Cash for clunkers, RIP

Goodbye, good luck and good riddance.

The much-ballyhooed “cash-for-clunkers” program ended yesterday. The industry is triumphantly proclaiming a 13% increase in car sales… and yet, I am glad to see the back of it.

What is it good for? When the law was announced, the first question that I asked is “what problem is this law intended to solve?“.

It doesn’t help the beleaguered American Carmakers: This rising tide lifts all boats, and Toyota has been a bigger winner than GM, Ford or Chrysler.

It doesn’t help the environment: The old cars have to be destroyed, not recycled, it doesn’t get people into alternative forms of transport. Studies have shown that the environmental impact will be minimal (think about it – switching 600,000 people from old gas-guzzlers to new gas-sippers in a nation of 62-to-247 million vehicles (depending on which figures you use) is a change of less than one percent at best, and less than a quarter of one percent at worst.

It doesn’t help everyone: I have two vehicles – a ten-year-old Camry and a seventeen year-old Saturn. Neither qualify. Had I been stupid enough to buy an SUV, the government would have been happy to bail out my stupidity.

The second and more pressing question is “who pays”? The program cost $3Billion. That’s $3,000,000,000. There are about dividing that up among the hundred million taxpayers means that my share of the cost is $30 per taxpayer. Don’t thank me though. I don’t get a choice.

I am sure that there are a lot of people who benefited from this program – but that does not make it an inherently a good program. For those who did not pay outright for their cars, hope you enjoy making those payments. Me, I’m debt-free and loving it.

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