Cash for Clunkers Alive Until Labor Day
By Michelle Krebs August 6, 2009
With Cash for Clunkers phase I scorching through its $1-billion funding in what is projected to be two weeks or less, U.S. Senate Majority Leader Harry Reid said Wednesday evening a moderately controversial continuation of the Car Allowance Rebate System (CARS) will be approved by the Senate. The vote will inject an additional $2 billion that should see the program through to its Labor Day termination.
Reid (D-NV) said that despite loud objection from some Senate critics -- mostly Republicans -- he was confident there were enough votes to pass the bill's extension, with or without some proposed amendments that could delay implementation.
Whether a significant number of lawmakers see merit in any of the amendments, which include schemes to place a limit on the income of those benefiting from the Cash for Clunkers program, is unlikely to matter, because if the Senate amends the House-passed bill to extend the CARS program, the bill would have to be returned to the House, which already has recessed until September.
Proponents do not wish to see a delay in extending the program, which has been credited for jump-starting languishing auto sales and perhaps fanning the flames of a broader upturn for the nation's still-hesitant economic recovery. Thus it is likely Democrat-led support will beat down any proposed amendments to the House bill in a vote scheduled for today.
In their sales reports for July, almost all automakers praised the effect the CARS program had on industry sales, but some analysts are questioning the net impact of the Cash-for-Clunkers-driven sales. Data analysts at Edmunds.com, parent of AutoObserver.com, surmise that a large ratio of the vehicles traded in the program would have been "turned over" for new-vehicle purchases even without the Cash for Clunkers incentive, but they are being replaced by vehicles more fuel-efficient than if the program had not been in place. -- Bill Visnic
LEAVE A COMMENT