Written by Lee Norris
The Senate republicans want a tax break for the purchase of new cars in 2009 as part of the economic stimulus package. The amendment would allow individuals buying new cars with financing and write off the interest. This tax break does not include a purchase of used vehicles either. The amendment would also let buyers claim the state excise tax. This is a tax break for the wealthy who can afford to buy a new car each year. For the average consumer, the cost of financing a new car out weights any tax benefits. During recession, financing has traditionally been harder to obtain for lower and medium income people.
Just a few months ago, the agenda in congress was weaning this country off of its dependence to foreign oil. Now that the price of crude is down and economy is crashing, the problem of dependence to foreign oil has slipped onto the back burner. The problems of importing oil and the trade imbalance has been around for the past 50 years. If we do not do something about this problem during this recession, then it will come back again in times of prosperity. These problems will most likely be worse in the future.
Why not give tax credits for purchasing new bicycles or for cycling to and from work as part of the economic stimulus package? In the United States on an average, half the car trips made are under three miles. This country consumes around 22 millions of barrels of oil a day. A large percentage of that oil could be saved each day by using bicycles as transportation on these short trips. if only 25% Americans would cycle on trips 5 miles and under, the social benefits to the country would be enormous. Two of the most expensive problems facing Americans today are rising health care costs and arresting greenhouse gases. Cycling makes people slim and healthy, and there are no greenhouse gas emissions to cycling. Cycling is better than tax credits for the economy. The Money saved at the pumps is more cash for the consumer to spend. With a tax credit, the consumer has to wait until they get their tax return. Cycling saves consumers money all the time there by stimulating the economy faster.
Recessions are times of re-tooling for the next round of prosperity and rethinking the way we do things. If all Americans do is buy new cars to stimulate the economy, we will pay for it later. This is just more of the old squirrel cage economy that got us into this economic mess in in the first place. In effect, what we are asking future generations is to finance our expensive life style today. Is that all there is to the economic stimulus package?