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NEW YORK – This was one government stimulus plan that yielded quick results. Maybe too quick.
Far more drivers signed up for the "cash for clunkers" program than anyone thought, overwhelming showrooms, blowing through the initial $1 billion set aside by Congress and leaving dealers panicked over when or if the government would make good on the hefty rebates.
Confusion reigned, even as dollars flowed into dealerships starved for business for months.
The government Web site set up to process rebates of up to $4,500 per new car could not keep up with demand. Washington scrambled to come up with more cash and sent mixed signals about how the program would unfold.
"A borderline train wreck," said Charlie Swenson, general manager at Walser Toyota in Bloomington, Minn. In Glen Burnie, Md., Bob Bell, who owns Ford, Kia and Hyundai dealerships, said his employees were overwhelmed filing for reimbursement from the government's clunky system.
He compared the program to a military operation: "It is a disaster," Bell said. "We met our objective, but the losses were terrible."
The House voted Friday to replenish the program with $2 billion, setting up likely Senate action next week. Sen. Carl Levin, D-Mich., said the administration assured lawmakers that "deals will be honored until otherwise noted by the White House."
Like a car salesman beckoning from the lot, Levin said "people ought to get in and buy their cars" while the hot deals last. The White House joined in the pitch, telling consumers the program is solid through "this weekend." That left unclear what happens after that, until more money is approved for it.
The Car Allowance Rebate System offers owners of old cars and trucks $3,500 or $4,500 toward a new, more fuel-efficient vehicle, in exchange for scrapping their old vehicle. Congress last month approved the plan to boost auto sales and remove some inefficient cars and trucks from the roads.
It was unclear how many cars had been sold under the program on Friday, but the number was far higher than anyone had expected. About 40,000 vehicle sales were done through the program but dealers estimated they were trying to complete transactions on an additional 200,000 vehicles, said Sen. Debbie Stabenow, D-Mich.
"I think the general public right now is looking for a bargain in any way to spend their money," said Kitty Van Bortel, who owns Ford and Subaru dealerships in Victor, N.Y., "and this was perceived as an incredible bargain and people took advantage of it."
The backlog had been building for weeks. Auto dealers could begin offering the rebate at the beginning of the month, and many began doing so over the July 4 weekend. But it was not until a week ago that dealers could begin filing for reimbursement, leaving them on the hook for as much as $4,500 per car until they get the federal money.
That's when they ran into difficulties with a federal Web site ill equipped to handle the volume of claims and the multiple documents each submission requires. Some dealers said the process took upward of an hour for each transaction, caused repeated rejections and consumed many hours submitting and resubmitting data.
At Walser Toyota in Bloomington, customers began lining up on Monday before doors opened at 7:30 a.m.. Swenson said. By that afternoon, his dealership had done 150 trade-ins under the program. His salesmen worked overnight to scan and submit forms.
But of the 150, he said, only 30 received responses and all of those were rejections.
Dennis and Marcia Strom hurried into that dealership Friday, fearing the rebates might not last, and filled out paperwork for a new car.
"I might have waited until the truck died," Dennis Strom said of his 14-year-old Dodge Dakota. "It's a good vehicle that suits our needs. But it's not worth $3,500."
About 100 people were looking to sign deals there but were holding off because of uncertainty over the rebates.

It took three hours Thursday for employees at one of Sam Pack's Dallas-area Ford dealerships to submit just eight documents. Pack said he feared that many deals made under the program wouldn't be properly reimbursed.

"The details of processing this is beyond what anybody would think is reasonable," he said.

Federal officials said they have increased the capacity of the submission system and added staff to work hot lines and process voucher applications.

In Victor, Van Bortel considered pulling the plug on rebates at the Ford and Subaru dealerships she owns, even though her ads promoting the rebates were locked in for the weekend.

"Honestly, in all my years in the car business, I have never seen such a mess," she said.

Still, it was a mess created by too much action, instead of not enough.

Officials hoped that when the dust cleared from the confusion, the program would be a tonic for the beleaguered auto industry and a benefit for the environment, with many inefficient cars taken off the road.

President Barack Obama said the program has "succeeded well beyond our expectations" and praised the House for moving quickly to establish new financing.

"This is a test drive," Rep. Steve Israel, D-N.Y., said of the program, "and people bought it big time."

Bell, in Glen Burnie, said the rebates have "pulled forward a tremendous market."

"It's wonderful to sell them," he said. "But if you have to pay off a vehicle immediately, you're going to have a severe cash flow deficit."

Dealers are used to working with similar incentive programs offered by auto manufacturers, said John McEleney, chairman of the National Automobile Dealers Association. But the rules are much less stringent under those programs, and automakers generally don't require nearly as much documentation, he said.

His group surveyed dealer franchises using the program and realized the money for it might be getting short. One survey finding: Consumers were opting to use the higher $4,500 rebate over the $3,500 amount by a margin of 2-to-1, eating through the money faster.

"It has been very problematic," McEleney said. "I don't believe that anyone anticipated the volume would be this great."

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Associated Press writers Stephen Manning in Washington, Nomaan Merchant in Minneapolis, Ben Dobbin in Rochester, N.Y., and Ken Thomas in Washington contributed to this report.

Los Angeles (E! Online) –
Kanye West thinks it's his time to rule as the King of Pop.

He's totally the obvious choice to follow Michael Jackson's reign.

"You know everyone loves and respects Michael, but times change," he is quoted by Scrape TV. "It's so sad to see Michael gone, but it makes a path for a new King of Pop, and I'm willing to take that on. There's nobody who can match me in sales and in respect, so it only makes sense for me to take over Michael's crown and become the new King. First there was Elvis [Presley], then there was Michael, now in the 21st century it's Kanye's time to rule. I have nothing but respect for Michael, but someone needs to pick up where he left off, and there's nobody better than me to do that. I am the new King of Pop."

Wow. We knew Kanye was into himself, but really?

No, people. Not really.
But apparently, numerous publications fell for the "interview" the "Heartless" singer gave to Scrape, which is a humor brand in the vein of The Onion.

In short, they made West's interview up. To be funny.

But the joke was on Ace Showbiz, Celebuzz, the Superficial and a handful of news channels who all reported the notoriously egotistical rapper's claims.

Suckahs!

··· THEY SAID WHAT? Get today's most commented stories now at www.eonline.com

LONDON – The British government said Friday that it plans to ban private organ transplants from dead donors to allay fears that prospective recipients can buy their way to the front of the line.
A government-commissioned report recommended that organs donated within the state-run National Health Service should stay within the public health system.
Very few Britons have private transplants, so in practice the new rules will stop overseas patients from coming to Britain and paying privately for a transplant.
The report by Elisabeth Buggins, former head of the Organ Donation Taskforce, was commissioned after a media storm over cases in which foreign patients were given transplants from dead Britons.
Buggins said that for most people, "financial gain from the transplant of donated organs feels morally wrong."
She said most people who wanted to donate their organs assumed they would be given to people on an NHS waiting list, and the idea of "queue-jumpers" could deter donors.
"While I found no evidence of wrongdoing in the way organs are allocated to patients, there is a perception that private payments may unfairly influence access to transplant, so they must be banned," Buggins said.
Citizens of other European Union countries will still be entitled to publicly funded transplants in some circumstances, but the report said these should be tightened and clarified.
The ban does not affect transplants from living donors — such as kidney transplants — which can still be carried out privately as long as no money changes hands.
The report also said there should be greater transparency in the way organs are allocated.
The government said it accepted the recommendations and hoped to enact the ban by October.
There are currently about 8,000 people waiting for organ transplants in Britain. In the past year, about 3,500 patients received transplants but another 1,000 on the waiting list died.

CARACAS, Venezuela — President Hugo Chavez has put relations with neighboring Colombia in the deep freeze again, sparking concerns about the mercurial leader's next moves.

Chavez withdrew his ambassador from Colombia Tuesday and threatened to break diplomatic relations to protest complaints by Colombian President Alvaro Uribe that three grenade launchers found in the hands of Colombia's biggest guerrilla group had been sold by the Swedish government to Venezuela in 1988.

Chavez denied Uribe's charge, which seems to provide more evidence of ties between Chavez and the Revolutionary Armed Forces of Colombia , or FARC, who've been waging a 45-year battle to overthrow Colombia's democratically elected government.

Tommy Stromberg , the political counselor at the Swedish Embassy in Bogota, Colombia , said Wednesday that his government has been pressing Venezuela for weeks to explain how the three shoulder-fired AT4 grenade launchers and ammunition ended up with the FARC.

"We're waiting for the content of the actual response," Stromberg said by telephone.

Uribe went public with his charge after getting no response from Venezuela , a spokesman said Wednesday in Colombia . He spoke days after his government angered Chavez by announcing that it would allow the U.S. military to expand its anti-drug presence in Colombia .

It's yet another source of frustration for the Venezuelan leader, who's sought in vain to return Manuel Zelaya , the ousted president of Honduras and a close ally, to power.

Honduras had been part of Chavez's anti-U.S. alliance, which also includes Cuba , Nicaragua , Bolivia and Ecuador .

Colombia , in contrast, has become one of the staunchest U.S. allies in Latin America .

While Chavez's bark has proven worse than his bite in past diplomatic crises, a deteriorating economy at home and his inability to orchestrate Zelaya's return make his next moves unpredictable as he tries to regain the offensive.

"Among those who consider (Chavez) an enemy, I'm sure they fear what he might do next as he ratchets up tension in the region," said Robert Pastor , a longtime Latin American expert who teaches at American University . "But history shows that he can be hostile in his language, but when there is pushback he usually retreats."

Chavez can thunder against Uribe, a longtime antagonist, but he faces more difficulty in explaining away the concerns of the Swedish government.

In a sign of the brittle atmosphere, Miguel Insulza , secretary general of the Organization of American States , the regional body that includes nearly all the nations of the hemisphere, called on Venezuela and Colombia Wednesday to avoid escalating the diplomatic tiff.

Fernando Morgado , the president of Consecomercio, a Caracas -based business association, expressed concern over Chavez's threat to act against Colombian imports and Colombian companies that operate in Venezuela .

Venezuela is a major importer of Colombian milk, meat and car parts, which can become scarce because of Chavez's price controls.

Nonetheless, Chavez threatened to cut off the imports.

"We can get them from any other country," Chavez said.

Venezuela's principal exports to Colombia — oil, sugar and rice — cross the border as contraband because the Chavez price controls make them much cheaper in Venezuela .

Colombian officials have released documents that it says show that Chavez's government sympathizes with the FARC and gives senior guerrilla leaders refuge in isolated areas in western Venezuela .

Electronic documents that Colombian forces found last year on laptops belonging to Raul Reyes , a slain FARC commander, seemed to confirm the Chavez government's assistance, including evidence suggesting that FARC leaders sought to obtain bazookas from senior Venezuelan military officials.

The attack that killed Reyes just inside Ecuadorean territory prompted Chavez in March 2008 to break off diplomatic relations with Colombia and send troops to the border. Uribe and Chavez later smoothed over relations and promoted efforts to increase bilateral trade.

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