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Dems push health reform, 'Clunkers'

From NBC's Ken Strickland and Kelly O'Donnell
Senate Democrats today reaffirmed their commitment to passing comprehensive health-care reform, calling the process "dynamic," welcoming all interested parties to participate in the process (doctors, pharmaceutical companies, insurance companies, etc) but stressing their determination to pass legislation, because, as Sen. Baucus repeatedly said, "It's the right thing to do."

Sen. Baucus called their lunch meeting with the president "enthusiastic," "comforting," and a "warm affirmation" that healthcare reform is "so necessary," and pledged to work together with Republicans to get it done "this year."

Video: USA TODAY's Washington Bureau Chief Susan Page reacts to the health care message wars during the August recess.

Sen. Reid also pledged to approve funding for the Cash for Clunkers program before the August recess. He also stressed the efforts still being made on healthcare reform, saying (rough) "there isnt a day that goes by that I dont talk to several people in the White House about healthcare reform...."

NBC News has obtained a copy of the letter from secretaries LaHood and Chu to senators today on the CARS/"Cash for Clunkers" program. They urge support for more funding. 

Full letter below:

Dear Senator:

Among the efforts undertaken this year to spur economic recovery, the Car Allowance Rebate System (CARS) program has been one of those that has delivered an immediate result. Consumers have been able to trade in their older cars for new, more efficient models under this program as of July 1, and the U.S. Department of Transportation (DOT) began accepting applications for the rebates from car dealers beginning on Monday, July 27.

This extraordinarily popular program is helping to revive our economy. The $1 billion originally provided was expected to last for four months. But in the week since DOT began accepting applications, dealers have submitted requests for nearly half of the available funds, and we believe a large number of applications is still awaiting submission by the dealers. Absent additional appropriations, this program will have to be suspended shortly owing to the overwhelming demand. Such a suspension would be a blow to our economy, to the environment, and to Americans' confidence in the emerging recovery.

We would like to share with you some of the benefits this program is producing. (The figures in this letter are based on submissions received from dealers as of the afternoon of Saturday, August 1. As new transactions come in these figures will be updated.)

- The CARS program is generating a 61 percent increase in vehicle fuel economy. The average fuel economy of new vehicles purchased under the CARS program is 25.4 MPG, and the average fuel economy of vehicles traded in is 15.8 MPG. This is a fuel economy increase of 9.6 MPG -- a 61 percent improvement. This far exceeds the law's requirement for a minimum increase of 2 MPG for trucks and 4 MPG for cars.

- This improvement will save the typical buyer $700 to $1,000 per year in fuel costs. In addition to the money saved on gas, people using the program will have safer cars and lower repair costs, and they will dramatically reduce the pollution released by their vehicles.

- To date, 83 percent of trade-ins are trucks and 60 percent of new vehicles are cars. The program is working far better than anyone anticipated in moving consumers out of older trucks and SUVs with poor gas mileage into new more fuel-efficient cars.

- New cars under the program are 18 percent more fuel efficient than the average
new car currently available. This means the program is raising the average fuel
economy of the fleet, while removing the dirtiest and most polluting vehicles from the road.

- Nearly half of new vehicles purchased under the program are from the Big Three. The Big Three's share in this program (47 percent) is above their overall share in the U.S. auto market (about 45 percent). The Ford Focus is the top selling vehicle in the program. Four of the top ten selling vehicles are manufactured by the Big Three. Of non-Big Three purchases, preliminary analysis suggests that well over half of these new vehicles were manufactured in the United States.

In response to the overwhelming popularity of the program, DOT is working closely with dealers to improve the processing of transactions to ensure that money flows quickly to dealers while preventing fraud and abuse.

- The DOT has made modifications to its online system to streamline the transaction process and speed up processing times on vouchers.

- The DOT hosted its third Webinar today, August 3, to help explain the application process to thousands of dealers across the country.

- The DOT has more than doubled the number of staff reviewing transactions in the past few days and is prepared to take whatever additional steps are necessary to ensure the program works smoothly.

As you know, last Friday the House of Representatives passed legislation providing $2 billion to extend this program. This bill would not increase the deficit; it is funded by reprogramming dollars from elsewhere in the Recovery Act.

The CARS program is an important element of our economic recovery and is consistent with the Administration's overall energy policy. We hope you will support $2 billion in additional funding for this program.

If you would like more information, we would be happy to answer your questions or arrange a briefing with the members of our staff.

Ray LaHood
Lisa P. Jackson Steven Chu
Secretary Administrator Secretary
U.S. Department of U.S. Environmental U.S. Department of Energy
Transportation Protection Agency