Congress Considering 'Cash for Clunkers' Stimulus Plan

WASHINGTON — Auto-industry officials are in advanced talks with Capitol Hill lawmakers on a proposal that would aim to revive vehicle sales by giving federal tax credits of as much as $4,500 to consumers who replace older gas guzzlers with new, fuel-efficient cars.

Executives and lobbyists for domestic and foreign auto makers hope to reach an agreement on what they call a "cash for clunkers" program in the next few days so it can be added to a nearly $900 billion economic-stimulus package the Senate will debate next week. A House version of the package, valued at $819 billion, passed on a largely party-line vote Wednesday.

It isn't clear that auto makers and Congress will strike a deal. Detroit Three executives haven't signed off on a plan, in part because they worry that the plan would encourage people to replace their older, American-made cars and trucks with new vehicles made by overseas-based rivals. It isn't clear how long the program would last or what it would cost the government.

The cash-for-clunkers plan is one of dozens of proposals designed to aid certain industries and companies that lobbyists are pitching to lawmakers. Together, those provisions have pumped up the cost of the economic-stimulus proposals by billions of dollars.

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