I don’t think an “economy on the mend” is a consensus opinion. It is, however, a good assumption to make if you want to write an editorial to bash a stimulus plan.
No, I believe this because the program says that’s what will happen. Why are you always trying to assign various motives to people without any evidence?
Here, you can read it all for yourself at www.cars.gov.
The relevent section:
The drivetrain of a vehicle includes the engine, transmission, differential, and the driveshaft.
I’m not sure what this has to do with anything at all, but I’ll humor you. Having grown up in a very low income family, the first few vehicles I had were total beaters, and I had to learn to maintain them myself. I never rebuilt an engine (never having had the tools), but I’ve repaired everything from brake systems to carburetors to electrical systems to cooling systems, done my own tune-ups, and done my share of emergency repairs after the beater broke down on a highway. And of course, I’ve spent many an hour at the salvage yard skinning my knuckles while trying to remove the parts I needed from old wrecks.
Does that make my opinion more valuable? Less valuable? Do I win a kewpie doll or something?
Here’s another thing I find totally incomprehensible about this program: It specifically excludes cars more than 25 years old. Why would anyone do that? They’re excluding every car made before catalytic converters and modern emissions controls. They’re excluding the class of vehicles that are by far the least fuel efficient on the road and which are mostly responsible for typical vehicle pollution.
Not only that, but by putting a price floor of $4500 on the mid-range used car market (and eventually destroying those mid-range cars), they are freezing out the really poor people with the old beaters who can’t afford to buy new cars but who could have afforded to sell their old smoking '74 station wagon for say, a 1997 VW Passat.
A more sane program would have allowed these $4500 trade-ins to be resold, but only to people with much worse vehicles. A tiered program might work like this:
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Trade in your 1997 Passat, worth $2500. Government gives auto dealer $3500 credit to be passed on to the consumer.
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1997 Passat can stay on the market for a maximum of 2 months. During that period, it can be resold to anyone whose car gets even worse mileage (maybe by the same ratio). For that sale, the government gives an additional $1500 credit. So now that Passat, which would be worth $2500 on the open market, can be sold to poor people who drive old beaters, for $1000. Upon sale, the dealership gets an additional $1000.
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Old beaters must be destroyed.
That keeps the valuable vehicles on the road, and gets rid of the very worst vehicles that are still struggling around.
Of course, such a program would devalue the inventories of current used car dealerships, but if you’re going to have the government swinging its power around like a hammer, you’re going to get market distortions. I’d probably still oppose this program, but it would be a hell of a lot smarter than the current abomination.
But that’s not the way this government works. To them, speed of implementation takes precedence over any kind of actual analysis. Everything’s a permanent crisis. Anything they want to do must be done now, before there’s a chance for debate. So you get ill-considered plans like this, implemented before the computer systems are ready and before the vast array of unintended consequences have been thought through.
You don’t even know the rationale behind the year limit, yet you feel you know enough about the program to entirely dismiss it.
If the plan was to increase sales of new cars then the program was successful. If the plan was to help the environment it was not. I think it’s important to keep in mind what this program was actually intended to do, not what people wanted it to do outside of that intention.
How many cars over 25 years old are worth $4500? Only the ones whose owners wouldn’t want to trade them in anyway. There is most certainly a rationale for the age limit, for those willing to give it even a moment’s thought, and if anything it probably should have been shorter - not many daily-driver cars older than 10 years are worth that. Even newer ones.
Broomstick is right - this was a plan to stimulate the economy, and increase wealth (!), by stimulating new car sales and production. There was some hope of getting less-efficient cars off the road too, but that was a side benefit, not the primary purpose.
But, if the purpose of the OP is instead to buttress a viewpoint that Democrats are evil and/or stupid, well, then, the rationale doesn’t matter anyway.
We don’t even know how successful the program is at stimulating car sales, because we don’t know what will happen when the program ends. Obviously it was somewhat successful (any subsidy will have an effect), but we don’t yet know how many of these sales are simply forcing sales that would have happened in the next quarter into this quarter.
We also don’t know the effect of uncertainty on the market. If you’re thinking of buying a car and you miss this program, what’s that going to do to your incentive to buy that car when you can’t get the $4500 credit? And what if you buy a car and then another program starts in six months? Uncertainty like that can really damage a market.
Now why would you assume that? The 25 year limit was added due to lobbying pressure from the Specialty Equipment Marketing Association a group that represents parts suppliers who specialize in restoration parts for old vehicles.
Yet another person who doesn’t understand the Broken Window Fallacy.
I didn’t assume anything. You asked a question in your post that you didn’t know the answer to. That you didn’t know was made all the more clear by the fact that your analysis didn’t even try to touch the main arguments in favor of the limit. I’m not even sure you now understand SEMA’s historical preservation rationale or are even aware of the economic reasons for preferring to not to pay to pull 25+ yr. old cars off the road.
It is pretty absurd that you’re making an argument that a prong of the policy is silly without even so much as identifying, much less addressing, the arguments in favor of that prong.
But here I am pointing out how shallow your arguments are instead of engaging with people who actually trying to analyze the policy, so I have only myself to blame. I really never learn.
By that reasoning, you won’t know then, either. But that’s a major backtrack from your OP, innit?
Hence the word “stimulus”.
The program isn’t targeted to any individual buyer, but to the manufacturers’ total production.
Lack of sales is what really damages a market.
Sure. Cars that age are either worth jack, or are collector’s items, neither one appropriate to the clunkers program. But, to you, that’s “totally incomprehensible”.
A moment’s thought about this “broken window” stuff would reveal its fallaciousness when applied to this program, even using your basic assumption that total material wealth is all that matters. Glass is fungible, cars are not - newer cars represent more wealth. Jobs have multiplier factors by which other jobs are created - your simplistic bit o’ ideologuism does not include that. Wealth is created by the program.
For those who recognize other values and imperatives, other benefits are apparent as well. But you don’t, so let’s not bother.
It was a rhetorical statement, not a claim of ignorance.
Look, EVERY lobby group has a rationale for defending their own interests. It just so happens that SEMA is more organized and has good lobbyists. You don’t think that if auto wreckers had a good lobbying organization, they wouldn’t have been fighting to prevent those engines and transmissions from being destroyed? And had they done so, I’m sure you would have argued that this was all good and proper.
As usual with legislation like this, the winners are those who are most connected to Washington. SEMA has been lobbying government forever. The bill was also modified due to lobbying pressure from the UAW. People who have cars older than 25 years have no lobby group, so they don’t get a bone thrown to them. Used car dealers don’t have a lobby group, so they get screwed. That’s the way Washington works. It’s not about what’s most efficient or most rational - it’s about who’s got the money and the power.
No, you really don’t. Because you never bother to actually do any research yourself. I’ve been posting cite after cite and backing up my arguments with logic and facts, and you pop into the thread and make offhand arguments and snarky rejoinders. I just looked back over this thread, and see that you haven’t offered a single fact in opposition to the arguments being made. Not a single cite. No reasonable analysis. You just try to parse others’ sentences in a way to find a ‘gotcha’ point, then post it and go away. When rebutted, you change the subject and attack the poster. Your contributions have been utterly useless.
For you to accuse me of arguing from ignorance shows amazing chutzpah on your part, but little else.
Funny how quickly we went from bailing out the auto companies to subsidizing them.
And when people buy a new car, they use money that they might have used to buy something else. This is the essence of the broken windows fallacy. There is an opportunity cost. Wealth isn’t just created. The money spent to buy cars is money not spent to fix homes, to buy new TVs or clothes, or to use on vacation, or saved and therefore available for others to invest in new production. There are no free lunches.
Are you kidding? 25 year old cars include cars through 1984. It’s your contention that every car older than 1984 is either already scrapped or a collector’s item? I just did a quick search on auto trader for cars between 1981 and 1984 - just four years, and only on one web site (and almost none of those cars would be ‘classic’), and got 1994 hits. That’s just for vehicles currently for sale.
The earliest data for fleet numbers by year was 1985, and there were almost 2 million vehicles still on the road in that model year alone. I think it’s safe to say that there are still millions of cars on the road that qualify as being older than 25 years and not ‘classic’ cars.
Speaking of simplistic - it seems clear that you don’t know what fungible means, and how a Keynesian multiplier is supposed to work.
That may be the weakest argument I’ve seen for a while. “there are other, unspecified benefits, but I’m not going to bother figuring out what they are.”
Thanks for the clarification. That is confusing, because it is inconsistent with the directions for disabling the vehicle in “The Rule” PDF from the same website.
Why would they not want the transmission to be reused?
I asked since the range of salvagable parts you offered was a mirror and a door handle. Since I’ve had to spend a lot more time finding things like tie rods, brake cylinders, exhaust system components and the like, things like mirrors and such seem to minimize the types of parts of interest that would remain, setting aside the engine.
Again, however, I think it’s a stupid waste to disable any of it. Sure, destroy the car to reduce the number of lower mpg vehicles, but don’t prohibit the parts from being recycled.
I believe the requirement to destroy the old drivetrain comes from lobbying by the UAW - if these major components are not available, it will push more people in the future into scrapping their cars and buying new. Buying a new engine or a new transmission for a 10 year old car is rarely cost-effective, so this is a way to help destroy the old fleet of cars and stimulate new car sales in the future. Note that this isn’t a recession stimulus, because this will have effects years down the road.
What is your evidence of that?
One of the more embarrassing features of the New Deal was the Agricultural Adjustment Act of 1933, which paid farmers to slaughter livestock and plow up good crops, as if destroying useful goods could somehow make the nation wealthier. Would the current supporters of Cash for Clunkers also support this action?
You’re really not getting this “stimulus” stuff, are you?
You’re not getting this “reading” stuff, either. Cars that old either SHOULD BE scrapped or are collector’s items.
Of course I do. If *you *did, you’d be going on about it, paragraph after paragraph, trying to refute it.
No, that was a comment only for those who have latched on so strongly to the idea that deploring “wealth destruction” is a good way to paraphrase “Democrats are stupid” that any other way of looking at the world is, to coin a phrase, “totally incomprehensible”.
That wasn’t the purpose then, either. It was to keep farmers from going broke and going on the dole.
You might keep in mind, by the way, the distinction between durable goods and consumables.
Yeah, I get it quite well, thanks. I also understand things like opportunity costs, market distortions, and the injection of uncertainty into an industry already suffering from large amounts of it.
But to you, any government program these days somehow has a multiplier effect and is a Keynesian stimulus. Because you don’t really understand any of it. You just know the talking points.
I see. So your argument goes like this: Cars older than 25 years are excluded from a program designed to buy up cars and scrap them, because they should be scrapped. Is that about it?
You might want to think that through again. Your logic is a little flawed.
Oh, and before you diss my reading skills, you should remember that your words are still posted above. And this is what you said:
If a car is worth ‘jack’, and it’s still driving around on the roads, isn’t it the best possible candidate for this program? These cars are being DESTROYED. The best cars to destroy are the ones that are worth jack. The lump of crushed steel representing a 1974 Oldsmobile is worth exactly the same as the lump of steel representing a crushed 1997 VW Passat. If one was worth $4000 before being crushed, and the other was worth ‘jack’, which one do you think would be the better candidate for crushing?
And the other argument for this program is environmental - get rid of the most-polluting, biggest gas guzzlers on the road. As a class, pre-1984 cars will be much worse in this regard. They should be the FIRST cars attacked under this program. Exempting them is idiotic. It’s only being done because, as usual, the legislative process was captured by special interests with powerful lobbyists.
Your arguments make no sense whatsoever.
You’re the one looking at the world through a partisan filter here, sparky. I note that over half of Republicans voted for this bill, so it’s a bipartisan screwup. You’re the one who jumped into the debate with bizarre knee-jerk defenses that were wholly unsupported by any facts. You’re the one throwing around accusations of partisanship. And you’re one of the most partisan posters on this board. So careful with that brush you like to paint everyone with. It’s dripping on you.