The New York Times acknowledges that there are legitimate criticisms of the Cash for Clunkers program.
The first is that the program is simply not ambitious enough — in an effort to make sure American carmakers are among the biggest winners, it set the mileage requirements for newly purchased cars too low. The second is that Congress and the White House are essentially rewarding car owners who in years past chose to buy gas-guzzlers — violating Mr. Obama’s own first rule of environmentalism, which is that polluters should pay.
And the third question is the one that haunts any big government subsidy: Does it make more sense to pay Americans to buy a new, slightly more efficient car than it does to insulate their homes? Or to go to the health club, in hopes of lowering future health care costs?
Even members of the Obama administration are among its critics.
“What we ended up with,” said one senior Obama administration official, who would not speak on the record because he was being critical of his own administration’s environmental bona fides, “is a program in which you trade in old clunkers for new clunkers.”
The third criticsm has to do with the real reason behind the program - to stimulate car buying because of the depression that that sector has been in. And it has done that. But is the plan to keep the program forever? Buyers suspect not so that is why they are trying to take advantage right now. So all we've done is shift the timing of people's purchases. Those who were going to buy a car earlier this summer held off until the program went into effect. Some people moved up their purchases. However, it is doubtful that the $4500 government gift convinced many who weren't intending to buy a car anyway to go ahead and trade in their supposed clunker for a new car. This is a temporary infusion into the market and, while welcome for those in the industry this month, won't do anything to transform the market for the future unless the government decides to put the program in place permanently.
8 comments:
There's a fourth problem with the program: it's being poorly run. I just heard from a friend who is trading in her old van for a new car. She's been without transportation for many days now because, although the dealer has taken possession of her van, the government hasn't delivered on their part of the agreement. The dealer said this has become an increasing problem. In the beginning he was sending the new vehicles home anyway, but the delays in getting reimbursed have become so long that he can no longer afford to do so.
Freeven,
Yeah, but there won't be any wait for subsidized government health care, right?
Oh, my, tfhr, health care is waaaaaaay easier than selling cars. Obama says so.
Yugocare.
This has been a sop to the UAW union and nationalized auto industry from the beginning. Sen. Stabenow (D-MI) was at a GM dealership in Flint, MI touting what she stated was the program "she initiated," because now, GM would have to put on extra shifts to replenish inventories drawn down by the program.
What's next? Whirlpool (appliances) has headquarters in MI. Why not a cash for washer and dryer clunker program, too, Sen. Stabenow?
If they really cared about reducing pollution, what they would do is buy up and crunch a lot of the $500 cars out there that get terrible mileage and don't have working catalytic converters. The clunker program we have is just another ineffective and dishonest giveaway from an incredibly ineffective and dishonest administration.
Do the math for the carbon footprint of producing a new car and scrapping the old one. It's huge and a heckuva lot more than that of keeping that older car running for a few more years.
I agree that this has nothing to do with the environment and everything to do with favors for BO's union buddies.
Green Clunkers - read all about it:
http://www.reuters.com/article/GCA-GreenBusiness/idUSTRE57G38Y20090817
(Pat Patterson could finally realize his life long dream of introducing a guilt free Trabant to California)
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