Friday, July 31, 2009

'Get your clunkers for nothing,
and your cash for free . . .'

In one of those fiendishly stupid examples of liberal logic that will be cited in Econ 201 texts for decades to come -- typing is difficult when I'm laughing so hard -- "Cash for Clunkers" is broke:
The program . . . was supposed to expire at the end of October. But in the one week since it took effect, it appears to have run dry of the $1 billion allocated to it . . .
Lots more at, including a post from the Cato Institute's Chris Moody, reminding us that Cato senior fellow Alan Reynolds figured out six weeks ago how to game the system: Trade clunker for crappy new econobox, collect fed bonus, sell econobox, add that to your bonus -- congratulations, you've got the purchase price for a classic V-8 '67 Impala or a second-hand SUV!

I'm reminded of something P.J. O'Rourke once said, in regard to "affordable housing": Every time the government promises to give you something for nothing, imagine the result if you tried this yourself. You'd quickly find yourself with a severe shortage of something and a whole lot of nothing.

Given that the fundamental flaw in this legislation was so obvious that any clever sixth-grader could spot it, what sort of geniuses dreamed it up?
Sponsors of the [Senate] bill [are] Sens. Dianne Feinstein (D-Calif.), Susan Collins (R-Maine) and Charles Schumer (D-N.Y.) . . . In the House, the same bill was introduced [Jan. 14] by Reps. Steve Israel (D-N.Y.), Jay Inslee (D-Wash.), Barbara Lee (D-Calif.) and Dennis Moore (D-Kansas) . . .
Writing in the Detroit Free Press [Jan. 6], Brookings Institution economist Jason Bordoff laid out both the economic and environmental advantages of such a program . . .
Ah, yes, the "advantages of such a program"! Clever libertarians now hot-rodding around in their '65 Mustangs and '71 Camaros are no doubt very grateful to Bordoff, Congress and the taxpayers who paid the tab.

(Via Memeorandum.)

UPDATE: Jimmie Bise wonders if ObamaCare will work better than "Cash for Clunkers."


  1. Wait, this isn't a unicorn. It's a painted mule with a carrot glued to its head.


  2. Something for nothing and the masses will vote for it!!! But wait, someone always pays..

  3. Alan Reynolds clearly has no clue how the car market works. Just TRY buying a brand new car and flipping it for what you paid minus $1000.

  4. Not that I disagree with Alan Reynold's sentiment, but his plan won't work. You don't get a $4,500 "voucher." The dealer takes your old car and takes up to $4,500 of the price of the new car. (And you don't get an additional trade-in allowance, because the car is supposed to be destroyed. The dealer gets reimbursed.) So at best you could trade an older SUV for a new econobox, put some cash down, take the financing, and then you could go and trade that in for your new muscle car, but since your econobox is no longer showroom-new, you would probably have, let's say, $3,000-$4,000 to work with, and you'd better have great credit.

    Now, speaking personally and with no concern for free-market principles, I'd be glad if Bammy shoves another couple of billion at this project, because I've got a '98 Chevy Suburban I would just as soon trade in before it needs new tires.

    Keep up the good work, Mr. McCain!

  5. What you miss, Stacy, is what a proof of success running through a billion in only four days is to a Keynesian. Why, it sends tingles up Chris Matthews' legs: that's stimulus!

    Here in Vermont, I see Green Jobs popping up all over, such as picking wild berries to ward off starvation. Of course, this leads inevitably to clashes with bears of no particular color, but thankfully the administration has generously protected our right to bear sharp sticks.