Cash for Clunkers

Tara Hornor
Written byTara HornorUpdated - October 19, 2023
Tara Hornor
Tara Hornor

Tara Hornor is an experienced writer and entrepreneur with over two decades of experien... | See full bio

John Rush
Edited and Fact-Checked byJohn RushEditor
John Rush
John Rush
Automotive Content Accuracy Auditor|||

With over four decades of experience, John Rush is a highly accomplished business owner... | See full bio

What is a Vehicle Retirement Program?

Biden and a New Take On Cash for Clunkers

The Cash for Clunkers program was initially called out for being inefficient according to economists. However, some of these economists claim that the revisions made by the Biden plan that are aimed toward the trading in of gas guzzlers (those vehicles which consume a lot of gas) for e-vehicles could possibly be an effective plan.

In an episode on the Morning Edition on NPR, Camila Domonoske reports on the Biden Administration’s goal of getting gas-powered cars off the American road. She explains that the government provided people with cash incentives to scrap the old cars, which took place during the Great Recession in a program that was referred to as the Cash for Clunkers.

However, just recently, President Biden has embraced the idea by Senator Chuck Schumer to pay people with cash to turn in or surrender their gas-powered cars and help them purchase the electrically-driven ones similar to what the Cash of Clunkers was aiming the battery-operated models.

Domonoske reports that Josh Linn, a professor at the University of Maryland, was so surprised by the concept of adapting the Cash for Clunkers since he thought that the idea of paying cash for old cars was long dead and gone. Yet, it is now making a comeback.

Original Cash for Clunkers Not Effective

According to Domonoske, Linn and other economists find that the “original Cash for Clunkers just wasn’t that effective.” The program was supposed to boost the economy for the automobile industries and an eco-friendly program to get rid of and eradicate the use of cars with extremely horrifying gas mileage. Every clunker was paid with a check. In fact, the program actually did cut the emissions, but it cost the government billions of federal funds for the program to achieve only a meager result.

According to those economists, the Cash for Clunkers program probably did not affect the figures concerning the total new vehicle sales at all. A lot of people who participated in the program would probably have bought a new vehicle nonetheless.

clash for clunkers

Cash for Clunkers Not Worth Taxpayers’ Cost

The reemergence of the program through Biden has one huge concern: that it will follow the same ineffective path as the original Cash for Clunkers program. Why spend so much money for a program that will not render many results after all? Domonoske reports that according to Sebastian Castellanos, lead researcher at the New Urban Mobility Alliance, those billions of dollars could be used for something else. He suggests that the money could be used to fund public transit or even bikes instead.

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In California, the San Joaquin Valley has a very serious problem concerning air quality, according to Domonoske. Thus, the Valley Air District is trying to get the oldest polluting vehicles right off the road, like Jerome Mayfield’s 1989 Chevrolet Silverado truck. This type of vehicle is a gas guzzler. In fact, there are owners, like Mayfield, whose ’89 Silverado failed the smog test in California, yet it was still in running condition. The program was capable of writing big checks to provide low-income car owners with the opportunity of purchasing an electric vehicle.

The amount needed for an electric vehicle can be overwhelming. There are certain cars with a down payment amounting to almost $9,500. That is beyond the financial capacity of most Americans. But when Cars for Clunkers offered Mayfield this exact amount, he took the deal and purchased himself a Nissan LEAF. Mayfield explains, “All I had to do was plug it up and it charged like a cellphone.” Domonoske adds that 5 years later, Mayfield’s LEAF is still running smoothly.

The pilot program at the San Joaquin Valley was considered to be a successful one; so successful, in fact, that it was expanded. Domonoske reports that the economist Linn concludes that maybe we should learn from the past program instead of scrapping it; focusing on the highest polluting cars could mean a much more successful program.

If the Biden administration targets and focuses on the vehicles that have the most potential in making the new Cash for Clunkers program into a more effective approach, federal money would be better used in addressing the fight against pollution. It can be true that the original Cash for Clunkers failed in utilizing the money of the government, but instead of giving up on the clunker program, it can be defined as an opportunity to learn from it and do better.

The Vehicle Retirement Program

This is the reason why the latest Cash for Clunkers program came into existence. This is the government’s take to address the environmental impact of Americans in the environment  (such as decreasing the emissions of cars).  For those who are really interested about understanding the Cash for Clunkers 2.0, check out this video.

For more information on the history of Cash for Clunkers or to get an instant quote on your vehicle, visit now!





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