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Obama administration asks Congress to approve more funds before leaving in August

The cash for clunkers program was controversial when it was first announced. The program offers Americans $4,500 to trade in their old cars with poor fuel economy and high emission output for a newer vehicle that gets better fuel economy. At the same time, the program was intended to help the ailing automakers turn some profit.

Reuters
reports that the Obama administration has announced that the $1 billion allotted to the program is now gone and that the program is in danger of being discontinued if more funds can’t be found. Car dealers around the nation began offering the government rebates in early July and by the end of July, more than 4,000 cars had been purchased using the rebates.

The program now has about 250,000 rebates waiting to be processed and additional funds are needed. The Obama administration is trying to get Congress to approve additional funds for the program before they leave in August. The program ran out of funds where sales unexpectedly spiked this week after the transactions began being logged and approved.

Reuters reports that officials had originally intended to simply suspend the program late Thursday or early Friday when funding ran out. Now officials are planning to keep the program in place while more funds for the rebates are approved. The rub is that in a short period it will be difficult to find funding for the program.

Estimations place the number of dealers able to participate in the program across the country at 16,000. For the funds to be depleted, each of those dealers would need to have sold more than 12 cars according to Reuters.

Congress had already said in early July that if the program proved popular and consumers were buying fuel-efficient vehicles that the program would possibly be extended.





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