'Clunkers' Program Likely on Through Labor Day

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WASHINGTON -- Every once in a while, Washington comes up with a brilliant idea and the Senate agreed, Tuesday, to keep one of them going for at least another month.

Senate Majority Leader Harry Reid says he has the votes to pass a $2 billion "cash for clunkers" measure already approved by the House.  The money would replenish the popular program which has exhausted all of its original $1 billion budget. 

Lawmakers in Washington feared they could take the heat-- not from the summer weather, but from angry customers wanting to cash in.

Now, it's likely the program will get enough gas to continue through Labor Day.

The scene is something car dealers haven't experienced in years -- busy showrooms with people looking to buy, and buy now.

"I thought I might've missed out watching the TV, but I thought I better check it out for myself," one woman said. And she's not alone.

The government's popular program helped carmakers' July auto sales: 11 million cars sold -- the first increase in nearly two years.

Even as inventories run low, some say they'll keep doing deals " until the government says 'No,'" said Mike Schrieber with Bill Brown Ford in Michigan.

And that may come sooner rather than later.

The program is such a success that it ran out of money in one week. And now, the White House is applying pressure on the Senate to approve more money before its goes on its month-long recess Friday.

While the program has picked up a few converts...

"If it ain't broke, don't fix it. It's working in every single way," Sen Charles Schumer, D-N.Y., said.

...there are those who still aren't sold.

"This is a horrible policy idea, and the fact that people buy cars when you give them free money, does not mean that is what the federal government should be doing," Sen Jim DeMint, R-S.C., said.

And some have other doubts.

"It's been a great program, there's a lot of upside to it, but as a dealer it's a little scary because we don't know when the money is going to be there, if it's there," said Lionel Garcia, a sales manager in Calif.

While lawmakers haggle, customers are taking advantage of the rebate program, trading in their old, gas-guzzling clunkers for more fuel efficient cars.

The huge sales spike turned cars salesmen into virtual pitchmen for the president's economic plan.

"Dollar for dollar, this is the best economic stimulus that the government could put out there," one dealer said.

"Who could turn down a $3,500-$4,500 free gift?" car dealer Russ Darrow said. "This is designed to help stimulate the economy, to get greener cars on the road, and to keep production going."

The House already approved $2 billion more for the program, which could keep it going through September -- that's if the Senate signs on, too.

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CBN News
John Jessup

John Jessup

CBN News Anchor

John Jessup serves as the main news anchor for CBN, a position he assumed after 10 years reporting for the network in Washington, D.C. His work in broadcast news has earned him several awards in reporting, producing, and coordinating elections coverage. Follow John on Twitter @JohnCBNNews and "like" him at Facebook.com/John.V.Jessup.