Coming soon to an appliance dealer near you
Beginning late this fall, federal rebates will be available for purchasers of high-efficiency household appliances, furnaces, and air-conditioning systems. Earlier this year Congress authorized $300 million for the program as part of the federal economic-stimulus bill. Funds were distributed to states based on numbers of households, but the federal government left the details of the programs up to each state. The states have until Oct. 15 to submit plans for their rebate programs to the Department of Energy.
But even after rebates, home appliances don’t come cheap. A new Energy Star® KitchenAid® 24.9 cu. ft. refrigerator, for instance, retails for about $2500, plus tax and delivery charges. So if you’re planning to purchase appliances, start saving your cash now, or fill out our easy online application to get a personal loan.
What are the rebates supposed to do, again?
The appliance rebate program is similar to the popular “cash for clunkers” program (the Car Allowance Rebate System Act, or CARS), but doesn’t require a trade-in or exchange. The stated goal is to stimulate consumer spending and smarten up energy use. With the CARS program winding down, appliance manufacturers and retailers are hoping the new rebate program will revive slumping sales of refrigerators, washing machines, and dishwashers.
It will be several months before we know what effect the CARS program had on the GDP, but we do know that it created a brief spike in car sales and a slight tailwind for the US economy. It wasn’t enough, however, to keep car sales in the black. After making gains in May and June, car sales fell again in July.
Some say appliance rebates are great
Some say that the American people have become frugal consumers and that the economy would benefit from another spending incentive. Retailers and manufacturers in particular endorse the appliance rebate program. J.B. Hoyt, director of governmental relations for Whirlpool Corp., recently told The Wall Street Journal that government rebates would be “a good way for the consumer to get back into the marketplace,” adding that “clearly, anything that boosts business is good for us.” Whirlpool was pushing for a rebate program long before the economic-stimulus bill was born.
Appliance manufacturers aren’t the only ones who like the government rebate program. According to someone on bloggingstocks.com, you can like the program even if you’re not a New Deal economist:
Yes, it’s government intervention in the U.S. economy. Yes, it’s a form of socialism: so are billion-dollar subsidies to American farmers. But it will further boost the U.S. economy. And you don’t have to be an economist in FDR’s New Deal administration to know that.
Some say appliance rebates are crazy
Others see the appliance rebate program as just another way to rack up more public debt, without a hope of ever repaying it — a shameful legacy earmarked for future generations. Someone on newsobserver.com had this to say:
Americans are about to be handed more of their great grandchildren’s money so they [can] shop for products for the kitchen and laundry room. Look, if we had even a whimper of a surplus — or even had a dream of one day dropping our deficit I could at least live with this. But we’re bankrupt and just piling on more debt as if money is going out of style.
Given its patent lack of environmental benefits, the CARS program was so popular that green cynics are now proposing things like “Cash for Clunker Homes,” “Cash for Clunker Computers,” “Cash for Clunker TVs,” and “Cash for Clunker Vacations.”
And some say appliance recycling programs are the way to go
In the final analysis no appliance is green
Some states, like New Jersy and Vermont, offer residents small recycling rebates and free pick-up for old appliances. In Michigan, as part of a plan to meet a state-mandated goal of reducing energy consumption, DTE Energy, the state’s largest power company will pay $50 for an old refrigerator or freezer and haul it away for free. The old appliances are recycled for parts used in making computers, cell phones, and steel rebar.
In a Wordpress blog called Cash for Clunker Appliances, Ann Porter explains that appliance recycling programs remove carbon dioxide from the atmosphere much more inexpensively than the CARS program did. The math may be questionable, but the underlying point may have some validity:
An Appliance recycling plan is far superior to the hijacked CARS program because the car rebates, which run as high as $4,500 per purchase, ultimately cost taxpayers around $160 per ton of carbon dioxide removed from the atmosphere. An appliance recycling rebate between $25 and $50 removes about five tons of carbon dioxide from the atmosphere. According to Elana Schor, that works out to a cost of $10 per ton for the richest refrigerator rebate program — more than 10 times cheaper than “cash for clunkers.”
