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Another way to keep truckloads of cash flowing out of Washington

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POSTED March 20, 2009 5:05 a.m.
It is becoming abundantly clear with each passing day that brings increasingly outrageous suggestions from politicians to see how fast they can deplete our great-great-great-grandkids’ pocketbooks that the theme song for Congress should be “If I Only Had a Brain.”

Rep. Betty Sutton, D-Ohio, wants Congress to shower new car buyers with up to $7,500 on the spot who trade-in old vehicles for new cars and trucks that are built in North America.

Sutton’s proposal would allow owners of vehicles eight years or older to trade in for vehicles that meet the new fuel economy standard of 27 miles per gallon for cars and 24 miles per gallon for light trucks to receive between $3,000 and $7,500. The higher the fuel economy of the vehicle they buy, the higher the voucher.

This is Sutton’s idea of saving the jobs of auto workers and propping up the Big Three. Sweet, except there’s just a few problems.

Now that there’s a chance that the 535 Robin Hoods in Congress are plotting to rob from the responsible and either give to the irresponsible or help others get a free pass on earning what they buy, what do you think will happen?

Let’s see, if you are thinking about buying a new car and there is an outside chance you can get a $7,500 check for doing it, wouldn’t you put off the decision to see what Congress does?

If you are in the market for a Chevrolet Cobalt that gets 37 miles per gallon you can get one for $16,330.

The odds are that a Chevy Cobalt would fetch close to $7,500 from the voucher scheme. So why wouldn’t you take a wait-and-see attitude to see if you can bring your out-of-pocket costs down to $8,830? Sutton could succeed in effectively killing auto sales for the next month or so. That would save a lot of United Auto Workers jobs.

There is the question of why only certain people will get a shot at $7,500 off of new cars that are actually selling for as much as $100 less than the same models that are two years older thanks to the new car inventory glut.

You keep your mortgage payments current even if your house value drops below market value and you pay your car payments on time yet you are helping bail-out people who acted irresponsibly and now may help a select group of people get car deals of the century on your back.

Life’s not fair, you say. No problem. There’s an easy solution. Just join in the latest rage which is dropping all pretense of being ethical and financially responsible for your own actions.

Let’s say you don’t have a car that’s eight years or older. No big deal. Just go out and buy a car that’s a clunker for $500 or less then drive it to your local dealership and buy the most fuel efficient new car there is on the lot. You’ll probably pocket $7,000 all courtesy of Uncle Sap. (That isn’t a typo.)

It gets better.

Sutton’s bill also provides an eco-friendly provision that could give consumers an option for a $3,000 voucher toward mass-transit fares in return for their old cars. Someone needs to check the water in Washington, D.C.

How does this help the auto industry? The mass transit voucher proposal is ripe for manipulating.

It would be worth it if you commute to go out and buy a clunker for $500 and turn around and pocket $2,500 in transit vouchers. Better yet, if there are three registered drivers in the household go out and buy three clunkers for up to $500 apiece and get $7,500 for a free ride on the rest of us. Considering that most mass transit is already subsidized with federal and state dollars to the tune of 75 percent this is a pretty brazen “in-your-face” provision in Sutton’s bill. Of course, that assumes she even understands the federal fare box recovery rules. She’s a member of Congress, so why does she need to know stinking details?

The Sutton plan could be a godsend for those who could face a loss of revenue from California’s lucrative illegal marijuana farming operations. If the Obama administration legalizes pot and therefore lowers the cost, enterprising pot growers could start moving old cars up from Mexico, falsify registration documents and trade them in for $3,000 in transit vouchers. They could sell the vouchers for 50 cents on the dollar to commuters and pocket a tidy profit.

Hey, it’s the new American way. Find anyway you can to get around a legal obligation with the implicit consent of Congress that passes laws with loopholes so big you can fly a 747 through them.

The only way to improve on Sutton’s proposal to loot Fort Knox is to require that those who get the proposed vouchers when they buy new vehicles to purchase auto insurance through an AIG company.
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