House Mulls Saving Broke Cash-for-Clunkers Program for...Two Weeks (Update: House Okays $2 Billion More)
1:03 PM, Jul 31, 2009 • By MARY KATHARINE HAM
The American people act on incentives. When the incentive is free wads of $4,500 for cars that would likely never qualify for such trade-in values on the free market, there will never be enough money to satisfy demand.
That's why the cash-for-clunkers program, meant to incentivize the trading in of gas-guzzlers for energy efficient cars, thereby boosting the flailing auto industry, has been suspended after less than a week. It was supposed to last until November, but lo and behold, when the government offers "free" money, the demand is high, indeed.
The House is trying to come to the rescue, with $2 billion in stimulus money. That's great. It oughtta keep up with demand for approximately two weeks:
And, then we'll presumably be on the hook for another couple billion after that. But what's another couple billion? Taxpayers have already "invested" billions in the auto industry involuntarily, so why not an arbitrary redistribution of tax money from people who own cars above the 18-mpg "clunker" qualification to people who happen to own '87 Chevy Blazers? I've known people with '87 Blazers. They're good people, and I for one am happy to subsidize their switch from glorious two-tone muddin' machines to...Chevy Bolts.
Many Obama-supporters on Twitter today have argued that the program is only a failure insomuch as it is a great success. You see, the Obama administration simply revealed the tremendous demand for
You know what was also a great success, by that standard? The KFC grilled-chicken giveaway. The crowds of angry people, the insufficient chicken supply to honor Oprah-touted coupons, the frayed relations with customers, franchise-owners, media, and the stain on the company's brand? Those were just syptoms of KFC's revelation of the tremendous demand for its free chicken product, not the biggest, most high-profile marketing failure and bad business decision in years.
Michael Barone notes that we've seen this program before: