Cash for Clunkers...

[Code Doc]

Homer said, "It's quite a brilliant plan, actually... As long as you don't believe in free markets. Never fear, billions more $$$ are on their way..."
----------------
But, Homer, you and I paid for those $billions. Government is broke without us picking up the tab.

Do you realize that practically no attempt is being made to salvage usable parts of those cars being flattened to the ground? So, what is going to happen to (1) the price and availability of those replacement parts and (2) the jobs of people and companies who now salvage replacement parts that are no longer made?

[homer13j]

But, Homer, you and I paid for those $billions. Government is broke without us picking up the tab.

I was being sarcastic about the money.

[nemaroller]

Now if a president initiated a program like 'Hotties for NOTies', I would definitely get behind that! In a real BIG way! I'm not exactly sure what we would do with the NOTties, but perhaps they could go work for the State Department, or be a presidential intern like that girl that was invited to those private presidential cigar parties.

[SJWhiteley]

The program does nothing for car manufacturers, really. The dealers are getting a much better deal by seeing customers come in (you can't sell a car unless the customer is on the lot). Sure it'll help, but 'value for money' it isn't.

I'd actually reassess who is buying thee cars - I believe it will be poorer people who can ill-afford a new car. Repo men are going to be having a good time of it the next 6 months. Now that's economic stimulation...

Significantly, the cash replaces the actual value of the car. If your car is worth $3000 then you will get a grand total of $3500 (for a 4-9 mpg gain). In addition, the car will be scrapped.

This is actually a net loss - the government (sic) is giving money to take money out of the economy, based like this:

Assuming no 'cash-for-clunker' program, your trade-in is worth 3K. You get a car with 3k off. The dealer gets a car that could potentially be sold for 5k. That is, there is 5K of assets in the market.

With cash-for-clunker program, the trade in becomes worth 3.5K. The dealer get's a 3.5K rebate (taxable as income), the asset is - theoretically - scrapped. The market has lost 5K of assets, and it cost us 3.5K. The bottom line, to the free market is a net loss of 8.5k.

Having said that, I suspect that a significant proportion of cars which are 'scrapped' will still be on the road. Only the engine and transmission are supposed to be destroyed, with the rest 'scrapped'.

$1billion dollars represents less than 1% of all annual sales of new cars; an additional $2billion will be spent. Taking that as you will, in other news, Obamas administration hasn't ruled out the possibility of increasing taxes on the middle class because of the increasing deficit; and the new healthcare plan needs funding from somewhere.

[Lord Orwell]

installing an engine in transmission in an old car is more expensive than buying another used car, even for dealers.

[Code Doc]

installing an engine in transmission in an old car is more expensive than buying another used car, even for dealers.

LO, this tends to make me ill:
http://newsbusters.org/blogs/p-j-gla...nment-programs
We are doing this to support the CFC program?

[storm5510]

I just watched a YouTube video on another site about this program. If true, then it is a bit scary. I put a link below. Make up your own minds.

http://www.youtube.com/watch?v=mqfuZ7hiap0

[Lord Orwell]

LO, this tends to make me ill:
http://newsbusters.org/blogs/p-j-gla...nment-programs
We are doing this to support the CFC program?

having owned a volvo, i can tell you that thing didn't sound right to start with. I don't really see how revving one would blow it up, unless they drained the oil and water from it. But keep in mind that just because the motor ran and sounded half-way decent, that doesn't mean the car was driveable. Mine ran a lot smoother than this one did, but the overdrive was out, rear bearings bad, needed 4 tires (both back tires had broken cords in them), and both motor mounts AND the transmission mount were broken. From the outside, the car looked better than the one in this video. Engine was flopping around and knocking it out of gear. I in fact still have the engine and trans for mine. I was screwing with the shifter trying to get it back in gear on a highway and ran off the road totalling it.
I will tell you one thing though: Germans sure know how to make a heater in a car. I miss the heater.

[Lord Orwell]

I just watched a YouTube video on another site about this program. If true, then it is a bit scary. I put a link below. Make up your own minds.

http://www.youtube.com/watch?v=mqfuZ7hiap0

I've seen this nutcase on tv before. Anyone with even a hint of computer knowledge knows that a web browser doesn't have access to your entire computer. This loony is all the time talking about stupid crap like that. You find the exact same or similar disclaimer on most government web pages.

Besides which, the lady claims "consumers in danger etc etc" the page he is on is the login page for DEALERS! A normal user can't even get to it.

[SJWhiteley]

LO, this tends to make me ill:
http://newsbusters.org/blogs/p-j-gla...nment-programs
We are doing this to support the CFC program?

The engine needs to be run to put the 'killer fluid' in the car, so I understand. It's surprising how much abuse an engine can withstand, however.

[homer13j]

having owned a volvo, i can tell you that thing didn't sound right to start with. I don't really see how revving one would blow it up, unless they drained the oil and water from it.

Uh... Any engine would sound bad when its crankcase is filled with a sodium silicate solution... Exactly what the government is telling dealers to do in order to destroy perfectly good engines. I'm guessing you missed that part.

I've seen this nutcase on tv before. Anyone with even a hint of computer knowledge knows that a web browser doesn't have access to your entire computer. This loony is all the time talking about stupid crap like that. You find the exact same or similar disclaimer on most government web pages.

The disclaimer in question:

"This application provides access to the DoT CARS system. When logged in to the CARS system, your computer is considered a Federal computer system and is the property of the U.S. Government. Any or all uses of this system and all files on this system may be intercepted, monitored, recorded, copied, audited, inspected, and disclosed to authorized CARS, DoT, and law enforcement personnel, as well as authorized officials of other agencies, both domestic and foreign."

If I was a dealer I would be extremely concerned about this. But hey, Glenn Beck's a blithering idiot so there's nothing to worry about. Our government is only here to help.



Nothing to see here, folks, move along...

[storm5510]

I've seen this nutcase on tv before. Anyone with even a hint of computer knowledge knows that a web browser doesn't have access to your entire computer. This loony is all the time talking about stupid crap like that. You find the exact same or similar disclaimer on most government web pages.

Besides which, the lady claims "consumers in danger etc etc" the page he is on is the login page for DEALERS! A normal user can't even get to it.

I didn't put much stock in it, but a friend was paranoid about it so I took a look. Those news people never tell the full story.

[techgnome]

Of course they don't... doesn't make for good TV to tell ALL of the truth ALL of the time... that's boring.

But I agree with homer... Glenn Beck is a blithering idiot. Sometimes I think they only keep him around to keep the heat off of everyone else. A sort of human-media-shield. So far it's been pretty effective.

-tg

[wild_bill]

I'd actually reassess who is buying thee cars - I believe it will be poorer people who can ill-afford a new car. Repo men are going to be having a good time of it the next 6 months. Now that's economic stimulation...

Don't worry about that, once the institutions who financed the loan go bankrupt, the government will fork over several hundred billion dollars. It's the growing fad these days.

[Lord Orwell]

The engine needs to be run to put the 'killer fluid' in the car, so I understand. It's surprising how much abuse an engine can withstand, however.

yeah i wasn't aware of that. The law does however state that the car itself doesn't have to be scrapped. The engine and drivetrain are not allowed to be salvaged, but any other part is available for resale. I can see dealers stocking up on body panels, etc. to save money in the bodyshop they operate. I did think it was odd that there is a bottom limit on how old a car is allowed to be. I would like to see what the reasoning behind that is. Also the disclaimer if you think about (especially the domestic and foreign part) is most likely there in an attempt to fight exporting of stolen vehicles.

[capsulecorpjx]

... is doomed to failure.

(1) Many "clunkers" get better fuel economy than the new vehicles that are on the road today that deliver the same function.

Right wing making things up again. There are rules for the trade in, the MPG upgrade is a requirement.

(2) Who wants to see their car that has been taken care of and driven for over 10 years suddenly flattened in a land fill?

Then you personally don't have to turn it in for Clash for Clunkers. But seeing how the program is so popular in general, point #2 is invalid.

(3) Why can't someone who really needs your old car that is still in good shape and cannot afford a new one have a chance to buy it after you trade it in?

Then the point of the program would be defeated. The point is to take gas guzzlers off the streets permanently, as well as stimulate the economy through the purchase of the more gas efficient cars.

[homer13j]

The point is to take gas guzzlers off the streets permanently

You mean like that "gas guzzling" little Volvo in that was destroyed the video above?

Like I said before - the purpose of this program is to destroy as many used cars as possible making them more expensive and therefore less attractive to buyers. It's not difficult to understand, or at least it shouldn't be.

[capsulecorpjx]

You mean like that "gas guzzling" little Volvo in that was destroyed the video above?

Like I said before - the purpose of this program is to destroy as many used cars as possible making them more expensive and therefore less attractive to buyers. It's not difficult to understand, or at least it shouldn't be.

Well first, Fox News is not very reliable, they lie routinely. It could just be a random car they film being crushed.
-> Have you seen the story where they photoshopped some liberal journalists to make them look uglier, have a larger forehead?

In any case, there are older sedans that have lower than 18 MPG, and yes they are considered a gas guzzler. The program dictates that the car must be around 18 MPG or lower (additional complex rules about weighted average mpg, but you can look that up).

[homer13j]

Well first, Fox News is not very reliable, they lie routinely.

Uh, the Volvo video was not made by the evil Fox News. If you really care about "truth" maybe you should actually WATCH the video before making comments?

Have you seen the story where they photoshopped some liberal journalists to make them look uglier, have a larger forehead?

I don't watch TV besides sports, but I did see when they did this:



Oops... that was CBS, not Fox News.

How about this?



Nope, this time it was USA Today, not Fox News.

Maybe this?



Oh, wait... that was Agence France-Press, not Fox News.

And this hilarious example...



This time it was Reuters, not Fox News.

And this...



Courtesy of the Los Angeles Times, not Fox News.

Remember this?



Again, not Fox News.

I have many more if you want to see them. I'm betting you don't.

[homer13j]

In any case, there are older sedans that have lower than 18 MPG, and yes they are considered a gas guzzler. The program dictates that the car must be around 18 MPG or lower (additional complex rules about weighted average mpg, but you can look that up).

According to cars.gov: "Generally, trade-in vehicles must get 18 or less MPG" but more efficient cars (like our little Volvo) are eligible if the new car gets better mileage.

Regardless of the semantics of the law the government is wasting billions in an attempt to alter the free market.

[Lord Orwell]

well i for one would be glad to see the demand for foreign gas drop. Notice i did not say oil. We currently import 10 % of our gasoline as well, because we don't have enough refineries. And of course have any of you actually driven that volvo in question? As far as any of us know, it's been rear-ended. My volvo had a smaller engine than that one and i averaged 24mpg with a standard tranny. Volvos are not designed for gas mileage. My escort got over 30 with the same size engine.

[SJWhiteley]

well i for one would be glad to see the demand for foreign gas drop. Notice i did not say oil. We currently import 10 % of our gasoline as well, because we don't have enough refineries. And of course have any of you actually driven that volvo in question? As far as any of us know, it's been rear-ended. My volvo had a smaller engine than that one and i averaged 24mpg with a standard tranny. Volvos are not designed for gas mileage. My escort got over 30 with the same size engine.

I would agree. Unfortunately, the department of energy created for this very reason has bloated to an obscene size and yet we are ever more dependent on foreign oil. (Notice I say oil, although gasiline imports may be significant).

Unfortunately, such programs as this have so little impact [fuel consumption]; 3 billion dollars would have been better spent on achieving one of its goals instead of driving a larger wedge into the fragile economy - which this bill does directly.

A tax deduction is a better way of getting less fuel efficient cars off the road. Is this unfair for those who don't pay taxes or have a rather small tax bill? Not at all; you shouldn't be buying a new car!

Additional taxes do not, and will not work. There is already an enormous tax on gas guzzlers, yet has done nothing to deter the purchase of said vehicles - the 'rich' can afford it anyway. Taxing gasoline directly will have a regressive effect.

Carrots are always a much better incentive to do something than sticks.

[techgnome]

Even with a tax-deduction, I still couldn't afford a new car, even if I wanted one... the tax deduction does nothing to make it more affordable. Sure it's an incentive, but one still has to be able to afford it. Same thing with the first time home buyers tax credit deal... great! Finally an incentive to buy a house for me... only I couldn't get a loan with terms that I could afford. So I'm still stuck... and it sucks. And now it'll just be one more carrot I get to miss out on.

While I think the concept of the cash for clunkers is a good one ... it was the execution that was handled badly. First, I don't see how or why it was so badly underestimated. Also, while it seems popular now, what's going to happen in 3 months when it is over for good? What are all of those dealerships going to do then? Fold. Because they will have sold everyone a new car already... Their service depts will pick up some business as people come in for their maintenance, sure, but not everyone goes back to the dealership for that kind of stuff. When I first heard about the CFC, I thought "what a neat idea" .... now I've had a chance to see it in action... and time to think about it. It could possibly cause more harm than good in the long run.

Personally, I think this is one time when a single party-controlled govt is a bad thing. My prediction: in three years, there will be a huge turn over, a majority of the incumbents will be tossed out, both Republicans and Democrats, and Republicans will re-gain control, and Obama will be re-elected.

-tg

[capsulecorpjx]

Uh, the Volvo video was not made by the evil Fox News. If you really care about "truth" maybe you should actually WATCH the video before making comments?



I don't watch TV besides sports, but I did see when they did this:



Oops... that was CBS, not Fox News.

How about this?



Nope, this time it was USA Today, not Fox News.

Maybe this?



Oh, wait... that was Agence France-Press, not Fox News.

And this hilarious example...



This time it was Reuters, not Fox News.

And this...



Courtesy of the Los Angeles Times, not Fox News.

Remember this?



Again, not Fox News.

I have many more if you want to see them. I'm betting you don't.

Obviously if other News sources cheat, that means Fox News is totally reliable all the time.

Right wingers LOVE straw-man arguments.

I'm not sure of the pictures you posted, you didn't post sources, though I wouldn't be surprised if they're true.

But I have to make a correction about the missles, they were photoshops done by the Iranian government.

As for my source of Fox News photoshopping Liberal Journalists to make them look uglier:

http://www.youtube.com/watch?v=CfCsQeOnsrk

[SJWhiteley]

Even with a tax-deduction, I still couldn't afford a new car, even if I wanted one... the tax deduction does nothing to make it more affordable. ...

-tg

A tax deduction is not, and never is, and never will be, designed to make anything 'more affordable'. Likewise, this cash-for-clunkers hasn't done that either. The only way to make 'things' - anything - more affordable is to increase ones income.

I'm in the same boat - my vehicle is a prime candidate for the cash for clunker program (actually, the value is the same as the rebate, so it makes no difference). And likewise, with a tax deduction, I still couldn't afford a new car, simply because I do not have the disposable income or savings to buy a new car. A tax incentive would steer me financially to a car which gives the incentive, rather than one that doesn't, when I'm in the market for a new vehicle.

It doesn't prevent choice, and places no burden on the tax payer when no-one takes advantage of a tax deduction. The alternative would be to increase taxes on the 'bad' things (the 'stick') and as we all know, doing so has decreased the demand for SUVs, right? [Don't research this, because you'll just poke a hole in my argument here...].

It's an incentive to move towards an [insert government goal here]. In this case, an increase in fuel economy (theoretically, a lower dependence on foreign commodities). A pure tax deduction is 100% scalable. The more people who take advantage of said deduction, the more money that stays in the economy, and the goal is achieved in a scalable fashion. True, less taxes, but that's the 'cost' of achieving the stated goal. Effectively we get a double bonus whammy: the government (sic) spends money on achieving said goal, and people get to keep that money to spend on other things - like health insurance...(that's another story, though).

[homer13j]

Obviously if other News sources cheat, that means Fox News is totally reliable all the time.

When did I ever say Fox News was perfect? Talk about a straw man...

Right wingers LOVE straw-man arguments.

Clueless left wingers love making broad generalizations.

But I have to make a correction about the missles, they were photoshops done by the Iranian government.

And distributed world-wide by Agence France-Press in a blatant attempt to mislead the public.

[Lord Orwell]

i found it interesting that SUVs still qualify to get the deduction, as long as you are still trading up.

[Code Doc]

i found it interesting that SUVs still qualify to get the deduction, as long as you are still trading up.

Rather amazing, isn't it?

Here's another turn of the screw. Germany has now spent $5 billion on a similar program that the Deutch launched in January, 2009.

So, if ours is as successful as Germany's, how much more revenue will be needed to keep our CFC program afloat for seven more months? $5 billion, $10 billion, or $20 billion?

Forum, please advise.

[Lord Orwell]

Even with a tax-deduction, I still couldn't afford a new car, even if I wanted one... the tax deduction does nothing to make it more affordable. Sure it's an incentive, but one still has to be able to afford it. Same thing with the first time home buyers tax credit deal... great! Finally an incentive to buy a house for me... only I couldn't get a loan with terms that I could afford. So I'm still stuck... and it sucks. And now it'll just be one more carrot I get to miss out on.

While I think the concept of the cash for clunkers is a good one ... it was the execution that was handled badly. First, I don't see how or why it was so badly underestimated. Also, while it seems popular now, what's going to happen in 3 months when it is over for good? What are all of those dealerships going to do then? Fold. Because they will have sold everyone a new car already... Their service depts will pick up some business as people come in for their maintenance, sure, but not everyone goes back to the dealership for that kind of stuff. When I first heard about the CFC, I thought "what a neat idea" .... now I've had a chance to see it in action... and time to think about it. It could possibly cause more harm than good in the long run.

Personally, I think this is one time when a single party-controlled govt is a bad thing. My prediction: in three years, there will be a huge turn over, a majority of the incumbents will be tossed out, both Republicans and Democrats, and Republicans will re-gain control, and Obama will be re-elected.

-tg

so somehow selling as many cars in three months as they normally would in a year will make them fall bankrupt? How exactly did you come to that conclusion? There is also the fact that this gives the automakers a boost in sales which help keep factories from closing, etc.

Rather amazing, isn't it?

Here's another turn of the screw. Germany has now spent $5 billion on a similar program that the Deutch launched in January, 2009.

So, if ours is as successful as Germany's, how much more revenue will be needed to keep our CFC program afloat for seven more months? $5 billion, $10 billion, or $20 billion?

Forum, please advise.

Really, you sound like you think this program is taking money from your own pocket. It's the US government. They print the money. And they have been spending non-existent money for years. This is what drives inflation. We are really set for a huge increase of prices of general items, similar to the one we had during the carter administration.

[techgnome]

"so somehow selling as many cars in three months as they normally would in a year will make them fall bankrupt? How exactly did you come to that conclusion? There is also the fact that this gives the automakers a boost in sales which help keep factories from closing, etc."

I didn't say they would go bankrupt.... but in 6 months when the program is over... what's to prevent them from failing again? That was my point, by flooding the market now with a bunch of new car owners... and creating a demand when there wasn't one before (the ONLY reason these people are buying a car is because they are getting something out of it) ... what is going to happen in 6 months? Sure, it's going like gangbusters now... but I have to wonder if anyone has thought through the long term effects of this.

-tg

[Lord Orwell]

all you have to do is look at history to see. a similar program was in effect in 1976, selling 1977 models. There are no new ideas in politics.

[wossname]

in the UK the metal from the cars that are crushed is reused to produce mutiple products including beer cans.

So the moral of the story is: "Save the planet - drink as much beer as you can - TODAY!"

My carbon footprint must be almost negative then.

[Code Doc]

Lord O. said, "Really, you sound like you think this program is taking money from your own pocket. It's the US government. They print the money. And they have been spending non-existent money for years. This is what drives inflation. We are really set for a huge increase of prices of general items, similar to the one we had during the Carter administration."
-----------------
And when did you stop paying taxes? If you figured out how to do that successfully, I'm all ears. I'd like to ride that train.

I fear that government takes money from your pocket daily. It needs that money to support itself and it relentlesly collects it.

[Lord Orwell]

[QUOTE=Code Doc;3577513]Lord O. said, "Really, you sound like you think this program is taking money from your own pocket. It's the US government. They print the money. And they have been spending non-existent money for years. This is what drives inflation. We are really set for a huge increase of prices of general items, similar to the one we had during the Carter administration."
-----------------
And when did you stop paying taxes? If you figured out how to do that successfully, I'm all ears. I'd like to ride that train.

I fear that government takes money from your pocket daily. It needs that money to support itself and it relentlesly collects it.[/QUOTEi]
if you are merely talking about income tax, that is easy. I am at poverty level and get all my paid in tax back.

[techgnome]

The latest twist .... Dealerships are running low on inventory (the 2010 models haven't been delivered yet).... meanwhile the lots are filling with "clunkers" that can't be scrapped yet until the money comes from the gov't.

-tg

[Code Doc]

The latest twist .... Dealerships are running low on inventory (the 2010 models haven't been delivered yet).... meanwhile the lots are filling with "clunkers" that can't be scrapped yet until the money comes from the gov't.

-tg

+1. Several new-car dealers are now sold out of new cars and their lots are all packed with clunkers that they cannot sell. Used car buyers can't even consider them. Interesting development. Even the show rooms are empty.

[capsulecorpjx]

"so somehow selling as many cars in three months as they normally would in a year will make them fall bankrupt? How exactly did you come to that conclusion? There is also the fact that this gives the automakers a boost in sales which help keep factories from closing, etc."

I didn't say they would go bankrupt.... but in 6 months when the program is over... what's to prevent them from failing again? That was my point, by flooding the market now with a bunch of new car owners... and creating a demand when there wasn't one before (the ONLY reason these people are buying a car is because they are getting something out of it) ... what is going to happen in 6 months? Sure, it's going like gangbusters now... but I have to wonder if anyone has thought through the long term effects of this.

-tg

I agree, they really should have just let most of GM go completely out of business (outside of maybe a few successful sub-brands into seperate companies).

That will leave more marketshare for Ford and any existing car company.

[Lord Orwell]

ford is pretty much the only american one left making any money right now.

And incidently those photos above? There was a special on nova last night and it actually showed two of the photos. The smoke was done by a foreign government to make damage look worse.

[penagate]

And incidently those photos above? There was a special on nova last night and it actually showed two of the photos. The smoke was done by a foreign government to make damage look worse.

Which one? The photo of Beirut with the badly cloned smoke was taken (and edited) by freelance photographer Adnan Hajj, and then circulated via Reuters.

http://www.msnbc.msn.com/id/13165165/


The photo of the missile launch was distributed via AFP and apparently obtained from Iranian state media.

http://afp.google.com/article/ALeqM5...Vj9dn9pWaVMCJQ

[Lord Orwell]

the first one. It was said to have been ordered done by lebanese government.

That photo was in fact instrumental in the creation of a program to find duplicated pixels in an image. Adobe systems is now owner of the software, as they purchased it from the creator (i didnt bother to memorize his name) but there were also issues with light sources in photos and light-source eye reflections that they can detect now.