Cash For Clunkers? Good Riddance!

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President Obama quickly signed into law what is billed as “The American Recovery and Reinvestment Act” a $787 billion package which he hopes will help stimulate the economy. That bill, however, includes many different projects well beyond the stimulative including specific pork induced items which will expand the roll of the federal government.

Nissan SentraLeft out of the bill is a provision that could have brought about a trade war or at the very least presented an unforeseen hardship for college students.

And what might that be? A “cash for clunkers” car buy back program, one that would have paid people money to turn in their old cars.

On the surface, the “cash for clunkers” program could have been something worthwhile as it would have:

  • Given a $10,000 credit to low and moderate income consumers who traded in a car or truck that was at least ten years old.
  • In exchange for the trade in credit, buyers would be required to purchase any new vehicle that was proven to be more fuel efficient as well as assembled in the United States.
  • The vehicles traded in would be scrapped instead of resold.

But, there were several problems with the bill, issues which would have impacted consumers and our country in ways not originally considered including:

  • Such a provision would violate trade agreements with other countries. Some of the vehicles popular with Americans are built overseas and would not be eligible. Even cars and trucks built by our trade partners in Canada or Mexico would not be included in the program, undermining NAFTA.
  • Had the provision been included with the bill, a segment of the car buying public would have found it more difficult to afford a used car.  Millions of college students rely on older vehicles to get themselves around; a limited availability of the same would have driven up prices for used cars.

College students are among the most environmentally conscious people, but they understand the ramifications that such a program could have on world trade as well as on their wallets. Many campuses across the country are only accessible via personal transportation, thus a ready supply of low cost used cars is necessary for them.

Some sort of cash for clunkers program will likely emerge over the coming months or years, both as a stimulative measure to get people to buy a new car and as an environmental measure to move off of the road less fuel efficient and higher polluting vehicles.

Adv. — Whether you drive a clunker or class act, your car needs regular maintenance to keep it running smoothly. Please visit Saylowerbills.com to find out how you can lower your transportation costs.

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Categories: Campus Cars