Cash For Clunkers Bust

By
August 9, 2009

Why do things like this happen? A government plan to take older cars off the road, now thanks to them, Americans shopping for a used car (read NOT the rich) get to pay higher prices for whatever they buy, or buy less car. Who knows, maybe they go without that new used car. Just great. And it happens because a bunch of meddling politicians with a feel good plan have no experience with, or appreciation for how markets work.

You think this is bad? Wait until they finish meddling with GM and the Financial Industry, we'll all be lucky if we aren't broke. This is not new people. It is not a rare event. It happens every time the government takes our money and meddles in the private sector. And that just points to the double nature of this hit, which makes it all the more insulting.

They take our money through taxes, then maybe take a little more so they can buy up old cars, or to service the debt on what they borrowed to buy them in the first place. And what do taxpayers get in return? Higher prices for used cars.

That's called sticking it to you coming and going. Usually people who do that are called crooks, or scam artists and end up in jail. These crooks end up in government cars also paid for by our dime. And when they want to take the family on vacation? They schedule a junket overseas that just happens to hit on the hot spots where the well-heeled like to play. We don't get to go, we just get to pay. And with Obama and the Dems, all we can expect is more, more, more for them, them, them. Isn't it time people stood up together to this craziness and said, hey, what about me for a change? See here for the rest of this miserable tale.

Bleech!!

The much ballyhooed Cash for Clunkers program has had the unintended consequences of driving up the cost of new and used vehicles and used auto parts, according to independent studies of the auto markets. The Cash for Clunkers program demonstrates the danger of government trying to micro-manage supply and demand, and is a warning as to the dangers of Democratic plans for health care restructuring and a cap-and-trade system.

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Comments:
  1. Mark_0454 says:

    Your government at work: Federal Underwriters Bureau of Automotive Recovery (FUBAR)

  2. Ad rem says:

    Mr. Riehl,
    What is all this fuss I hear about a “Cash for Cluckers” program? Seriously, I would think that our government would have more important things to do than worry about whether or not a bunch of poultry has a little spending money. Next thing you know, they’ll be expecting us to by them shoes and send them off to some agricultural college.
    Ms. Emily Litella

  3. Larry Sheldon says:

    The good news is that GM got rid of all the contaminated sites they were going to have to pay hazmat crews to cleanup.

  4. Foghorn Leghorn says:

    WHUT? I SAY WHUT! Ms. Emily, I DO NOT WANT to hear a werd about thowing awey them ole cluckers. If they anythin I caint stan it is a bitchin clucker weth a dryed up cloaca whut ain no use fo no one leestwise me, Foghorn Leghorn. Esq. Executive Chickin Fucker. Bes thaing that fool in de White Howse done es get us cocks sum nice young chicks.
    THANK Ya. Kindly go buy an old clucker as a gud patriot.
    Yors Truly, F. Leghorn, Plenipotentiary of Cocks

  5. jakee308 says:

    Dan, they’re doing that on purpose. They want those “gas-guzzler” off the road. They don’t care if some marginal waged person now can’t find a cheap vehicle to replace their last ‘beater’ that just blew up. They don’t care if the person lives somewhere where there’s little or no mass transit right now. The whole point is to create a demand for mass transit (to be provided at taxpayer subsidy of course). Besides, as far as what I’ve read, the Government hasn’t paid for the cars taken in so far. The dealers are getting very nervous (something like 200k car deals have happened) and the buyers are also concerned as they can’t get the car or they’re out the money until the dealer gets the rebate from the government. As I understand it the website was screwed up (Government contracted software is always clunky and user-unfriendly) and wouldn’t accept the data from the dealers. And they want us to turn over our health care to them? HAHAHAHAHAHAH.

  6. Hyman Roth says:

    Hummer SUVs qualify as replacement vehicles under this “fuel efficiency” boondogle.
    That’s liberalism in action: always the exact opposite result from the stated intent.
    Way to go, 0bamateur! The Carter administration is looking more competent every day.

  7. Ran says:

    Roth,
    Dude, you’ve quoted Jim “War Room” Quinn’s First Law. Heh. Ten years ago, statements like that were considered “extreme”… today it’s common-sense. “Progress” just ain’t what Liberals had hoped it would be.

  8. WBestPresidentEver says:

    The thing about it all..taxpayers are paying for this. So, My neighbor up the street just bought a new car and got the 4,500 TRADE IN. You, me and everyone else that works and pays tax just helped pay for his new car.
    Don’t that make you feel great ?
    Wait til they get doen with healthcare. Ha..you know that Mexican family that has 8 kids and another on the way and is here illegally. Well, you will be paying for their healthcare soon.
    Wait til they pass the cap and tax energy bill. You know all those people that can afford barely to pay their energy bills ? Well, if the bill passes you will be paying the bills they can no longer afford to pay anymore when the cost of energy go out the roof.
    Happy days are here again. ?? LOL

  9. Money Man says:

    Say what you will, this is a good thing. It is better than just giving cash to people. I used the site http://WWW.SLICKBUDGET.COM/CASH4CLUNKERS.HTML to get an informed decision on what car to get and it saved me thousands. I ended up getting a Nissan Ultima Hybrid. This saved me $4500 for the clunkers + $2400 in hybrid tax credit + $2000 from the dealer + $3500 from Nissan! That is $12400 off the sticker of $27300 to get me a mid size hybrid that gets 35 MPG for $14900!!! Are you kidding me? AND it has the 100000 mile warranty on the battery.

  10. mark l. says:

    love to see the profiles on the takers of cash for clunkers…
    it has to be at least 60% of people who are defaulting on their mortgages.
    so they take a car that they own, and take on a 15-20k debt load. Can’t wait to see the default rate on these beauties.
    “It is better than just giving cash to people.”
    I have to disagree. In a tight credit market, you have to pony up something. the govt is providing the down payment, so the loans look legit, becuase they can put 4500 usd down. Yes, it makes it easier to get a loan, but now in lieu of an income or real ownership of anything, aside from a junky car, the govt just helped at least half of the buyers go further into debt, which, like their mortgages, won’t be repaid.
    clunkers for trailers? now that’s a plan.

  11. mark l. says:

    this thing is like its own mini bubble, that the admin created for an artificial boost in gdp for the 3rd quarter.
    people who would not be compelled to buy a car in bad econmic times will be forced ‘psychologically’ to spend money they don’t have for the skae of redeeming a coupon. it would be like getting one of those coupons in the mail that offers you a 5000 dollar coupon on a 20k purchase. The morons of the universe are compelled to spend money they don’t have, to redeem such a ‘valuable’ coupon.
    here’s how the bubble plays out. everybody who was going to buy a car in the next six months, bought theirs during the coupon stage. 3rd quarter gdp comes out, and we look like we are exploding out of recession. the problem is that no one buys cars in the 4th quarter, which ironically, would have featured dratically reduced prices to clear space for the 2010 models.
    3rd q gdp looks fantastic(well, actually just ‘better’), 4th q gdp falls flat.
    this was a cosmic act of desperation to boost large ticket price sales(because next to housing, this is the second biggest ticket out there), at the expense of future purchases, for the very short term.
    The one advantage for the admin is that they can create a rosy economic scenario, when the gdp number comes out in october, and they have a small window to capitalize on it, before 4q numbers come out in january.

  12. Josh Painter says:

    You never hear anyone talking about how this turd of a federal program affects auto mechanics and parts people. Just because a car is older doesn’t mean that it’s apiece of crap which should be taken to the scrapyard and crushed. Some older vehicles should, but not all of them.
    Case in point: have you seen the video of the Volvo that takes about four times longer than the other cars to be killed? It’s a perfectly serviceable car with a six-cylinder engine which is remarkably durable. Why take vehicles like this off the road? They are all some people can afford to drive.
    Our thow-away society is only encouraged by this kind of liberal insanity. Good vehicles with a lot of life in them are being taken off the road, hurting people and killing aftermarket jobs in the auto industry, a sector this is already hurting. So mechanics, small garages, parts houses, parts rebuilders and parts manufacturers will all be hurt and jobs will be lost all for two or three miles per gallon?
    This just plain sucks.
    - JP

  13. WBestPresidentEver says:

    A lot of things going on these days just plain SUCKS. I can hear the sucking sound now. LOL.
    What do you do. ?????

  14. mark l. says:

    “You never hear anyone talking about how this turd of a federal program affects auto mechanics and parts people.”
    here you go…
    my cherokee just blew its window motor/switch. I was thinking about going to the junkyard to get a replacement part, and I get an ABC news break talking to a guy who is going to have to destroy a 95 grand cherokee-his quote?
    “this car is in great shape, the owner took great care of it, now I have to destory it”.
    it’s not like obama was in any danger of losing my vote, but I imagine people who are holding their cars, because they took care of them, and they have been reliable, are a little apalled that the govt is calling the car a “clunker” and destroying it.
    If you got a car on the deal, I’m happy for you. If you didn’t because you are watching your money, or you like your car, you get nothing.
    Little surprise that rassmussen has the disapproval at 54%, with approval at 33%, for C4C. I hope the dems keep running this deal, because it just shows how out of touch they are. The media used to be a good third party judge, but now they are just seen as enablers by a majority of americans.

  15. Rich K says:

    Yep, For those with the income its a great deal to steal from their neighbors and get a new car at full list price minus the rebates.It was an excellent deal for the japanese car companies too as they seemed to get the bulk of the business.OH, and of course we who didnt partake of the free whiskey during happy hour do get the benefit of the local taxes collected on the deals which help local economies spend on more bullshit social programs for deadbeats and parasites who contribute nothing to anyone and to the beaureucrats who get paid to manage them.What a Maaavalous program.
    HAPPY DAYS ARE HERE AGAIN!!

  16. syn says:

    Rich K
    I was just going to say what you said only you said it better.
    Yes indeed, shiny happy TV people enjoying happy days again.
    Though I have to wonder how heavy the hangover will be when the bill comes due for the big party being thrown today; do Americans believe they can drink the cheap champagne forever and not end up with their heads over a third-world toilet puking out their guts?

  17. Barbara says:

    Dan,
    It has been my contention that this program was designed to hurt charities,
    primarily Christian charities at that.
    I also feel that the expansion of “paid” volunteer government programs are designed to hurt Christian groups.
    The 3rd dot to me is the change in taxcode to limit charitable deductions.
    This a war on Christianity to replace God with government.
    ,,B

  18. WAHOO WILLIE says:

    I’m going to drive what I want to, even if it’s a hummer with a bad head gasket. Just ot of curiosity though I ran a little test and learned that I could get 3500. for my pickup and replace it for one with less power and gain 1 MPG! I was so tempted to do my part to save the planet, but the 500 a mo payment for 60 mo scared the shit outta me. Dont sweat used cars though, banks will be piling up repos in October…..I assume anouther round of bailouts for the banks for this great program. Auto financing credit crunch on deck, more money wasted, and we’re still bulldozing forests and filling wetlands for parking lots and golf courses and flying congress to and fro in gulfstream jets. Way to save the planet Obie.
    CHAINS WE CAN BELIEVE IN!!!

  19. Barbara says:

    Willie,
    keep your truck I will sit in the middle if you aint hitched ;)
    Thank you for being an American MAN.

  20. WAHOO WILLIE says:

    Sorry Barb, completely married for over a quarter century.

  21. WAHOO WILLIE says:

    “local taxes collected on the deals which help local economies spend on more bullshit….”
    Since you mention non-producers and other parasites, it’s sort of like North Carolina laying off teachers but giving FURTHER tax breaks to the film industry.Funny the demonrats sense of priority.

  22. mark l. says:

    funny you mentioned north carolina…
    i have family there. they are going crazy over the fact that the state was holding their state income tax returns.
    haven’t gotten the update of whether they have finally been made, but the delay is going to be fodder for the conservatives in the state for a looong time.

  23. WAHOO WILLIE says:

    Dunno about that Mark, I’m retired and pay no state income tax. NC did not have enough of eight years of a crooked governor (now finally being investigated by feds) the geniuses who were taught to check “D” on a ballot gave us his Lt. governor. I’m not sure she even took the oath of office before she was raising taxes. We already pay highergas taxes than all four of our neighbors but that wasn’t good enough for that dingbat. She even wants to tax labor. Yeah, when you get your oil changed, bottled water delivered, whatever, she wants to tax the service just like goods.

  24. mark l. says:

    http://www.newsobserver.com/news/story/1431445.html
    “North Carolina has delayed sending out state income tax refund checks so state officials can juggle the cashflow needed to give taxpayers back their money.
    Secretary of Revenue Ken Lay described the problem as a temporary backlog, because the department is having to tap special accounts to pay refunds, he said.
    “Everyone who is due a refund will get a refund,” Lay said in a prepared statement, saying he expects progress in the coming weeks.”
    and I thought ken lay was dead.
    who’s over education? josef stalin or adolph hitler.

  25. xerocky says:

    To me it’s pretty basic, the industry has been working for years. Nothing has changed. The only reason that people aren’t buying cars is because of the crisis that started because the democrats wanted to give poor people the wonderful gift of home ownership. That caused what may be the end of capitalism, so what do the democrats do?? They start to screw with the basics of the next big money maker, cars. And of course health care.
    Mark l, I think that you are correct, this will make a bubble and when the bubble pops, I really wonder who they’ll blame? Bush?

  26. joyMc says:

    The law of unintended consequences. Democrats take it to a new level on a daily basis.

  27. Cash for clunkers is hurting charity car donation since many of the vehicles being turned in for a voucher would have been donated to charity for a tax deduction. These running vehicles are being destroyed even though many of them are in good condition. This seems like such a waste.

  28. joyMc says:

    Cash for clunkers is anti Hispanic down her in Texas where many of our Hispanis residents have larger families and really like to buy used SUVs. When is LaRaza going to realize?