Sunday, August 2, 2009

The Cash-For-Clunkers (CFC) scam

Okay, I have to admit that it initially sounded like a plausible scheme to me, even if it was obviously intended to help out the car dealers and manufacturers since it was limited to purchasing new cars. But what's also happening is that perfectly reasonable used vehicles are being deleted from the used car inventory. The engines in the traded in cars have to be destroyed and then the vehicles scrapped. Okay, maybe this makes sense if you're picturing a clapped-out Buick with a bad exhaust being destroyed, but that's not all that's happening...

A BMW 735i engine being run to destruction to comply with the requirements.

A Volvo S80 T6 hanging on to life for a while.

So here it is, relatively recent cars are being destroyed with our government's money to give a discount to the purchase of new, slightly more efficient cars and trucks. But what about the environmental and economic costs of the new construction? Move along now, nothing to see here.

A large fraction of the so-called clunkers are actually modern, relatively non-polluting, and well-running vehicles. This isn't getting rid of the nasty polluting old cars, just thinning the good used car market. That's a newer, nicer car than mine (the Volvo) and gets better fuel economy than most any SUV or truck out in suburbia.

If you had a 17MPG pickup, you could use the money to buy a (new) 19MPG SUV.

Absolutely insane. Next up, a bailout for the US insurance and glass industry by handing out rocks to be thrown through windows.

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