According to Hudson Institute economist Irwin Stelzer, at best "the reduction in gasoline consumption will cut our oil consumption by 0.2 percent per year, or less than a single day's gasoline use." Burton Abrams and George Parsons of the University of Delaware added up the total benefits from reduced gas consumption, environmental improvements and the benefit to car buyers and companies, minus the overall cost of cash for clunkers, and found a net cost of roughly $2,000 per vehicle. Rather than stimulating the economy, the program made the nation as a whole $1.4 billion poorer.You can't? It worked for Chaplin:
The basic fallacy of cash for clunkers is that you can somehow create wealth by destroying existing assets that are still productive, in this case cars that still work. Under the program, auto dealers were required to destroy the car engines of trade-ins with a sodium silicate solution, then smash them and send them to the junk yard. As the journalist Henry Hazlitt wrote in his classic, "Economics in One Lesson," you can't raise living standards by breaking windows so some people can get jobs repairing them.
October 6, 2009
"Cash for clunkers had two objectives: help the environment by increasing fuel efficiency, and boost car sales to help Detroit and the economy. It achieved neither."
Says the WSJ:
Subscribe to:
Post Comments (Atom)
Posts
126 comments:
First!
Doesn't matter Ann, his intentions were good! Oh and did you catch Rush about the MSM's conniption fit about SNL skit? Can you believe the MSM fact-checked SNL because they dared to make a skit about Obama?
Chaplin caulks like the government too.
Really, why does anyone give a rat's ass about anything the Wall St Journal has to say? Their positions are entrenched, if Obama is for it, they are against it.
How did their love of deregulation of the financial industry go for the country? Ewwww.....
How did their love for invading and occupying Iraq work out? Not so well.
They are a fringe opinion page. Whacked out righties.
Good ole Hudson Institute. Betsy McCaughey, Scooter Libby, Doug Feith, Richard Perle, Donald Kagan, and Conrad Black. Deeply Serious thinkers, all of them. Prophets. In reverse!
Alpha & Garage - engage in ad hominem attacks when they can't dispute the facts that "Cash for Clunkers" is a miserable failure.
Alpha Ell -- you forgot to point out that Ray LaHood is a Republican. Most car dealers are probably plutocrat Republicans too. In your bestiary of excuses you found some red herrings, but missed on the scapegoats.
Anything the WSJ says must be wrong because they have entrenched positions, like this one.
We should stimulate the paper and ink industries by shredding money as soon as it comes off the presses at the Bureau of Printing and Engraving. Think of all the jobs we could create (or save!).
Next stop, health care!
you can't raise living standards by breaking windows so some people can get jobs repairing them.
You can't? It worked for Chaplin:
Well considering Chaplin was a leftist it's not any surprise he'd adhere to a failed economic model.
What does never-met-a-payroll-Obama know about the economy, Alpha Schmuck?
Obama is in the shithouse and he's not getting out.
Thanks to criminals the cop has a job too. Let's not forget the economic benefits of crime!
Garage and Alpha are getting a bit desparate. You might want to you know at least try to defend the program rather than attack the messanger. But considering that the program was one big government run broken windows fallacy, I guess that is a bit hard.
The basic fallacy of cash for clunkers is that you can somehow create wealth by destroying existing assets that are still productive...
WW II wasted a huge quantity of wealth and destroyed an enormous amount of assets, but it got the world out of the Great Depression.
CfC was still a stupid idea, though.
they left off the net environmental cost and carbon generation of producing 3,000 pounds of steel, aluminum, plastic and rubber.
You have to save a hell of a lot of MPG to make up for the production of a car.
Liberal Garage does sound far more concerned with who said it than with what was said.
WW II wasted a huge quantity of wealth and destroyed an enormous amount of assets, but it got the world out of the Great Depression.
Well sure, but 50 to 70 million people were involuntarily eliminated from the workforce, too.
Mass slaughter of the unemployed is a bit harsh in terms of a stimulus plan, though.
"WW II wasted a huge quantity of wealth and destroyed an enormous amount of assets, but it got the world out of the Great Depression."
Funny how the specter of mass death and destruction acts as an incentive to get busy and build the materials which a nation needs to defend itself.
I'm not sure waiting around for a government handout produces the same spirit of urgency though.
The problem with the Wall Street analysis is that it looks at the economy overall, adroitly adds the vast wealth of Ruling Elites into average income...then wisely pronounces that "Cash for Clunkers" made no economic sense for the economy as a whole.
But it did...
For the people in dire straits that needed the economic stimulus injection or they would go belly up (many car dealers stuck with unsold inventory, durable goods part suppliers, auto firms).
That is the rational of earmarks..which on the whole may be bad..but if you are in Pascagoula Miss and you get a dumb grant to build a not-so-needed highway off-ramp upgrade...it sure helps locally.
And illustrates the stupidity of John McCain approving a 110 billion supplemental to "help the noble Freedom Lovers!! of Iraq" while waving a 17 million dollar earmark for "needless Park improvements" and a 58,000 dollar research study on exporting American ginseng to China he cut from the 110 billion Bill as proof he is "watching over budget like a mother hen".
Even "broken windows" payments may make excellent sense for the overall health of the nation. FDR was paying people to WPA projects that could be far easier done by construction equipment...because it was better for society to pay jobless men for inefficient work than have them resort in desperation to derailing 15 million dollar locomotives in economic "dead spots in America" and stealing food and goods from them, then fighting Federal troops.
Similarly, we would be far better off if we put black youth 30-45% jobless in some cities to work clearing garbage and repairing broken windows than leave them to sit idle.
(Yes that would be "inefficient" and bad for the bottom line of Ruling Elites the WSJ and it's pet beloved economists champion....but overall, it would be better for US society).
WW II wasted a huge quantity of wealth and destroyed an enormous amount of assets, but it got the world out of the Great Depression.
To the extent that FDR was forced to end his hostility to business and that millions of people were put to work, WWII ended the Great Depression. Just remember, most of the assets destroyed belonged to the Axis powers, not our own stuff.
CfC was still a stupid idea, though.
Absolutely agree. Among other things, CfC destroyed several hundred thousand workable cars and trucks, driving up the cost of used vehicles. The ones most hurt were the working poor who can't afford new cars even with the CfC subsidy.
The entire idea of "cash for clunkers" was completely ridiculous. In addition the purposeful destruction of useful and affordable cars for this foolish and failed program was nothing less than obscene.
The net gain in gasoline savings was not worth spit. The environmental and dollar cost of producing the new cars and ESPECIALLY hybrids was neither a help to the environment or a cost savings to anyone. In fact it made both worse.
The destruction of cars that could be used and that were affordable to those in the lower income strata also created economic harm. The used car market and the used parts market became tighter and more expensive.
The dealers who made these sales have yet to be reimbursed. And all they really did was clear out some old inventory, pushed sales that probably would have happened anyway forward by a few months. You will note that car sales have dropped off dramatically. This is because those who were going to buy just did it early
The program helped NO ONE and hurt a lot of people.
The destruction of usable assets for a political circus sideshow is obscene.
Clunkers was Debbie Stabenow's stimulus to the auto workers' unions. It had nothing to do with the environment and, like the rest if the stimulus, it flopped.
As Sarkozy would say "Kel surprise"
This is great news about a conservative civil war. Though I believe the WSJ is silent on the loony ravings of Glenn Beck.
Some delicious quotes:
Joe Scarborough: "Republicans have gone off the deep end" (Ya think?)
David Brooks: "...the story of media mavens who claim to represent a hidden majority but who in fact represent a mere niche -- even of the Republican Party."
David Brooks: "[i]f the Republican Party is sane, they will say no to these people." (Well, the Republican Party is getting deeper in bed with them. So, yes, they are insane!)
Mark Levin on Glenn Beck: "mindless," "incoherent," "pandering," and "pathetic." (glad someone noticed).
I love it. Just love it. They've gotten too fringe for parts of their own base.
Pass the ammo!
I heard that they're going to replace Hail to the Chief with the Benny Hill theme song.
Seems appropriate.
A colossal failure and stupid idea from the start. Many, like myself, won't ever buy a GM or Chrysler product again because of the bailouts, etc. Cash for Clunkers dried up 6 to 12 months of demand, so the car manufacturers will be hurting for sometime to come.
The Obama administration's efforts to help the economy so far have had a negative net effect and are on par with what the average middle schooler would come up with. I say "average" because I know some bright middle schoolers who can do better.
Alpha, I find it interesting that you're so wound up over the shortcomings of a political party that holds no power in DC. I mean, if I were you I'd be a lot more upset over the Democrats, you know, the ones with the massive congressional majorities that still can't get this vital, necessary health care reform bill passed?
Seems to me you guys have something of a crisis of leadership when President Shortpants, Botox Nancy and Whorehouse Harry can't get thier minions in line.
Hoosier - Alpha is giddy at the prospect of 50 years of uninterrupted Democrat rule. That's why he's hopeful of a big GOP crack-up.
Bastiat explained the Broken Windows fallacy back in 1850.
17 years later, Karl Marx wrote Capital, reaching the opposite conclusion, and in the next century 100 million people died as a direct result.
Socialists are experts at impoverishing the masses, and killing them in large numbers.
So sure, why not adopt their failed economic ideas again and again?
100 million deaths in the US would more than cover the 30 million (47?) lacking health insurance.
Just remember, most of the assets destroyed belonged to the Axis powers, not our own stuff.
Technically yes, but much of our assets in the war years had gone into warships, planes, tanks, etc. that became just as useless at war's end as if they had been destroyed.
I think the reason the war led to an economic boom was the enomous advance in technology (nuclear, electronics, medicine, etc.) stimulated by the war. When peace came a whole new world of opportunities had been created. By contrast, CfC didn't create anything.
Hoosierist, I am more concerned that Democrats make so many efforts to include Republcians, who have gone stark raving mad.
I agree they should be ignored in this sense, but when they're having this epic crackup, well, throw the popcorn on the stove and pull up a seat, I say!
Alpha - because 1-party rule is GOOD for America right?
Everyone is out of step but my president, Obama.
"Similarly, we would be far better off if we put black youth 30-45% jobless in some cities to work clearing garbage and repairing broken windows than leave them to sit idle.
(Yes that would be "inefficient" and bad for the bottom line of Ruling Elites the WSJ and it's pet beloved economists champion....but overall, it would be better for US society)."
Unless you plan to go out and break some windows for them to fix, that would not be an example of the broken windows fallacy. Further, we have been doing youth jobs programs for decades and none of them have ever worked or been proven effectively.
In the end, the money to pay thier salaries has to come from somewhere and at the opportunity cost of something else. The terrible reality is that the government cannot create wealth without destroying an equal amount somewhere else through taxes or debt or debasing the currency. Liberals just refuse to admit that.
Obama care is a cash AND clunkers.
Will pay more taxes and they’ll ‘take care’ of granny.
Yeesh. What a bunch of simplistic talking points. Car sales were dead in the water, inventories weer stocked up, factories were closing.
That's the status quo which conservatives defend. Instead of the situation now where inventories are cleared and production is increasing.
The idea that there were no net new buyers even with this substantial discount flies in the face of Economics 101. It's a lower effective price, hence more demand and sales.
Because the clunkers were taken out of the market, there will be more demand along the way.
The Auto Dealers loved it.
But the anti-Obamites insist anything backed by Obama is wrong. Then they construct their flimsy arguments to support their forgone conclusion.
It wasn't the gratuitous destruction of WWII that created economic activity, it was the riduclous amount of deficit spending. Likewise, breaking windows does result in more economic activity when the owner of the windows is simply able to borrow money to buy new windows. All you're doing is increasing economic activity now at the expense of economic activity in the future, when presumably you're more able to afford it.
But, in the case of both WWII and the shopkeeper, you do have to pay for that burst of economic activity sooner or later. As we are in the prociess of rediscovering, you can't service debt with more debt forever.
"Yes that would be "inefficient" and bad for the bottom line of Ruling Elites the WSJ and it's pet beloved economists champion....but overall, it would be better for US society"
Wouldn't it be better for society to lower the minimum wage so they could get actual productive jobs?
"they’ll ‘take care’ of granny."
Doggone it. Our evil plan to kill grandmothers has been foiled!
Next, granpas... shhhhh....
John:
Wouldn't it be better for society to lower the minimum wage so they could get actual productive jobs?
Better yet, legalize slavery and there will be many more jobs!
The idea that there were no net new buyers even with this substantial discount flies in the face of Economics 101. It's a lower effective price, hence more demand and sales.
Price is an effect, not a cause. That's economics 101.
Some people have sworn off GM and Chryco products. Words are cheap, but the year on year sales figures for the month after CfC ended are in. IIRC, Ford, off 5%, GM and Chryco off more than 40%. Actions speak louder than words, but here they are consistent.
Interestingly, both Toyota and Honda off more than 10%.
"The idea that there were no net new buyers even with this substantial discount flies in the face of Economics 101. It's a lower effective price, hence more demand and sales."
First, it is only "additional demand" if people who would not have otherwise bought a car bought one. If they would have bought one anyway, you are just pushing demand forward from one month to the next. Yeah you sell more cars this month but you sell that many less in the future after the program is over. That appears to be what happned.
Second, even if you got people to buy cars that they would not have not otherwise bought, that money came at the expense of all of the other things those people would have bought with the money but didn't. So, someone who would have kept their old car, now has a new car and $300 less a month to spend on other things. You have, again robbed Peter to pay Paul. Worse still, you have taken a valuable asset, a running car, and detroyed it and made the country that much poorer.
"Because the clunkers were taken out of the market, there will be more demand along the way."
You have artificially raised the price of used cars. So people now have to buy new cars where before they could buy old ones. Again, we are poorer not richer for that. Worse still, you have made poor and lower middle class people even poorer by making it more expensive to buy transportation.
Alpha Liberal you are either performance art or a complete economic illiterate.
"Better yet, legalize slavery and there will be many more jobs!"
We have, they are called un paid internships. There people agree to work for a zero wage in exchange for the benefit of the work experience.
When you raise the minimum wage you just make labor more expensive and create more unemployment. Buy you cock eyed logic, why not set the minimum wage at $100 an hour? We could solve poverty tommorow.
Hoosierist, I am more concerned that Democrats make so many efforts to include Republcians, who have gone stark raving mad.
I agree they should be ignored in this sense, but when they're having this epic crackup, well, throw the popcorn on the stove and pull up a seat, I say!
Alpha, that makes no sense. YOUR party controls the White House. YOUR party has a massive Congressional majority. You guys spent 6 of the last 8 years pissing and moaning about GOP control and how things will be different when YOUR party takes over.
Well now you got it all in spades and all you can do now is piss and moan that YOUR party can't get shit done and is running to the GOP for backup?
Jesus Christ on a pogo stick. Talk about pathetic.
Because the clunkers were taken out of the market, there will be more demand along the way.
Sorry, AL, but you are an econ idiot.
Taking clunkers out of the market doesn't increase demand at all.
Demand has not changed, because the consumers have not changed.
What cash for clunkers did was shift the supply curve for clunkers to the left, which then forces candidate buyers of clunkers to move up, along the demand curve, in order to meet the market at a higher sale price.
Net result, fewer low priced cars are sold at a higher price.
The little guy with a scarce amount of money is screwed. His cars are now more expensive.
He shared his precious, scant wealth with the union thugs and the failing car makers.
re: destruction of valuable assets
At least some of these clunkers were just that - clunkers. I know of one that had a cracked intake manifold - the owner was told to be ready to bail out should the crack really open up and cause an engine fire. At 275000 miles, the car was not worth repairing. The CfC payment was a a real gift for him.
Many of these older cars are new enough to have some fairly complicated electronics in them - they are not the simple mechanical devices the Cubans have been maintaining for half a century. Give one to a poor person gratis and you could leave them poorer. In the year 2030, there may not be many 'classic' cars from the 90's and the ought's, at least that run.
It seems to me that if everyone kept everything that still worked instead of satisfying their need to constantly get newer stuff, our economy would grind to a screeching halt.
Didn't the gov also have Dollars for Dishwashers, Greenbacks for Groceries, Rebates for Refrigerators and Funds for Furnaces?
wv = dedsodis: when you let the fizz out.
GOP Civil War update: they've also lost T. Coddington Van Voorhees VII.
"Didn't the gov also have Dollars for Dishwashers, Greenbacks for Groceries, Rebates for Refrigerators and Funds for Furnaces?"
What we really need to do is just carpet bomb the entire country. Then we could all get rich off of the rebuilding. Right Alpha?
The fact that Obama and his economists could not or would not see how badly CfC would fail tells me they were
a) Lying, or
b) Extremely Stupid.
Of course, they could just be stupid liars, given the massive printing of money that's going on.
the idea that the government needs to give dealers $4500 to discount unsold inventory is naive. I guess Saturn didn't haggle but they folded anyway.
I always wondered where twisted right wing loons come from. Poor little kids, abused by Republican idolatry.
Speaking of deluded, John says:
"What we really need to do is just carpet bomb the entire country. Then we could all get rich off of the rebuilding. Right Alpha?"
What the fuck are you asking me for? I wasn't part of that discussion.
I think the Keynesian policies used by Roosevelt were working prior to WWII, except for the throwback period to Hooverism for a year or two when his conservative opponents prevailed. WWII was Keynsianism in a uniform, is all.
Just like tried and true Keynesian policies worked this year to stop our economy from falling into another deep abyss, caused by yet more Republican policies.
Wait, wait. Don't tell me. Up is down and green is brown. Yellow is blue. It's all true.
Uh huh. Right....
HoosierLSOS:
Well now you got it all in spades and all you can do now is piss and moan that YOUR party can't get shit done and is running to the GOP for backup? .
I said no such thing, you liar. I said they are too concerned about including Republicans.
Really, you're a stunningly dishonest person. You might want to have that checked out.
Conservative predictability: 1) Economy worsens -- It's Obama's/Democrats' fault. 2) Economy improves -- Obama/Democrats had nothing to do with it.
Alpha Liberal,
You are the most astonishingly economicly illiterate person I have ever seen posting. And you add a good bit of historic illiteracy and humorlessness for spice.
First, Hoover spent like crazy on Keynsian projects. Second, Roosevelt did not stop the depression. No serious scholar today beleives that. It is just not true. Only liberals who don't know any better beleive it. Further, Roosevelt's complete unpredictability in his policies and high taxes on the wealthy made things worse during the depression.
Beyond that, several people on this thread has explained in a very cogent manor why CfC was a terrible idea and a failure. And all you can say is "don't tell me up is down". That is not a response. That is not agrument. Screaming that reality doesn't fit your dellusions and projecting on other people doesn't cut it.
"Conservative predictability: 1) Economy worsens -- It's Obama's/Democrats' fault. 2) Economy improves -- Obama/Democrats had nothing to do with it."
Since the government has very limited ability to help the economy and a virtually limitless ability to hurt the economy, that would be true of any President.
Alphaliberal,
You keep bashing conservative opinino writers, but you have no arguments that they are wrong. You just assert blindly that they must be wrong, since after all, they are conservatives.
why don't you read the WSJ's awesome column and tell us why it's wrong? How was Cash for Clunkers not retarded? How was it supposed to create wealth? It hurt the poor, the rich, the middle. It helped a few people who got more money than their car was worth, and Honda, and that's it. It didn't even help GM.
You ignore the discussion and get really irritated at the 'conservative civil war' or whatever you kooks are worried about. That's BETA. You should call yourself betaliberal. If you aren't willing to have a real argument about cash4clunkers, why even come in here?
It's not interesting. Nobody thinks Obama can do his job. Of course everyone, from smart to dumb, is bashing this jackass. That's not relevant.
Sorry you are intolerant of other views.
What a bunch of simplistic talking points.
Thanks for the warning.
Car sales were dead in the water, inventories weer stocked up, factories were closing.
The closing factories still closed. One more brand got axed. Inventories weer [sic] stocked up, so now warehouses are empty (I guess people making money off of warehousing products are the rich?). Oh and car sales? They are down 25% from a year ago. So where they were dead in the water, they are now sinking beneath the waves.
That's the status quo which conservatives defend. Instead of the situation now where inventories are cleared and production is increasing.
Production is increasing? Factories were closed, permanently. That may be an inconvenient fact for you, but it is a fact.
The idea that there were no net new buyers even with this substantial discount flies in the face of Economics 101. It's a lower effective price, hence more demand and sales.
In ECON 102 is the concept of subsidies that artificially lower price. Those subsidies are now gone. Go back to your earlier arguments, such as production is up. If subsidies are gone and sales were based are artficial prices, what's going to happen next? Oh yeah, sales will go down and stockpiling will occur again (I guess warehouse owners are just out of luck for a short time).
Because the clunkers were taken out of the market, there will be more demand along the way.
I understand supply and demand, but demand for new cars was low and only artificially raised. The sold clunkers won't become used cars, but then the used car market was rather flat, thanks to subsidies to new cars. Therefore, the used car supply is about the same, and there is less demand, because some of those buyers purchased new. They call that market substitution, and that requires probably ECON 201.
The Auto Dealers loved it.
Yes, Toyota and Honda appreciated the sales.
Cash for Clunkers didn't save any car dealership from going bankrupt. Indeed GM/Chrysler are still closing dealerships, even solid performing dealerships. Cash for Clunkers didn't stop any factories from closing. Some factories had fewer days of shutting down production, but other factories were completely closed and those jobs totally lost. On top of that, a whole brand was closed along with its factory.
On the consumer side, those interested in purchasing a new car are looking at less stock. Less stock means higher prices. If you weren't able to take advantage of CfC (perhaps you didn't own a car, or more likely owned a fuel efficient car to begin with), then you will pay more for a new car. When that's the option, along with purchasing a used car (like you already have), then you are likely to hold on to your money.
Well, at least that is what I'm now doing.
wv: uptaggid What Althouse does.
"Sorry you are intolerant of other views."
He is intolerant of other views because he doesn't understand them and can't respond. He is too arogant and dogmatic to admit the otherside has a point. But, he can't figure out a way to respond to positions and ideas he doesn't understand. So, instead of argueing he just yells and insults. It is pretty typical. Most liberals have spent their lives swimming in a war sea of like opinion and have no idea how to effectively argue with an opposing viewpoint. In AL's circles screaming "you are a conservative" actually counts for rational discourse.
bearbee, I know you're joking, but yes, the government is planning to have cash for dishwashers and refrigerators and whatnot.
It's time to stop the federal government from having any impact on anything like car or appliance sales. It's time to simply snip the commerce clause right out of the constitution. If the states want to use the devalued greenback, that's up to them. It's a death pact thanks to the democrats.
Screw this enviro analysis- that is just a "nice to have" piece but is unrelated to economic stimulus. It just confuses the issue.
Americans need jobs and I bet most Americans would prefer death caused by pollution over economic death due to being broke.
Since the government has very limited ability to help the economy and a virtually limitless ability to hurt the economy, that would be true of any President.
Why can't you blame the free market for its own downturns? Or the previous president under whom this major downturn happened? That's my whole point.
Bastiat and Hazlitt never said that "broken windows" policies benefit no one.
OF COURSE they do! They benefit the politically connected people on whose behalf the policies were made.
OF COURSE Cash for Clunkers benefited car dealers! If the government gave everybody $3500 to buy my patented left-hand-thread dildos then I'd benefit too.
But SOCIETY would not be better off, in terms of what they get for their money. Taxpayers would be out the cost of 300 million $3500 left-hand-thread dildos that only Titus would have any use for.
So I don't understand Ann's comment that Charlie Chaplin made it work for him. OF COURSE it worked for him.
AJ Lynch, everything that keeps the union thugs in power COSTS americans jobs.
The main source of employment and unemployment is small business. With excessive regulation, it is too expensive to take a small business public, and very hard to succeed by opneing shop today and hiring people. The money being sucked into GM, Cash for Clunkers, TARP, etc has a huge impact on small business owners, or propsective entreuprenuers.
That's why 'too big to fail' is a lie. Propping up these huge broken democrat machines like the UAW actually costs millions of jobs. These billions of dollars are real dollars, after all. Inflation, taxes, and worst of all, unpredictability, has a serious effect.
If they had done nothing... just kept taxes low and let entrepreneurs buy parts of GM ans try their hand at business, we would have more jobs, more wealth, more stability, and it would be clear letting GM fail was a great thing. A great thing for those who don't make millions off the graft, that is.
Why can't you blame the free market for its own downturns? Or the previous president under whom this major downturn happened? That's my whole point.
10/6/09 2:48 PM
Congress did the main damage. The 2006 House held the purse strings from the time things were awesome to the time they weren't. That's Democrats.
Bush was wrong on TARP, but I don't see how else he's to blame. He was warning about the specific problems that occurred.
And when the government interferes with the free market and causes a downturn, with ridiculous regulation and forced bad loans and horrible spending levels, it's idiotic to them blame the 'free' market for the downturn.
That's all you're saying.
Cash for Clunkers didn't save any car dealership from going bankrupt.
Indeed. It may have increased bankruptcies as it has dried up the demand for the next 6-12 months.
...owned a fuel efficient car to begin with)
Yep. Government preach about doing the right thing and reward your irresponsible neighbors with a great deal on a new car while I'm still driving my 1998 Camry with over 300,000 miles on it.
Of course, liberalism has always rewarded irresponsible behavior. Somehow, if you fail to produce and don't provide for yourself and your family, you're a victim. But, if you work, provide, and, heaven forbid, make some extra money, you're greedy, racist and immoral.
OF COURSE Cash for Clunkers benefited car dealers! If the government gave everybody $3500 to buy my patented left-hand-thread dildos then I'd benefit too.
So YOU'RE the one that got the left-hand-thread dildo patent before I did!
And when the government interferes with the free market and causes a downturn, with ridiculous regulation and forced bad loans and horrible spending levels, it's idiotic to them blame the 'free' market for the downturn.
That's right, blame Dems only, give Bush a slap on the wrist, and hold Wall St. entirely blameless like a typical intellectually dishonest conservative. Thanks for illustrating my Conservative Predictability aphorism for all to see.
bearbee, I know you're joking, but yes, the government is planning to have cash for dishwashers and refrigerators and whatnot.
Yay! I hope they do a cash for computers and printers. My printer at work just took a dump and my computer is about 4 years old. Could sure use an upgrade
Cash for televisions would be nice too. I need a flat screen for the bedroom.
All the proof needed to show that leftists as a group don't understand economics, is their embrace of socialism/communism over capitalism.
Capitalism isn't perfect... but especially when inefficient "progressive" policies, like the Community Reinvestment Act, are forced into the system.
The fallout of Cash for Clunkers is probably still yet to be fully felt. Will there be defaults on those loans as well? Creating artificial demand by tampering with prices is inefficient. How many individuals bought new cars when they would have been better off financially to keep the clunker a while longer, or trade it for another gently used car?
tonejunkie, your argument is what?
If you think Bush did something that caused this economic problem, let me know what it is. Maybe you're right. I know most conservatives had a huge problem with Bush's spending level, and a huger problem with TARP. So blame away... but have something there. Don't just say 'Welll... it would feel better of you also blamed the guys I don't like'
The FACT is that Obama's ACORN lawyer activitied were part of an epidemic. His congress's actions from 2006 on were very harmful. The union bloat was a huge problem. But that's not all of the problem, of course.
I do not think it's fair to blame the free market for the effects of regulation, though. I just don't get how that would work, but I'm happy to hear something. you noting that I am not blaming someone is not sufficient to show they should be blamed. I also did not blame polar bears or Nazis for the economic collapse.
Wouldn't it be better for society to lower the minimum wage so they could get actual productive jobs?
Better yet, legalize slavery and there will be many more jobs!
If the minimum wage is such a great idea, why not make it $100 an hour? That way, everyone will be rich!
Unless you're a total economic moron, you'll quickly see why we can't do that. But then, most liberals are total economic morons.
Keep in mind that the determination of which dealers to close was not done based on sales, but rather, on some formula derived by people who had no experience in the auto industry. So, as a result, some of the top selling dealers in the country have been, or are being, shut down because they failed the formula.
Some of it made some sense, but one of the basic criterion for some dealerships was whether or not there was foreign competition close by, and if there was, then keep the dealership open. If not, then shut it down, even if it was the only dealership in town.
Some people wonder why Ford is doing so well, compared to pretty much every other car company, and, esp. its U.S. rivals, which are just getting hammered, with drops of 40% (GM) and 45% (Chrysler) (if I remember right). One factor is that in middle America, flyover country, the dealers are part of the community. And, so, someone who has bought 5 GM trucks over the last several decades from the guy in church, is not going to drive 50 miles to the nearest GM dealership, but is rather, going to go the Ford dealership, esp. when he has seen the devastation that GM caused by shutting down the local dealership that the community had supported. The local GM dealership and its owner are now bankrupt and the employees out of work, so why should they drive that 50 miles to deal with a dealership they don't know to buy a vehicle from a company that just screwed people they do know?
I know, this is CFC, but rather the auto "bailout", so sorry for the rant.
All the proof needed to show that leftists as a group don't understand economics, is their embrace of socialism/communism over capitalism..
Right! That 8 yrs of conservative rule sure panned out didn't it? Even the rich and connected for whom those policies were meant to benefit lost their ass as the system collapsed on itself. You guys have REAL short memories. How come the fact the Bush tax cuts cost taxpayers over 1.3 trillion dollars since 2001 never gets mentioned? What did we receive for that again? Factor in jobs created under Bush, that comes out to $800,000 per job!
The environment was harmed in two ways by cash for clunkers. First, it deprived the world of vehicles whose production carbon costs had been fully or nearly fully amortized. Next, it encouraged the production of more automobiles, the manufacture of which stomps a big carbon footprint that takes many years to erode. The very best thing for old gaia would be for us to buy fewer new cars, or no new cars at all, and drive well tuned clunkers until they literally fell apart. I have read but forgotten the equation, but one would have to drive a Prius for a long long time to offset its production cost, even when netted against a Suburban. Hippie's never much liked math, but they sure do hate those old gas guzzlers.
If the minimum wage is such a great idea, why not make it $100 an hour? That way, everyone will be rich!
What is really tragic here is that as a result of the recent big hikes in the minimum wage, the largest unemployment rate in this country is in the demographic that depends on minimum wage jobs to get their start in the working world. This demographic was destined to get hurt by the recession, but it didn't need to be nearly this bad for them. But, the Democrats, in their desire to help the common working man, managed to put an awful lot of people making minimum wage out of work.
Of course, the reality is that minimum wage increases are never really about helping those at the bottom of the economic ladder, but rather, are implemented to push up union rate jobs above them. The unions are the ones who provide all the muscle and manpower for the Democratic machine, not the people on the bottom of the economic ladder.
Which, BTW, was also why GM and Chrysler were "bailed out" and the CFC program was run.
Garage:
Well, you have us there, all right. The $1.3 trillion that took 8 heinous years of rule by the reichwing has been quadrupled in 9 mere months by the...smartest....president....ever. UmmmUmmmmUmmmm
tonejunkie, your argument is what?
Forget it. It's futile for me to point out Wall St.'s role in the economic downturn since you've so clearly managed to deflect the monsoon of such unpleasant facts so far.
One of the most disturbing developments I've noticed in the past 8 years is people like Alpha Liberal, who cannot discuss things rationally or who seem to have a complete disregard for anything related to history, reason, or facts – and yet they are not stupid people, their ability to write proves that they are at least of normal intelligence.
Or maybe this trend began with Hillary's "vast right-wing conspiracy" and the likes of gutter mouths like James Carvelle.
The main characteristic is to ascribe their own nefarious logic and methods to the opposition.
It's really quite sad and pathetic. Alpha Liberal here probably thinks that he's a supporter of individual rights, yet just about every policy he espouses that I've seen has been anti-individual and pro-government. Modern liberals have stood the term "liberal" on its head and are anti-freedom, anti-individual, and are marching us (frog marching, as they like to say) towards serfdom.
It makes one despair for our future.
Right! That 8 yrs of conservative rule sure panned out didn't it? Even the rich and connected for whom those policies were meant to benefit lost their ass as the system collapsed on itself. .. How come the fact the Bush tax cuts cost taxpayers over 1.3 trillion dollars since 2001 never gets mentioned? What did we receive for that again? Factor in jobs created under Bush, that comes out to $800,000 per job!
The logic here is a bit foggy. I am struggling to understand why a tax cut could cost taxpayers $1.3 trillion dollars.
Now I do understand how Obama's "stimulus" package cost them almost a trillion, and the budget he signed cost a similar amount, and how Cap and Trade will cost the taxpayers a lot more.
But, please, explain to us how a tax cut costs taxpayers over a trillion dollars.
WV: surgenas - female surgeons? Probably better than the "surgeonettes" that I have used on occasion around militant feminists.
"Conservative predictability: 1) Economy worsens -- It's Obama's/Democrats' fault. 2) Economy improves -- Obama/Democrats had nothing to do with it."
How is that different from Liberal predictability?
I will say though... I did see some rather surprising "liberal" responses on a comment thread about unemployment in the 18-25 year old group which is utterly outrageous no matter how it's measured. The responses?
Young people don't want jobs.
Yes, indeed, that was the "liberal" scoff and scorn to those who were concerned that young people were out of work. What? You MORONS, they don't WANT jobs when they're in school... more kids in school means fewer of them working. DUH!!! NUMBNUTS!!
It was amazing.
I wonder if the WSJ folks can now turn their critical eye on the boondoggle otherwise known as Operation Iraqi Freedom.
Garage,
I think you aren't seeing that most Americans, including "conservatives" were very unhappy with Bush for various reasons, but among them was that he was not very careful with our money and in fact was quite "liberal" in most of his policies. The reason McCain lost, among other reasons, is that he was perceived as not being very conservative and would continue the liberal trend. Conservatives saw little reason to support him, especially after his astounding performance regarding the bailouts.
My point is that you can't say that "conservativism" is to blame when our economy was extremely "liberal" and our government driving towards more and more intrusion into local authority.
... can't dispute the facts that "Cash for Clunkers" is a miserable failure.
I don't know about that. It worked just fine -- for the Japanese and Korean car manufacturers.
A minimum wage of a mere $100 per hour would result in something short of "rich" unless the concept has again been defined downwards. I am basing this on the probability that minimum wage employees are anxious not to work more than 40 hours per week, but I might be wrong on that score.
It is very entertaining to read the comments by liberals who seem to simply posit any old number that appeals to their standing indignity at the opposing point of view. It actually doesn't work like that, you actually can't correctly say that $1.3 trillion in deficits was caused by tax cuts because there were both tax cuts and a trillion + dollar deficit. There is a concept called logic that intervenes in these matters, at least amongst those who earn more than the current minimum wage and that concept would suggest that a fallacy in thinking is involved. Puzzle it out.
I'm sort of missing the logical comparison between a war, which is expected to cost money, and an economic stimulous which is supposed to make money.
Cash for Clunkers lost money by every measure.
And the answer is... so did Iraq, neener neener?
Let's just comtemplate the terminology that I have brought into the lexicon of the Althouse blog.
Hogs, Rare Clumbers, Pinching Loaves, Crowning, putting Waunakee on the world map, Chakras, Third Eye, Fellow Republicans, etc.
My insight is so unique from most others here who tend to bicker and get all political and shit.
I think it is important that we focus on what we have in common. We all pinch loaves, we love dogs, we have an affinity for Wisconsin, and we have sex, well some of us do.
Group hug right now. I feel very close to all but more importantly I feel I am so important to this blog.
thank you.
I couldn't participate in Cash For Clunkers because I have a 2008 Black BMW 328XI. It costs over 50,000. I sent Althouse a picture of me in it with one of the rare clumbers head out the window-to prove my fabulousness.
Did I mention I make lots of money? Don't hate the player, hate the game.
Titus wrote: I couldn't participate in Cash For Clunkers because I have a 2008 Black BMW 328XI. It costs over 50,000. I sent Althouse a picture of me in it with one of the rare clumbers head out the window-to prove my fabulousness.
Cash For Clumbers would have been indecent.
Keynes and Marx are the gods that failed.
But they keep propping up their corpses, and giving it another try.
That's funny Henry.
Could you imagine Cash For Clumbers. I haven't heard of anything so disgraceful in the dog world since the Michael Vick situation.
By the way I put 5 offers together today. They included a major 6 figure base, big time international relo (which is a total bitch), sign on, stock options, etc. It was very strategic and high level and important, natch.
Do you know that when you do an international relo or "expat" or "inpat" you can expect to pay 50%x2x cash of base and bonus. We are talking big bucks. And don't even getting me started dealing with them and where their little brats are going to go to school. Then there is also the tax crap. Social Security and all that shit.
Yes, I am strategic, yes I make an invaluable impact to my organization and yes I work with people to resolve complex issues. One of the candidates I extended the offer out to sent me a 5 page email requesting additional shit for their relo, what a bunch of crap.
I think I am going to break up with my boyfriend because I think he is better than me.
Have you guys seen Levi's new nut ad? "He does it with protection"-wow that is something else. I would still do him, he is totally rough trade.
Liberals losing?
"This fighting is so unnecessary. Why can't we all just get along? Group Hug!"
Liberals thinking they have the upper hand?
"Ha ha! Now we can kill the bastards! No rulez!"
3 Series owners are so, what's the word. Stuffy. What's the joke, "prick on the inside"? You'd think 3 series owners would give a little more respect on the road to their bigger cousins, the 5 series, but nooooo. My Cash for Clunker purchase recently was a 1990 535i for $1200 off Craigslist, Louisiana car in absolute mint condition. Not a speck of rust. I love this fucking car.
I always knew garage was a kulak.
"Right! That 8 yrs of conservative rule sure panned out didn't it? "
Ah, I see the problem. You are confusing "Republican" with "Conservative". Smaller minds will do that.
Titus, didn't you say you got married? AND you have a boy friend?
*googling kulak*
The fact that Obama and his economists could not or would not see how badly CfC would fail tells me they were
a) Lying, or
b) Extremely Stupid.
Of course, they could just be stupid liars, given the massive printing of money that's going on.
This is what scares me. Up until now I had assumed Obama was disingenuous and mostly blowing smoke so he could use tax money to take care of his constituencies. I find it terrifying he might actually be dumb enough to believe the lefty drivel he spouts on economics.
I mean, seriously, they thought CfC would actually do some good beyond greasing the UAW? It's astounding, like the 20th century didn't happen or something.
John: Alpha Liberal you are either performance art or a complete economic illiterate.
You say that as if the two are mutually exclusive.
How come the fact the Bush tax cuts cost taxpayers over 1.3 trillion dollars since 2001 never gets mentioned? What did we receive for that again? Factor in jobs created under Bush, that comes out to $800,000 per job!
This is giving me a headache.
I was tempted though. My purchase a year ago was a 1996 GMC 3/4 ton Suburban 2500 4x4 for not much more than Garage paid for his 5 car. With the big engine and tow package, so I could tow my other two vehicles, if I could figure out the logistics. I bought it when gas topped $4 a gallon, since it really doesn't get that great mileage (I think it has a 454 cubic inch engine (7.4 liters, over twice the size of my 3.0 liter A6)).
It was the perfect vehicle for the CFC program, but I just didn't need another vehicle. And, I would have made over $3k if I had participated. Heck, I probably could have bought a new Suburban and still qualified.
At first, I thought, wow, a vehicle I can use to intimidate people on the road, but then discovered that there are a lot of Suburbans and similarly over-sized trucks here in Northern Nevada - probably half the vehicles on the road.
John-
You are the most astonishingly economicly illiterate person I have ever seen posting. And you add a good bit of historic illiteracy and humorlessness for spice.
I see you've met Alpha...
LOL!
"According to Marxism-Leninism, the kulaks were a class enemy of the poorer peasants."
People were called out as kulaks for hoarding pieces of wheat, hiding coins from the state, and feeding their family from private gardens. you know, the rich.
They were killed, mostly by starvation.
Slow Joe said...
AJ Lynch, everything that keeps the union thugs in power COSTS americans jobs.
The main source of employment and unemployment is small business.
No, unions are not the problem nor the cure for the problem with jobs - which lies with our inability to compete globally in key wealth generating sectors.
No, small business is not the main source of employment. It is a vehicle of employment in some cases, and is either a source of wealth generation or a parasitic "services" sector dependent on larger generators of revenue to exist in the 1st place.
The keys - are the wealth creators.
Lawyers generally do not generate wealth.
Nor do people with small "shoppes" selling China junk to other people selling other China junk or who exist on loans given by China for their jobs as "nurturing caregivers" to people who generate no wealth.
A person mining coal (typically union) is a source of wealth.
As are the makers of a crystal-grown jet aircraft turbine blade.
A welfare worker is not a small business "wealth creator", nor is the welfare momma, nor her cable TV service.
Military are not wealth generators unless they have direct value to stability...and it is far smarter to have a smaller military that sucks up 1/4th of what the US pays per capita, if the US or some other country picks up the slack.
Reducing the cost parasitic healthcare services frees up wealth otherwise squandered. That is why cutting our healthcare costs 50% to 80% to match up with other advanced nations and free wealth to pay off China and perhaps some be spent elsewhere is so important...
-----------------
Finally, on unions. Had we not allowed unions and devised a system where they had real political power, and workplace power to create sorely needed workplace reforms, better conditions....the US would have gone Socialist or communist.
Right now, the most efficient system appears to be the "Command (authoritarian) capitalism" model of ASian growth from past practitioners like Japan, Singapore, Taiwan, S Korea to today's new exemplars in China, Dubai, Brasil...
Less messy democracy, a big clampdown on lawyers delaying matters and forcing non-competitiveness means dramatically rising standards of living...and GNP growthrates of 11%-13% annually while the US calls 3% growth and a 0.1% rise in standard of living - a good year.
The labor theory of value was discredited a long time ago.
create wealth by destroying existing assets that are still productive
Some ideas are so blindingly, obviously stupid, you really have to wonder at the people who espouse them.
Reducing the cost parasitic healthcare services frees up wealth otherwise squandered. That is why cutting our healthcare costs 50% to 80% to match up with other advanced nations and free wealth to pay off China and perhaps some be spent elsewhere is so important...
This is the evil of socialism. By taking on a private cost, now the government gets to say that it needs to reduce costs.
But the cost isn't the government's, or at least shouldn't be. There are even some who would say that even the private costs need to be reduced. But whose cost is it for the government to reduce? How is it any of their business?
If I want to spend my money on doctors, I'll do so without permission of the government, thank you. And if I wish to spend money on cheeseburgers, I'm not going to ask for permission from the government.
The idea that the government needs to break glass windows to sell more glass windows, er, I mean destroy cars in order to sell more cars, is anaethema to freedom and capitalism. There was a time when even liberals would be willing to speak well of each of those concepts. Now both are denigrated and we are lurching towards serfdom, led by ignorance and loud voices of intolerance.
Another point that I haven't seen anyone bring up is that some people who couldn't afford a new car, bought one anyway, believing that the rebates and so forth made it worthwhile. If this is true, we'll see an increase of repossessions and/or people paying their car payment at the expense of uncollateralized debt (i.e. credit card.) They may also refi their house yet again in an attempt to cover their new debt.
Ironically, by destroying their old cars they've actually eliminated their ability to sell their new car, even at a loss, and have something to drive around.
I'm not saying unions cost unionized businesses jobs, though I'm sure that's the case at times.
I am saying that there is a severe disfunction in our economy, thanks largely to a system of corruption that involves politicians and unions and extreme theft from taxpayers. This causes a degree of uncertainty about our economy, and it also has great costs. Both inhibit small business existence and growth. Small businesses ARE this country. They are where the employment comes from. It's that simple.
Make a nation that is friendly to small business, and you will have economic prosperity and lots of jobs. However, small businesses are not powerful individually. The politicians get very little out of helping their country succeed for success's sake.
It's madness.
It's not just bad economics (broken window fallacy), it's not just a poor way to improve the environment (even at best it's several hundred times less cost effective than the best methods of CO2 offsetting).
It's also regressive - people well off enough to buy new cars get the benefits of the subsidy while the poor will pay more because functional used vehicles have been artificially destroyed.
What really gets me is how liberals love it. How on earth could you possibly like this inefficient, ineffective, regressive poster-child for government stupidity? People won't accept expanding the role of government when they think that government basically incompetent, and at a time when America is considering expanding government's role in health care it's shit like this that really undermines the liberal's case.
"Skyler said...
Reducing the cost parasitic healthcare services frees up wealth otherwise squandered. That is why cutting our healthcare costs 50% to 80% to match up with other advanced nations and free wealth to pay off China and perhaps some be spent elsewhere is so important..."
This is the evil of socialism. By taking on a private cost, now the government gets to say that it needs to reduce costs.
NO - because if you wish to go down that road, everything Gummint does could be catagorized as a private cost taken over by Gummint.
There were the days of private roads, private armies. Of schooling only done in private institutions. A sort of Freedom for true Freedom Lovers!! only enjoyed and savored by top dogs who own those private armies, roads, etc.. in places like Somalia, Afghanistan, and remote parts of Congolese jungles.
Unfortunately for lovers of Barbarism means Freedom!! - mankind has generally taken a path where we understand collective endeavors that benefit the masses, protect them, safeguard certain rights. Which means that many "private means" go into the public sphere...which in turn, creates the infrastucture, mutual support, and security indispensible for private wealth creation. That is not Socialism. Any more than the belief of a rugged individualist Ayn Randian Freedom Lover!! who never depended on any Gummint for anything is proof no Social Contract need exist..Because we have depended on collective things in any advanced society since civilization started, and that individual has never existed.
And if our Democracy is working, it is the People, not Gummint, who must decide on what level of expenditure our security needs in the way of resources allocated to life and death matters of police and military capacity. To life and death matters of road safety, Coast Guard, how much medical care non-earning seniors and welfare momma's kids get.
(Why Freedom Loving!!! private enterprise, Gummint-shunning Pashtuns, Somalis and Congolese jungle tribes tend to be short-lived, brutish, and dirt poor.)
If you fear Socialism, join the Taliban. Meanwhile, avoid our socialist roads and anti-Freedom Lover!! public electricity lines and facilities....
Thanks! I just found my next career. (Is window breaking/repairing franchiseable?)
Cash for Clunkers is just like mortgages for the undeserving. People bought cars they cannot afford, they will be repossessed. Then the Democrat Crime Family will try to stop banks from repossessing the cars.
Maybe the government should just stay out of the economy. They have never done any good for it and never will.
Cedarford - How on earth is Obamacare going to reduce health care costs by 50 - 80%? The "reforms" they're proposing - mandatory insurance, community rating, guaranteed issue, etc. - will cost even more money than we're spending now.
It's not credible to believe that they're going to save trillions by cutting "fraud, waste and abuse". But how else is all this money going to saved?
Cedarford brilliantly deduced:
NO - because if you wish to go down that road, everything Gummint does could be catagorized as a private cost taken over by Gummint.
I think you're catching on, by god.
In utopia, there is no need for government. In hell there is nothing but government. We live in neither, but we should err on the side of less government and closer to the ideal, than closer to hell. Obama and his party are driving us the wrong way.
Reasonable people can disagree on how much is too much government, but we've far exceeded any reasonable point since the Bush/Clinton/Bush administrations and now the current administration is intent on achieving the dreams of the CPUSA.
Reducing some of the costs of health care is great. After all, a lot of fraud goes on with medicare.
But a lot of the costs for health care go into research and development. I w3ant drugs to be profitable. Drugs are, by far, where most of the cost increases have come from.
I do not want the government forcing drug companies to make less money. that's a death pact. We rich chemists and rich investors in drug companies. And guess what, Obama is already making deals to reduce drug prices. By billions. Forget it.
everything Gummint does could be catagorized as a private cost taken over by Gummint.
Um, everything the government does IS a private cost taken over by government.
Here's a simple exercise for those people who are a little slow on the uptake: if the government didn't pay for it, who would? What's that? Private citizens? Well I'll be damned -- it would appear that the government has assumed a previously private cost.
The only point of argument is whether it is good for the government to have taken control of what was previously a private arrangement.
Reducing some of the costs of health care is great. After all, a lot of fraud goes on with medicare.
Yes, and every President since Nixon has promised to cut Medicare costs by eliminating waste, fraud, and abuse. Costs remain un-cut. Either (a) there's no waste, fraud, or abuse, (b) the last seven Presidents all secretly wanted to waste money on Medicare, or (c) cutting costs by eliminating "waste, fraud, and abuse" is basically impossible.
(PS: It's (c))
How come the fact the Bush tax cuts cost taxpayers over 1.3 trillion dollars since 2001 never gets mentioned? What did we receive for that again?
garage, I disagree with pretty much everything you say but I have to admit, this is probably one of the most ignorant comments I have ever read. In fact, my eyes started bleeding.
Tax cuts costs the taxpayers? Are you so monumentally thick you can't see the oxymoron in that statement? What did we receive for that gain? We'll here's a clue, 'we' those of us who actually PAY taxes got to keep more of OUR OWN MONEY.
I'm going to give you the benefit of the doubt and just assume that AlphaLiberal or Luckyoldson hacked your user name and password.
So WWII got us out of the Great Depression?
Well, let's go start a war somewhere!
Problem solved.
/snark
AL: Really, why does anyone give a rat's ass about anything the Wall St Journal has to say? Their positions are entrenched, if Obama is for it, they are against it.
How did their love of deregulation of the financial industry go for the country? Ewwww.....
How did their love for invading and occupying Iraq work out? Not so well.
They are a fringe opinion page. Whacked out righties.
SC: Umm, didn't you cite mediamatters.org later in this thread? And dailykos as well?
AL: Hoosierist, I am more concerned that Democrats make so many efforts to include Republcians, who have gone stark raving mad.
SC: Inclusion, apparently, consists of ignoring them and calling them all racists..
AL: Yeesh. What a bunch of simplistic talking points. Car sales were dead in the water, inventories weer stocked up, factories were closing.
That's the status quo which conservatives defend. Instead of the situation now where inventories are cleared and production is increasing.
The idea that there were no net new buyers even with this substantial discount flies in the face of Economics 101. It's a lower effective price, hence more demand and sales.
Because the clunkers were taken out of the market, there will be more demand along the way.
SC: And the month after CfC ended, we have the worst sales in, what, 45 years? Sales worse than last year's sales, which were so bad it drove companies into bankruptcy?
And why no concerns over the poor, who cannot afford new cars and now have a nice price increase on the used cars they could afford?
AL: I think the Keynesian policies used by Roosevelt were working prior to WWII, except for the throwback period to Hooverism for a year or two when his conservative opponents prevailed. WWII was Keynsianism in a uniform, is all.
SC: So, even though unemployment was still high and the economy was still in the toilet --- it worked. I guess if one can define success how one wants, sure. Can you define how it was a "success"?
As for "reverting to Hooverism" --- The New Deal was an extension of Hooverism. The "Hoover was into laissez faire economics" is based on a rather substantial amount of ignorance.
Post a Comment