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'Cash for Clunkers' Limits Access to Affordable Used Vehicles for Low- and Middle-Income Families

Posted on: Wednesday, 15 April 2009, 13:19 CDT

BETHESDA, Md., April 15 /PRNewswire-USNewswire/ -- Cash for Clunkers would prematurely destroy vehicles and their valuable parts and components, denying more affordable used vehicles to millions of low- and middle-income families who cannot afford to purchase a new car even with a $3,000 to $5,000 government voucher.

"For families that cannot afford the price of a new vehicle even with a government voucher, the Cash for Clunkers program would limit their access to affordable transportation, a must for most working Americans," said Aaron Lowe, vice president of government affairs for the Automotive Aftermarket Industry Association. "Cash for Clunkers may sound good at first, but when you take a closer look, it is clear that the Cash for Clunkers proposal will negatively impact car owners, wasting billions of taxpayer dollars."

Steven Levitt, a University of Chicago professor of economics and author of the best-seller Freakonomics, recently wrote about Cash for Clunkers on his New York Times blog: "It also seems to me that any effect on the demand for new cars would be extremely limited. People who drive clunkers are generally not in the market for new cars. Presumably their replacement car will be a used car. The increased demand for used cars will lead to higher prices for used cars, which will push some buyers towards a new car, but the likely impact on new cars would be small."

Congress and states have considered Cash for Clunkers proposals in the past and in many cases have decided against them. Many legislators have come to realize the unintended consequences of these programs and that they are not a cost-effective use of government money.

"Providing incentives for individuals to purchase fuel efficient vehicles or to have their current vehicle maintained would be a better use of federal money," continued Lowe. "The bottom line is that Cash for Clunkers is a bad idea and should be rejected by Congress."

Interested parties can send an e-mail in opposition to the Cash for Clunkers program to the Speaker of the House, the Senate Majority Leader and their congressional representatives by visiting www.fightcashforclunkers.org and clicking on "Take Action."

About Fight Cash for Clunkers:

The Fight Cash for Clunkers organization opposes the inclusion of a Cash for Clunkers provision in the economic stimulus package currently being considered by Congress, instead favoring tax credits to help upgrade, repair or maintain older vehicles, as well as tax deductions for interest on car loans and state sales tax. For more information, visit www.fightcashforclunkers.org.

SOURCE Automotive Aftermarket Industry Association

Source: PR Newswire

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