Cash for Clunkers 2?

[RangerM]

Cash for Clunkers 2?

Ready for another cash for clunkers program? It looks like General Motors is attempting to replace it's own consumer incentives with tax payer money. The car company, bailed out of bankruptcy in 2009 by the American tax payer, appears to be turning the government into an automatic rebate provider.

 

The Obama administration and their friends on Capitol Hill are floating around a proposal to change the $7500 tax credit for green vehicles. This change can be found not only in President Barack Obama's budget but also a bill proposed by Senator Debbie Stabenow, Michigan Democrat.

 

Edmunds.com, a 45 year old trade magazine company that provides automotive information, posted a Department of Energy document listing the department's funding highlights. The proposed Obama Budget, changes the existing $7,500 electric vehicle tax credit “into a rebate that will be available to all consumers immediately at the point of sale.”

 

According to Senator Stabenow's website, her proposed legislation, known as the "Charging America Forward Act" (S.298), "will provide consumers with a rebate worth up to $7500 for plug-in electric vehicles at the time of purchase."

 

Essentially, if one were to buy a $41,000 Chevy Volt, the buyer gets a $7,500 coupon, so the final price is $33,500. In the end, the auto dealer assumes the risk of the government giving them this tax credit.

 

It is pretty convenient that Ms. Stabenow, who represents a state where GM is headquartered is pushing a bill that is also supported by Edison Electric Institute, whose president was loaned a Chevy Volt, Eaton Corp: the sole American producer of car recharge systems, and Battery Electric Vehicle Coalition, a lobbying group for the electric car industry.

 

In fact, Department of Energy's David Sandalow told Bloomberg News in February the insta-credit would operate the “same way the 2009 ‘Cash for Clunkers’ program worked.”

 

The Detroit News reported Vice President Joe Biden said at an Indiana battery assembly plant, "You won’t have to wait,’ it would be like the cash-for-clunkers program.”

 

GM is likely the most excited about this instant credit plan. “General Motors supports the instant credit saying the bill “integrates all of the components necessary for successful acceleration of electric vehicles in the marketplace," The Detroit News reported.

 

People who buy $41,000 cars sure need a lot of help and encouragement.

[esevans]

Cash for Clunkers 2?

 

 

People who buy $41,000 cars sure need a lot of help and encouragement.

 

Don't see the problem. If the gov't is going to give you $7500, it might as well be done at the time of purchase rather than after your taxes are filed. $7500 can also make a big difference in financing. Unless you don't want GM to be able to lure people in with the tax rebate coupon. Me personally, if the gov't is going to hand out money, I'll take mine. They already get more than their share.

[RangerM]

Don't see the problem. If the gov't is going to give you $7500, it might as well be done at the time of purchase rather than after your taxes are filed. $7500 can also make a big difference in financing. Unless you don't want GM to be able to lure people in with the tax rebate coupon. Me personally, if the gov't is going to hand out money, I'll take mine. They already get more than their share.

The "problem" is under the current system, the $7500 tax credit is non-redundable--meaning if your tax liability is less than $7500, you only receive up to that amount.

 

Under a rebate system, the government would spend more on people purchasing $41,000 cars.

 

If you are getting $7500 and you didn't already owe it, you are getting more than your share, too; from your children and grandchildren. You can explain it to them that "you got yours".

[Ron W.]

My opinion, the government should stay the hell out of cars sales and quit printing and giving away money that we the taxpayers have to pay for.

[jpd80]

Why give people money to buy fuel efficient vehicles when higher gas prices will do that anyway...

 

Cash for clunkers was a stimulus package gussied up to look like an emissions/efficiency drive.

Edited April 2, 2011 by jpd80

[esevans]

The "problem" is under the current system, the $7500 tax credit is non-redundable--meaning if your tax liability is less than $7500, you only receive up to that amount.

 

Under a rebate system, the government would spend more on people purchasing $41,000 cars.

 

If you are getting $7500 and you didn't already owe it, you are getting more than your share, too; from your children and grandchildren. You can explain it to them that "you got yours".

 

 

Actually, I've 42 and have worked continuously since my early teens, and have paid in multiples of 7500. Both my parents worked 40+ years and paid their share. Actually more than their share. My parents sold part of their business property a few years ago, and thru poor planning, ended up paying over 500K in taxes. A business can in fact pay capital gains. Right now, we have two properties that are borderline useless, but still have high property tax bills due to the boneheads at the county tax assessors office.

 

Local gov't is constantly raising taxes. Anti-business all the way. Most people don't realize it, but fee increase=tax increase. They can't make do with what they have, so new fees, higher fees, higher property taxes, to the point that the cost of living in my town (eastern nc) is probably as high, or higher than the Triangle.

 

I could take back 7500 each year the rest of my life with a completely clear conscious. I can put 7500 to better use in my sleep than a hundred PhD gov't bureaucrats giving their full effort.

 

I really don't care if I have to explain to any future children or grandchildren that I took "my share" from the gov't. Should I have any, I imagine they would get left more than I took from the gov't. when I expire.

Edited April 3, 2011 by esevans

[RangerM]

Actually, I've 42 and have worked continuously since my early teens, and have paid in multiples of 7500. Both my parents worked 40+ years and paid their share. Actually more than their share. My parents sold part of their business property a few years ago, and thru poor planning, ended up paying over 500K in taxes. A business can in fact pay capital gains. Right now, we have two properties that are borderline useless, but still have high property tax bills due to the boneheads at the county tax assessors office.

I am no different than you, except I started from (apparently) less than you since I'm far better off (at 41) than my parents were/are. It doesn't mean that I'm going to go out and purchase a $41,000 car, and I suspect if you're frugal, you won't either. That means the money you send will go to someone either foolish enough to blow $41,000 they don't have on a car they don't need, OR they are rich enough to afford it. Either way money is transferred from you to them.

Local gov't is constantly raising taxes. Anti-business all the way. Most people don't realize it, but fee increase=tax increase. They can't make do with what they have, so new fees, higher fees, higher property taxes, to the point that the cost of living in my town (eastern nc) is probably as high, or higher than the Triangle.

No doubt that certain prices are higher. Things like food and fuel are likely higher, but the cost of housing is likely much lower where you live, unless you're on the coast.

I could take back 7500 each year the rest of my life with a completely clear conscious. I can put 7500 to better use in my sleep than a hundred PhD gov't bureaucrats giving their full effort.

It's one thing to keep the money you earn, it's another to take it from someone else. We have become a nation of takers with clear consciences. (more like NO consciences)

I really don't care if I have to explain to any future children or grandchildren that I took "my share" from the gov't. Should I have any, I imagine they would get left more than I took from the gov't. when I expire.

Then you either don't have children, you don't care about the world you leave them, or you're already rich enough that they'll likely never have to worry. I have children, and I'm working so they'll never have to worry.

[esevans]

I am no different than you, except I started from (apparently) less than you since I'm far better off (at 41) than my parents were/are. It doesn't mean that I'm going to go out and purchase a $41,000 car, and I suspect if you're frugal, you won't either. That means the money you send will go to someone either foolish enough to blow $41,000 they don't have on a car they don't need, OR they are rich enough to afford it. Either way money is transferred from you to them.

 

No doubt that certain prices are higher. Things like food and fuel are likely higher, but the cost of housing is likely much lower where you live, unless you're on the coast.

 

It's one thing to keep the money you earn, it's another to take it from someone else. We have become a nation of takers with clear consciences. (more like NO consciences)

 

Then you either don't have children, you don't care about the world you leave them, or you're already rich enough that they'll likely never have to worry. I have children, and I'm working so they'll never have to worry.

 

 

You win. Go about your business paying taxes happily to a wasteful gov't. When the gov't offers money to encourage you to do something you would do anyway, let your principles be your guide (don't take the money). The gov't will put your money to better use anyway.

 

Ride your principles all they way. Joe, meanwhile with his new Volt, will travel alot further with our $7500 in his pocket.

 

You explain to your children why you stood on principle, and the college fund is $7500 lighter.

 

I'll be a little more pragmatic, take the money, and explain to my children that the $7500 I stole from their future is why their college fund is a little bit heavier.

 

Until the day comes (.00001% chance) that we have a national sales tax funding the bare-ass minimum efficient gov't for society to function, I don't mind taking some back that I and my family have paid in many times over.

 

 

BTW, I'm not interested in a Volt. I had a interest in the electric Focus>Leaf, but they're not going to be sold in my market. As for my new car buying habits, I recently picked up a salvage Prius to replace my salvage Focus I used as my daily driver when I relegated my salvage F150 to work duty only when gas prices spiked a few years ago.

[RangerM]

You misunderstand. I am in fully in favor of adopting the FairTax and scrapping the current tax system. Until then, I take the deductions that I can (legally) under the current system.

 

I don't buy $41,000 cars for the $7500 rebate, netting me $33,500 in the hole, and a $20,000 car. I don't define pragmatism that way. Apparently you don't either, since you buy used.

 

Standing on principle means that I vote for politicians who wish to represent my (and the country's) best interest. Not those who would favor me above others.

Edited April 3, 2011 by RangerM

[esevans]

You misunderstand. I am in fully in favor of adopting the FairTax and scrapping the current tax system. Until then, I take the deductions that I can (legally) under the current system.

 

I don't buy $41,000 cars for the $7500 rebate, netting me $33,500 in the hole, and a $20,000 car. I don't define pragmatism that way. Apparently you don't either, since you buy used.

 

Standing on principle means that I vote for politicians who wish to represent my (and the country's) best interest. Not those who would favor me above others.

 

 

Well, I guess we more or less agree, sorry if I came of as an a**. I will probably buy a new car sometime in the future, right now I can't justify it though. However, I would take any financial consideration offered if I were in the market. My father tried his hand in the car business, and working with him I drove a variety of different cars. I can buy a car today, and next month see something I like better. Plus the fact I didn't bother with a retirement account till a few years ago and am now maxing out my savings.

 

As for voting I've purposely abstained from voting one Presidential election when one candidate had my interests at heart but I didn't feel he was right for the country. Didn't know if I could trust myself in the booth. Other candidates that election I had no real opinion so my vote would have been a guess.