Cash for Clunkers... a lesson in economics.

[Andy]

So, now that Cash for Clunkers is over 2 months old, what have we learned?

Cash for Clunkers benefited the rich, and harmed the poor.

Cash for Clunkers drives up used car prices

In his 30 years in the used car business, Doug Turner, owner of independent used car dealership Deal N Doug’s Autoplex in Metairie, says he has seen his share of surges in second-hand vehicle prices, but none to the degree he’s seen in recent months.

“I would say they’re probably about 20 to 30 percent higher than what they should be” this time of year, Turner said last week, referring to wholesale used vehicle prices.

While the prices for used cars that middle and lower class need, were shooting up, the rich were taking advantage of tax payer money...

$3 MILLION BUYS NOT-SO-GREEN VEHICLES

Transportation Secretary Ray LaHood has cited the Obama administration's best-seller list of mostly smaller, fuel-saving cars like the Ford Focus to describe the success of the "Cash for Clunkers" rebate program. But what LaHood doesn't mention is that some trucks and sport-utility vehicles that get less than 20 miles per gallon are being purchased with the new government subsidies, says the Las Vegas Sun.

And since the program offers rebates of up to $4,500 and isn't limited to the best gas savers on the market, big car salesmen and luxury car dealerships are seeing their sales increase, says the Sun.

Among the cars purchased were such, lower and middle class vehicles like...

2009 Cadillac SRXs
2008 Hummer's H3T
2009 Lexus RX 350
2009 Lincoln MKX
2009 BMW X3

All these high dollar, luxury upper-class purchases were made on our tax dollars, thanks to liberal idiots.

But what about the vast benefits? What about all that savings of fuel and the drop in gasoline prices?

http://www.wtrg.com/daily/small/clfclose.gif

Huh, prices have gone up and gasoline sales are on the rise!

Yeah yeah, ok maybe it didn't help the poor, and perhaps we did end up buying luxury cars for rich people, and yeah ok maybe it didn't have any effect on gasoline sales at all....

But at least we boosted our economy!

Sorry, wrong again. After the program ended, whatever artificial gains in sales disappeared, as well as the rest of the market. In fact sales at the end of September were as low, if not lower than the lowest point they have been during this entire recession.

According to auto-industry research site Edmonds.com, new-vehicle sales across the country are expected to fall 40 percent from sales in August, when the Clunkers program was spurring activity. Jackson says it’s impossible to get exact numbers this early but that in Colorado the drop looks closer to 37 percent.

It’s bad, he said, and so worth reviewing the clear lessons learned from Cash for Clunkers.

And indeed we should. The lesson is, government caused artificial demand, is not real economic growth. Real economic growth doesn't end when the government runs out of other peoples money.

Moreover, this should be a lesson about how good government is at achieving it's goals. In this can, not one single goal was accomplished.

Instead of helping the poor, it hurt the poor.
Instead of saving oil, it did nothing about oil consumption.
Instead of giving an economic boost, the there was none.

Hopefully people will remember this when government laughably claims it can provide health care without new taxes.

 

[Hanno]

Horrible program - of all the kinds of capital to burn down, and I mean, talk about sticking it to the small-time/do-it-yourself mechanics right after propping up GM who won't take money to work on their own cars after 10 years (you know, when a Korean car would just be running out of warranty). Reminds me of the signs that say 'CONSUME' in the movie 'They Live'. Love me some McCain for threatening to filibuster the renewal.

 

[Andy]

Absolutely. This is a perfect example of a complete crash and burn policy. What else would you expect from a president that actually suggested inflating tires was a national policy on fuel consumption.

 

[asur]

Cash for Clunkers Results Finally In: Taxpayers Paid $24,000 per Vehicle Sold, Reports Edmunds.com


This was a waster of taxpayer money, brought to us by Obasma and it's called CHANGE!

 

[pocketfullofshells]

well this may just be me useing all that learning in such...but seems sales where much higher ...and I mean alot during the event..and yes its clear it dropped after,....but guess what thats normal. you run a big sale, right after its over you get slow for a bit...its how large ticket sales go...there is pent up demand, but no one wants to pull trigger...you give a good reason, the flood gates open...but if you where looking and your half smart, you move fast on the savings...Thats why the day after a Big sale ends.....I dont see anyone come in half the time...Same right now at my job, same when I sold cars...also this time of year is always slow, people hold back costs for xmas and such.

also your //here are some cars people got...its a pathetic show of useing stats to show what you want. Why dont you put up a useful graph...one that shows the best selling ones from the event? Why not, simple it makes your list look retarded...as you listed a few cars that made a very very small dent in the sales used from the promo...while the list that shows the cars that sold out the most...Civics, Focus,Corolas.. ext...would show that it did what it was intended, and are lower priced cars. So why dont you post that graph for us...I could, but its more fun to have you do it.

its funny how very little you know about cars, yet how much you talk about them like you do.

 

[ASPCA4EVER]

Andy Said:

All these high dollar, luxury upper-class purchases were made on our tax dollars, thanks to liberal idiots.

Sorry Andy...find each and everyone of those 'LIBERAL IDIOTS' and identify them by name...BTW, please don't leave out those 'OTHER IDIOTS' that voted for this plan either!!!

 

[Andy]

Andy Said:

Sorry Andy...find each and everyone of those 'LIBERAL IDIOTS' and identify them by name...BTW, please don't leave out those 'OTHER IDIOTS' that voted for this plan either!!!

Sorry ASPC, but only liberal idiots were in favor of this program. I don't need, nor care to name them, because you already know who they are, unless you are saying you are too uninformed to be commenting on this forum. If you are too uninformed to be commenting, for be it from me to educate you.

 

[Andy]

its funny how very little you know about cars, yet how much you talk about them like you do.

Yeah, I only worked in the auto industry from nearly every aspect.

well this may just be me useing all that learning in such...but seems sales where much higher ...and I mean alot during the event..and yes its clear it dropped after,....but guess what thats normal. you run a big sale, right after its over you get slow for a bit...its how large ticket sales go...there is pent up demand, but no one wants to pull trigger...you give a good reason, the flood gates open...but if you where looking and your half smart, you move fast on the savings...Thats why the day after a Big sale ends.....I dont see anyone come in half the time...Same right now at my job, same when I sold cars...also this time of year is always slow, people hold back costs for xmas and such.

"seems" was the operative word. Sales may have seemed much higher, but they were not.

Further, the point is not relevant. Sales are now lower than they were before the program even started. Just as demand was beginning to rebound, government stepped in and killed it. Short term gain, long term pain. Meanwhile, we'll no doubt have a tax hike to pay for these failed policies.

also your //here are some cars people got...its a pathetic show of useing stats to show what you want. Why dont you put up a useful graph...one that shows the best selling ones from the event? Why not, simple it makes your list look retarded...as you listed a few cars that made a very very small dent in the sales used from the promo...while the list that shows the cars that sold out the most...Civics, Focus,Corolas.. ext...would show that it did what it was intended, and are lower priced cars. So why dont you post that graph for us...I could, but its more fun to have you do it.

Because it's not relevant. What difference does it make what the "top selling car" was? My point wasn't that moderate cars didn't sell. My point was that high end luxury cars were also getting our tax money.

Do you really support a program that takes money from us tax payers and gives it to the upper class to buy a Hummer, a BMW, a Lexus, and other high end low gas-mileage vehicles? (I point out low-gasmileage not that I care, but just to rub it in idiot liberals faces)

In your screwy world, does the sale of 10 Honda Civics offset the purchase of a Cadillac SRX, Hummer, BMW X3, Lexus RX 350 and Lincoln MKX by super rich corporate CEOs? Oh never mind the fact that most of the other Cash for Clunkers purchases were 3rd vehicles for upper-middle class families to "give" to their college student children.

The relatively small differential suggests that consumers have not been turning in the oldest, dirtiest and least fuel-efficient cars, but instead have been getting rid of their second and third cars, according to Art Spinella, who ran the survey.

“These are third cars used for kids in school,” Mr. Spinella said

Well, I feel better. So now we're buying upper-middle class people, 3rd vehicles to 'give' to their college student kids a bran new Ford Focus and Honda Civic, so they can install neon under lights, and blare 400 MegaWatts of rap music out their windows at 4 AM. Oh wow, I feel much better. My tax dollars at work! Thank Pocket! Thank you Obama! You both clearly have my best interest at heart!

The facts are, this is exactly what happened, no matter what BS crap you spew about which car was the "top selling car" garbage. Sorry, but I'm a bit pissed that I helped pay for a Rich mans luxury land yacht, or his son's punk mobile. Let them buy their own blasted car. Let me pay for my car. Don't make me buy their car. That's stupid, and only an idiot would defend this.


FURTHER...

A total of 690,000 new vehicles were sold under the Cash for Clunkers program last summer, but only 125,000 of those were vehicles that would not have been sold anyway, according to an analysis released Wednesday by the automotive Web site Edmunds.com.

Edmunds found that the program was used for only 690K vehicles. Yet of those 690K sales, only a mere 125K were purchases that were not already planned. Meaning "only" 565K vehicles would have been purchased with, or without the rebate. So we blew tons of tax money on purchases that would have happened if we had saved that money, and not gone further into public debt. (like luxury cars, and 3rd vehicles for upper-middle class families)

Yet....

According to a survey of new-vehicle buyers who participated in the recent Cash for Clunkers program, more than 17 percent now harbor “some” doubt or “serious” doubt about letting a government subsidy convince them to go further into debt.

The significant revelation of the CNW survey, however, is that under normal conditions only 6 to 8 percent of new-car buyers suffer the shouldn’t-a-done-that syndrome.

17% of Cash for Clunkers buyers are now having second thoughts? Second thoughts about having a massive monthly car payment in the middle of a recession?? Shocking!!! Just what we need in an economy crushed by people taking out loans they could not afford, is thousands more people who rushed in for a rebate for a car-loan payment they can't afford.

But that 17% seems a bit odd.... Let see... 125K new car purchased that wouldn't have happened... 125K of 690K already planned purchases is.... (drum roll please) 18%! Funny how those numbers are similar.

So government enticed people to go into massive debt on a new car they couldn't afford, and nearly all of them are now regretting it, save 1%.

I'd wager the buyers of the Hummers, BMWs and Lexus's are not the people regretting getting us to pay for their luxury yacht.

What a great program you support Pocket! Why... I just can't see how anyone, not clinically insane isn't supporting this.... Maybe Government can work the same magic on health care, and make nearly the entire country regret the whole program.

Why yes! Everyone rejoyce! The liberals are here to save us!

Liberal: Ah yes! I can see clearly the program worked perfectly!

 

[ASPCA4EVER]

Sorry ASPC, but only liberal idiots were in favor of this program. I don't need, nor care to name them, because you already know who they are, unless you are saying you are too uninformed to be commenting on this forum. If you are too uninformed to be commenting, for be it from me to educate you.

Naive though you try to sound...you know exactly what my POINT was...and ignore it while you are able...it wasn't just 'LIBERALs' that got that stimulus plan of 'CASH FOR CLUNKERS' pushed through. Hmm...how many states profited from those JOBS that this plan enabled to provide for the auto industry to keep their manufacturing plants open and operational???

Sure it 'ALWAYS' easy to become the constant naysayer/whiner about the problems...but it's taking both sides of this political issue to get something/anything working. So blame away as you seem fit and ignore the TRUTH about the people behind the attempts to create change

 

[TruthAboveAll]

Naive though you try to sound...you know exactly what my POINT was...and ignore it while you are able...it wasn't just 'LIBERALs' that got that stimulus plan of 'CASH FOR CLUNKERS' pushed through. Hmm...how many states profited from those JOBS that this plan enabled to provide for the auto industry to keep their manufacturing plants open and operational???

Sure it 'ALWAYS' easy to become the constant naysayer/whiner about the problems...but it's taking both sides of this political issue to get something/anything working. So blame away as you seem fit and ignore the TRUTH about the people behind the attempts to create change

Actually, it was exactly LIBERALS that got that stimulus plan. Whether operating under the label of Democrat, Republican or Independent, it is a failed LIBERAL economic policy.

The jobs are illusory. True, there are some automotive jobs that are still there, but as inventory builds and suppliers are once again reducing inventory and material, it will become evident that the sales necessary to support true stability and growth are not there. This was a false stimulation in sales, and by it's very definition is a limited scope in effect.

The TRUTH about the people behind the attempts to create change is the TRUTH that they keep trying to use tried and failed policies and gimmicks that simply don't work. Somehow, SOMEHOW, with the right intention and the right energy applied, they can in some way get different results. The definition is obvious: doing the same things but expecting different outcomes is insane. These socio-fascist policies and income redistribution schemes are patently certifiable.

Here is a link to the original Edmunds.com article, and it's follow up after the White House cried 'Foul!' The facts are spelled out, and if you CHOOSE to read them, comprehend and accept they are self-explanatory. Or you can simply apply any number of your usual left-twist spins...

 

[Andy]

Naive though you try to sound...you know exactly what my POINT was...and ignore it while you are able...it wasn't just 'LIBERALs' that got that stimulus plan of 'CASH FOR CLUNKERS' pushed through. Hmm...how many states profited from those JOBS that this plan enabled to provide for the auto industry to keep their manufacturing plants open and operational???

Sure it 'ALWAYS' easy to become the constant naysayer/whiner about the problems...but it's taking both sides of this political issue to get something/anything working. So blame away as you seem fit and ignore the TRUTH about the people behind the attempts to create change

That's my whole point. How many states profited from those JOBS that this plan enabled to provide?

ZERO!

We just had a plant close down this week sparky! GM just sold off a plant that they closed down to a foreign company last week. We had 15 Chrysler dealerships close up this month!

Do you not understand ZERO? Is this difficult? Sale have crashed, the companies are going through bankruptcy. Chrysler just announced that nearly half of their existing models will be retired. Fiat.... what a great idea that was.

No jobs were created. None. Not one single job was saved, none created, no one benefited. That is the whole stinking point Zippy.

What part of "Sales at the lowest point in the entire recession" do you not comprehend?

 

[pocketfullofshells]

That's my whole point. How many states profited from those JOBS that this plan enabled to provide?

ZERO!

We just had a plant close down this week sparky! GM just sold off a plant that they closed down to a foreign company last week. We had 15 Chrysler dealerships close up this month!

Do you not understand ZERO? Is this difficult? Sale have crashed, the companies are going through bankruptcy. Chrysler just announced that nearly half of their existing models will be retired. Fiat.... what a great idea that was.

No jobs were created. None. Not one single job was saved, none created, no one benefited. That is the whole stinking point Zippy.

What part of "Sales at the lowest point in the entire recession" do you not comprehend?

based of course on all the facts you just stated....if by facts we ment you uninformed opinion...

 

[Andy]

based of course on all the facts you just stated....if by facts we ment you uninformed opinion...

I see. So showing actual sales trends falling to the lowest point of the entire recession, and much lower than they were before the program, in your screwed up world is just "uninformed opinion".

If statistical facts about the lack of sales, and increasing unemployment, and the decline of the auto sector is 'opinion' in your world, then why should anyone bother to read anything you have to say?

 

[ASPCA4EVER]

That's my whole point. How many states profited from those JOBS that this plan enabled to provide?

ZERO!

We just had a plant close down this week sparky! GM just sold off a plant that they closed down to a foreign company last week. We had 15 Chrysler dealerships close up this month!

Do you not understand ZERO? Is this difficult? Sale have crashed, the companies are going through bankruptcy. Chrysler just announced that nearly half of their existing models will be retired. Fiat.... what a great idea that was.

No jobs were created. None. Not one single job was saved, none created, no one benefited. That is the whole stinking point Zippy.

What part of "Sales at the lowest point in the entire recession" do you not comprehend?

Were you under the misguided/befuddled/mind-bending thought that the 'Cash for Clunkers' was going to save each and every car dealership...that the 'Cash for Clunkers' was going to be the 'be all/end all quick fix' for the auto industry...HOLY BAT CRAP...no wonder your so hysterically confused...SPARKY!!!

The 'GLUT' and over inventoried auto industry has had it coming for YEARS and they needed to tweak/amputate the dead wood and become more 'buyer friendly' so quit your all time WHINING about something that was already set in motion and would have happened any way.

 

[asur]

We learned Obama folks will lie about an ill-conceived, ineffective and
very wasteful program they implemented.

We also learned that Obama and demorats will misrepresent the facts and lie about any
program they have their hands in. They knew the facts and decided to report fiction instead, so they could pat themselves on the back.

It was a bad program from the start, in the middle and now afterwards.

Obama is destroying American prosperity one clunker at a time!

It's called CHANGE!