Cash for Clunkers to Be Suspended at Midnight

The program will be suspended as of midnight Thursday. Why? It's quite possible the entire Cash for Clunkers allotment of $1 billion has been spent already.

Official figures show that through late Wednesday, 22,782 vehicles had been purchased through the Cash for Clunkers program, amounting to $96 million being spent.

However, the National Automobile Dealers Association surveyed 2,000 dealers and found that about by the found about 25,000 deals had not yet approved by the NHTSA, which oversees the program. If you extrapolate that number across the 23,000 dealers taking part in the Cash for Clunkers program, you would come up with over 280,000 rebates that have not yet been finalized.

That would already exceed the 250,000 estimated rebates that the Cash for Clunkers program would cover. The program gives rebates of $3,500 or $4,500 for a new car lease or purchase, depending on the specifications of the trade-in and the new vehicle.

While seen as a "green" program, it's also been seen as a stimulus. Rep. Candice Miller (R-MI) wants more money allocated. Yes, a Republican wants more money spent. She said:

"There can be no doubt that the Cash for Clunkers program is a complete success given the fact that the entire $1 billion allocated to the program was expended in less than a week. This is simply the most stimulative $1 billion the federal government has spent during the entire economic downturn. The federal government must come up with more money, immediately, to keep this program going.

"Whether we look at returned TARP funds or reprogram stimulus funds to a truly stimulative purpose, the administration must take action."

Whether or not more funds are allocated will probably be a contentious discussion. The administration originally sought $4 billion for the Cash for Clunkers program, but by the time it had been approved the amount had been reduced to $1 billion.