Cash for Clunkers

The Cash for Clunkers bill, formally titled, "Consumer Assistance to Recycle and Save Act", is now law. So what does it do for anybody? Well, the congress has dipped into our pockets (sometime in the future no doubt) and allocated a wad of our cash to rid our streets of bad old polluting cars.

How old? Not that old (at least not from my perspective ; -); 1984 or newer are the model years covered. So the notion that a Chevy Nomad from the golden age of American hot rods would end up being scrapped is off the table.

Further the car to be scrapped (and it is scrapped - the drivetrain must be intact and the entire vehicle must be crushed or shredded once it is in 'government' ownership) has to meet a max fuel economy target. A 2001 Honda Insight wouldn't be eligible. The dollar amount of the voucher are based on the previous and new fuel economy.

Additional restrictions are in place to prevent people from going to Joe's Salvage Yard and plucking a POS from the bowels of the yard and plopping it at the dealership as a 'down payment' on a new car. Those restrictions ensure that the car has been continuously licensed and insured for at least a year prior to being turned in.

So who is going to take advantage of this? If the clunker is worth more as a trade in than the voucher, the clunker will hit the used car market. It's then off the table - the cycle of insurance and registration starts over. The folks driving really nasty clunkers tend to miss renewing their licenses and forget about insurance, so those won't come off the street either.

The only case of a car worth using this program for that I can imagine is my mom's 1987 Plymouth Caravelle (the dreaded Pink Panther ; -) which is on its last legs and is worth absolutely zero as a trade in. At least some of my tax dollars will stay in the family. ; -)