Congress Races to Save "Cash for Clunkers"

House Plan Would Provide $2 Billion in Extra Cash For Rebate Program; Initiative Still "Up and Running," White House Says

(CBS/ AP)  Last Updated at 12:41 p.m. EDT.

The House raced Friday to pass legislation pouring an additional $2 billion into the popular - but financially strapped - "cash for clunkers" car purchase program.

Debate commenced at midday, and House Majority Leader Steny Hoyer predicted a vote within hours, saying the funds would come from money approved earlier in the year as part of an economic stimulus bill.

The Maryland Democrat said that at the request of House Republicans - whose approval was required for swift passage - the bill would include provisions for government auditors to make sure the money was being spent as intended.

Senate action is likely next week, making sure the program would not be affected by the sudden shortage of cash.

Rep. David Obey, D-Wis., said "consumers have spoken with their wallets and they've said they like this program."

Republicans argued that Democrats were trying to jam the legislation through hurriedly. The Senate was not scheduled to vote on Friday but lawmakers hoped to win approval for additional funding next week.

House members acted within hours of learning from Transportation Secretary Ray LaHood that the program - designed to help the economy as well as the environment - was out of funds. Under the program, car owners can receive federal subsidies of as much as $4,500 if they trade in their old car for a new one that achieves significantly higher gas mileage.

Sen. Carl Levin, D-Mich., said the administration assured lawmakers that "deals will be honored until otherwise noted by the White House." But he suggested that "people ought to get in and buy their cars."

White House spokesman Robert Gibbs said Friday that the program is still "up and running," reports CBS News White House correspondent Mark Knoller.

"If you were planning on going to buy a car this weekend, using this program, this program continues to run," Gibbs told reporters. He would not commit to any timeframe beyond that.

But Gibbs said administration officials and bipartisan leaders of Congress were working Friday morning "to find and develop ways to continue to fund this program."

A House Democratic aide had said earlier that Hoyer told lawmakers the legislation would transfer $2 billion from unused recovery funds because the vehicle program was an urgent priority. The aide spoke on condition of anonymity because he was not authorized to speak publicly about the program.

House Minority Leader John Boehner of Ohio said lawmakers were working to bring the measure to the House floor on Friday but it was unclear how many Republicans would support on the plan. "There are a lot of questions about how the administration administered this program. If they can't handle something as simple as this, how would we handle health care?" Boehner told The Associated Press.

The administration assessed its options amid concerns the $1 billion budget for rebates for new car sales may have been depleted. The program officially began last week and has been heavily publicized by automakers and dealers.

Called the Car Allowance Rebate System, or CARS, the program offers owners of old cars and trucks $3,500 or $4,500 toward a new, more fuel-efficient vehicle, in exchange for scrapping their old vehicle. Congress last month approved the plan to boost auto sales and remove some inefficient cars and trucks from the roads.

The program was scheduled to last through Nov. 1 or until the money ran out, but few predicted the fund would run out so quickly. The $1 billion in funding would provide up to 250,000 new car sales.

It was unclear how many cars had been sold under the program. Sen. Debbie Stabenow, D-Mich., said about 40,000 vehicle sales had been completed through the program but dealers estimated they were trying to complete transactions on another 200,000 vehicles, putting the amount of remaining funding in doubt.

John McEleney, chairman of the National Automobile Dealers Association, said many dealers have been confused about whether the program will be extended and for how long. Many had stopped offering the deals Thursday after word came out that the funds available for the refunds had been exhausted.

"We are hoping for some clarity from the White House and Congress before the day is over," McEleney said Friday.

The clunkers program was set up to boost U.S. auto sales and help struggling automakers through the worst sales slump in more than a quarter-century. Sales for the first half of the year were down 35 percent from the same period in 2008, and analysts are predicting only a modest recovery during the second half of the year.

So far this year, sales are running under an annual rate of 10 million light vehicles, but as recently as 2007, automakers sold more than 16 million cars and light trucks in the United States.

Earl Stewart, who owns a Toyota dealership in North Palm Beach, Fla., said the changing messages on the program has created confusion among his customers and his staff. Stewart's accounting department also could only enter about a dozen of the 47 sales he made into the government Web site set up to handle the transactions, leaving him wondering if he will get refunded for the remaining vouchers.

With so much uncertainty surrounding the program, Stewart said he planned to continue to sell cars under the program Friday but would delay delivering the new vehicles and scrapping the trade-ins. Drivers would be put in loaners until he was absolutely certain the program was still going.

"It's been a total panic with my customers and my sales staff. We are running in one direction and then we are running in another direction," he said.

[cattiej]

The picture at the beginning of this story is stupid...nobody puts a car part way in a dumpster...The Cash for Clunkers is going to cost us lots and lots of money folks....get ready for it..it might even cost you your job. Only cars made in the U.S. should be eligible for this rebate...again, no stupulations given by Obama..just go buy any car and we will give you money....just another scam by the car dealers and the government...our world is going to come crashing down soon...be ready for it..we can't go on spending, spending, spending and not expect to pay. Soon our country will be the very rich and the very poor, the middle class lifestyle is on the way out..close the door when you leave.

[Joe_NY_15]

I want Universal Car Insurance - paying my premiums is money lost....I need other Americans and taxpayers to foot the bill for my insurance.....same bull with healthscare

[dwilson59]

I can see only one problem, my E55 gets bad milage but I cant get an extra $4500 if I get a new E Class. I guess my loss

[beaumuff]

Is this another one of those "historical" Obama moments or just another Historical cluster f--- of Obama and Turbo Timmy?

[DaVicar5]

It was a "Historical Election" . . . isn't that enough to sustain you till 2012 ? ? ?

[beaumuff]

Seems like "Historical" has a way of bitting you in the Azzz these days.

[noanobamalemming]

Another Obama success story. Almost as good as the 3000+ stimulus jobs that lasted only 35 hours....This is what happens when you elect a village idiot like Obama

[DaVicar5]

Village Idiot = Community Planner . . . same thing.

[beaumuff]

Are you sayiny the community organizer was one of the Village People?

[beaumuff]

I don't know if free insurance for all uninsured drivers is in Obamas new health care plan or not.

[Joe_NY_15]

X million people are without car insurance......LOL

Where are those wealthy and their bottomless pit, we need to tap into their wealth to pay for those un-insured.

[DaVicar5]

by Joe_NY_15 "Where are those wealthy and their bottomless pit, we need to tap into their wealth to pay for those un-insured."


That evil "Top 1-percent"?
Did anyone notice that they are also paying 40% of all the income tax in this Country?

I guess that makes them all "Uber-Evil", huh?

[Joe_NY_15]

by DaVicar5 July 31, 2009 1:45 PM EDT

Those Uber-Evil wealthy have those bottomless pits of money, so where are they ? we need Universal Car Insurance

(j/k of course)

[DaVicar5]

by Joe_NY_15 "Those Uber-Evil wealthy have those bottomless pits of money, so where are they ? we need Universal Car Insurance"

Car insurance?
I want dental, and homeowners insurance too! I mean, as long as the Government is giving away insurance?
Why not free pet-care, too?

[xlib]

hungry-one question for you. So, let's say someone from, oh Cheektowaga, turns in the family clunker and buys a brand spanking new car that ends up with a financing of, oh, 20,000. Now, in between finance charges, taxes, etc he has a monthly payment of, oh, 350.
What happens when they can't keep up the payments, hungry?? What happens then?
Do we, the taxpayers, bail them out. This is setting up to be a mini-fannie & freddie debacle all over again. But hey, you're fine with that.
And you know what, hungry, you are such a typical lib that immediately calls anyone who doesn't agree with you as a "dummy". Do you know how classless that makes you sound??

[DaVicar5]

The DemoLibs can't even manage to buy 1000 used cars without bollocksing the whole thing up, and you guys want them to provide free health care for 100Million people?

Gimmie a BREAK!

[actornaught]

What used cars? And where does it say dems are selling any cars at all?

With such blatantly namecalling and disregard for truth, there's no need to worry about your irrelevant (& off-topic) conclusions.

Should be about your nap-time...

[Joe_NY_15]

by actornaught July 31, 2009 1:16 PM EDT
He said BUY used cars, not sell them.....
You need a nap
If the Obama government can't handle a little 1 billion dollar program, how can they handle thousands of billions in budgets ?

[DaVicar5]

by Joe_NY_15 "He said BUY used cars, not sell them.....
You need a nap - If the Obama government can't handle a little 1 billion dollar program, how can they handle thousands of billions in budgets ?


Thanks, Joe . . . nice to see that someone is paying attention!

[DaVicar5]

by stickdog3 "Whats with all this name calling, in your previous post you referred to the President outside his name, respect your President regardless of whatever,"


I respect the Office...as for the man currently in that office...gimmie a break! He can't even run a simple used car buyback program!

[actornaught]

hahaha... you actually want to say that only dems are the customers for these cars, instead of dems in congress buying them for the customers?

THAT makes even less sense....

[dragyn30]

This is confusing a few days ago they declared this panic and only 10% of the funds had been used.

This this sounds like a scare tactic to get people to get rid of their old cars so they can boast about how this program is saving the environment!

I do not trust this at all!!! While it would be nice to have a new car, mine is a 1994 Chevy, I do not think I could afford the new car payments on top of the higher rate of insurance required for a new car these days!

[actornaught]

What you should mistrust are your reading and reasoning skills.

That is, unless you didn't read the article at all...

[beaumuff]

Congress racing for more money? Pelosi, Reid , Kennedy , and Barney could not race to the bathroom if it were an emergency.

[DaVicar5]

I disagree . . . I'm pretty sure Barney Franks could make it to the men's room - if it were really important!

[sheree1821]

I think it's great the government is making an effort to get old clunkers off the road and giving people money to get new, more fuel efficient vehicles. HOWEVER I thought the purpose of the program was to help the big three auto makers out during this tough economy? The "cash for clunkers" program should be limited to the purchase of a brand new American car, not foreign! Keep the $$ in our economy for once!!!

[beaumuff]

The goverment is not giving money for new cars, they are giving your money for new cars.

[clym51]

So, another example of the new government not knowing how to do the job. Obama and his cronies know nothing of how to run the government. They are all inexperienced and are causing this country to "go bankrupt" (by the way these are Obama's quoted words - the country is going bankrupt"). This program is not necessary anyway. Spending government money, does not stimulate the economy. Do you realize that the economy was in the best shape it had been in a generation when Bush was in office in 2006 (after six years in office)...then the Democrats (big spenders and taxers got in office and controlled the Congress...and things started going downhill immediately. It was the Democrat controlled Congress that started our econmic decline for the two years prior to the Obama election, and it has just gotten worst with the new Presidency and even more Democrats controlling Congress. If you don't believe me, take an HONEST look at the trends and economic statistics for the years since 2000, and you will see it is true. This new government would never be able to run healthcare, and it SHOULD NOT.

[grabandgo]

Only buy from Ford or German mfg. cars.
GM is government motors, they gave 10 million of our tax dollars to ex CEO as a retirement bonus for running the company into the ground.
They deserve to go under.
Ford is good, they didn't take the money. German cars are good quality.
Anything from Asia winds up in the hands of the chinese, they make most of the parts.

[sheree1821]

what are you talking about? German cars are crap! VW are over priced pieces of garbage. Keep the $$ in our economy!

[actornaught]

And what CEO's? The fired ones? Altho' you're probably a union-hater, since they own a big chunk of GM now.

[denn034]

Deficit spending is a way of life in DC and were to believe that they're actually looking for money to fund it knowing full well that they can just deficit spend. Seems to me like the liberal media is wanting to avoid making the Democrats look like the tax and spend liberals that we all know them to be.

[Volksstimme]

When did the Constitution give any of these morans the right to become used car sales men or own and operate the car and health care industry. NEVER. They are violating and of course ignoring it. Bye the way this is indeed punishable by law. But than again, it's Dictator Maobama and Nazi Pelosi his propaganda minister that call the shots. Ooops, wrong it's the person that programs the tele prompter.

[beaumuff]

China owns half the country and now own a bunch of new cars. They gave Obama a good thrashing the first of the week about spending their money, either he is stupid or it did sink in.

[actornaught]

"china owns half the country"???

In what reality? do you have a non-hate-radio source for that nugget?

[actornaught]

Volks, um, just how could the constitution have possibly said anything about the car & insurance industries, since no such things were even remotely conceivable at the time? Do you advocate the return to horse transport, and barbers doing bloodletting?

You're in the wrong country....

[ffoulkes-2009]

Insurance has been around for a long time...In the early years, it was life insurance AKA gambling.

[Hagford]

It doesnt make any sense to me, as a tax payer I feel riped off I feel like I am helping everyone out to buy cars and houses. This government has gone too far and some one needs to wake up and stop printing off money before its too late.

[beaumuff]

Another great moment for Obama and Turbo Timmy. Just add it to the list off all the f---ups.

[grabandgo]

A Jr. senator and a tax cheat timmy in charge of the country, scary isn't it?

[GeoWeo]

I'm an average American who hoped to trade in my 1997 Grand Marquis Gas guzzling, oil burning POS for a new more efficient vehicle. Now, It looks like I might have a chance this weekend. They can make a transfer from the Bonuses for Bankers Fund. Republicans don't like this program because it benefits people with clunkers, and that's codespeak for poor. The government need to fund it as long as people keep trading in polluting cars that get 15 mpg for ones that get 25mpg and are cleaner.

[clym51]

Whether you realize it or not, there are just as many Republicans that are poor as Democrats (maybe more). The Democrats have tried to drum into Americans for years that tune of Democrats for the poor and Republicans for the rich...but it is all talk. If you check the REAL FACTS, the Republicans have long done more for the poor (and don't brag about it because its not for show) while the Democrats talk about it but never follow through. Latest statistics a year ago, polls show more wealthy Democrats than Republicans. Check the facts before you speak.

[xlib]

You're such a good little lemming. Hope that pitchfork isn't too heavy.

[credibility2]

Another Obama program gone awry. Improperly researched, planned and executed. Taxpayers on the dole over and over again for the automakers and their labor unions. No one deserves to get this type of cash incentive. The government is run by a bunch of neanderthal nincompoops.

[hungry1968-16]

You mean because it was so wildly popular, that it ran out of money?

[Volksstimme]

I wonder how many of these cars are stolen ?????????

[actornaught]

stolen? The proof of ownership involves registration & insurance, and just a bit fussy about that.

Stop the scare talk.

[xlib]

No hungry, because it shows poor planning on the part of the party who initiated and administered the program, that's why. To use another favorite word of the left-incompetent.
Just heard on the radio from a car dealer who states that they tried to access your program but it was shut down.
So, blame that on the Republicans.

[hungry1968-16]

by Joe_NY_15 July 31, 2009 11:04 AM EDT
Yeah, because it's always running out of OUR taxpayer money....you act like the Government is a profit making entity and has cash laying around to hand out to anyone who wants a car with 4 more MPG






Actually dummy, the cash for clunkers program is designed to get people buying NEW cars again.

You know - stimulate the economy that you conservatives left in the dumpster like an abandoned baby, and are STILL trying to sabotage?

[Hagford]

Actually, the government owns the auto industry so they are just a bunch of car salesmen.

[xlib]

Wow, you're on a tear today. Loved the "like an abandoned baby" line.
So, tell me, if this program is being run by YOUR PEOPLE and they botch it up, how is it OUR FAULT??
BTW-remember the daily barrage of hate and bile thrown towards Bush because he didn't know from the get go how much the war was going to cost?? Remember that, I mean, I always thought Congress controlled the purse strings but you libs were railing daily on that. So, here's YOUR program, YOU botched it but it's OUR fault??
hungry-go outside for awhile, walk along the canal, it's not raining and get the he&& off your lib soap box full of hate.