brand081309
On the homepage
Vikings
Out There
Artcetera
Table Talk
Some consider CARS program itself a clunker
Print this story
E-mail this story
Save to del.icio.us
Share on Facebook
Share on Digg
Minnesota business by the numbers
See Minnesota's top earning companies, CEOs and non-profits
More from Paul Brand
Have you been able to take advantage of the "Cash for Clunkers" program -- or wish you could? The Car Allowance Rebate System (CARS) program has been wildly successful, but perhaps for the wrong reasons.
It looks like the feds misjudged the huge pent-up demand for new vehicles. So when the program launched, it cracked open a gate and the stampede was on -- and still is, now that the program has just been supercharged with another $2 billion in federal money.
Hey, I'm a hard-core car guy, so I'm all for stimulating the auto industry and the national economy with a new-car incentive program. But I have a real problem with the "clunkers" concept. And it's parked in front of our house.
My wife purchased our '96 Chevy Tahoe brand-spanking new. We've driven, enjoyed and lovingly maintained this road warrior for 14 years and 132,000-plus miles.
I've invested an obsessive amount of sweat equity into this vehicle. It's still in great shape, fully functional and almost rust-free. On road trips it still delivers 17 or 18 mpg and averages 14 to 16 around town -- as it did when new.
So ... there's absolutely no way this vehicle is a "clunker." Heck, our teenage boys tried to mechanically kill it for years. They wounded it, we fixed it and kept on trucking. I can't bear to think of a dealership being forced to kill the engine and then scrap the vehicle.
That's my problem, of course. But I do have trouble coming to grips with the fact that because we took great care of our vehicle, we cannot justify being rewarded with $4,500 to destroy the vehicle. Seems we'd have been better off just driving the Tahoe into the ground with little or no attention to maintenance and repairs, then having Uncle Sam reward us for this abuse with $4,500 if we can limp it to a dealership.
And what about the person who has managed to keep a mid-'90s econobox running all these years? Because the vehicle gets more than 18 mpg, it's worth nothing more than scrap value. No good deed goes unpunished.
And who's benefiting from the program? How many folks who rely on a "clunker" for daily transportation could have afforded a new motor vehicle anyway?
Now, I have no qualms about someone taking full advantage of the program. Like the farmer who trailered his old farm pickup truck to the dealership, fired it up, backed it off the trailer and drove it into the lot. The vehicle had been fully licensed and insured for years, but it was missing its headlights, grille, tailgate and much of its bodywork and for the past few years had been used only to haul hay wagons around the farm. And it was worth the same $4,500 as our Tahoe would have been. Good for him!
So, how could an automotive incentive program address the fairness issue, the "still serviceable" issue, the "destroy good parts" issue and still motivate folks to buy new cars?
Simple. Offer a voucher or federal tax credit toward the purchase of any new motor vehicle. Scale the dollar amount of the voucher or credit to the CAFE mileage rating for the new vehicle. Allow the market to dispose of the older vehicles at the end of their service life -- as has been occurring since the first pavement was still cooling. And open that door of pent-up demand for new vehicles to all of us, not just those who own clunkers.
Recent Business stories
Praxair's Chinese unit wins contract to sell gases to solar cell manufacturing company - August 12, 2009
Praxair's Chinese unit wins contract to sell gases to solar cell manufacturing company - Praxair Inc.'s Chinese unit has signed a multiyear agreement to sell gases that MAGI Solar Energy Technology Co. will use to make solar cells and modules, Praxair announced Monday. More
Blog: Patent Pending
Lights out at U energy conference. Irony police notified.
Just as Lawrence Kazmerski, a top official at the National Renewable Energy Laboratory, was about to give the keynote address at the University of Minnesota's annual E3 conference at the RiverCentre in St. Paul, the lights went out, bathing the audience in darkness and a deep sense of irony.
Comment on this story | Read all 12 comments | Hide reader comments