Get the best car for your money with new Cash for Clunkers calculator

(Photo: Photo Illustration by
Gloria Dawson / iStockPhoto)

When Congress approved hundreds of billions of dollars to bail out Wall Street by buying subprime mortgage derivatives and other "toxic" assets, economists and moralists worried over the "moral hazard." Do you encourage bad behavior by saving those who have made bad decisions, and lost because of them?

When Congress passed a smaller-scale bailout for regular Americans who made a bad choice by buying a gas-guzzling SUV, truck or sports car that they don't need, lawmakers rewarded the bad decision with a check for as much as $4,500.

The reason, ostensibly, was to improve fuel economy by getting old cars off the road, but the law was written so weakly that it will still subsidize the purchase of new clunkers that get as little as 15 mpg (for a truck, 18 mpg for an SUV and 22 mpg for a car).

Granted, there are barely a dozen 2009 cars and SUVs that get 30 mpg or better, and only two (the Toyota Prius and Honda Civic hybrid) that get better than 40 mpg -- a sad enough fact. But why not subsidize those vehicles, to the exclusion of gas-guzzlers? Ford -- remember Ford? that other, healthier member of the Big Three? -- even makes three SUVs that get better than 30 mpg (the hybrid Ford Escape and Mercury Mariner and the Mazda Tribute).

All in all, Cash for Clunkers is clearly another bailout for automakers -- who need to sell more vehicles, particularly those gas guzzlers sitting on the lot. It's not really designed to limit pollution or gas consumption.

But that doesn't mean that you can't trade in a clunker for a fuel-efficient vehicle, and still cash in on the government check. Now, the Sierra Club has helpfully created a Cash for Clunkers Calculator shows how to magnify your savings by simply quantifying the savings you can enjoy every year with a more fuel-efficient vehicle.

Aim for the top, with a 2010 Toyota Prius, for instance, and you'll save almost $1,500 a year on fuel costs, compared to buying a car with the minimum qualifying fuel economy (18 mpg).

First, see if your junker is clunky enough to qualify for the Cash for Clunkers program at the government's cars.gov site.

Then, use this Kelly Blue Book calculator (www.kbb.com/kbb/cash-for-clunkers) to see if your car is worth more as a trade-in.

Then, use the Cash for Clunkers Calculator (sierraclub.org/transportation/clunkers/calculator.aspx) to determine the best fuel-efficient vehicle to purchase, and find dealers that sell it.

The Sierra Club adds these two nifty little bits of negotiating advice that should help you get the best deal:

1. Talk to multiple dealers before you mention you have a guzzler to trade in. Find out which offers the best deal for your vehicle, and work with that dealership.
2. Your guzzler will be crushed and recycled, not resold, and you will get a voucher toward the purchase of your new car. Be sure to talk to your dealer about the scrap value of your guzzler -- you can apply some of the scrap value toward your purchase.

Do you think a $4,500 trade-in credit for gas guzzlers is a good idea?

Tell us by commenting below or take the poll (www.thedailygreen.com/clunkers).

More from The Daily Green

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• How to Pay $1 a Gallon for Gas (or Less)
• Five Little Fuel-Efficient Cars that Dazzled the NY Auto Show
• Eight Micro Cars Set to Take Over the American Road
• The Auto X Prize: Racing for a 100 MPG Car and $10 Million

Reprinted with permission of Hearst Communications, Inc