Government can work, and the "Cash for Clunkers" program proved it. So, naturally, conservatives have to hate on it.
The "Cash for Clunkers" turned out to be one of the most successful government programs in some time. It was so successful that a program that was meant to take until November achieved its goals in something like a week or two! Thousands of cars were sold, helping dealerships and car companies to move toward recovery. Thousands of gas guzzlers were scrapped, helping the country move toward improved energy efficiency.
Dealers reported that their showrooms were full and their sales way up. Ford reports that the program is helping them have a strong July.
Ford Motor Co has seen a sharp increase in sales over the past week since its dealers began accepting trade-ins under the U.S. government's "cash for clunkers" incentive program, the automaker's U.S. sales chief said on Thursday.
The only problem with the program was that so many people are taking advantage of it that the computer system got slowed down!
Yes, the program achieved its goals in record time. So the House has approved an additional $2 billion and the Senate should take it up this week. This means even more help to dealerships and manufacturers and even more fuel economy for the country!
What could be wrong with that?
Well, if you are a conservative, plenty is wrong with that. First of all, it makes government look good -- and conservatives just hate government. Government is those people who get in the way and tell companies they can't pour toxins into our rivers. Government is those people who show up and ask big companies to share what they make -- after building the roads and courts and schools that enabled them to do so well. That goes against everything conservatives stand for: dirty rivers, big corporations doing and taking anything they want for free, etc.
Mostly, though, a big success like this comes at exactly the wrong time for conservatives. Right now conservatives are fighting tooth and nail to keep We, the People from passing health care reform in a way that chooses better care and lower costs for the people over higher profits and CEO pay for insurance companies. So right now it is vitally important to discredit the idea that government can do things right.
So just as it starts to become clear that the government has a winner on its hands, we start to see reports in the conservative media -- Drudge Report, right-wing blogs, talk radio, FOX News, etc. -- that call the program a failure. In fact, many of these stories coincidentally seem to use almost the same wording! The lesson they all teach is this failure shows what will happen if we pass health care reform.
So draw your own lessons. Was a program that wildly overachieved its goals, stimulated the economy, improved the country's fuel efficiency and brought a great price for a new car to tens of thousands of Americas a success or not? I say it was, and I say it shows why we want a public option choice in the health care reform!
This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
Follow Dave Johnson on Twitter: www.twitter.com/dcjohnson
Like I’ve said many times before. Thanks Government for taking half my paycheck and giving me nothing in return.
I never see any article that addresses a HUGE problem.
I hear people say, well they should be able to afford a $100 a month car payment.
HELLO PEOPLE.
Do you think these people have FULL INSURANCE COVERAGE ON A CLUNKER?
NO.
Now there insurance has went from $20/month to $80/month.
So NO. They are NOT paying $100 a month, they are paying $180 a month. Almost double what you said they shoudl be able to afford.
Household formation and income levels drive automobile demand. The program affects neither. It accelerates replacement rates by lowering the income of many (at $3 billion, it's $25 per household), and giving large subsidies to few.
Fine, if scrapping a clunker contributed $4,500 to the public good, or if politically important groups (automakers and dealerships) should enjoy greater government largesse - which I doubt you believe, Mr. Johnson, given your opposition to industry subsidies. But the program's efficiency requirements lack heroism, and lack economic sense if CO2 emissions are proxy for environmental damage.
Scrapped cars averaging 15.8mpg have been replaced by cars that get 25.4mpg on average-a 9.6mpg difference. A year of average driving (12,000 miles) produces 2.7 fewer tons of CO2. One ton emission credits cost $19 on the European Climate Exchange. $4,500 buys 237 tons of CO2. Equivalently, drive the new car for 87 years.
Mr. Johnson, praise of the program should rest upon more careful consideration of its environmental impact and its ability to improve the lot of Americans sustainably and broadly. Of all programs held aloft as proof of government's ability to provide healthcare, cash for clunkers is a poor choice.
Why stop there, though? Why just cars? If we paid everyone in America to buy everything they want, surely the economy would thrive? And surely taxes would never have to go up to pay for it, and inflation would never be a concern, right? Da, tovarisch.
Associated Press Writer Stephen Ohlemacher, Associated Press Writer Mon Aug 3, 8:51 pm ET
http://news.yahoo.com/s/ap/us_plummeting_taxes/print
WASHINGTON – The recession is starving the government of tax revenue, just as the president and Congress are piling a major expansion of health care and other programs on the nation's plate and struggling to find money to pay the tab.
The numbers could hardly be more stark: Tax receipts are on pace to drop 18 percent this year, the biggest single-year decline since the Great Depression, while the federal deficit balloons to a record $1.8 trillion.
[...]
The last time the government's revenues were this bleak, the year was 1932 in the midst of the Depression.
Senators to put brakes on ‘cash for clunkers’
By Edward Luce in Washington
Published: August 3 2009
http://www.ft.com/cms/s/0/bede213a-8065-11de-bf04-00144feabdc0.html
The Obama administration’s oversubscribed “cash for clunkers” scheme looks likely to founder in the Senate this week as bipartisan opposition mounted on Monday to the $2bn extension passed last week in the House of Representatives.
http://www.ft.com/cms/s/0/bede213a-8065-11de-bf04-00144feabdc0.html
Just this year I have...
Traded my car under cash for clunkers: $4500
Contracted to replace my roof with an energy star roofing material (metal): $1500
Replaces one of my doors with an Energy Star Door: $55.
My total stimulus benefit: $6055
Now there are those on the right who see the stimulus as taking tax dollars from one person and giving them to another, but since corporate welfare does exactly the same thing, I have no problem taking advantage of any and all stimulus deals. I will just note in the margin of my tax return that any stimulus benefit I have taken should come from Exxon Mobile's taxes.
It is your job as a poor person to take care of us, who can afford to take care of oursleves without the Goverenment's help.
Thanks to YOU, I can become richer.
The people it was meant to help, it does not.
Don't ask yourself why the program exists. Ask congress when they voted on it. They specifically said on the floor it was to help those who could not afford a car before, be able to afford one now.
We've ignored this and made up our own reasons of why this is good.
I don't need help from my Gov't. THough I know people who do. I could take advantage of this. But I don't. Because the Gov't needs to stop helping people who can help themselves, and start trying to help those that cannot.
Cash for Clunkers doesn't help the environment; it doesn't help automakers and it will only drive up the price of used cars because there will be more demand than supply once the clunkers are shredded. Market rules, DJ. Learn them.
"The only thing Cash for Clunkers has succeeded in is wasting $1 billion of tax payer money in record time. No wonder Obama has declared it a success “well beyond our expectations.”
http://blog.heritage.org/2009/08/03/is-this-what-passes-for-economic-success-in-the-obama-administration/
Almost all of my elders are self-avowed liberals, and they sound just like you, sane and sensible.
Does anyone remember several years ago when the Big 3 did their Employee Discount for everyone program? It was a big success, the problem was the aftermath. The aftereffect was a huge slump in sales after the program ended. Short term gain followed by long term loss, everyone that could come close to buying a new car bought one during the program. When it ended there were too few customers left to sustain the momentum.
Here we go again.
The only reasons they are against it:
1- it was signed into law under President Obama.
2- it helps the middle class and lower middle class and even some under-employed, all of whom may not have bought another car for more than 2 years depending on how their financial situation looked.
There you have it..the black guy made it happen and millions of regular folks benefit, not just the rich. So what fell in line with the hypocriticans ideology had the unintentional consequences of being good for America. Go figure!!
I have driven a car that gets at least 35mpg since 2002
I have made biodiesel in my garage from waste vegetable oil and burned it in my truck.
I spent $10,000. 00 on a wood gasification system so that I can heat my house with wood and burn about 1/2 as much as what my neighbors burn.
I built my addition out of recycled wood and block.
And, I oppose the cash for clunkers program as a waste of funds that will do no long lasting good to the economy, run the country deeper in debt, is generally just another handout to the automakers.
I guess this makes me a conservative. Go figure.
As long as we continue to spend money we don't have, I don't care what it's for, we're screwed. Sooner or later, the money will run out, and if the economy being built is based on the spending of government funds, there is only one possible outcome when the funding finally collapses.
Can you guess what that outcome is?
In the meantime, I suggest a $100.00/hour minimum wage, free cars for everybody, by all means pave every road that is lacking asphalt, and subsidize everything, from agriculture to zebra importation. It will create jobs, help us all to live better, and only cause minimal inflation. I think we could go at least $30 trillion dollars in debt before China owns us completely. Let's do it.
First, I think the mileage differential should be a little higher so we get more fuel saved and bigger bang for the buck (maybe 3 levels of rebates: $2500 for 5mpg difference, $3500 for 10mpg, $4500 for 15mpg). Second change I'd like to see is that the dealers don't have to ruin the engine of the trade-in vehicle. According to stories I've seen, they have to put a liquid in the engines that permanently renders them useless, but it also makes them useless for recycling. I understand the logic of junking these vehicles to get them off the road, but there are valuable parts being ruined. Parts that could help out the poor, low income, and working class people who can't afford a new vehicle to take advantage of the program, but still need to keep their older cars running.
Let's go one better. Let's break every window in the country to stimulate glass manufacturers and construction business. We could kick off a really big construction boom by burning all our houses down.
Why not cash for refrigerators? Why does the car industry get subsidized but not home appliances?
The point here is that programs like this produce no net gain to the economy. And don't start with the whole "helping people" trope. If Bush, and Obama in continuation, really wanted to help people they would have given all that government cash directly to the taxpayer instead of favoring businesses and Wall Street with it.
"One of the more embarrassing features of the New Deal was the Agricultural Adjustment Act of 1933, which paid farmers to slaughter livestock and plow up good crops, as if destroying useful goods could somehow make the nation wealthier. And yet here we are again, with the cash for clunkers program insisting that working vehicles must be junked to qualify for the subsidy."
http://blog.heritage.org/2009/08/03/is-this-what-passes-for-economic-success-in-the-obama-administration/