You need a new mod1 pinion. Yours has most likely been used with a steel spur at one time. I can see a couple of the teeth on the top that have been worn down to sharp edges. It only takes one sharp edge to do the kind of damage your experiencings. They will cut through a plastic spur like a hot knife through.....
Pick up one or two of the RCM hardened steel pinions Mikes sells.
http://www.rc-monster.com/proddetail...1pinion&cat=40 Never had a problem with any of them. FYI I think all the 1/8th scale buggies run Mod 1 gears. If you have anything like a MT that runs the .32 pitch you can just use one of them to see what the difference is. After a little while of just staring at the two, you'll know the difference.