Friday, July 31, 2009

Congressional Clunkers

It was supposed to help jump-start the auto industry, as well as help the environment.

The big-budget Car Allowance Rebate System—“CARS” in governmental acronymic; “cash for clunkers” in the vernacular—was a billion-dollar system intended to last through October. Low-mileage but otherwise perfectly operable cars were to be cashiered—literally crushed out of existence—in exchange for a $4,500 rebate. This rebate would be redeemed at car dealerships, and used to encourage customers to buy new cars from an auto industry in such serious trouble that much of it is owned by the Goverment.

It started last week, on July 24th.

Of course, destroying all those perfectly usable cars means that the price for a used car is likely to skyrocket—meaning that people needing to buy a cheap car (such as college kids, or the poor), may well be priced out of the market.

It also means that a lot of cheap used parts that used to be available to fix cars in need of repair won’t be available—driving up the cost of maintenance.

And as far as I know, nobody has studied whether destroying a quarter-million cars and replacing them with brand new ones, built in pollution-emitting factories, results in a net benefit to the environment.

Now, a week later, the program is out of money—possibly leaving dealerships holding the bag for all those now-destroyed cars. That probably won’t be much of a help for any of them. Or, for that matter, for the auto industry...unless all those customers who were rushing for all that free cash actually were new customers who materialized out of thin air, rather than people who just moved their purchase ahead by a few months to try to pick up some of the "free money" that the Government was tossing around.

Maybe it’s just me. But it seems funny that the geniuses in Washington couldn’t anticipate that giving away "free money" wouldn’t result in people making a mad rush to claim it. (Of course, I keep thinking that the money isn't really free: it comes from taxpayers---many of whom would probably rather just keep it in their own pockets. Of course, I'm not looking at it from the lofty perspective of Congress).

And...I guess maybe it is just me. But the fact that a program designed to last four months ran out of money in less than a week doesn’t exactly make me anxious to see just how accurate the cost projections for health care reform turn out to be.

JEFFREY CAMINSKY, a veteran public prosecutor in Detroit, Michigan, specializes in the appellate practice of criminal law and writes on a wide range of topics. His books include the science fiction adventure novel The Star Dancers, the exciting second volume in the Guardians of Peace-tm series, The Sonnets of William Shakespeare, and the acclaimed Referee’s Survival Guide, a book on soccer officiating. All are published by New Alexandria Press, and are available on Amazon, as well as directly from the publisher.

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