Althouse: The Clunker Clunker.

July 31, 2009

The Clunker Clunker.

"Cash for Clunkers" got a lot of folks jazzed up, but it flamed out in 1 week.

Is this just some oddball quirk of a program, or should we see it as a sign that all those other programs loaded with money and big ideas are fatally ill-designed?

AND: Ha ha. Instapundit drives a clunker.

AND: "House seeks $2B more in cash-for-clunker aid." Rule of thumb: After a program goes into operation, the estimate of its cost will increase by >200%. Not fair? Why? Because it's too high or because it's too low?

226 comments:

«Oldest ‹Older 201 – 226 of 226

Once written, twice... said...: thank you to the many House Republicans who voted for this successful program this afternoon!; 7/31/09, 4:45 PM
Anonymous said...: This comment has been removed by the author.; 7/31/09, 4:46 PM
Jeremy said...: Synova - YOu don't know your fat ass from a hole in the ground.

You post silly drivel, get called on it, then try to change the subject.

And yes, I have seen black roofs...but then again, I get out more than you.

If you don't believe light colored roofs save energy...don't use light colors on your roof.; 7/31/09, 4:46 PM
Jeremy said...: Dogwood said..."...solar is only feasible with massive government subsidies, otherwise, it is not economically viable given current technology."

You're out of your frigging mind.

I'm in the business and have no idea what the fuck you're talking about.

The solar companies I deal with are privately and publicly owned, for-profit entities, and get no "government subsidies" to produce their panels or coatings.

There are literally millions of homes throughout the wester and southern states that have panels, coatings and other devices designed to save energy...and none of the companies that provide such material nor the customers receive "government subsidies."

The "customers" get rebates for lowering their consumption.

Huge and massively profitable farmers sure as hell do, though. Are you against that?; 7/31/09, 4:51 PM
Jeremy said...: Anybody want to blame Obama for this?

Dow ends best July in two decades
as Wall Street enjoyed it's best July in two decades, as investors considered a government report showing the pace of the recession is easing.; 7/31/09, 4:53 PM
BJM said...: Cash for clunkers doesn't address Government Motors root problem:

The 10 most reliable new cars:

According to the recently released J.D. Power & Associates list of the most reliable cars of 2008:

1. Lexus
2. Mercury (Ford)
3. Cadillac (GM)
4. Toyota
5. Acura
6. Buick (GM)
7. BMW
8. Lincoln (Ford)
9. Honda
10. Jaguar (Ford)

Consumer Reports released their 2008 rating by category:

* Family cars: Toyota Prius, Honda Accord (4-cyl), Ford Fusion (V6)
* Large cars: Buick Lucerne (V8), Toyota Avalon, Dodge Charger (V6)
* Small cars: Toyota Yaris Hatchback, Honda Fit, Toyota Yaris Sedan
* Minivans: Toyota Sienna, Honda Odyssey, Chrysler Town & Country
* Small SUVS: Honda Element, Mitsubishi Outlander, Subaru Forester (turbo)
* Midsized SUVs: Toyota Highlander, Honda Pilot, Toyota 4Runner

I was startled to hear a local GMC dealer advertising "hot" deals on new 2008 & 2009 models on the radio. Jumping Jehoshaphat! They have new 2008 iron on the lot?; 7/31/09, 4:54 PM
Jeremy said...: BJM said..."Cash for clunkers doesn't address Government Motors root problem"

It's not designed to address GM's problems.

Just as solar panels aren't designed to address retail sales.

What's your point?; 7/31/09, 4:56 PM
Anonymous said...: The solar companies I deal with are privately and publicly owned, for-profit entities, and get no "government subsidies" to produce their panels or coatings.

The customers are getting the subsidies Jeremy, c'mon, stop being obtuse.

My comment was a direct reply to your posting of the Massachusetts plan, which is nothing but a massive taxpayer-funded subsidy for the solar industry.

And yes, I would like to see ag subsidies eliminated. Not sure what that has to do with the topic, but seems to be important to you.; 7/31/09, 5:01 PM
BJM said...: Okay, who spilled the troll chow?

"Clean up on aisle 208!"; 7/31/09, 5:01 PM
Anonymous said...: Cash for clunkers doesn't address Government Motors root problem:

Exactly, that is why I am interested in the sales data. No question the program is helping to clear inventory, but whose inventory?

And once that inventory is reduced, who has the products capable of enticing full-pay customers to visit car lots for the rest of the year?; 7/31/09, 5:09 PM
Jeremy said...: Dogwood said..."Exactly, that is why I am interested in the sales data. No question the program is helping to clear inventory, but whose inventory?"

WHoever has the best deal.

The domestics are offering the $1,000's in addition to the clunker rebate. Toyota and other appear to be not.

We've got an older Jeep and have considered doing this, it fits the guidelines, but we just don't know if we want to buy another new car.; 7/31/09, 5:31 PM
Jeremy said...: Dogwood said..."My comment was a direct reply to your posting of the Massachusetts plan, which is nothing but a massive taxpayer-funded subsidy for the solar industry."

Funding for the program will come from two sources: a $10 million annual commitment from the state Renewable Energy Trust, which collects the 25-cent monthly electric bill tax, and $28 million paid to the state in recent years by NStar and National Grid as compensation for failing to buy enough wind, hydro, and other renewable power to meet state mandates for green energy.

WOW...25 cents month in new TAXES!!; 7/31/09, 5:35 PM
Jeremy said...: BJM said..."Okay, who spilled the troll chow?"

Translated: HEY!! Who's butting in on the wing nut suck fest!! Agree or move on.; 7/31/09, 5:37 PM
mrs whatsit said...: I don't believe that painting roofs white will save energy for many people who live where I do (that is, where it gets cold.) We put almost no energy into cooling; it all goes into heating. Our house stays cool in summer because it's shaded by trees on the south, and that's all it takes in this climate. In the winter, it takes a very great deal more than roof color to keep warm!

As for Jeremy, anybody who would call somebody else an "idiot" because she (I think Synova's a she -- apologies if not) has a clearer memory than he does of what's been in the news recently really isn't worth talking to.; 7/31/09, 6:01 PM
Dave said...: "For your assertion that consumption will return to previous levels to be true however, consumption must not just resume but skyrocket - even as the equity position of most homeowners continues to decline as does personal income. I am simply asking on what basis you believe that be even possible let alone likely."

Modest economic expansion will produce the approximately 2% needed to bring consumption back to previous heights. It would take 4 quarters of 2% annualized growth or about 0.5% per quarter to get us there. By comparison, the post-war US average for PCE growth is about 3.5% annualized. If you want to exclude the era when Americans began saving less (roughly from the mid-80's onwards) your average is 3.7%. Even in the darkest days of the 70's and including the twin recessions of the '80's, real PCE averaged 3.5% per annum. That's in an era of high interest rates, too.

Real PCE doesn't need to skyrocket to get us where we were, as you claim. A modest economic expansion along with stability in the job and housing market will do the trick. The housing market is likely bottoming this year, and it is looking like a pretty good bet that GDP growth will turn positive in the 3rd quarter. That leaves job creation, which is always a lagging indicator.; 7/31/09, 6:16 PM
Der Hahn said...: Some insider info on cash for clunkers. It looks like the lack of money is going to hurt car dealers as they are on the hook for the cash until government pays up (after they complete a 20 page application) unless they demand purchasers cough up the extra money.; 7/31/09, 8:26 PM
Synova said...: I apologize to everyone for addressing Jeremy today as if he was a rational and decent human being who simply disagreed.; 7/31/09, 8:46 PM
I'm Full of Soup said...: Yeah I'll say, Luckoldson Gene Olson Jeremy Michael is really off the rails today.

El Cajon Community College is missing an idiot again.; 7/31/09, 8:53 PM
Anonymous said...: WOW...25 cents month in new TAXES!!

According to the article you posted, the Massachusetts plan will provide a subsidy equivalent to 1/2 to 2/3rds of the total cost of installation.

So yes, each installation requires a massive government subsidy to make it economically viable. It doesn't matter if the overall tax rate funding the program is low because that's not the point.

Nothing you have posted contradicts my point that solar is not economically viable without substantial government subsidies.

Take away the subsidies and the solar industry dies a quick and painful death.

Instead of spending scarce public resources installing such systems, which will never pay for themselves, state and federal governments should spend those dollars on new and ongoing research that will ultimately result in PV panels that are more efficient & economically viable.

Once that point is reached (somewhere between $1 to $2 per watt) then consumers will begin adopting the technology without subsidies.; 7/31/09, 10:27 PM
BJM said...: Der Hahn, looks like car dealers and doctors have more in common than one might think at first glance.

The government is very good at using OPM, but then all their money is OP's isn't it?; 7/31/09, 10:49 PM
Bruce Hayden said...: Nothing you have posted contradicts my point that solar is not economically viable without substantial government subsidies.

But, but, but the government money doesn't count. It is free money, since it is coming from the rich, who have too much of it already, and we need to spread it around some more, and this is a great way to do it.; 7/31/09, 10:52 PM
BJM said...: Dogwood, it's not just economics, solar is not an option in hurricane alley. Which is a great pity as the elctricity rates are prohibitive.

We investigated installing solar for the pool in Sth Florida, but the county wouldn't permit roof panels and the HOA prohibited both roof and ground installations post-Wilma.

We went with propane.; 7/31/09, 11:03 PM
MC said...: Why stop at a small subsidy! Think of the economic stimulus that can be achieved by paying people the full cost of their car to buy a new car! Or more! Forget a paltry 27%, we could get auto sales up by several hundred percent! Think of the jobs created! Hey, how about we extended it by borrowing money from China to pay people to dig holes and fill them up again? Think of jobs we could create!

Not.

Oh sweet Jesus I wish we could keep economically illiterate liberals away from government.; 7/31/09, 11:26 PM
Jim said...: dave -

You seem to be working off the false assumption that returning to the previous absolute dollar amounts of consumption would be sufficient to "restore consumption to previous levels." That's a wholly incorrect assumption.

Because of inflation and normal population dynamics, consumer spending must grow at a minimum of 1.5% every year just to tread water. Given the 2% year over year decline in absolute dollars, that means that consumer spending is actually down 3.5% in relation to last year.

Consensus economic forecasts for 2010 are for anemic growth rates in the range of 1-2%, i.e., just enough to keep us from losing additional ground compared to this year. That still leaves us 3.5% behind.

Going forward that means 2011 would have to see a minimum of 5% growth in 2011 to get us back to even. I don't know who you're listening to, but no reputable economist is predicting anything close to those numbers - which means that now we're talking, at the earliest, going into 2012 before we have even the slightest prayer of getting back to previous consumption levels.

You'd still have to assume that the economy is growing at an extremely healthy clip in 2012 to think that we have a prayer of seeing those numbers then. More likely we're talking at least 2013 or beyond. And that's barring any significant setbacks between now and then: which Obama and the Democratic Party seem bound and determined to inflict on this country anyway.

So we return to my still as yet unrefuted point: consumer consumption isn't going to go back to previous levels for at minimum 3 to 4 years - with much longer time periods required with every bit of "rob Peter to pay Paul" stimulus that Obama and the Democratic Party jams down our throats.

You may like the short-term impact of the "cash for clunkers" program, but all it's doing is extending the economic pain. The more we borrow as a country, the higher our interest rates will be pushed and the less our dollar will be worth. It's a vicious cycle they have driven us into, and it's short-sighted in the extreme to advocate a whole bunch more of the same without any realization of just how much pain it's going to cause in the future.; 8/1/09, 12:30 AM
Dave said...: Jim - those are real numbers - adjusted for inflation.; 8/1/09, 10:23 AM
TosaGuy said...: All this program will do is cannibalize future auto sales. If you were thinking of buying a new car in the next 6 mo to a year, you pulled the trigger last week or will do it when they put in the next 2 billion.

A manufacturing firm is most efficient when it can build at a steady pace. Ramping up productions for a few weeks will only facilitate paying lots of overtime to existing workers--not hire new ones.

This bill will in the period after the program is over, will kill the price point on the cars. People will not want to pay what the car costs, instead, expecting to pay what the car cost after the rebate. US car companies already have a problem with the price point of their cars, this will not help them in the long run.

it also only helps the middle and upper income. It does not help those who on the lower rung who can only afford the very cars that are going to to the crusher. This will drive up the price of that level of cars.

So we have new cars getting cheaper to the detriment of unprofitable car companies and old cars getting more expensive to the detriment of the poor.

Moral: get Uncle Sam out of the marketplace because the he has yet to figure out the law of unintendend consequences.; 8/1/09, 9:20 PM