While the Cash for Clunkers (CARS Program) should be extended, we have to be clear here: this is an economic stimulus and jobs program which happens to have some energy security and environmental benefits. Yet, the Obama Administration (Office of Management and Budget?) was the power behind the scenes in seeing that the funding stream for the CARS Program extension came out of a renewable energy pot of money. While there has been quite a bit of rhetoric about the CARS Program’s environmental impacts, it isn’t $3 billion worth: we can’t justify this program’s expenditures on the basis of its oil demand reductions and CO2 reductions. If it were for those reasons, alone, it would not be a good use of taxpayer funds. It was (and is) principally about economic stimulus — and there it is a far more effective use of taxpayer funding.
Now, the money was taken out a pot of money for helping renewable energy projects get quality loans. Considering that tightness in the financing market is a critical barrier, at the moment, for moving forward with many renewable energy deployment projects, taking $2 billion out of a fund to help solve that program seems quite counterproductive. Especially since there is ample TARP funding authority available, including $1 billion that Goldman Sachs just returned to the Treasury.
Now, lets be clear, there are many members of Congress that, truly, are not happy with this approach. For example, Senator Bingaman
“If Congress decides to extend this initiative, I believe we must not rob from the loan guarantees we provided through the recovery package that, in the long-term, will shift our country to home-grown, renewable energy while creating good ‘green collar’ jobs,”
Representative Ed Markey specifically discussed this issue and the need for getting back the funding when he spoke on the floor.
In essence, when it comes to fostering a clean energy future, the Obama Administration and Congress are choosing to rob from the Peter of renewable energy financing to fund the lesser Paul environmental benefits of the CARS Program. While they could have, they should have found other sources of funding, restoring (and, well, increasing) that funding should be on the agenda.