Cash for clunkers is the current raging political debate in the US.  Let’s cut away all the BS and look at what is happening: the cars being bought are on average about 10 mpg better than the clunkers (heard this on CNBC yesterday).  That means for an increase of about 40% for cars and 60% for trucks.  For a vehicle driving 20,000 miles a year, at 25mpg would use 800 gallons of fuel a year, saving about 600 gallons of fuel or 6 tons of CO2. If a car is used for 10 years (much more than average) the newer car would reduce CO2 emmissions by about 60 tons.

Yesterday, US carbon credits on the CCX traded for 40 cents, yes  $ 0.40, per ton.  So the US government is giving a $4500 rebate to protect the environment from $24 worth of CO2, about 200 times more than the market price.  So, if folks want to keep the program growing for the sake of ramping up car sales, that’s great.  Just don’t think the environmental benefit is worth the cost.