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Capitol Hill Passes "Cash for Clunkers" Bill


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SEE ALSO: Cash for Clunkers Tutorial
SEE ALSO: Buying a new car- Cash for Clunkers Qualifications

WASHINGTON - June 18, 2009: With the minimum votes needed, Congress approved a "cash for clunkers" program this afternoon that provides government incentives of $3,500 to $4,500 to motorists who trade in their gas guzzlers for more fuel efficient vehicles. The vote came after Senate Democrats narrowly defeated a Republican effort to kill the plan.

Proponents of the bill believe that the program would help hard-pressed car dealers and automakers by bringing buyers into showrooms. Of course, having great, desirable, fuel-efficient product to offer for sale to consumers could accomplish that feat, but then the car makers would have to design, build and sell them, a task that is clearly out of the reach of many carmakers.

Support to pass the bill came from President Barack Obama and Vice President Joe Biden, who made calls to wavering Democrats urging them to keep the plan alive.

"This is an emergency for families and small businesses — for an industry that has been the backbone of our economy for a generation," said Sen. Debbie Stabenow, D-Mich., who sponsored the proposal.

Opponents fear that the implementation of the bill will increase the federal debt without doing much to get expensive-to-operate vehicles off the roads.

Senate supporters of the program overcame a procedural hurdle by the plan's leading opponent, Sen. Judd Gregg, R-N.H., on a 60-36 vote, winning the minimum number of votes needed to keep the program in a $106 billion war-spending plan that the Senate passed later Thursday.

Last week, the House approved the cash for clunkers bill by a margin of 298-119 and Senate Democrats attached it to the war-spending bill. The overall bill now goes to the White House for Obama's signature.

Four Republicans — Kit Bond of Missouri, Thad Cochran of Mississippi, Susan Collins of Maine and George Voinovich of Ohio — voted with two independents and 54 Democrats in favor of the clunker measure, while Democrat Ben Nelson of Nebraska was opposed along with 35 Republicans.

Sen. Dianne Feinstein, D-Calif., who supported a plan with more stringent requirements to receive the vouchers, said she received "absolute assurance" from Senate leaders that if the program was continued beyond November it would be modeled after the bill she pushed.

Supporters said the program, which would be implemented by the Transportation Department, was expected to be implemented by early August.

The auto industry and its union lobbied heavily for passage of the cash for clunkers plan as GM and Chrysler have received billions of dollars in government-led bankruptcies and the entire auto industry has dealt with plummeting car sales. In May, overall sales were 34 percent lower than a year ago.

Under the plan, car owners will get a voucher worth $3,500 if they trade in a vehicle getting 18 miles per gallon or less for one getting at least 22 mpg. The value of the voucher would grow to $4,500 if the mileage of the new car was 10 mpg higher than the old vehicle. The miles per gallon figures are listed on the car window's sticker.