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Posted: 9/19/2009 11:49:35 AM EST
CASH FOR CLUNKERS


A vehicle that gets 15 mpg and does 12,000 miles per year uses 800
gallons a year of gasoline. (A Clunker)


A vehicle that gets 25 mpg and does 12,000 miles per year uses 480
gallons a year. (A New Car)


So, the average clunker transaction will reduce US gasoline consumption
by 320 gallons per year.


They claim 700,000 vehicles were part of this program, so that's 224
million gallons/year.


That equates to a bit over 5 million barrels of oil.


5 million barrels of oil is about ¼ of one day's US consumption.


And, 5 million barrels of oil costs about $350 million dollars at
$75/bbl.



So, we all contributed through our taxes to spending over $3 billion to
save $350 million.


How good a deal was that ???


They'll probably do a great job with Health Care though and think of all
those union jobs saved!
Link Posted: 9/19/2009 11:51:15 AM EST
It was never about "bad" cars.

Already been discussed.
Link Posted: 9/19/2009 11:52:30 AM EST
Originally Posted By NimmerMehr:
It was never about "bad" cars.

Already been discussed.


Then what is your point?
Link Posted: 9/19/2009 11:55:09 AM EST
One step forward, two steps back is progress, my dear comrade.
Link Posted: 9/19/2009 11:55:49 AM EST
Classic Government. Wait till they run healthcare. TT
Link Posted: 9/19/2009 12:07:58 PM EST
OP, you forgot to figure in the number of years that the new cars will be used. But C4C was bad for many reasons already discussed.
Link Posted: 9/19/2009 12:10:04 PM EST
Yep......old news, but, important news.
Link Posted: 9/19/2009 12:12:34 PM EST
Wait until we get Cap and Tax!
Link Posted: 9/19/2009 12:13:33 PM EST
Originally Posted By The_Insider:
Originally Posted By NimmerMehr:
It was never about "bad" cars.

Already been discussed.


Then what is your point?


IDK, but IMO it was all about making work for the unions.
Link Posted: 9/19/2009 12:13:45 PM EST
The goal of Cash for clunkers was to drum up new auto sales in the USA. It achieved that goal very well. Better than expected in fact.
Link Posted: 9/19/2009 12:16:45 PM EST
Originally Posted By StevenH:
The goal of Cash for clunkers was to drum up new auto sales in the USA. It achieved that goal very well. Better than expected in fact.


/thread

car sales where booming..auto recyclers are having a hay day. this was one of the "better" government stimulus programs
Link Posted: 9/19/2009 12:17:16 PM EST
Its a "rob Peter to pay Paul" scam. The auto market was in the shitter so they make up some bullshit program to funnel even more dollars into the failed US auto industry by making it seem lucrative for Americans to buy new cars. It was never about fuel, it was about the cars.

Private autos are just a tiny spec compared to what we use oil for. Diesel freight, trains, power plants, all make up the lion's share of our daily consumption.
Link Posted: 9/19/2009 12:20:14 PM EST
You didn't figure in the reduced tax revenue due to decreased gasoline consumption.
Link Posted: 9/19/2009 12:23:55 PM EST
Originally Posted By The_Insider:
CASH FOR CLUNKERS

So, we all contributed through our taxes to spending over $3 billion to
save $350 million.


How good a deal was that ???



I'm sure it's been done before, but that's assuming the new cars last a year and then die. Assuming a minimum 10 year life span of the new cars, the oil savings would be $3.5 billion over 10 years, vs. a $3 billion cost, which on pure math terms makes it a net gain.

The real issue is that 100 million taxpayers coughed up $3 billion so that a small subset of society (700,000 people, perhaps a few less) could save $3.5 billion on their personal expenditures over 10 years. That's wealth transfer and is the true problem.

Link Posted: 9/19/2009 12:26:55 PM EST
Originally Posted By Halliganman:
Originally Posted By StevenH:
The goal of Cash for clunkers was to drum up new auto sales in the USA. It achieved that goal very well. Better than expected in fact.


/thread

car sales where booming..auto recyclers are having a hay day. this was one of the "better" government stimulus programs


Not so,,,

Source


Cash for Clunkers Destroys Wealth and Resources
Program isn't delivering on its eco-goals


Shikha Dalmia
August 12, 2009

It seems almost petty to join in the loud kvetching that has erupted in the blogosphere––at least in its more economically literate portions––since Congress reauthorized the so-called Cash for Clunkers program last week. After all, the program's $3 billion total cost barely constitutes chump change in that august body's stimulus/bailout spending spree, which, by some reckoning, is touching $13 trillion.

But the program's lunacy-to-spending quotient, especially when it comes to its alleged environmental benefits, is so high that it is hard to stay quiet.

So here goes.

The program's basic idea involves paying owners of fuel-inefficient clunkers worth less than $4,500 a voucher up to the value of their vehicle toward a new, more fuel-efficient car on the hope that this will stimulate the moribund auto sector and slash carbon dioxide emissions. If you disregard the poor taxpayers financing it, everyone is a winner under this scheme.

But that's only in the fantasy land on Capitol Hill.

Edmunds.com, the nation's premier car-buyers' guide, debunked the stimulus claim even before the program was launched. It pointed out that even if the program succeeded in financing 250,000 cars in three months as originally planned, it would boost the economy as much as inducting Paris Hilton would boost the aggregate IQ of MENSA. That's because in any given quarter, about 200,000 such clunkers are traded in anyway. "In effect, we are paying customers to do something most would do anyway," noted Jeremy Anwyl, CEO of Edmunds.com. At best then, the program would drive about 50,000 additional trade-ins, which works out to a whopping $20,000 per clunker.

Of course, the $2 billion more that Congress just authorized will bump net new sales by another 100,000. But this too is peanuts given that the industry needs 5 million additional sales to come out of the doldrums. Even though car companies are lavishing praise on the bonanza they are reaping, they are not exactly rushing to increase production.

Nor is the program delivering on its eco-goals. It aims to nudge participants toward more fuel-efficient cars by handing the full $4,500 voucher only to those whose new cars get at least 10 miles per gallon more than their trade-ins––with a smaller rebate of $3,500 going to drivers who get between four and nine mpg more.

But buyers ain't buying it.

Department of Transportation Secretary Ray LaHood is going around touting the program as a roaring success because the government's list of the top 10 new purchases allegedly shows that drivers are trading in their gas guzzlers for fuel-sipping compacts in order to qualify for the full voucher. LaHood claims that the new vehicles are giving a combined average of 9.6 miles per gallon more than the trade-ins, delivering close to the maximum possible environmental bang for the buck.

This convinced even critics of the original legislation, such as Sens. Diane Fienstein, D-Calif., and Susan Collins, R-Maine, to vote for its reauthorization. But there are two problems with this claim: One, even if one accepts LaHood's numbers, the fuel savings add up to only 72 million fewer gallons of gasoline every year––about what Americans consume in four and a half hours. This translates into 700,000 tons fewer carbon dioxide emissions annually––about what Americans emit every 57 minutes.

Two, LaHood's numbers should not be accepted. Why? Because they are based on a false list of top 10 new purchases, an independent Edmunds.com analysis found. Indeed, the list that LaHood has been waving around, with the exception of a Ford Escape, contains mainly gas-sippers such as Toyota Corolla and Honda Civic with the holy Prius hybrid occupying the fourth place. But the list compiled by Edmunds.com contains two full-size, gas-guzzling SUVs and a crossover––with the Prius nowhere in sight. In other words, the program is effectively paying drivers to trade in their clunkers for––hang on to your recycled hats!––other clunkers. This undercuts LaHood's fuel economy claims by about 37%.

But there's more.

One of the crazier aspects of the Cash for Clunkers program is that it requires the engines of the traded-in clunkers to be euthanized by a sodium silicate injection. The point is to ensure that these clunkers never see the light of day again. This will no doubt force some folks who would have otherwise used the engine to refurbish their old cars to buy newer, less polluting ones. But this won't reduce emissions, it'll actually enhance them.

For starters, manufacturing a new car has the same cost in terms of emissions as driving it for a year. Thus, the more the program causes new cars to roll off the assembly line, the more it will contribute to pollution, at least initially. What's more, when drivers switch to more fuel-efficient cars, they don't pocket the fuel savings, they actually drive more, producing no net reduction in emissions.

Above all, however, the program might severely disrupt the ability of the used-car market to recycle parts, producing all kinds of negative unintended consequences for the environment. (Where is the green obsession with recycling when you need it?) The engine, combined with the drive train, accounts for about 35% of the value of the used car. But with this destroyed, it will make far less sense for recyclers to incur the cost of cleaning up mercury and other toxins to mine the remaining parts from the discarded vehicle. The upshot is that the car is more likely to land in scrappage with many valuable parts––engine, pistons, brakes––still intact. This will take a huge chunk out of the 80 million barrels of oil that the recycling industry saves the country every year, maintains Michael Wilson, executive vice president of the Automotive Recyclers Association.

So, to recap, the Cash for Clunkers plan involves restoring the economy by destroying wealth and healing the environment by destroying resources. By this logic, we should use the stimulus money to fund a new Godzilla brigade to mow down the country and rebuild it in a more environmentally friendly way. Imagine how much richer and cleaner the planet would be.

Shikha Dalmia is a senior analyst at Reason Foundation and a bi-weekly Forbes columnist, where this column first appeared.
Link Posted: 9/19/2009 12:35:44 PM EST
Originally Posted By The_Insider:
CASH FOR CLUNKERS


A vehicle that gets 15 mpg and does 12,000 miles per year uses 800
gallons a year of gasoline. (A Clunker)


A vehicle that gets 25 mpg and does 12,000 miles per year uses 480
gallons a year. (A New Car)


So, the average clunker transaction will reduce US gasoline consumption
by 320 gallons per year.


They claim 700,000 vehicles were part of this program, so that's 224
million gallons/year.


That equates to a bit over 5 million barrels of oil.


5 million barrels of oil is about ¼ of one day's US consumption.


And, 5 million barrels of oil costs about $350 million dollars at
$75/bbl.



So, we all contributed through our taxes to spending over $3 billion to
save $350 million.


How good a deal was that ???


They'll probably do a great job with Health Care though and think of all
those union jobs saved!


Are you questioning the Messiah's brilliant plans? YOU EFFING RACIST!!!


[/sarcasm]
Link Posted: 9/19/2009 12:53:39 PM EST
Originally Posted By Halliganman:
Originally Posted By StevenH:
The goal of Cash for clunkers was to drum up new auto sales in the USA. It achieved that goal very well. Better than expected in fact.


/thread

car sales where booming..auto recyclers are having a hay day. this was one of the "better" government stimulus programs


No it wasn't. It demolished used car lots and charities who depend of reselling clunkers to fund their operations.

Not to mention our tax dollars went to buying other people brand new cars.

Fuck the auto companies. They deserve what they got. We're just delaying the inevitable.
Link Posted: 9/19/2009 12:58:29 PM EST
Has the Government really spent any money?
I still hear that many dealers are still not seeing the money they are owed.
Link Posted: 9/19/2009 7:32:54 PM EST
Originally Posted By Jeeper21:
One step forward, two steps back is progress, my dear comrade.


Communism, and progressivism is all about mediocrity. So it's all about not progressing
Link Posted: 9/19/2009 7:34:05 PM EST
Originally Posted By DragoMuseveni:
Has the Government really spent any money?
I still hear that many dealers are still not seeing the money they are owed.


If one didn't know better, one would think that Barry wanted to destroy the US auto industry.
Link Posted: 9/19/2009 7:36:35 PM EST
My wife traded an old "clunker" worth actually $500 on the street for $5,000 for a brand new Scion for my son. That was a good deal, the taxpayers kicked in $4,500 of "free" money.
Link Posted: 9/19/2009 7:44:41 PM EST
Originally Posted By Halliganman:
Originally Posted By StevenH:
The goal of Cash for clunkers was to drum up new auto sales in the USA. It achieved that goal very well. Better than expected in fact.


/thread

car sales where booming..auto recyclers are having a hay day. this was one of the "better" government stimulus programs


ok

then who is gonna buy the cars they're producing now? and how long will they keep the workers they re-hired for tthis?

are they going to have another c4c program? then another one? then another one?

it was a terrible program. it created false demand and it will leave a huge gap in the amount of cars bought in the next year or two.

just like the obama stimulus program. give the states a bunch of money to start a new social program then when the money is gone who keeps paying for it? the state government? probably, then

they'll be in the red even more next year because you know they could never cancel a program once they start it.



Link Posted: 9/19/2009 7:57:14 PM EST
Originally Posted By warlord:
My wife traded an old "clunker" worth actually $500 on the street for $5,000 for a brand new Scion for my son. That was a good deal, the taxpayers kicked in $4,500 of "free" money.




How did she get $5000 for it from the dealer? I'm a little confused.
Link Posted: 9/19/2009 8:05:03 PM EST
Originally Posted By tax_monster:

I'm sure it's been done before, but that's assuming the new cars last a year and then die. Assuming a minimum 10 year life span of the new cars, the oil savings would be $3.5 billion over 10 years, vs. a $3 billion cost, which on pure math terms makes it a net gain.

The real issue is that 100 million taxpayers coughed up $3 billion so that a small subset of society (700,000 people, perhaps a few less) could save $3.5 billion on their personal expenditures over 10 years. That's wealth transfer and is the true problem.



Our dancing frog friend has it correct. Quoted for posterity.
Link Posted: 9/19/2009 8:09:59 PM EST
Originally Posted By tax_monster:

I'm sure it's been done before, but that's assuming the new cars last a year and then die. Assuming a minimum 10 year life span of the new cars, the oil savings would be $3.5 billion over 10 years, vs. a $3 billion cost, which on pure math terms makes it a net gain.

The real issue is that 100 million taxpayers coughed up $3 billion so that a small subset of society (700,000 people, perhaps a few less) could save $3.5 billion on their personal expenditures over 10 years. That's wealth transfer and is the true problem.



Have you calculated the fuel that was used to create the new vehicles and move them to the dealership? Have you calculated the fuel that was used to transport the old vehicles to the scrapyard, and the fuel used to destroy said cars? You're also assuming that every new vehicle purchase averaged 10mpg higher than the traded in vehicle. That is also most likely not true.

This program was a net loss, period. On top of that, it was a rip-off of taxpayers, as you said.
Link Posted: 9/19/2009 8:57:57 PM EST
Originally Posted By ragedracer1977:
Originally Posted By warlord:
My wife traded an old "clunker" worth actually $500 on the street for $5,000 for a brand new Scion for my son. That was a good deal, the taxpayers kicked in $4,500 of "free" money.




How did she get $5000 for it from the dealer? I'm a little confused.
Sorry, it was $4,000, the dealer also gave my son $1,000 discount for getting a diploma from a local junior college.
Link Posted: 9/19/2009 9:12:09 PM EST
[Last Edit: 9/19/2009 9:13:08 PM EST by Tony-Ri]
My mom spend nearly two weeks verifying the paperwork on the .gov side. They hired on the spot anyone who was alive that walked through the door! (And they let them go with no warning two weeks later.) In a normal shift, each individual was expected to do about 20 forms max.



(This is all from what I remember. I'll have to ask her for the exact figures)
Link Posted: 9/19/2009 9:56:43 PM EST
With unemployment as high as it is and the credit market shot how can people afford the payments on new vehicles? Will this be another housing market boom then bust?
Link Posted: 9/19/2009 10:34:36 PM EST
Originally Posted By mo98:
With unemployment as high as it is and the credit market shot how can people afford the payments on new vehicles? Will this be another housing market boom then bust?


There's a reason most of those people were driving clunkers - they couldn't afford anything else. They have all taken on new debt - just sit back and see if it turns out like a mini version of the housing crisis.
Link Posted: 9/19/2009 10:47:46 PM EST
It was a scam, just like 99.9% of everything DC does now adays...

George Washington is killing cute little bunnies in heaven because of the disgrace the 'district' that bears his name has become.
Link Posted: 9/19/2009 11:01:15 PM EST

Originally Posted By shocktrp:
Originally Posted By mo98:
With unemployment as high as it is and the credit market shot how can people afford the payments on new vehicles? Will this be another housing market boom then bust?


There's a reason most of those people were driving clunkers - they couldn't afford anything else. They have all taken on new debt - just sit back and see if it turns out like a mini version of the housing crisis.
Thats not what we need but i sure would like a newer low mile used car for a smoking low price.

Link Posted: 9/20/2009 12:26:07 AM EST

Originally Posted By Halliganman:
Originally Posted By StevenH:
The goal of Cash for clunkers was to drum up new auto sales in the USA. It achieved that goal very well. Better than expected in fact.

/thread

car sales where booming..auto recyclers are having a hay day. this was one of the "better" government stimulus programs



It was 3 billion dollars of make-work for the Unions.

How many of the dealerships are still waiting on their money?
Link Posted: 9/20/2009 3:20:08 AM EST
That's pretty good performance for a government program.
Link Posted: 9/20/2009 9:45:22 AM EST
Originally Posted By bytor94:

Originally Posted By Halliganman:
Originally Posted By StevenH:
The goal of Cash for clunkers was to drum up new auto sales in the USA. It achieved that goal very well. Better than expected in fact.

/thread

car sales where booming..auto recyclers are having a hay day. this was one of the "better" government stimulus programs



It was 3 billion dollars of make-work for the Unions.

How many of the dealerships are still waiting on their money?


again,

leftists and their followers want to be judged on intentions, not results. It doesn't matter if no money has been processed out. It doesn't matter if car dealers lose their shirts because the .gov took too long to process their paperwork. It doesn't matter than an entirely new bureaucracy is established and will exist till the end of time costing tax payers millions to billions to trillions down the line. As long as they can see that sales were made UP stream, they don't give one iota about what happens DOWN stream.

It's like fucking social security and welfare. They're successful as long as you ignore reality.
Link Posted: 9/20/2009 10:10:11 AM EST
I HATE this program with every fiber of my being...

But,

it has created a temporary goldmine at the local salvage yards. Got a ton of really nice parts off CFC cars super cheap. It did make my heart sink when I saw a clunkered Z28SS Camaro and a Corvette at the yard. Along with about 50 other cars that are nicer then what I drive daily.
Link Posted: 9/20/2009 10:13:58 AM EST
Yet they can improve efficiency and lower the cost of healthcare.
Link Posted: 9/20/2009 10:33:09 AM EST
Cash for Clunkers was never about saving oil.

It was about saving GM after the .gov invested in it.
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