[Mongol Federation]

The plan was simple, set aside $1 billion to help jalopy driving ditizens of America get a new, more fuel efficient car. It was to be a win-win-win situation, giving people new cars, upping car sales for the auto companies and reducing green house gas emissions with improved MPG. Well unfortunately it worked, unfortunate because car sales jumped so fast the program, after less then a week since launching and scheduled to last until November 1st, is out of money.

Today the House of Representatives rushed to approve $2 billion more for the program, taken from the stimulus package. Congress, having seen the 1st $1 billion disappear in a matter of days isn't so stupid, despite the common perception, to not realize how ineffective another $2 billion will be and plans to lobby for more money. 2 problems have, at least temporarily, stalled this plan. 1. The Senate is out of session today and thus can't vote on the issue and 2. the Republican minority is, at least in part, threatening to vote no.

So now we must ask ourselves, is Cash for Clunkers (officially known as the Car Allowance Rebate System or CARS) out of gas? For the sake of the environment and the jalopy driving ditizens of America, let's hope not.

[El Pilchinator]

i don't see what the issue with it being used fast is, to be honest. its going to achieve the same effect.

[Mongol Federation]

El Pilchinator, on Jul 31 2009, 11:19 PM, said:

i don't see what the issue with it being used fast is, to be honest. its going to achieve the same effect.

The issue is that the gov't didn't give the program the money it needed. We'll get stuck with old gas guzzlers and the gov't will have to honor CARS deals made after the money ran out.

[Ethan Smith]

Germany did this months ago and it worked fantastically.

[Simon De Montfort]

It's good to see how well congress does in estimating the cost of programs. This gives me more confidence in their plans for health care ..... oh wait.

Well at least this plan doesn't expand the deficit .... oh.

[Ethan Smith]

Yes, taking money out of the money that you've allotted to spend increases the money that you're using OH WAIT.

[Emperor Stranger]

Ethan Smith, on Aug 1 2009, 01:22 AM, said:

Yes, taking money out of the money that you've allotted to spend increases the money that you're using OH WAIT.

The real question is, should we have spent that money in the first place? I was watching Glenn Beck today as usual and this guy on it did bring up a good point: How is trading in your car and putting yourself into more debt by purchasing a car through yet another loan going to help? And not allotting more money actually did put the car companies in a pretty pickle. Multiple millions, if not billions, have already been spent on advertisements for this government program. Since it ran out in four days instead of a few months, all the advertisement will be a complete waste and the car companies/dealers would have that much less cash to spend trying to get people to buy their cars.

Otherwise, it's a decent deal. Too bad it uses that $2.5 trillion we should have never agreed to spend..

[Delta1212]

Emperor Stranger, on Aug 1 2009, 01:49 AM, said:

The real question is, should we have spent that money in the first place? I was watching Glenn Beck today as usual and this guy on it did bring up a good point: How is trading in your car and putting yourself into more debt by purchasing a car through yet another loan going to help? And not allotting more money actually did put the car companies in a pretty pickle. Multiple millions, if not billions, have already been spent on advertisements for this government program. Since it ran out in four days instead of a few months, all the advertisement will be a complete waste and the car companies/dealers would have that much less cash to spend trying to get people to buy their cars.

Otherwise, it's a decent deal. Too bad it uses that $2.5 trillion we should have never agreed to spend..

Well, as long as we are spending it, we might as well do it on something that produces results, which this seems as if it might do. It's a little early to tell after less than a week, but so far it seems to have done quite well other than a "misunderestimation" of how successful it would turn out to be.

[Emperor Stranger]

Delta1212, on Aug 1 2009, 01:54 AM, said:

Well, as long as we are spending it, we might as well do it on something that produces results, which this seems as if it might do. It's a little early to tell after less than a week, but so far it seems to have done quite well other than a "misunderestimation" of how successful it would turn out to be.

I am just a firm believer that putting yourself into more debt will not solve your debt problems. I don't know, maybe it's just me... and several economists.

[Ethan Smith]

Alright, the argument you're making has nothing to do with the argument I just made. I said that we have a set amount of money that we have allotted to spend. Spending it doesn't put us deeper in debt because we've already decided to spend the money.

[anenu]

Emperor Stranger, on Aug 1 2009, 12:49 AM, said:

The real question is, should we have spent that money in the first place? I was watching Glenn Beck today as usual and this guy on it did bring up a good point: How is trading in your car and putting yourself into more debt by purchasing a car through yet another loan going to help? And not allotting more money actually did put the car companies in a pretty pickle. Multiple millions, if not billions, have already been spent on advertisements for this government program. Since it ran out in four days instead of a few months, all the advertisement will be a complete waste and the car companies/dealers would have that much less cash to spend trying to get people to buy their cars.

Otherwise, it's a decent deal. Too bad it uses that $2.5 trillion we should have never agreed to spend..

because if nobody buys anything the economy tanks and then everthing falls apart. So by helping millions of people buy new cars you help the car companies out and they then have to meet higher demands which means they hire more people which means more people have a job which means that more people can buy things which means that more people do buy things which means that other buisnesses start going up which means they need to hire new workers to meet increasing demands and that means that more people have jobs and more people can buy things ....

You see the cycle yes?



TL;DR
If nobody buys anything then nobody has a job cause nobody is selling.

[Emperor Stranger]

anenu, on Aug 1 2009, 02:15 AM, said:

because if nobody buys anything the economy tanks and then everthing falls apart. So by helping millions of people buy new cars you help the car companies out and they then have to meet higher demands which means they hire more people which means more people have a job which means that more people can buy things which means that more people do buy things which means that other buisnesses start going up which means they need to hire new workers to meet increasing demands and that means that more people have jobs and more people can buy things ....

You see the cycle yes?



TL;DR
If nobody buys anything then nobody has a job cause nobody is selling.

I suppose no one has heard of the 1920's depression. How did that depression get solved? Less government. The problem is that people believe that the government needs to increase its debt to save America and put more people into further debt. Yes, this program seems nice. But what put us into this recession in the first place? Could it be people not being able to afford their loans? Yes, I do believe that was it...

[Kenadian_2006]

Emperor Stranger, on Aug 1 2009, 02:31 AM, said:

I suppose no one has heard of the 1920's depression. How did that depression get solved? Less government. The problem is that people believe that the government needs to increase its debt to save America and put more people into further debt. Yes, this program seems nice. But what put us into this recession in the first place? Could it be people not being able to afford their loans? Yes, I do believe that was it...

And how did the following and much larger depression occur? Too much crap letting run free.

This post has been edited by Kenadian_2006: 01 August 2009 - 12:28 AM

[Ethan Smith]

Emperor Stranger, on Aug 1 2009, 07:31 AM, said:

I suppose no one has heard of the 1920's depression. How did that depression get solved? Less government. The problem is that people believe that the government needs to increase its debt to save America and put more people into further debt. Yes, this program seems nice. But what put us into this recession in the first place? Could it be people not being able to afford their loans? Yes, I do believe that was it...

Yeah, and nothing bad happened after the 1920's.

[Emperor Stranger]

Kenadian_2006, on Aug 1 2009, 02:33 AM, said:

And how did the following and much larger depression occur? Too much crap letting run free.

Too much spending and debt. Wait, isn't that what's happening today?

Edit: Actually, to be fair, the Great Depression was started because 17,000,000 stocks were sold in a day over some rumor.

This post has been edited by Emperor Stranger: 01 August 2009 - 12:44 AM

[Zarfef]

I don't own a car. I like the idea, but they can't have my bike .

[Lamuella]

Emperor Stranger, on Aug 1 2009, 01:49 AM, said:

The real question is, should we have spent that money in the first place? I was watching Glenn Beck today as usual and this guy on it did bring up a good point: How is trading in your car and putting yourself into more debt by purchasing a car through yet another loan going to help? And not allotting more money actually did put the car companies in a pretty pickle. Multiple millions, if not billions, have already been spent on advertisements for this government program. Since it ran out in four days instead of a few months, all the advertisement will be a complete waste and the car companies/dealers would have that much less cash to spend trying to get people to buy their cars.

Otherwise, it's a decent deal. Too bad it uses that $2.5 trillion we should have never agreed to spend..

did you just claim that the cash for clunkers program cost 2.5 trillion dollars? You might want to re-think that

[Simon De Montfort]

Ethan Smith, on Aug 1 2009, 01:05 AM, said:

Alright, the argument you're making has nothing to do with the argument I just made. I said that we have a set amount of money that we have allotted to spend. Spending it doesn't put us deeper in debt because we've already decided to spend the money.

Just because they already planned to borrow the money to pay this for doesn't erase the fact that this plan is contributing to our annual deficit and growing our already obscene national debt. If we didn't have to borrow money our government doesn't have to pay for this program then this program wouldn't be a bad idea. But that's not the case.



Also what pork barrel "stimulus" project did they cut to pay for this?

[Mongol Federation]

Simon De Montfort, on Aug 1 2009, 08:53 AM, said:

Just because they already planned to borrow the money to pay this for doesn't erase the fact that this plan is contributing to our annual deficit and growing our already obscene national debt. If we didn't have to borrow money our government doesn't have to pay for this program then this program wouldn't be a bad idea. But that's not the case.



Also what pork barrel "stimulus" project did they cut to pay for this?

Most of the money isn't preassigned. It's just there for when the states or Feds get an idea, like this 1.

[juslen]

The plan didn't run out of money.

It simply went through 100 million in just 8 days.

It was on track to burn through the entire billion dollars in less than 4 months

The CARS programs goes until November 1st. They had originally asked for 4 billion dollars but settled for 1 billion. Since the plan has been so popular, and because the computer systems were crashing because of the demand, Congress jumped into action to get an addition 2 billion to keep it going.

Germany did a programs very similar to this, and apparently it was a success. But from what I have read, Germany was prepared, the United States was not. Another reminder of the complete lack of organization and planning that the government has. Perhaps because they pushed through the stimulus plan before anyone had a chance to read it.

The only thing that bothers me about this program is the fact that the old cars that people trade in are scrapped almost immediately. A dealer can't get reimbursed for the $3500-4500 dollars until they have proven that the car is unusable (scrapped, engine destroyed)

They are essentially taking used cars off the market, and destroying them. People who can't afford new cars could probably use salvaged parts from these vehicles, but they are essentially just destroyed and become nothing more than landfill material and scrap metal.

Another problem I have is the fact that people are still putting themselves into debt. The average car probably costs 20k dollars. Lets just subtract 4k dollars from that, with no down payment.. your talking 300-400 dollars a month for a car payment for 5 years.

Sure, if these cars are being sold to people who really need a car, and they have money to put down or money saved to reduce payments or prepare for unforeseen losses of income then this is great.

Hopefully this doesn't turn into one big Black Friday shopping spree for people. Then you will just see new cars back on the lots after people default on payments.

Cars contribute to 1/3 of the United States economy. Honestly, I think those days are over, and they should have been over a long time ago. That is what got us into this mess in the first place. People spending way beyond their means, always needing a new car.. something new to put them in debt.

If this program is a success, be thankful its only 3 billion. Because the government was not prepared for this unlike German was. I will give this program credit where it is due, but the results wont be in for another year.