportation Why "Cash for Clunkers" Pisses Me Off.
Posted by Sarah Mirk on Wed, Aug 5, 2009 at 12:58 PM
Tens of thousands of Americans traded in old cars for more fuel-efficient ones last week to snag a federal "cash for clunkers" rebate that gave new car buyers $3500-$4000 to purchase vehicles with slightly improved gas mileage.
Putting aside my jealousy that I can't score a $4000 check from the government because I choose not to own a car in the first place, it seems like, objectively, the program is just a greenwashed way to help flailing auto companies.
It's great that the government is looking to incentivize improving cars' gas mileage, but the MPG of the new cars people are buying under cash for clunkers is not a significant step forward. The average gas mileage of cars bought under the cash for clunkers program was 28.3 MPG, with subsidized SUVs averaging 21.9 MPG and trucks only 16.3 MPG. Meanwhile, cars in Europe average 36 MPG. If we're going to get serious about climate change and oil consumption, we need to set our bar much higher.
Also, for all the environmental hubbub over the program, analysts are skeptical that the rebates will actually cut oil use. The NY Times "Wheels" blog writes:
According to a survey of car dealerships and 2,200 consumers by CNW Research, the average fuel economy of vehicles traded in last week was 16.3 miles per than the 18 m.p.g. needed to qualify for a government rebate of $3,500.The relatively small differential suggests that consumers have not been turning in the oldest, dirtiest and least fuel-efficient cars, but instead have been getting rid of their second and third cars, according to Art Spinella, who ran the survey...
The vehicles turned in were driven about 6,000 miles a year, he said. If the new vehicles are driven about 12,000 miles a year, the rough annual average, then consumers will actually use more fuel, not less
Today Senate Majority Leader Harry Reid promised that the Senate will put $2 billion more into the program, but over at Worldchanging they point out that even that massive new car subsidy will result in only "microscopic" impact on U.S. oil consumption — a .05 percent decline.
On the other hand, Oregon Representative Earl Blumenauer has been pushing to strengthen a bill that pays Americans for choosing real green transportation: the Bicycle Commuter Tax Provision pays workers $20 a month to ride their bikes to work. It costs only $1 million a year.
1
Don't use deceptive statisctics. If you're going to quote the average MPG of cars in Europe, quote the average MPG of cars in the US (NOT just trucks and SUVs). Otherwise it weakens your case.
2
Did you actually expect a government program that relies on the destruction of wealth and resources while using other people's money to work?
It has failed financially and environmentally.
Just wait until you see what they do next with health care!
And if I am not mistaken - Blumenauer's proposal is a tax break - not the govt taking your money and 'paying' people.
They work every time.
It has failed financially and environmentally.
Just wait until you see what they do next with health care!
And if I am not mistaken - Blumenauer's proposal is a tax break - not the govt taking your money and 'paying' people.
They work every time.
3
Thanks for the note, ragold. I added in the average overall "cash for clunkers" car MPG to make that comparison more accurate.
4
I hate the fact that you're required to buy a brand new car-- which means paying out the ass for a rapidly-depreciating liability sold by deceptive, dishonest salespeople. It's a bad deal, no matter how you slice it.
Dealers had already slashed prices on their dead-stock lots (by thousands of dollars!) before the program began. But now they wag "$4500!" in buyers' faces to give the illusion of a discount while jacking prices back up to normal levels. It's a bait-and-switch designed to help the auto industry-- surprise, surprise.
Dealers had already slashed prices on their dead-stock lots (by thousands of dollars!) before the program began. But now they wag "$4500!" in buyers' faces to give the illusion of a discount while jacking prices back up to normal levels. It's a bait-and-switch designed to help the auto industry-- surprise, surprise.
5
I think you're on to something there, Sarah. If people can get a cash for clunkers and tax credits for buying hybrids, wouldn't it reason that tax credits should also be offered to those who don't buy cars at all?
6
Ah, that rarest of things - a Blogtown political entry that I agree with.
I read somewhere recently that this is the kind of thing that the Daily Show used to mock, but now embraces. "Wait, a government program is offering people free money.. and they're taking it? What a country!"
That's all it is -- free money for those who happen to be in the market for a new car, paid for by the rest of us. And don't forget about the wealth-destruction inherent in crushing all these perfectly good used cars. And then, of course, there's the negative impact on the poor - the typical consumers of the used cars that are now being crushed.
I read somewhere recently that this is the kind of thing that the Daily Show used to mock, but now embraces. "Wait, a government program is offering people free money.. and they're taking it? What a country!"
That's all it is -- free money for those who happen to be in the market for a new car, paid for by the rest of us. And don't forget about the wealth-destruction inherent in crushing all these perfectly good used cars. And then, of course, there's the negative impact on the poor - the typical consumers of the used cars that are now being crushed.
7
Don't forget about the environmental bonuses of all the perfectly good cars destroyed and destined for scrap and landfills.
8
It seems to me that this program is not really getting rid of the old clunkers because they are mostly owned by people who can't afford to buy anything better, regardless of how much money is allowed on a trade-in. To really work, what you are buying should have to get at least 5 miles per gallon better economy. I read of one customer who traded in a 1988 (I think) Jeep for a new Toyota Highlander and the difference in fuel mileage was only about 1 or 2 mpg. Also, a lot of the clunkers are cars like Pintos, old VWs and other cars that don't qualify because they already get more than 18 (or whatever the qualifying mpg is) but that are not as clean and green.
9
I'm surprised to find progressives parroting the Republican line on this.
Perfect...meet Enemy of the Good.
Whiners on the left don't know when to declare any kind of victory. Especially the enviros. Used to the 8+ years of opposition to Bush, you don't know how to be for anything. Your only feeling of victory is defeating something.
In a matter of weeks more people are aware of their low mpg car as a result of this program than all the door-knocking hippie canvassers can produce in a year. The cars being purchased are 60% more efficient than the ones being traded in. Tens of thousands of tons of CO2 will not be emitted because of it.
And fine, give a tax credit to bike commuters. Remember, people do actually drive cars to get to work, run errands, take their kids to school. There were no bike paths within a 100 miles of my Illinois home town. It's going to take a while to build all the bike paths and trolleys we're all apparently going to be able to use. Until then, some people are going to be driving.
Perfect...meet Enemy of the Good.
Whiners on the left don't know when to declare any kind of victory. Especially the enviros. Used to the 8+ years of opposition to Bush, you don't know how to be for anything. Your only feeling of victory is defeating something.
In a matter of weeks more people are aware of their low mpg car as a result of this program than all the door-knocking hippie canvassers can produce in a year. The cars being purchased are 60% more efficient than the ones being traded in. Tens of thousands of tons of CO2 will not be emitted because of it.
And fine, give a tax credit to bike commuters. Remember, people do actually drive cars to get to work, run errands, take their kids to school. There were no bike paths within a 100 miles of my Illinois home town. It's going to take a while to build all the bike paths and trolleys we're all apparently going to be able to use. Until then, some people are going to be driving.
10
There's no 'republican line' There are the facts, (resources, energy put to waste destroying clunkers, the bankrupt-ness of the program that steals from you to give to car buyers and companies) and then there is the fantasy.
And I sincerely doubt car owners who had no idea what gas mileage a month ago just found out thanks to 'cash for clunkers.'
And I sincerely doubt car owners who had no idea what gas mileage a month ago just found out thanks to 'cash for clunkers.'
12
> I'm surprised to find progressives parroting the Republican line on this.
Hyperpartisanship - when whatever your political opponent says is wrong, no matter its merits.
Hyperpartisanship - when whatever your political opponent says is wrong, no matter its merits.
13
I don't know if I follow you about the average MPG thing. Yes, CfC cars are ten or so MPG lower than the European average, but they are also ten or so MPG higher than the US average, or at least that's what I've heard reported. This isn't darts: you don't have to hit it exactly or you go bust. Considering that the trend for the past 20 years has been in the opposite direction, this seems like a positive step.
Also, the article where you find the 36MPG figure puts it a bit, um, simplistically. Yes there are higher gas taxes in Europe, but that's on top of 60 years of social engineering projects, ration programs and a different set of engineering priorities. If we are going to get there, it is going to take more than just higher taxes. We are going to need to enact some social programs of our own, and we can either incentiveize better car choices or try to ban bad ones, and good luck doing that.
Also, the article where you find the 36MPG figure puts it a bit, um, simplistically. Yes there are higher gas taxes in Europe, but that's on top of 60 years of social engineering projects, ration programs and a different set of engineering priorities. If we are going to get there, it is going to take more than just higher taxes. We are going to need to enact some social programs of our own, and we can either incentiveize better car choices or try to ban bad ones, and good luck doing that.
14
more energy is spent on the manufacturing of a car than will ever be spent on driving it. This program aims to increase manufacturing of cars = increased energy consumption = good for the economy, bad for the environment.
15
> "energy put to waste destroying clunkers"
It's called - Recycling. Those cars will be crushed, melted into slag, refined and then made into new cars, bicycles, street car rails, train cars, ships and planes.
> "energy put to waste destroying clunkers"
It's called - Recycling. Those cars will be crushed, melted into slag, refined and then made into new cars, bicycles, street car rails, train cars, ships and planes.
16
> That's all it is -- free money for those who happen to be in the market for a new car
Exactly. This isn't about getting people who need reliable transportation into new vehicles-- it's about enticing the same consumers who used to buy new cars every few years to start doing it again. Economic fears made people wary of taking out $30k loans for non-essential stuff, and sales tanked.
My vehicle is 15 years old and has 200,000 miles on it. It's also got a long list of problems not worth fixing, and I know for a fact that it's going to die in the next year or so. But that's not enough to justify spending $300+ every month to pay off a shiny new replacement.
Exactly. This isn't about getting people who need reliable transportation into new vehicles-- it's about enticing the same consumers who used to buy new cars every few years to start doing it again. Economic fears made people wary of taking out $30k loans for non-essential stuff, and sales tanked.
My vehicle is 15 years old and has 200,000 miles on it. It's also got a long list of problems not worth fixing, and I know for a fact that it's going to die in the next year or so. But that's not enough to justify spending $300+ every month to pay off a shiny new replacement.
17
Bob Dole: "more energy is spent on the manufacturing of a car than will ever be spent on driving it. "
False. See: http://answers.google.com/answers/threadvi…
(Complete with links to several studies, including ones by the government, oil companies, and the car makers themselves.)
False. See: http://answers.google.com/answers/threadvi…
(Complete with links to several studies, including ones by the government, oil companies, and the car makers themselves.)
19
I'd like to see a tax credit for giving up your car completely. I realize this isn't practical for a lot of people in lots of places around the country, but for some it could be a great way to get some cars off the road and turn people on to alternatives.
20
I think they should extend the same program to typewriters to add incentive to buy a new computer. Bring in your old typewriter and get $500 off a new computer.
21
Getting low MPG cars off the road is critical. You save the same amount of gas moving from 10MPG to 20MPG that you do moving from 25MPG to 50MPG.
It just doesn't sound as big, but when folks bump their truck from 10MPG to 14.2MPG, its the *same* savings as an eco-head upgrading their 35mpg civic for a 50mpg prius.
I see this program as a big win.
It just doesn't sound as big, but when folks bump their truck from 10MPG to 14.2MPG, its the *same* savings as an eco-head upgrading their 35mpg civic for a 50mpg prius.
I see this program as a big win.
22
Cool, but you can't upgrade a 35mpg civic and get the incentive. Hell you can't upgrade a 25 year old civic (or in my case accord) and get the incentive. Maybe they figure if you've kept your car running for more than 20 years it can not be a clunker by default .
A ploy to move metal. Yes.
No one should have been offered any incentive to purchase a passenger vehicle getting less than 25mpg.
Under any circumstances.
But it would be hard to rescue the auto companies unless your going to subsidize the purchase of the same tired-too big-too tall-sport-truck-ute-look at me (even if I can't see you) vehicles they already have in their line-ups.
A ploy to move metal. Yes.
No one should have been offered any incentive to purchase a passenger vehicle getting less than 25mpg.
Under any circumstances.
But it would be hard to rescue the auto companies unless your going to subsidize the purchase of the same tired-too big-too tall-sport-truck-ute-look at me (even if I can't see you) vehicles they already have in their line-ups.
23
@oliver: the big SUVs are not what people are buying in the program. The top cars purchases Focus, Civic, Corolla, Prius and Escape. They are replacing SUVs. The top 5 cars being traded in are Explorers 1996-99 and jeep grand cherokee.
You may think it's not worth it, but most people are trading SUVs for mid-sized sedans and a hybrid. And again, this will prevent thousands of tons of CO2 from being released into the atmosphere.
You may think it's not worth it, but most people are trading SUVs for mid-sized sedans and a hybrid. And again, this will prevent thousands of tons of CO2 from being released into the atmosphere.
25
I only want all the anti-business posters here to remember your rants praising 'tax incentives' They are also known as 'tax CUTS' and they stimulate economic growth every time they are tried.
26
There really should be a tax break for those of us that don't drive cars. It feels like the auto industry will always be in the way of any positive changes in mass transit out of their never ending greed. I've actually enjoyed watching it's decline.
29
One question is whether the program will cause a net reduction in carbon emissions over what period of time.
Another issue is whether it stimulates the economy and saves of from the great recession of 2007-.
I haven't heard an answer to the first question, but the answer to the second appears to be a resounding yes. Now, if you believe that economic growth is inherently bad because it uses natural resources and produces waste that harms the environment...well, I guess some questions are better left to philosophers and Mercury blogtown commenters. Here is a nifty article from the Times about the program.
http://egan.blogs.nytimes.com/2009/08/05/c…
Another issue is whether it stimulates the economy and saves of from the great recession of 2007-.
I haven't heard an answer to the first question, but the answer to the second appears to be a resounding yes. Now, if you believe that economic growth is inherently bad because it uses natural resources and produces waste that harms the environment...well, I guess some questions are better left to philosophers and Mercury blogtown commenters. Here is a nifty article from the Times about the program.
http://egan.blogs.nytimes.com/2009/08/05/c…
30
A tax break for not owning a car? Selling cars makes tons of money for people. Making cars makes tons of money for people. Selling products that promote unhealthy lifestyles makes tons of money for people. Selling services and drugs to fix people made unhealthy by poor lifestyles makes tons of money for people. All that money generates tax revenue. Which goes to lots of neat things. Like medical research. Space exploration. PUPPY ADOPTION PROGRAMS. Parks maintenance.
What would the US look like without all that money? The Sudan with no health care. Or Thailand with all that AIDS. Or Europe during their last Welcome Back Germans! episode. No thanks. I prefer my poverty remote and wars by proxy.
What would the US look like without all that money? The Sudan with no health care. Or Thailand with all that AIDS. Or Europe during their last Welcome Back Germans! episode. No thanks. I prefer my poverty remote and wars by proxy.
31
I'm pissed because the ORIGINAL legislation included a provision to allow the vouchers to be used to purchase public transportation yearly passes, but the provision was removed in committee to get Republicans to back the bill.
32
Cash for Clunkers in the US is a poster child for corporate welfare. It's a short-term band-aid at best. British Columbia, Canada has a better program. Check out this post on Sightline's web site about BC's "Scrap it" program: http://tinyurl.com/kmgl3r
33
"You save the same amount of gas moving from 10MPG to 20MPG that you do moving from 25MPG to 50MPG. "
I'm bad at math apparently.
Its the same *percentage* gain going from 10->20 as it is 25->50. Not at all the same amount of gas. You actually save a TON more gas moving from 10->20! (VeloBusDriver's link points this out).
avg driver: 12k miles per year.
12k/10mpg = 1.2k gallons
12k/20mpg = 600 gallons
savings: 600 gallons
12k/25mpg = 480 gallons
12k/50mpg = 240 gallons
savings: 240 gallons
My example above, the trucker moving from 10-14.2: saves something like 33 gallons every 1000 miles. While the eco-head saves only 8.
So yea, my point is still the same. Its totally important to take low MPG vehicles off the road.
The following chart shows the curve here. Moving folks from 18->26 mpg is well worth it.
http://farm4.static.flickr.com/3561/3799816163_5a4dc1323c.jpg
I'm bad at math apparently.
Its the same *percentage* gain going from 10->20 as it is 25->50. Not at all the same amount of gas. You actually save a TON more gas moving from 10->20! (VeloBusDriver's link points this out).
avg driver: 12k miles per year.
12k/10mpg = 1.2k gallons
12k/20mpg = 600 gallons
savings: 600 gallons
12k/25mpg = 480 gallons
12k/50mpg = 240 gallons
savings: 240 gallons
My example above, the trucker moving from 10-14.2: saves something like 33 gallons every 1000 miles. While the eco-head saves only 8.
So yea, my point is still the same. Its totally important to take low MPG vehicles off the road.
The following chart shows the curve here. Moving folks from 18->26 mpg is well worth it.
http://farm4.static.flickr.com/3561/3799816163_5a4dc1323c.jpg
34
I really never saw this as anything but a stimulus for the domestic auto producers, and retailers. The negligible environmental benefits are beside the point. But they are benefits, and this is really helping the auto industry domestically.
It is a minority viewpoint that cars are just going to disappear, globally, overnight. The vast majority of humans on earth, in my opinion, want a personal automobile. Clearly the burning of gasoline, and diesel to meet this demand is not working. However, technology, coupled with a capitalist incentive, is our best hope of providing real improvements to technology.
Car companies are "flailing", for many reasons. Sub-par products tops my personal list. However, anti-car sentiment is no help either, and that's artificial stimulus.
This was never about the environment, was never pitched that way, and is doing a world of good. Yup, sounds like a horrible idea.
It is a minority viewpoint that cars are just going to disappear, globally, overnight. The vast majority of humans on earth, in my opinion, want a personal automobile. Clearly the burning of gasoline, and diesel to meet this demand is not working. However, technology, coupled with a capitalist incentive, is our best hope of providing real improvements to technology.
Car companies are "flailing", for many reasons. Sub-par products tops my personal list. However, anti-car sentiment is no help either, and that's artificial stimulus.
This was never about the environment, was never pitched that way, and is doing a world of good. Yup, sounds like a horrible idea.
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