Hidden in President Barack Hussein Obama’s proposed 2013 budget is an increase of the subsidy for electric cars from $7500 to $10000.
In his effort to have 1 million electric, or “Advanced Technology,” vehicles on American roads by 2015, a budget document, entitled “Investing in Our Future,” discussed briefly by White House economic chief Gene Sperling, includes this goal. If that goal is reached and the new subsidy rate is enacted, the subsidy will cost $10 billion. Cars powered by natural gas are also considered as advanced technology vehicles.
But not to worry. Chevrolet Volt and Nissan Leaf sales are nowhere near that goal. The 2011 sales for both of them combined was 30000. In fact, General Motors’ goal of selling 10000 Volts in 2011 came up 3800 short. The Toyota Prius, which has been around since 1997, sold 13650 in 2011. Still, at the current rate of $7500 subsidy per car, we taxpayers shelled out $348.75 million. Bad enough! And at a time when we are over $16 trillion in debt.
The average yearly income of Chevy Volt owners is $170000, higher than Cadillac and Lexus owners, on par with BMW owners, and exceeded only by Mercedes-Benz owners. That yearly income puts the Volt’s buyers in the top 7% of American households. The obvious question is why do these buyers receive subsidies?
An unexpected occurrence has been the advance in the traditional internal combustion engine. Ford Motor Company is ending its hybrid version of its Escape crossover vehicle, saying a new model equipped with its EcoBoost engine will outperform the hybrid. It will be most interesting to see how the Obama administration spins this situation.
So while the average yearly income for the American family in 2011 is $63091, we continue to subsidize Obama’s goal. I think former British Prime Minister Margaret Thatcher said it best: “The problem with socialism is that you eventually run out of other people’s money.”
But that’s just my opinion.