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Cash for Clunkers

When Cash for Clunkers first launched I thought it sounded like a good idea. But over the past few weeks, as I started to consider it's implications, I really think it's the wrong way to go. Here are a few reasons I think it's not the program our country needs right now.

  1. We shouldn't be promoting cars - In an era when dollars should be spent figuring out a way to keep us from using fossil fuels, we are spending $3,000,000,000 helping people buy new cars. Granted it's a great idea to remove gas guzzlers from the roads but why not focus on getting more people to bike or walk to work, or start using public transit.
  2. Where are the jobs? - Sorry, this program will not create any jobs, it might add a few people temporarily to dealerships and maybe even a few people will get hired at car manufacturers, but those will be offset but a slight decrease in the amount of work auto repair shops get.
  3. Again, where are the jobs? - At a time when getting people back to work should be a number one priority, we are spending money on a program that not only doesn't create jobs but requires the person participating to have a job. Unless you think car companies are going to give loans to the unemployed so they can earn that $4,500 payment.
  4. It rewards poor decisions - Why should someone who purchased a used SUV 3-4 years ago suddenly get a better resale value than I would if I went to sell my used Honda Accord? My vehicle isn't worth $4,500 but I can't trade it in because it get's good mileage. Granted there are a million instances where our government rewards those who made poor decisions, and I'm more than happy to give my tax dollars to the people who are taking advantage of this program,I just wish we were doing it in some other way.
  5. Debt, again - Have we learned nothing over the last few years? Why would we want to promote people taking on additional debt? It would be one thing if people could trade in their car for a fuel efficient used vehicle and the government covered the cost difference, but instead the program forces you to buy a new car and take on a car payment. Their is nothing inherently wrong with taking on debt for a vehicle, but it seems like something we shouldn't be promoting right now.

All my problems with the program being stated, I have no problem with anyone who takes advantage of the program. I probably would have considered it if I had an eligible vehicle and had been looking to buy a new vehicle soon. My problem is with the Obama administration rolling out a program that does very little good. It's a short term news generating program that won't do much in the long run other than add to our national debt.

Some additional reading:

David Brauer, who participate in Cash for Clunkers write about his experience.

Bob Collins asks an important question regarding the actual environmental impact of the program. (Make sure you read the comments on this story)