Yes, Taxpayers Paid to Trade Clunkers for Clunkers

In June, when the Cash-for-Clunkers program — which provided a government subsidy to people who traded in older low-mileage vehicles to buy new, supposedly better-mileage vehicles — was humming to the tune of $1 billion, we wrote a piece warning that the program was hardly the environmental benefit its Capitol Hill supporters were claiming. Instead, “some truck and SUV drivers will be eligible for thousands of taxpayer dollars to purchase the latest version of the same large vehicle they’ve just scrapped — even in cases when the new model boasts just one- or two- miles-per-gallon better economy than the old.”

That’s precisely what happened.

Roughly 13 weeks after Congress infused $2 billion more into the Clunkers program — and about 10 weeks after the program ended — the Department of Transportation finally unveiled the final figures surrounding the program, posting the details of all 677,000 transactions on its Website. The Associated Press undertook the unenviable task of crunching the data, to discover that the single most popular swap was that of an old Ford F-150 pickup for a new Ford F-150 pickup.

Owners of that pickup were 17 times more likely to buy a new F-150 than, say, a Toyota Prius. The new pickups’ EPA combined city/highway mileage ratings ranged from 15 mpg to 17 mpg, depending on the powertrain and other factors, up 1 mpg to 3 mpg over the old ones.

That’s not to say there wasn’t some environmental benefit to the program. Indeed, the average trade-in vehicle got 15.8 miles per gallon, while drive-away vehicles averaged 24.9 mpg. Still, how much better could those numbers have been if Congress had summoned the guts to pass a slightly different Clunkers bill — one that bumped up the mileage requirements to prevent drivers from trading clunkers for clunkers? As Sens. Dianne Feinstein (D-Calif.) and Susan Collins (R-Maine), the sponsors of the alternative bill, wrote in The Wall Street Journal in June, the original program was “expertly designed to provide Detroit one last windfall in selling off gas guzzlers currently sitting on dealer lots because they’re not a smart buy.”

Of course, in the end, both Feinstein and Collins voted for the $2 billion extension of that very windfall.