Cash for Clunkers: This is What We Call Success?
Nicolas Loris /
Politicians are touting cash for clunkers as a successful program that has killed two birds with one stone. By handing out taxpayer money to subsidize a portion of the cost of a more fuel efficient vehicle, the program is saving the economy and saving the environment.
Although the program increased consumer spending and increased fuel efficiency, the question should be: At what cost? It has been a bureaucratic nightmare laden with unintended consequences. And despite all its ‘success’, GM and Chrysler’s sales in August from a year earlier fell 20 and 15 percent, respectively.
Sure, the government was successful as spending $3 billion in taxpayer dollars, but when isn’t the government good at spending other peoples’ money? Unfortunately, the government hasn’t been so great at transferring the money affecting the cash flows of some of the dealerships. A few examples:
One owner quipped, “I have not gotten one dollar in reimbursement. I have $300,000 or more dollars out there that Uncle Sam owes us. If they screwed up this program so badly, I wonder what our health care system will be like.”