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Would cash-for-clunkers be good or bad for the environment?

Paying people to get rid of old cars is supposed to help the economy and the environment. Not everyone agrees it will do either.

By Staff writer of The Christian Science Monitor / April 17, 2009

Junkers: Several US states already offer cash incentives to get older vehicles off the roads. The federal government may soon follow suit.

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In the tale of Aladdin, the young hero is tempted by an enticing pitch to swap his old, but magical, lamp for a new one.

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The US government may soon be offering Americans another swap they may find hard to resist: cash toward a new car or truck if they’ll promise to send their old vehicle to be crushed into scrap metal. It’s being pitched as a win for both the economy and the environment.

In a March 30 speech, President Obama endorsed using part of the $787 billion economic stimulus package to fund what’s being called a “cash for clunkers” plan. Several such bills now are being considered by the US Congress.

They follow clunker-retiring schemes already in place in several European countries, most notably in Germany, which, as a result, saw a dramatic 40 percent rise in new car sales in March over the previous year. (March sales by US automakers, in contrast, were down about 40 percent from a year ago.)

Several US states, including California and Texas, already offer cash incentives to get older vehicles off the roads.

While each bill in Congress is different, they all offer rebates of up to $5,000 toward a new car for retiring a qualifying clunker that is at least eight years old.

Whether such a program would boost the US auto industry remains under debate. Some reason that, like traditional automaker rebates, the clunker cash would only temporarily boost sales, and they would plummet again shortly after the program ended.

One bill, sponsored by Rep. Betty Sutton (D) of Ohio, originally restricted the program to US-made vehicles. But that provision may have to be removed because of free-trade agreements the US has signed, which in turn could dilute its beneficial effects for Detroit automakers.

But wouldn’t the plan at least take gas-guzzling, air-polluting clunkers off the road?

Maybe. Much would depend on the specific details in the final plan, knowledgeable observers say.
For one thing, the difference in gas mileage between the old and new vehicles would need to be significant.

Senate bill sponsored by Sen. Diane Feinstein (D) of California and others, for example, would require that the new vehicle’s m.p.g. rating be 25 percent better than the federal standard (the Corporate Average Fuel Economy, or CAFE) for its vehicle class.

Other variables are harder to figure. Do you only retire clunkers that are heavily driven? Could out-of-service clunkers be registered just to qualify for the cash? Would the program be limited only to vehicles that emit the most pollution?

Another consideration: the amount of CO2 emissions released in the manufacture of a new car – from making the steel, plastic, electronics, and other parts to the actual assembly of the vehicle.

Estimates of the “carbon cost” of a new vehicle range from 3.5 tons to 12.4 tons of CO2 expended per vehicle, says William Chameides, professor of the environment and dean of the Nicholas School of Earth & Ocean Sciences at Duke University. He’s averaged them as 6.7 tons per vehicle.