Cash for Clunkers
POSTED BY: AnthonyT
UPDATED: Sunday, October 2, 2011 23:29
VIEWED: 4647
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Hello,
I remember that when this program came out, I thought rather highly of it. Amongst a lot of stimulus programs that targeted companies directly, this one targeted the consumer. It created demand amongst the consumer base and also updated a portion of the nation's automobiles to a more fuel efficient standard.
But lately I've seen the Clunkers program derided by some folks. What was the downside to this program that has made it unpopular with many Republicans? I'd always thought it was rather successful.
--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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Ok, I'll field this one.
So you've got some POS claptrap you want to get rid of? Ok. The "gubmint" going to give you some great moolah for it.
They give you, maybe, a grand over what its really worth. You're happy, cus you got rid of it and you can put a down payment on a Chevy, GM (or some other government bailed out company car).
I mean, lets get rid of these gas-guzzling, old, cars. Make way for the new hybrid, unicorn-horn burning super machines!
Great, right?
Except.
Those "clunkers" are then sent to the trash heap. Crushed, and sold for scrap metal. But hey, thats ok, right? It barely ran, or was too old and ugly to be worth much.
Except.
Now there is a shortage of cheaply priced used vehicles.
So, Joe Blow, has got exactly 700 dollars to his name. His POS dies. He needs a new POS to get to work. But ALL of the POS cars in his area have been traded in under "Cash for Clunkers".
In fact, now, to try and buy some used POS he needs at least 5 grand. Cus there arnt any more cars that he can afford.
So, he tries to get a loan. But can't. Cus while he could afford 700 for some crappy car, there are none left.
So now, hes out of work, cus he can't afford to buy a vehicle to get work...
and he has to then go on unemployment.
"Hope is a good thing, maybe the best of things, and no good thing ever dies"
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Hello,
I am still able to find inexpensive used vehicles in my neighborhood. A 'POS' as you put it.
Is your objection based on the idea that the Cash for Clunkers program consumed the entire American inventory of cheap used vehicles?
Would you have found the program more helpful if it did not require the trade in of a 'clunker?'
--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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Btw..
Chevy and GM are AGAIN going bankrupt.. (they took those government loans)
But Ford? Who refused?
Doing just fine.
But hey, bailouts worked... right?
"Hope is a good thing, maybe the best of things, and no good thing ever dies"
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"Hello,
I am still able to find inexpensive used vehicles in my neighborhood. A 'POS' as you put it.
Is your objection based on the idea that the Cash for Clunkers program consumed the entire American inventory of cheap used vehicles?
Would you have found the program more helpful if it did not require the trade in of a 'clunker?'"
Whats "inexpensive"? To Joe Blow, inexpensive means a 500 dollar car. To Bill Gates, its a 500000 car.
Much of it comes from the real belief that this government was trying to clear the market of "gas-guzzler" cars, to make way for hybrids and green energy-tech ones.
Even if they were overpriced. Or out of the reach of most Americans...
But hey, PROGRESS must be FORCED.
"Hope is a good thing, maybe the best of things, and no good thing ever dies"
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Well, for one thing, it urged people to get rid of cars which were capable of giving them reasonable transportation, and trading in for cars which were more expensive than they would have likely bought on their own. Once all the extra fees were tacked on, along w/ higher insurance and cost of operation ... it amounted to a colossal boondoggle.
A worthless waste of tax payer money, as is the case with much of what this administration has given us.
" 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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Well, it's an Obama/Democrats program. That's all it takes.
If you want why they SAY they oppose it, tryQuote:
Republicans say the problems with the program are another strike against the Obama administration as it pushes for a speedy overhaul of the health care system that would involve a government-run insurance program. They argue that government involvement in any industry is a recipe for disaster.
.....
“Within a few weeks we will see that this process was abused by speculators and people who took advantage of what is basically a huge government subsidy of corporations that they already own,” Mr. McCain told Fox News last week.
.....
Speaking on “Fox News Sunday,” William Kristol, the conservative editor of The Weekly Standard, said the rebates were going to middle-class people who would have eventually bought a new car anyhow.
Instead of helping the legions of unemployed, the money is going to a “bunch of upper-middle-class people who have some cars sitting around from 12 years ago,” Mr. Kristol said. “Now they’re just accelerating their purchase to get 4,500 bucks.” http://thecaucus.blogs.nytimes.com/2009/08/02/cash-for-clunkers-become
-a-republican-target/ was in 2009.
It's been hugely successful in some respects, disappointing in others. The average fuel economy of a clunker was 15.8 mpg, compared to 25.4 mpg for the car that replaced it—a 61% improvement.. It's been good for the auto industry, good for those who have turned in cars, stimulative, as above good for fuel efficiency and as a result, good for the environment. But there were actual negatives. Since the "clunkers" had to be destroyed, it created a shortage of used cars for lower-income buyers. It was so popular it ran out of money almost immediately, and another $2 billion had to be added, which also went pretty quickly.Quote:
There were problems in the interest crashing the cite initially, a paperwork boondoggle for auto makers, and other things. It was discontinued. It only existed from July 1, 2009 to August 25, 2009. There were valid arguments for and against it, and valid arguments whether it was a success or failure.
A September 2010 study by Atif R. Mian and Amir Sufi concluded that the program simply pulled purchases from the future: it produced a short-lived effect (360,000 additional cars sold in 2 months), but that the effect was almost completely reversed in the 7 following months due to fewer cars sold, and found no evidence of effect on employment, house prices, or household default rates in cities with higher exposure.
.....
Despite Transportation Secretary LaHood claims that the program would benefit scrapyards,[64] auto recyclers and scrapyards have lamented the limited profit potential of the program, including the costs of transporting and removal of toxic waste such as motor oil, coolant, refrigerants, gasoline, unrecoverable plastics, and other items)[65] from the car before processing, which can amount to between $700–$1,200 per car. Some recyclers refuse to participate in the program due to this. Wiki
The new one has differences. First, the program does not incentivize trade-ins, only the purchase of the vehicle. That’s an improvement over the original C4C in at least the sense that it didn’t destroy viable assets. The 2009 program destroyed cars that lower-income people could have purchased; instead, C4C created an artificial shortage in used cars that pushed prices higher and reduced availability. Also, this is not a new subsidy, but a new delivery mechanism for an existing subsidy. Whether it passes (probably not) and whether it would be a success or failure, remains to be seen.
Hippie Operative Nikovich Nikita Nicovna Talibani,
Contracted Agent of Veritas Oilspillus, code name “Nike”,
signing off
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Ahhh, I see our righties were right there to make claims based on what they "know", whether valid or not. There is SOME validity in the fact that there was a short-term deficit of used cars. Not at all what Wulf says, however.
It was also not a "collossal boondoggle" like Raptor claims. I've provided the facts, above, from several sources, which will give you some relatively nonpartisan answers. Whether it was a success or failure is up to you to decide from those FACTS and FIGURES. They will no doubt deny any of the positives.
By the way, Wulf is wrong: "At the end of the program Toyota accounted for 19.4 % of sales, followed by General Motors with 17.6%, Ford with 14.4%, Honda with 13.0 %, and Nissan with 8.7%."
There's the fact that foreign cars are made here, as in provide jobs.Quote:
The program was introduced at a very unique time in automotive history. Annual retail sales were in a spiral. Decreases were in the area of 6 million units over a 20-month period with no end in sight for how low it could go.
Toyota, Honda, and Nissan were also reeling, suffering significant losses in market share and, in some cases, product quality. Once thought to be untouchable, their steady rise to the top was now completely up for grabs.
.....
As if this weren`t enough, the price of gasoline reached record levels. Not only was it a daunting prospect that people could manage to pay for a new vehicle, but it was also equally unlikely that they could afford to drive them after taking ownership. Fuel efficiency was quickly becoming just as important as the purchase price of a new car, truck, SUV, or van. http://autos.yahoo.com/articles/autos_content_landing_pages/1164/Cash-
for-Clunkers-Success-or-Failure- the whole, contrasting the stimulus, gas mileage and environmental effects with the negatives it created, I'd say it was somewhere in the middle; given the time it was done, it saved jobs and created a short-term stimulus. But then hey, I'm a liberal, so I must be grossly partisan about it, right?
Hippie Operative Nikovich Nikita Nicovna Talibani,
Contracted Agent of Veritas Oilspillus, code name “Nike”,
signing off 
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Quote:
Originally posted by AnthonyT:
But lately I've seen the Clunkers program derided by some folks. What was the downside to this program that has made it unpopular with many Republicans? I'd always thought it was rather successful.
--Anthony
I think you answered your own question.
Anything the Dems do is BAD, no matter the outcome, in the minds of the teabaggers and GOP.
"Goram it kid, let's frak this thing and go home! Engage!"
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"The 2009 program destroyed cars that lower-income people could have purchased; instead, C4C created an artificial shortage in used cars that pushed prices higher and reduced availability."
Which is what I said...
"It's been hugely successful in some respects, disappointing in others. The average fuel economy of a clunker was 15.8 mpg, compared to 25.4 mpg for the car that replaced it—a 61% improvement.. It's been good for the auto industry, good for those who have turned in cars, stimulative, as above good for fuel efficiency and as a result, good for the environment. But there were actual negatives. Since the "clunkers" had to be destroyed, it created a shortage of used cars for lower-income buyers. It was so popular it ran out of money almost immediately, and another $2 billion had to be added, which also went pretty quickly."
What I said.. but added that the new cars run on hope, dreams, and unicorn-horns...
"Also, this is not a new subsidy, but a new delivery mechanism for an existing subsidy. Whether it passes (probably not) and whether it would be a success or failure, remains to be seen.
"
PROGRESSIVENESS must be forced! Even if it doesn't work. Can I get an AME...err... head-nod?
"Hope is a good thing, maybe the best of things, and no good thing ever dies"
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