tag:blogger.com,1999:blog-4509173218981631666.post3687598890754471003..comments2023-11-05T07:47:39.708-05:00Comments on The Blog of Diminishing Returns: Cash for Clunkers: The Money is Actually Being SpentSeth Gitterhttp://www.blogger.com/profile/05419336947867237619noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-4509173218981631666.post-50588006644564657742009-08-05T15:22:03.269-04:002009-08-05T15:22:03.269-04:00Just a few thoughts.
1. We don't know for sure...Just a few thoughts.<br />1. We don't know for sure whether this is stimulating car sales or just changing when they are being bought. If someone was thinking about trading in their clunker next year, they might buy now. Since not all expected purchases are realized, it might increase some purchasing, but the net effect might be mostly to change WHEN the cars are purchased.<br /><br />2. One of the arguments for the program is that it improves the environment. Does it? If people use a car longer, it means less manufacturing and hence less transportation of auto inputs. Is there a net gain? Probably. How much? Hell if I know.<br /><br />3. Why do we subsidize autos, per se? (Disclosure to anyone aside from Seth reading this. I was born and raised in Detroit.) One Arkansas congressman said there were a lot of chicken farms in his district. So why not "Cash for Cluckers?" One reason for the $'s to autos is the gov't has large shares of GM and Chrysler. But, gov't policies based on ownership is one of the fears that opponents of bailouts had.<br /><br />4. But, I still favor the Cash for Clunkers. Why? Right now confidence is a big thing. If this helps restore consumer confidence and hence spending, it is a good 1-3 Billion spent.Bob Gitterhttps://www.blogger.com/profile/14044726462116314459noreply@blogger.com