Park cash for clunkers

The cash-for-clunkers program ran out of gas faster than the White House expected.

Clunkers roared into the car lots with tires screaming, prompting Transportation Secretary Ray LaHood to conclude: "This has worked very, very well."

By working well, he means that thousands of owners of qualified gas guzzlers have taken government cash in return for buying a new car or truck that gets better fuel mileage.

Car dealers have enjoyed a great week, and the economic excitement is being felt in communities across the country. But that doesn't make the handouts fair, affordable, measurably beneficial to the environment, socially responsible, economically sustainable or logical.

If giving some of us money to buy new cars would improve the economy and help the environment, why not give more of us more money to buy more cars? If every car buyer got $4,500 to spend, Congress could really crank up sales, as well as car prices and dealer profits. Why not help other industries? Because it doesn't really make sense.

The $1 billion that was supposed to last four months lasted less than a week. The House quickly voted to add another $2 billion. Now the Senate is caught in the headlights of a wildly popular yet expensive scheme that takes money from some taxpayers and gives it to others. The Senate should fund enough to pay for all the deals in the works. But it should not continue the clunker buy-backs through October, as was planned.

Here are just a few reasons why the Car Allowance Rebate System ought to be parked.

• It doesn't help those who need it most. The ones needing help are the folks driving the worst smoke belchers or those walking and riding bicycles. You only get a rebate if you buy a new vehicle, which is hard to do if a clunker is all you can afford.

• With the federal budget in deep deficit, the program is being funded with borrowed money, which is a debt future taxpayers must either repay or pay interest on.

• If you have a good income and happen to own an older car you were planning to trade in later in the year, the availability of this cash windfall likely made you trade now instead of later. That means the big uptick in sales won't be sustained into the fall and winter. Meanwhile, some of the best maintained clunkers are being junked while owners of the worst of the clunkers will find fewer used cars to choose from.

• If you're trading in your big pickup truck in for a new one just like it, you can qualify for a rebate if you get a mere 1 mile per gallon more. If you drive a few more miles each day in your new truck, you'll be using even more gasoline.

• Drivers are excluded from the program if their cars get more than an arbitrary 18 mpg. At the margins, the cutoff is infuriating. A clunker with a manual transmission that officially gets 19 mpg doesn't qualify, but the automatic version of the same car that gets 18 mpg might be worth $4,500. It isn't fair.

• Because the rebates are so high, some people will be tempted to buy cars and trucks they really can't afford.

• The rebates can be used for new cars worth up to $45,000. Taxpayers who can't afford cars that pricey are wondering why they must help other people buy luxury cars.

• If you planned to donate your clunker to charity for a tax write-off, you might have decided instead to have it scrapped for the rebate. That means the charity will be out a donation, and a needy person will miss out on the gift of a drivable car.

• If you've saved up enough to buy your first car and have nothing to trade in, you're out of luck. Likewise if your clunker broke or was in a wreck, you don't qualify. To get a rebate, you car must be drivable, and you must have owned it a year or more. If you work to save up $4,500 to buy a car, your savings are reduced by income taxes and Social Security taxes. The clunker rebates are tax free.

The best that can be said for the clunker program is that it really is an economic stimulus to a few of us ordinary taxpayers. That's certainly not the worst thing Congress has done lately.