Harkin [and Durbin] Proposes $10K Auto Purchase Rebate (Get a load o' this!)

KCCI, Des Moines ^ | 1:39 pm CST December 12, 2008

[newgeezer]

DES MOINES, Iowa -- Sen. Tom Harkin is proposing new legislation that he said would increase the demand for American cars.

Along with Sen. Dick Durbin, of Illinois, Harkin introduced a bill earlier this week that in turn would take older, less-fuel-efficient cars off the road, while also giving buyers a big bonus.

The Sell Fuel Efficient Cars Act would provide a rebate of $10,000 to buyers who trade in a car more than 10 years old for a new American car.

Officials said the reason for the act is to help create demand for American cars and preserve jobs in the weak economy.

The rebate would be limited to families with an adjusted gross income below $40,000 a year or individuals making less than $25,000.

To get the rebate, you would be required to turn in a car more than 10 years old that is still drivable.

The rebate would only apply to purchases of fuel-efficient GM, Ford or Chrysler vehicles that are assembled in the United States. The car would have to have an average fuel economy of 25 miles per gallon.

Officials said close to 15 percent of automobiles that are manufactured by the Big Three automakers would qualify for the rebate.

There would be a one-car limit per family or individual and the program would end in 2009.

[The source article includes a video news clip.]

[Brett66]

If I could buy a car for $9,500, I might do this.

[DungeonMaster]

What a great idea. The two step house rebate program, aka loans to the poor followed by a bailout, got all kinds of negative publicity. So now they skip the government loan phase and go straight to the rebate.

[ecomcon]

Just think what that will do to brand prestige. American car = “I’m on welfare”.

[camle]

yep! let’s drive up the price of cars so that everybody can afford one!

teh words “Crack” and “pot” come to mind when I think of this scheme...

[MathDoc]

Unintended consequences - Part 1: The Big Three can raise their prices to pocket most of the rebate and still be competitive with foreign cars, so that the net savings to buyers will be much smaller than the cost to taxpayers.

Unintended consequences - Part 2: Trade in value for used cars will fall by a huge amount, again lowering the net savings to buyers.

Unintended consequences - Part 3: In yet another waste of our tax dollars, money that would otherwise have been productively generating wealth will be transferred from our wallets through corrupt Washington officials to the big unions and big business. Our kids get to pay all that money back.

Sorry, I noticed the payback for big Democrat donors in this liberal tax-and-spend scheme, but I missed the upside.

[HD1200]

I see the value of junk car inventories at scrap yards just went up.

[neocon1984]

“If I was one of the other American carmakers I’d sue for unfair business practices or something. This is just plain unfair and if not, it should be illegal”.

I am not a lawyer, but I am almost positive that this is unconstitutional. Maybe a FR lawyer can tell us otherwise.

[avacado]

"The Sell Fuel Efficient Cars Act would provide a rebate of $10,000 to buyers who trade in a car more than 10 years old for a new American car."

Most excellent! I will trade in my 12 year old Jeep Cherokee for a Mercedes made in Tuscaloosa County Alabama, U.S.A,

[Izzy Dunne]

Fast Eddie down at the corner user car lot is drooling over this.

His inventory of 1994 Yugos just got more valuable.

"Buy a three-dollar car now for $500! Trade in tomorrow for $10k!

[The Anti-One]

The rebate would only apply to purchases of fuel-efficient GM, Ford or Chrysler vehicles that are assembled in the United States.

Ha! Ha! None of the above vehicles exist. All "American made" cars are manufactured in either Canada, Mexico, Brazil,...
Everywhere but here in America.

These demoncraps are sure willy little b******s aren't they?

[absolootezer0]

And, where is the wisdom in encouraging a family making < $40K/year to take on thousands of dollars in car debt? Typical government "help."

most 25mpg cars that'd be sold would probably be cobalts, aveos, neons, focuses, etc. cars that aren't much over $10k to begin with.
unfortunately, what would likely happen is that the minute they got that rebate, they'd head down to the next dealer down the street to trade up for a navigator, escalade, expidition, hummer, etc.
the bright side is the repo business would stay brisk. :)

[camle]

that 9550 car will go up to 10550 very soon, and those who buy the most new cars, those making over the incomc limit, will put off their purchases, so the net volume of new cars going out the door will plummet.

way to go washington! swift.

[mewzilla]

The rebate would be limited to families with an adjusted gross income below $40,000 a year or individuals making less than $25,000.

Durbin and Harkin asking people who make less than UAW workers to bail out UAW workers who make far more.

Talk about robbing Peter to pay Paul.

[blam]

"i see the price of cars going up at least 10K in the near future..."

Yup. The used car market will temporally explode. In fact, I probably should go buy that old used car down the road for $800.00 so that I can qualify. (ahem)

[longtermmemmory]

how can you buy a used car if Obamacrats are going to tax the heck out of gasoline or outright BAN gasoline?

[camle]

since the tradein has to be drivable, this would be a lesser side effect.

any market will expand to absorb any additional capital thrown into it - just look at the health care market.

one would think that even a politician would have more brains than this.

[rellimpank]

-—as a retiree with a Geo Tracker with 157,000 miles on it-—hummmmm!!!! (sarc)

[musicman]

[Aquinasfan]

This is just plain unfair and if not, it should be illegal.

All of this bailout stuff violates the "equal protection" clause of the Constitution. But the intelligentsia doesn't care about the Constitution anymore.

[y6162]

I have a 99 Corrola with 160,00 miles that runs great. I can sell it to my college student daughter for a dollar, buy a new GM car, score the rebate, trade the GM car in on a new Corrola!

Sign me up!