Highway Trust Fund

Jason Peuquet — Wed, 19 Aug 2009 19:10:08 +0000

Date:

August 7, 2009

Who:

Dept. of Trans.

Policy Area:

Fiscal Policy

Economic Target:

Consumers

Action Type:

Direct Spending

Maximum Amount:

7000000000

Amount Spent:

7000000000

Deficit Impact:

The highway trust fund was at risk of running out of funds in August 2009. The trust fund, made up of revenue from gas taxes at the pump, has steadily declined over the past several years because the recession has caused people to drive less, sales of fuel-efficient cars have increased, and Congress has not raised the federal fuel tax since 1993 despite increased construction costs and inflation. This law serves as a temporary replenishment of the highway trust fund over the August legislative recess.

Source:

White House Press Release

CBO Cost Estimate

Notes:

Maximum amount and amount spent reflect the $7 billion infusion to the highway trust fund. Since the $7 billion addition by Congress from the general fund of the Treasury to the trust fund is an intergovernmental transfer, the deficit impact is zero. However, CBO estimates that the $7 billion addition to the trsut fund will shift $1 billion in outlays originally planned for FY 2010 into the final two months of FY 2009. As a result, outlays will increase by $1 billion on 2009 but will have no net impact over the 2009-2010 period on the federal budget.

Is not a top-level node

Cash for Clunkers

Jason Peuquet — Wed, 19 Aug 2009 19:02:36 +0000

Date:

June 11, 2009

Who:

Dept. of Trans.

Policy Area:

Fiscal Policy

Economic Target:

Manufacturers

Action Type:

Direct Spending

Maximum Amount:

3000000000

Amount Spent:

2877000000

Deficit Impact:

2877000000

The Consumer Assistance to Recycle and Save Act (CARS), also known as "Cash for Clunkers," established a program for owners of gas-guzzling cars and trucks to receive tax credits worth up to $4,500 for purchasing newer, cleaner automobiles. The trade-in vehicle had to get a combined city and highway fuel economy rating of 18 miles per gallon or less.

On 8/7/2009 the President signed a temporary $2 billion extension in funding for the Cash for Clunkers program. The first $1 billion was nearly exhausted within a week after the program’s opening on July 24, 2009. The additional funds became immediately available. Government officials expected the $2 billion extension to last until September 7, 2009. However, on 8/20/2009 the Department of Transportation announced that the Cash for Clunkers program would end on 8/24/2009, fearing that vouchers would exceed $3 billion and after dealerships were overwhelmed with applications.

On 8/26/2009 the Dept. of Trans. reported that nearly 700,000 clunkers were traded in. The release also stated that rebate applications totaled $2.877 billion, under the $3 billion allocated for the program.

On 9/10/2009 the Council of Economic Advisers (CEA) released a report on the economic impacts of the Cash for Clunkers program. The reported concluded that the while 60 to 70 percent of auto sales during the program's duration were likely borrowed from future demand, GDP in the third quarter was boosted by around 0.2 percent and over 17,000 jobs were created or saved. The report also noted that there is widespread consensus in support of shifting future demand to the present during contractionary periods through programs such as Cash for Clunkers.

Source:

White House Release 7/31/2009

Dept. of Trans. Release 8/20/2009

White House Release 8/6/2007

Dept. of Trans. Release 8/26/2009

CBO Cost Estimate

Notes:

Maximum amount reflects the total authorized funds from H.R.2751. Amount spent equals the amount appropriated. Deficit impact based on CBO analysis. Light vehicle sales data from Bureau of Economic Analysis (http://www.bea.gov/national/index.htm).

Is not a top-level node

Stimulus.org - Dept. of Trans.

Highway Trust Fund

Cash for Clunkers