Deal Near for "Cash for Clunkers" in the U.S

I've been covering the whole "Cash for Clunkers" program as it began to take form in the United States and more recently as the U.K implemented a revised version of the plan. Now it seems the two representatives that created the two competing bills in the House might be nearing a compromise.

The two bills being discussed were Rep. Betty Sutton's (D-Ohio) HR. 1550, the Customer Assistance to Recycle and Save (CARS) Act. The other is HR. 520, The Accelerated Retirement of Inefficient Vehicles Act of 2009 introduced by Rep. Steve Israel (D-NY). The two sides have some key differences in their bills. Rep. Sutton's bill gives the largest subsidies to American made vehicles, smaller subsidies to North American vehicles and nothing for foreign made vehicles.

Rep. Israel's bill is vastly different and would give a bit smaller amount ($4,500) to vehicles domestic and foreign alike. The vehicle being turned in would have to get at least 18 mpg and the vehicle being purchased would have to achieve 25% or more above CAFE efficiency standards. That would mean 34 miles per gallon or more this year.

I think that is pretty restrictive but would definitely go far towards the goal toward achieving a more fuel efficient fleet in the the United States. Some of the ideas being discussed in order to reach a compromise including a subsidy based on market share (like GM gets 21 percent, Toyota 17 percent). I think that idea would make a lot more sense certainly then putting subsidies equally for vehicles domestic and foreign.

Rep. Israel says the two sides are "90 percent" of the way to a compromise. It'll be interesting to see what the final bill looks like after all the House and Senate wrangling because once the House agrees negotiations don't stop there. The House and Senate have to both agree. I'd imagine Rep. Israel's bill will be a lot more easy to pass the Senate as U.S Senators Diane Feinstein (D-Calif.), Susan Collins (R-Maine) and Check Schumer (D-N.Y) have introduced a similar bill there.