Bailout Watch 520: Clunker Bill, Retooling Loan Double-Down Move Forward

Who would have guessed it? As soon as we start reflecting on what exactly this little government foray into the auto sector will cost us, DC goes and prepares to bump up the sum. From ABC News comes a report that Democrat wranglings on the upcoming climate bill have yielded a compromise on forthcoming “cash-for-clunker” provisions. Details are still sketchy, but according to ABC, “under the new agreement, consumers will be able to trade in a “clunker”—a car that gets 18 miles per gallon or less—for a voucher for a new fuel-efficient car. The amount of the voucher will range from $3,500 to $4,500, depending upon the fuel efficiency of the new vehicle.” Want more details? Too bad. All you get for now are the assurances of one John Dingell (D-MI) that “it’s a good agreement. It means sales of autos, it means fuel efficiency and it means progress.” No word on cost to taxpayers, limits, “buy-American” clauses or other potential sources of trouble.

Speaking of Michigan reps stepping up to reward decades of auto industry campaign contributions, Rep Sander “Tweedledum” Levin has introduced legislation to double the Department of Energy’s $25 billion industry retooling loan program. “It is vital that the federal government be a full partner to the domestic auto industry’s efforts to build the cars of the future,” Levin tells DetN. “The program has already received applications for loans well in excess of the resources available, and we need to move quickly to ensure that all eligible investments are able to participate.” Because otherwise you can just kiss your $60K+ Tesla Model S and $40K Chevy Volt goodbye. The DOE has received requests for $38 billion so far, and clearly all of the requests are worth spending taxpayer money on. Why question it? Incidentally, the DOE loan program was the topic of TTAC’s Bailout Watch #1. Little did we guess where we’d be just a year and a half later.