Cash for Clunkers
POSTED BY: AnthonyT
UPDATED: Sunday, October 2, 2011 23:29
VIEWED: 4647
PAGE 3 of 6
Quote:
Originally posted by AnthonyT:
"Whats "inexpensive"? To Joe Blow, inexpensive means a 500 dollar car. To Bill Gates, its a 500000 car."
Hello,
Cars are available in my area in the 500-2000 dollar range. Of course, you get what you pay for with such vehicles, as you always have. They generally have multiple mechanical faults and leak multiple fluids and possibly burn some oil. They are a temporary solution to a permanent problem. All the cars I ever owned in Florida were all of this type. None of them cost more than two thousand dollars, and most of them hovered around 1000. Back then, I had a mechanic named Pepe who would perform triage on my car every few months, repairing or replacing the most defective systems to keep it running just a little longer. "Pepe, I've got 200 dollars. What do I absolutely need to fix to make it through the next 30 days?"
Anyhow, such cars still exist where I live, but Pepe is gone, so I invest a lot more in my vehicles now.
Don't you guys have to have roadworthy's for cars? I mean $500 for a car wouldn't be roadworthy.
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Quote:
Originally posted by NewOldBrownCoat:
The real problem with the program was that, in the end, it bailed out jobs for union auto workers, good paying jobs in old line Democrat cities and states, instead of crushing those workers back into bad paying jobs held by disposable illegal aliens and poor fo'ks so desperate for any job they'd build cars for minimum wage.
It was contrary to the unspoken Republican platform.
Yes, that IS a big problem. Because, like so much of what this administration does, it's a catering to a voter base, instead of doing what's right for the whole country. The auto companies got themselves into a heap of trouble, and largely thanks to the union contracts they agreed to pay. All Obama did was siphon $ from the tax payers and hand it to his union campaign contribution bundlers, and only to stave off the inevitable.
" I do not love the bright sword for its sharpness, nor the arrow for its swiftness, nor the warrior for his glory. I love only that which they defend. "
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Quote:
Originally posted by Magonsdaughter:Don't you guys have to have roadworthy's for cars? I mean $500 for a car wouldn't be roadworthy.
It all depends on the state.
I do not fear God, I fear the ignorance of man.
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Quote:
Originally posted by AURaptor:Yes, that IS a big problem. Because, like so much of what this administration does, it's a catering to a voter base, instead of doing what's right for the whole country. The auto companies got themselves into a heap of trouble, and largely thanks to the union contracts they agreed to pay. All Obama did was siphon $ from the tax payers and hand it to his union campaign contribution bundlers, and only to stave off the inevitable.
Yes, ignoring that negotiations with the auto unions to reduce the contracts, the fact that saving GM saved a huge amount of jobs not only in the auto industry but in the supply industries, and the fact that C for C helped save a fair number if dealerships that also employ people.
I do not fear God, I fear the ignorance of man.
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Gawd, you gotta love it. "instead of crushing those workers back into bad paying jobs held by disposable illegal aliens and poor folks so desperate for any job they'd build cars for minimum wage" is seen by Raptor as a good thing; yes indeedy, we should crush ALL workers who we don't like into minimum-wage jobs, poverty and desperation, yes, YES! Make that wage gap BIGGER and BIGGER, of course, good job!
I wonder what he'd do if those crushed workers ever have enough and rise up? He can only kill a few at a time with whatever gun he cuddles up with at night, and eventually he'd run out of amunition. But by gawd, we gotta have LEGAL Americans doing those shit jobs, good, hard-working Americans crushed under his boot heels. You betcha!
If there was any intelligence behind the echoing of right-wing talking points, there might be a debate. Like, for instance, other possible reasons auto makers failed, were failing or are failing, aside from those "evil union workers":Quote:
1. Much is said about poor management in the Big Three, but less is said about the short-term focus on quarterly profits that characterized their corporate culture. Maybe we should examine whether the short-term focus on quarterly profits that was certainly part of the Big Three's demise is itself bankrupt. Maybe this corporate philosophy is leading American industry to the junkheap because it creates all the wrong incentives and disincentives: an obsession with profits rather than quality, a dearth of long-term planning, a pressure to pay out bonuses and dividends rather than pay down debt and all the rest.
Maybe the collapse of the Big Three is not just an indictment of the Big Three but of Corporate America in general. The endless propaganda spewed by the financial press never tires of glorifying Corporate America with stories about "the top 100 companies," the top 50 innovators, the best companies to work for, etc. etc. etc.
Maybe it's as simple as: those companies with long-term planning and an abhorrence of debt will prosper and all those which focus on short-term profits and acquiring debt will wither.
2. Most of the profits generated by the Big Three in North America came not from manufacturing vehicles but from financing the sale of those vehicles. In other words, the auto industry securitized its way to "prosperity" just like the investment banking and housing industries.
3. The durability of Big Three-manufactured cars was simply not competitive. The Big Three chose to tout the J.D. Powers reports on the number of defects found per new vehicle as the proper metric for their improved quality; as a low-income marginalized consumer my metric was more demanding: can this car run for 12+ years with almost no maintenance or repair bills?
This lack of durability of the Big Three vehicles receives almost no visibility. The fact that a car made by American workers with largely American-made parts in Tennesee lasts a decade or more with virtually no repairs or maintenance required while the 10-year old Big Three vehicle is either junked or a problem-riddled "beater" is the 800-pound gorilla in the room few have cared to discuss.
There are three basic explanations for this decline in durability. One is that the Big Three relentlessly squeezed their parts suppliers to lower costs, and since that's all that mattered then the quality of those parts declined--you get what you pay for.
Meanwhile, the Japanese management philosophy is quite different; they seek to establish a consortium of parts suppliers which they will work with for years if not decades. Yes, price matters but quality matters above all else. The suppliers eventually learn they can make a profit by supplying high-quality parts in quantity to Honda, Toyota, et al.
Poor parts lead to parts failures and durability vanishes.
The second possibility is that the Big three consciously pursu
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Anthony,
I'm going to agree with Wulf here, but I have a couple of things to add.
Here, in NY, I'm finding a dearth of low cost vehicles, and the overall price of used cars has definitely at least doubled. That's annoying.
The definition of clunker is awkward too. It meant "<18 mpg." That means SUVs and the like. As someone with a boat, I would like to get an SUV to tow it, but now they are overpriced because so many are gone, so they're out of my range.
Now, I'm somewhat stunned that you thought "highy of it" at some point. I would think that the flaws would have been instinctive, but if not, let me try to suss it out.
1) The energy cost of building a car vastly exceeds its lifetime fuel consumption.
2) Any time you are destroying a real world thing for an on paper gain, you are automatically generating a loss in human industry in favor of a bureaucratic bumble. I cannot imagine a situation in which this would be a positive thing.
3) Removing supply from any market is automatically going to be detrimental to all consumers in that market, as all markets bleed into one another. In this case, a person who might buy an SUV, like me, will now buy something else that has a similar size engine, which means a luxury or muscle car, that I probably wouldn't normally buy. This means I'm spill-over pressure on that market, and I'll be taking off the market some of the lower priced cars in that class, and causing the price to go up for those who might buy such a car.
Specifically, if I were to get a smaller car, and simply rent a truck when I wanted to move my boat, my preference would have been for a used Datsun. They were going quite cheaply prior to cash for clunkers, but now they are very expensive. I'm sure no one crushed their Datsun, and the cars have gotten older, but I can see that people on the lower end would probably also prefer them to other cheap cars, and so they got pushed out of the cheap car market by an excess of demand spilling over from other areas.
Now, sure, the spike will subside in a while, but for the moment, it's still in effect and very annoying. I noticed that my Chevy was worth about $300 when it started, about $2000 at the peak, and about $700 now. Some things will not come down, however, and I feel that I missed an opportunity there to trade in for a Datsun.
More of a nationally impact was that of personal debt for anyone dumb enough to take part in this program. I read a study of those who did, and one of the requirements going in what that you hold no debt on the car, so about 5% of participants held car debt (on a second vehicle.) After participation, around 80% of owners had car debt, and the average amount of debt was $14,000, the most popular car was the Toyota Prius at $24,000. I assume that though the program offered discounts, the amount was (I forget, i think it was a $5,000 voucher or so) and the buyers must have contributed some of their own cash as well.
The recipients of all this cash were car companies and banks, and the losers were middle class families, who had been tricked into thinking that fuel efficiency was worth the cost. Undoubtedly this involved some bogus calculations which excluded interest payments, fluctuations in the price of fuel, etc.
That's what a ship is, you know - it's not just a keel and a hull and a deck and sails, that's what a ship needs.
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Quote:
Originally posted by Magonsdaughter:Quote:
Originally posted by AnthonyT:
"Whats "inexpensive"? To Joe Blow, inexpensive means a 500 dollar car. To Bill Gates, its a 500000 car."
Hello,
Cars are available in my area in the 500-2000 dollar range. Of course, you get what you pay for with such vehicles, as you always have. They generally have multiple mechanical faults and leak multiple fluids and possibly burn some oil. They are a temporary solution to a permanent problem. All the cars I ever owned in Florida were all of this type. None of them cost more than two thousand dollars, and most of them hovered around 1000. Back then, I had a mechanic named Pepe who would perform triage on my car every few months, repairing or replacing the most defective systems to keep it running just a little longer. "Pepe, I've got 200 dollars. What do I absolutely need to fix to make it through the next 30 days?"
Anyhow, such cars still exist where I live, but Pepe is gone, so I invest a lot more in my vehicles now.
Don't you guys have to have roadworthy's for cars? I mean $500 for a car wouldn't be roadworthy.
Hello,
In my youth, I frequently drove vehicles that violated the minimum standards for an automobile in one particular or another. I remember on one car, the muffler literally fell off while I was driving it. I retrieved it and put it in the back-seat. I drove that way for weeks. When a police officer would pull me over, I'd indicate the muffler in the back seat and say, "It just fell off. I'm going to take it to be repaired." It wasn't entirely a lie. I eventually was able to pay Pepe to re-install it.
On one car, the alternator wasn't functioning correctly. So every day when I got home, I had to use a battery charger to charge the car battery so that it would start and run the following day. That went on for weeks until I could afford to fix it.
Several of my cars have not had working windshield wipers. One car really loved to burn oil, which created black clouds of noxious smoke behind the vehicle whenever I accelerated.
No one chooses to drive cars like this. They drive them because they can not afford the alternative. As a minimum wage owner throughout most of my early driving years, I was lucky to be able to afford a car period. Disrepair and cosmetic travesties were the name of the game.
However, I find that the same poor-quality cars that were available in my youth are still available today.
It seems to me that the primary complaint about the Cars for Clunkers program amongst the Republicans is as follows.
1) Tax dollars should not be used to stimulate the economy. This is not a function of government.
2) The government should not engage in social engineering programs, however laudable the goal may sound.
3) We do not like anything that reminds us of Unicorns. (I added this for a chuckle.)
There seems to be agreement that the Cash for Clunkers program did stimulate activity as it was designed to do.
Personally, I would enjoy seeing future stimulus plans that follow the general profile of the Clunkers program, with the buying power being given to the consumer. I like this much better than programs which feed money directly into the businesses.
--Anthony
_______________________________________________
"In every war, the state enacts a tax of freedom upon the citizenry. The unspoken promise is that the tax shall be revoked at war's end. Endless war holds no such promise. Hence, Eternal War is Eternal Slavery." --Admiral Robert J. Henner
ETA: I am adding here a note about the fact that used cars are more expensive to obtain, even though my own observations differ. And also about the belief that people were tricked into buying fuel efficient vehicles, because the prior poster stressed this. I maintain that it is better to make these dollars available to the consumer. The alternative is a direct payment to the businesses, and that does not properly stimulate anything.
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Quote:
Originally posted by AnthonyT:
No one chooses to drive cars like this. They drive them because they can not afford the alternative. As a minimum wage owner throughout most of my early driving years, I was lucky to be able to afford a car period. Disrepair and cosmetic travesties were the name of the game.
No one has the 'right' to own a car, and owning and driving cars that are unroadworthy is highly dangerous to people's safety as well as being an environmental hazard.
Some cars just shouldn't be on the road. They are a significant cause of accidents and road deaths.
To sell a car here you have to have a roadworthy certificate. In some states you need to have a roadworthy cert to register it every year.
There was some talk about bringing in a cash for clunker kind of scheme here, but it never happened.
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"No one has the 'right' to own a car"
Hello,
No one has the right to a job or the basics of life, either. At least not where I've lived. Owning a car makes both of those things easier to obtain, again where I've lived. I hear that some places have remarkable public transportation systems. Hialeah was endowed with a sub-standard system at the time, and such systems were not adequate to fulfilling the transportation needs of some jobs I held.
My only requirements from an automobile when I was young were as follows:
1) When I tell it to go, it goes.
2) When I tell it to stop, it stops.
3) The lights must function.
Everything else was a luxury that I purchased when I was able. With apologies to the environment, I was rather deeply concerned with my own well-being at the time. As far as I know, I never endangered any other drivers (nor would I want to!) I suppose a possible exception is when the muffler fell off, but in fact no one was harmed by that incident. If I'd known it was about to fall off, I'd have removed it myself. It gave me quite a shock when it decoupled.
--Anthony
_______________________________________________
"In every war, the state enacts a tax of freedom upon the citizenry. The unspoken promise is that the tax shall be revoked at war's end. Endless war holds no such promise. Hence, Eternal War is Eternal Slavery." --Admiral Robert J. Henner
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I think that Cash for Clunkers (I'd forgotten about that, thanks for the reminder, I felt silly when I saw it and realized that I'd forgotten it) was a mixed bag. It was good in that people got to upgrade their vehicles when they might not have been able to otherwise, but it was bad in the lack of used cars for a while as Wulf said, though I think that is more pronounced in some parts of the country than others, sounds like NY got hit harder with that side effect. :( for DT.
Magon's, in my state, Oregon, all cars must pass the Department of Air Quality test every two years to show that they are running fine, plus I think they look it over on a cursory level, is the muffler falling off etc. It isn't too hard to pass these tests, but at least there is a standard.
"A completely coherant River means writers don't deliver" KatTaya
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