Here is another one of those ridiculous subsidies for the auto industry:
Individuals in disadvantaged census tracts who make up to four times the federal poverty level will be able to trade in their pre-1994 models and receive as much as $12,000 toward the cost of a new or used fuel-efficient vehicle.
A $4.8 million pilot, expected to replace about 600 cars, is currently rolling out in the San Joaquin Valley and South Coast air districts. The Air Resources Board plans to expand the program, which is funded by cap-and-trade auction revenue, by about 10 times next year.
Whereas cap-and-trade started with the best of intentions, it really has turned into a joke of a program. It provides no dedicated funding for bike projects (and only minimal support for transit services), and instead is being used to subsidize private car purchases.
Even viewed as an anti-poverty measure, this is a bad idea. Car ownership is really costly, and it is a mistake to encourage low-income families to hang onto cars when there are much lower cost transportation alternatives.
Systemic Failure 
It isn’t that ridiculous. Someone who qualifies for this is probably not in a position (mostly geographic) to switch to a car-free lifestyle, and getting them in newer car will leave them with lower operating costs and the rest of us with better air quality as their old car is taken off the road.
It’s not that it’s “ridiculous”, it’s that it is a super inefficient way to reduce emissions which is what cap and trade is supposed to do. $5 million to remove 600 functioning cars from the road to subsidize the manufacture and use of 600 new cars that aren’t even ‘zero’ emission.
Subsidize bus passes, car tune ups, bike lanes, expanded bus service, home efficiency projects, water use reduction, etc. etc. There’s just so many more productive ways to spend this much money instead of dumping it into automakers’ pockets.
I don’t think it’s ridiculous – if anything, the problem is that the credit is too low. If you’re going to encourage them to trade-in old vehicles for new efficient ones, you should put the credit at a level where they can buy the cheapest possible car that fits the requirements.
if the goal is to get rid of polluting vehicles, then there is a simple and cheap solution: Set the annual VLF at the appropriate level. Older polluting vehicles pay much more, newer less polluting vehicles pay less. Note that California does the opposite, which incentives people to hold onto their old vehicles.
Youre punishing the poor. Not just that, your proposal would be a wealth transfer from poor to rich.
Last year at Winco I saw three (3!) old VW Bettles (old old) on the same parking aisle. Almost next to each other! These people arent using that vehicle because its fun, or cool, its because its all they can afford. Taxing them would just put them deeper into poverty. Helping them buy a newer car (maybe a 2002 Corolla?) is the better way to go.
JJJ:
The primary reason for sprawl is the enormous subsidies. For economic and ecological reasons, those subsidies need to be phased out. Drivers have to pay the full costs — and yes, that does require making hard choices. Whenever it is suggested to do market-rate parking, increased gas tax, etc. you can always count on someone to complain that this is “punishing the poor”. As ‘maxutility’ points out above, that is a false choice. Reducing the subsidies frees up plenty of money to build out bike paths, run transit, and develop infill.
Youre talking about sprawl, but how do you propose agriculture exist in a dense form? The people in the San Joaquin valley with cars from the 80s are driving to work because you cant exactly walk to the almond plantation.
You can make valid arguments about why helping certain people purchase new cars is a “good thing” all other things being equal. But all other things aren’t equal. Cap and trade funds are specifically supposed to go to reducing emissions. Not only is buying people new cars a hugely inefficient way of reducing emissions (manufacturing on a fuel efficient car often releases more emissions than are saved by driving the new, more efficient car.) But Drunk Engineer’s point is that it is directly subsidizing a development pattern and transportation system that is directly responsible for a huge part of our total emissions.
We tried this approach before with the ‘cash for clunkers’ program as part of the ARRA recovery bill after the crash. It helped some people get a new car and got some old, polluting vehicles off the road. But pretty universally it is agreed that it was a really wasteful way to achieve its goals and the money could have been way better spent.
maxutility, the program says you can use the money for a used video. Stop throwing around the new vehicle straw man
I didn’t catch that. If you can use the money for a used car, that is a big improvement. I still think this is a poor use of cap and trade money for all the reasons discussed, but at least that’s better than cash for clunkers.
A used car makes literally no difference. California has a steady-state inventory of autos, so accelerating the retirement of older ones just increases the demand for new cars — even if that new car doesn’t go to a program participant.
For example:
Driver “A” trades in his Nissan Leaf for a brand new Cadillac Escalade.
Driver “B” buys the used Leaf with the $12k he got from taking a late 1980’s VW Rabbit to the crushers.
CARB would claim this transaction reduced pollutants, even though all that really happened was that a VW Rabbit got exchanged for a Cadillac Escalade.
Also note that the used car has to be hybrid or fully electric, The lifespan is much less than an IC car. So if buying used, most of the lifespan is already used up — unless the owner is prepared to pay at least $5k for a lithium battery replacement.
[…] studying. ATL Urbanist breaks down Wendell Cox’s arguments in favor of Atlanta sprawl. And Systemic Failure notes one way that California’s cap-and-trade law is subsidizing […]
“Car ownership is really costly, and it is a mistake to encourage low-income families to hang onto cars when there are much lower cost transportation alternatives.”
Uh, what alternatives? The people driving their El Caminos to work (and there must still be over 1,000 of them just in Fresno) dont really have an alternative. Bus service, for example, ends at 9pm.
Again, were talking cars older than 20 years here. This is strictly aimed at people barely getting by, who have a car valued at $500 because they need it.
The alternative is to improve public bus service and have agricultural employers run employee shuttles from central areas. There’s no way the state should subsidize car ownership and constant road/freeway/highway expansion projects that will just create more sprawl and more need for costly road projects and auto subsidies.
The state is already spending the money, but spending it inefficiently.
[…] studying. ATL Urbanist breaks down Wendell Cox’s arguments in favor of Atlanta sprawl. And Systemic Failure notes one way that California’s cap-and-trade law is subsidizing […]