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Old 07-31-2009, 01:10 PM
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Default Stimulus Works: Cash for Clunkers Needs More Cash to Continue Its Success

Hiring police officers isn't the only area where the stimulus is making a difference. The "Cash for Clunkers" program is having wild success - and hence needing more cash:
Car sales have been in the tank for more than a year as the nation's deepening recession and growing ranks of unemployed turned the market into the worst one in decades and helped send General Motors Corp. and Chrysler into filing for bankruptcy protection this year.

The federal program provides rebates of $3,500 or $4,500 to consumers who trade in vehicles with combined city/highway mileage of 18 miles per gallon or less and buy more fuel-efficient new cars or trucks.

The program was designed to run until Nov. 1 or until 250,000 cars had been sold, whichever came first. Many analysts had expected the money to last at least until Labor Day.

So far the program has paid about $150 million to car dealers and reserved as much as $850 million more for pending applications, according to congressional aides. That brought the total dangerously close to the plan's funding limit.

Dealers are hoping that more money is found for the program.

"I hope they will extend the program because it was such a win on so many levels -- for the consumers, for the environment, for all the car manufacturers," said John Sackrison, executive director of the Orange County Automobile Dealers Assn. "It got a lot of people to go car shopping who wouldn't have otherwise."


Like other stimulus benefits, this has short- and medium-term effects. It doesn't address the underlying problems of a car-based society, but it does get money flowing and, by increasing the average fuel efficiency of cars on the road, save ordinary Americans money and save society some pollution. In the face of that success, I hope Congress finds more cash for the program. Shouldn't have stripped out the full funding in the first place, huh Senators?

Politically, it's a win too. Listen to Republican critics sputter:
Rep. Jeb Hensarling (R-Texas) criticized the program today, saying there was no such bailout for other struggling industries.

"Almost everyone is hurting in this economy, and sadly for many workers across East Texas and America, Pilgrim's Pride, one of the largest poultry producers in the country, recently had to file for bankruptcy," Hensarling said. "Where's their 'cash for cluckers' program?"(*)


Cash for cluckers? Maybe that's the Republican plan for recovery - we all raise chickens in the third world economy they have planned for us.







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