Maybe Cash For Clunkers Helped The Economy After All?

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What I found untoleraable... because of the demand for high mileage cars in my area, Toyota had $4000 market adjustment, Subura had a $3000, and VW a $6000. Here's the stumper, these were end of the year cars, that the dealer would have normally been discount by $1000-$2500. In all good, it did clear out inventories so the dealers/factories did not have a huge inventory of last years models. But in the end, I'm not sure if the stimulus caused any addition 2009 cars to be produced or put people to work? Detroit was already gearing up the 2010 models which they tried not to trickle into the market less the 2009 wouldn't sale.
It did however help the manufacture from having to take $4000 rebates on cars to clear their inventories. Myself, my 1991 Volvo was at 230,000 and I couldn't clunk it before it hit one lunar unit, and I could not let down fellow Volvo drivers by crushing a good parts car. So taking some of those part cars off the market might in the near long run get other similar makes and models of the road (expensive quarter panels, rebuilt engines, etc). So the factories didn't have to take a loss and give rebate (mostly foreign vehicles), and the dealer took a huge chunk of the rebate, some did take the bait and cash out clunkers, me, I'm just waiting to see what 2009 inventory might be discounted by $3000-$4000, that will allow me to keep my car.

R.S. of OR 11:50AM November 09, 2009

If domestic auto production is saved in America, it will not be due to the efforts of the right-wing blowhards on talk radio, or their braindead dittohead followers.
Unfortunately, George W. Bush failed to follow the lead of his republican predecessor, Ronald Reagan, who despite a multitude of ill conceived conservative ideas, at least had the foresight and good sense to bail out (and save) Chrysler and Harley Davidson during the !980's.
This time, if Chrysler and General Motors survive, it will be due to the efforts of Barrack Hussein Obama, and the billions in life support he supplied to those struggling companies during a time of unprecedented financial crisis, which was further compounded by the wreckless policies of George W. Bush.
President Obama's innovative 'Cash for Clunkers' program was another life support for the entire auto industry in America and all of the downstream suppliers and servicers who are employed in that extensive chain.
None of this matters to the modern right-wing America haters, because it goes against the grain of that old and curiously contradictory Reagan mantra, 'that government is the problem'. And it matters not one whit that Reagan himself contradicted this notion when it was obvious to him that domestic manufacturing and the welfare of the nation trumped stupid campaign slogans and harsh reality.

Forest Gump of AL 10:12AM November 06, 2009

Cash for clunkers reflects the corruption of our government and the naivette of our population: charities that rely on used car donations, poor people who can only afford older cars, used car parts recyclers, and taxpayers (those 88 million of the 138 million taxfilers who actually pay taxes) were all negatively impacted. The environment was negatively impacted: the credit was available with a minimum 4 mpg improvement, thus there was no real incentive for people to buy the truly efficient high mpg cars, and many recyclable parts were crushed. Notice that car sales have completely slumped to new lows now that the program is over, so long term there was no stimulus. The people who cashed in however, do not usually see this bigger picture...they are likely to vote for the same crooks who stole from everyone else to help fund their new vehicle.

Lloyd of ID 10:12AM October 08, 2009

Cash for clunkers reflects the corruption of our government and the naivette of our population: charities that rely on used car donations, poor people who can only afford older cars, used car parts recyclers, and taxpayers (those 88 million of the 138 million taxfilers who actually pay taxes) were all negatively impacted. The environment was negatively impacted: the credit was available with a minimum 4 mpg improvement, thus there was no real incentive for people to buy the truly efficient high mpg cars, and many recyclable parts were crushed. Notice that car sales have completely slumped to new lows now that the program is over, so long term there was no stimulus. The people who cashed in however, do not usually see this bigger picture...they are likely to vote for the same crooks who stole from everyone else to help fund their new vehicle.

Lloyd of ID 10:12AM October 08, 2009

Show me something the Government has done right and I can show you corruption, U S postal workers sleeping in rooms because they are not needed, Government funds acorn, seiu, apollo, and other terrible organizations, bridge to no where, cash for clunkers was a waste of hardworking Americans, vote all of them out. Change Washington, vote for 4 year term limits on Senator's and House of Representitives, they are also the major problem Americans are being taken advantage of, Wake up this is not a blue or red issue here. Save America from the corruption in Washington NOW.

Ed of IA 2:26PM September 19, 2009

He has no education in economics, and he demonstrates this fact in his columns. He is consistently liberal for the sake of being liberal, and cherry picks his examples. He essentially hates free markets.

J of FL 3:25PM September 16, 2009

Why is it that I have not heard of any concerns about destroying perfectly good vehicles that could have been put to good use by donating them to low income people that need a car to get to work..etc. Why is destroying these clunkers so necessary? It sounds like wastefulness to me.

Robin of AZ 11:43AM September 15, 2009

It's very painful to admit that the program did harm. It looked like such a win-win. But I'm seeing too many downsides. People who owned their cars outright now make payments. Ouch. Car dealers boosted prices; if you didn't have a trade-in, you overpaid. Eew. Used car dealers, even Carmax! will have reduced inventories and used cars will more expensive. Ouch. Nearly all of the top 10 cars were probably built overseas (or Canada & Mexico), no boost to American production. So, which Americans won? New car dealers. Car insurance companies. Detroit car executives. States with high car tax. The banks underwriting new car loans. Metal scrap dealers. Possibly junk yards if the cars were raided for parts. New car inspectors.
Maybe the long-term win will be that those who traded in their clunkers will pay a lot less for gas. Maybe even $20 per 500 miles. (Trade an 18mpg car for a 25mpg car.) And no repairs for a few years. (oops, car mechanics lose, parts manufacturers lose...) And hopefully, they will use LESS GAS. (Do you really care if the oil companies lose?) Also, the cars will be "better built" with more safety features.
Add it up. The losers are: new car owners with huge car payments, mechanics, gas station owners, used car dealers... and people who can only afford used cars - the little people! The winners are: banks/loan underwriters, car dealers, car insurance companies, states with high car taxes, and Detroit and Japanese car executives - the rich got richer.
I think the wrong people won the game.

Lauren in Brooklyn of MD 8:43PM August 26, 2009

What a ridiculous program- there was probably no real benefit to the environment- so you get rid of clunkers but how many will be bar b que ing this weekend? or will there be a forest fire ? How much pollution did it take to make the new car. how about smog checks and none of my money because you want a new car. This program just benfitted people that had clunkers it is not equitable 9douobly not equitable to car companies who already got a bailout- here's another round but no incentive to get rid of gold plated pensions and bad designs- I am contributing 4500 to my neighbors new car wtf.

SF2OAK of CA 2:24PM August 26, 2009

I am no scientist or economist but I believe giving the money to the people in such a way is better than giving it to the companies for several reasons
1. people buy whats available and they can use and sometimes feel they have no way of getting what they really want because they have jobs and are not inventors
2. you encourage those who are inventors to invent what the people want.
3. those who are greedy and do not concern them selfs with quality go out of business
Which is why I feel bailing out wall street and the banks was backward and wrong and was not in the interest of the people
Let the people decide!
Also education and health will move this nation foreword. Health care as we have now does not always make us healthy.
I heard that in our history we gave blankets to the Indians to keep them warm but what we did not tell the Indians is what hurt them.
A free gift or A Trojan? the blankets had a virus in them to rid us of the Indians(poor).
Its okay for the government to act as our savings account for hard times but in hard times I would like the money to go to the right places.
even though nobody likes politicians and do not get involved with the government anymore.
The contitution is still for the people by the people.
It is our responsibility to take back our goverment.
Don D. Brock

Don D. Brock of AZ 1:32PM August 26, 2009