House fuels 'Cash for Clunkers' with $2B

WASHINGTON, July 31 (UPI) -- The U.S. House passed a bill to add another $2 billion to the "Cash for Clunkers" program, so popular that it ran out of cash the first week it was available.

The chamber overwhelmingly passed the measure on 316-109 vote that would use funding from the economic stimulus package. The measure now goes to the Senate. If it gains final passage, stimulus package funds will be diverted to the fund the program, the White House said.

While commenting on the economy Friday, President Barack Obama praised the bipartisan effort in the House to fund the rebate program that offers up to $4,500 to car owners who trade in their older gas guzzlers for new, more fuel-efficient models.

The program performed "well beyond our expectations," Obama said, despite skeptics "who weren't sure it would work."

Earlier, lawmakers traded barbs over the program, officially called the Car Allowance Rebate System.

Rep. Ed Markey, D-Mass., said, "America's consumers haven't run out of clunkers," although estimates on how many were out there were hard to find, The New York Times reported.

Speaking in opposition, Rep. Jeb Hensarling, R-Texas, said the Car Allowance Rebate System "enshrines us as a bailout nation."

The National Automobile Dealers Association also warned that auto retailers could get hamstrung with unwanted trade-ins, but the White House said the program's set-up was sound.

"If you meet the requirements of the program," White House spokesman Robert Gibbs said, "the certificates will be honored."

The Senate will probably bring the bill up next week, The Washington Post reported, but conservatives who opposed the original program and the stimulus package as a whole may seek to slow the process. Liberals might also balk unless mileage standards are revised upwards, the newspaper said.