Why 'Cash for Clunkers' legislation is stuck in low gear

Jul 01, 2009 | 06:38 AM |

When Congress considers creating a new program, consensus on broad goals often conceals dissonant agendas. Working out the details can strain coalitions.

Such has been the case with two end-of-life vehicle programs, which vary widely, depending on how much importance is assigned to aiding U.S.-based automakers.

Take the idea of paying owners of aged, polluting cars and trucks to scrap them and buy environmentally friendlier replacements. Good for car sales, good for fuel efficiency and good for shredder activity.

Or take the law mandating a nationwide log of defunct vehicles that have been taken off the road to become used parts and scrap. A centralized roster of decommissioned vehicle identification numbers (VINs) is viewed as making it harder for bad guys to disguise stolen cars with fake IDs or to resurrect flooded cars after a hurricane, but the divisive element has been which players should pay the costs and put out the effort.

The "Cash for Clunkers" idea comes in several congressional versions. One bill, which has an explicit "Buy American" element but with gradations to allow for North American Free-Trade Agreement solidarity, has a three-tier formula for subsidizing purchases of new passenger cars. To be eligible, the vehicle must meet the criteria specified in one of the following three tiers ....

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