As for the factual claims, did cash-for-clunkers indeed "help everyone"? Well, no. Let's take my favorite example: me. The Welch household owns one car, a 1994 Acura Integra. While clunky, this 15-year-old car does not qualify for the program, because it gets too many miles per gallon–around 28, allegedly. So our tax dollars are being redistributed to people who have made less eco-friendly purchases than we have.Brilliant. Simply brilliant.
One could counter-argue that monocle-wearing magazine editors such as moi are not the intended audience for this bit of alleged FDRism, and while that actually doesn't make any sense (since no one's checking your pay stubs on the showroom floor), let's roll with it anyway. Here's the problem even then: We bought that pup (for the C-4-Cish price of $4,000, about six years ago), back when we were poor. Hell, I'd bet that the majority of households whose lone car is a 1994 anything ain't exactly swimming in the do-rey-mi. What this program does is take money from the stickshift-driving non-rich, and gives it to anyone with an SUV and/or old beater. Who (again, unlike us) is ready to shell out five figures for a shiny new car.
BUT WOULD IT QUALIFY???And wait! It gets worse, from that whole social-justice angle. What about the estimated 12 percent of Americans aged 15 years and above who don't drive, period? What about all the adults who live in the 8 percent of households that don't have a vehicle? What about half the residents of Manhattan, who took transit planners' decades-old dream to heart and "got out of their cars"? What about those who are too poor to drive? The answer: All of these people are subsidizing whoever turns in an SUV or crappy old $800 K-Car like the one I used to drive. Not only that, but what do you think happens to the $800 car market when the guvmint is handing out $4,500 checks to have the things destroyed? I'll go ahead and state the obvious: It shrinks, making it more expensive for the truly poor people, the ones who want to make that daring leap from the bus system to an awful old bucket of rust.
So no, not "everyone" was helped by cash-for-clunkers. Ah, but what about how it's better for the environment, and therefore "everyone"? Tell it to those smokestack apologists at, uh, The New York Times, The New Republic, and The Guardian.
Sullivan is dead right about one thing: Cash-for-clunkers is indeed very "popular." So is the home mortgage interest deduction, the prescription drug benefit, and any number of federal programs that siphon from the diffuse pool of tax revenue+debt and blast out concentrated benefits to the broad middle class. The standard for judging these things shouldn't be popularity–Richard Nixon's wage-and-price control spasm of 1971, to name one of many historical measures now widely and rightly considered asinine, was hugely popular at the time–but whether they make sense in both the short and long term.
Cash-for-clunkers amounts to a rounding error in Tim Geithner's nose-hair at this point, which is probably why at least some liberals seem so genuinely baffled by the disproportionate criticism it has drawn. But for some of us it's also a nearly perfect symbol of economic statism run amok. The federal government is taking from the many, giving it to the less-than-many, destroying functional cars, funneling money to an auto industry that it already largely owns (at a hefty taxpayer price tag), then taking multiple (and multiply premature) bows for rescuing the economy and the auto industry in the process.
There's simply no excuse for the idiocy that is Cash for Clunkers. No, it's not a huge program compared the rest of the bailouts and the massive printing of monopoly money that we've seen in the last year. No, it's not the worst thing that's ever happened in terms of big-government stupid, but it's a perfect example of Bastiat's broken-window fallacy.
And a perfect example of how governments screw over most of the population in order to placate a much smaller - but more visible, more vocal and more sympathetic group of other people. In most cases, you find that the benefits almost invariably go to the middle class, clearly at the expense of the poor (who might benefit from cheaper used cars and more widely available transportation)... Again, prompting me to ask, "Why do politicians hate poor people so damn much!?"
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