Political Discussions
Cash for Clunkers Debacle
Posted by anticsrocks • 7/30/09 • Subscribe to this Discussion [RSS] • Report This Topic
Topics: cash for clunkers, inefficiency, obama
The Government wants us to hand over our health care to them, yet they cannot even handle a simple voucher program to boost car sales.
The C.A.R.S., or Car Allowance Rebate System should be a pretty simple operation. Consumer brings in older car, buys new car, gets $3500-4500 off the price of the new car, drives off the lot, then the dealer simply gets a check from Uncle Sam, right? Wrong.
"Each deal is 20 pages of documents that must be scanned and submitted individually through a government website that often doesn't work very well. They’ve sent in more than a hundred deals, cars they've already sold and about thirty have been rejected. Many of them were rejected because of a paperwork error. The rules of the program sound pretty simple, but the rulebook is at least a couple hundred pages long."
www.myfoxtwincities.com/dpp/news/business/Cash_For_Clunkers_Comes_with_Prob...
There are a few basic criteria to the C.A.R.S. program.
* Your vehicle must be less than 25 years old on the trade-in date
* Only purchase or lease of new vehicles qualify
* Generally, trade-in vehicles must get 18 or less MPG (some very large pick-up trucks and cargo vans have different requirements)
* Trade-in vehicles must be registered and insured continuously for the full year preceding the trade-in
* You don't need a voucher, dealers will apply a credit at purchase
* Program runs through Nov 1, 2009 or when the funds are exhausted, whichever comes first.
* The program requires the scrapping of your eligible trade-in vehicle, and that the dealer disclose to you an estimate of the scrap value of your trade-in. The scrap value, however minimal, will be in addition to the rebate, and not in place of the rebate.
www.cars.gov/
So then, if it is so simple, why are the rules for this program in a book that is over 200 pages long? And furthermore, if the health care bill is over 1,000 pages long, how huge will the regulations be for that?
This is the perfect example of the efficiency and cost-savings ability of our Government. And evidently they are scrapping this program due to their not being able to make it work.
www.foxnews.com/politics/2009/07/30/officials-say-government-set-suspend-ca...
User Comments
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Except I heard a news item in my area where people were taking advantage of it. To qualify as a debacle, you'd have to have no takers. Course, you and your kind were judging Obama about 12 minutes into his presidency, so waiting this one out till Nov. 1st is too much to ask, I know.
Mommy, Daddy, I want my free ride now! And I don't want to fill out any paperwork! Cause, you know, accountability is mean.
Course, I really don't care personally, having given up my clunker 5 years ago and with no plans to buy any motor vehicle for as long as I am able to work in an urban setting.-
Really? Got a link to that news item you allegedly heard? It is a debacle because less than one month into the program, the Government is already having trouble writing $4500 dollar checks. Yay!! Let's let them manage our kidney transplants!!!
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The thing was working well I have to admit, but it was so dang specific and the rule book is just ridiculous. I think the point is that the government tries to do something good, but the system collapses on its own flaws.-
Which is my point, jhix. Funny how you and I, just a couple of "dumb" conservatives understand that the Government can't manage a checkbook, much less any program or agency and the "smart," supposed teacher just wants to make personal attacks.
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"hey Jethro! Cut them blackberry vines off the Yugo! We's tradin' that bad boy in!"-
Better have had insurance on it there Agit8r. Surprisingly Congress put that little provision in there. Otherwise one could envision junk yards all across the nation going into the "Clunkers for Sale - CHEEP!!" business.
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I was making a point about the paperwork. Some verification that the clunker was being driven would help see to it that such nonsense wasn't going on
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It was fun watching John Stewart question Bill Crystal this week. They got to a point where Crystal said that the U.S. military had the best health care in the world. And Stewart pointed out that that was a government-run program. Eventually Crystal tried to deflect and bring up the Veterans Admin's problems. (The VA is under a serious overload of work with underfunding thanks to that guy who wanted two wars on the cheap, and at the same time it is dealing with a lot of aging and ailing WWI vets. Needs more funding)
Anyway, I suppose the all-things–government-are-bad crowd hates our military, right? But then why is one of them here wearing an old recruiting poster for an avatar? So much cognitive dissonance and so little time to sit back and appreciate it.-
So now you are blaming me of hating our military? That is pretty low there mark. Even for you.
My father fought in WWII and saw very heavy action. My younger brother was in the First Iraq war. I love the military. Maybe you are unaware of my Memorial Day post.
www.blogcatalog.com/politics/discuss/entry/memorial-day-freedom-isnt-free
Once again, if you would put aside your dislike for me long enough, you might notice that my avatar says, I want you to love you country.
You know for someone who throws out personal attacks all the time, it is funny that when I tried to be civil and post on your blogs - at your invitation - you asked me not to post on your blog. I guess you can dish it out, but cannot take it. -
You say all things government are bad. You say the government can't do anything right. You point to paperwork. . . . Look, our military is a huge government-run program. So are the police. But if government-run programs are bad per se . . . You know what I'm saying? Either you must hate the military and our law enforcement officers, or maybe you need to admit that the government sometimes gets it right. Just saying.
But it was a really funny moment between Crystal and Stewart, and Crystal was man enough to take it, because there was no way out of that one---until his next column or TV or radio appearance. -
I don't really care about Stewart or Crystal or their discussion. I care about my country, I care about all Americans, even you mark. However, you take a point I make about Government bureaucracies and stretch it to mean I hate the military.
What you said and accused me of is despicable.
Our military is probably the only Government program that is efficient. Thank God that if only one Gov't program is good, it is that one. -
Mark:There's a complete difference between the two. Government changes, but the military stays the same. The military doesn't fight for the government they fight for our country. I support the men and woman who put their lives on the line, but for the most part I do not support the ones that employ them.
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There's a difference of incentives though. When government is running healthcare for the general public, if they do what's right, they'll see a budget deficit. When government is running healthcare for the millitary, they do what's right, they get combat victories and a better prepared force. -
I'd ask someone who has been to the VA if that is how things really work JJ. i drive my father-in-law to the VA from time to time, and I hear some complaints (more so with Veterans Affairs in general, than the quality of care, or even the facilities).
I should also note that the personel at such facilities generally have a stronger committment to their patients than doctors on average. Many are vets, or come from military families and see their profession as their part in serving their nation, and they deserve our gratitude. -
@Agit8r: I was talking about active duty, not veterans care. I understand what you're saying about the commitment of the doctors but the doctors aren't the problem - it's the people who fund, supervise, and equip the doctors, as you said, "Veterans Affairs in general."
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right. unfortunately our country has a long--only occasionally interrupted--history of sweeping its veterans under the rug
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Cash for Clunkers' Program Suspended did not even last a week. But that dose not suprise me.-
Yes, and they want us to turn our health care over to them.
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No kidding they need to bud out. They are just making more problems
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The headline on NPR this morning was that the program was closed (perhaps temporarily) because "it has been too successful." The funds have almost been used up. In other words, it has worked. Now Congress and the administration need to take a look at things and maybe sink more money into it, the idea presumably being that it is good for the economy and environment.
There was a longer story yesterday: www.npr.org/templates/story/story.php?storyId=111402438&ft=1&f=1014
Don't know how that could be considered a debacle. Course, some people would judge the program in that way, no matter what.-
"Cody Lusk, president of the American International Automobile Dealers Association said the group has fielded hundreds of calls from frustrated dealers who have had problems entering vehicle data into the program's Web site. He said frequent crashes of the site have made it harder for car sellers to complete deals."
"Jack Fitzgerald, who owns several dealerships in the Washington region, said his stores have already taken in about 200 clunkers. He said the government hyped the program too much before setting clear rules and guidelines on it."
"Tammy Darvish, another major auto dealer in the Washington area, said her more than two dozen dealerships have had lots of interest in the program but its success has left dealers strapped for money as they wait for payments from the government."
"There's a whole lot of money out there that dealers haven't collected on," said Darvish, who noted that she's taken in about 200 clunkers. "We've sold the cars and we've processed the paperwork, but we haven't been reimbursed. I'm out about $1 million. The government is supposed to reimburse me for that."
www.washingtonpost.com/wp-dyn/content/article/2009/07/30/AR2009073004122.ht...
"Adam Lee, owner of Lee Auto Group in southern Maine, had stopped accepting clunkers at four of his dealerships because he was concerned the funds would run out. Mr. Lee said his firm accepted 100 clunker trades and is owed $450,000 from the government, none of which has been disbursed."
online.wsj.com/article/SB124898886526095011.html
So it would appear that our uber efficient Government dropped the ball again. Like I said, if they can't even keep a simple program like this up and running without delays in payments and crashing web sites why should we turn our health care over to them?
What could be the only successful stimulus package to come out of Washington is turning into just another example of Government mismanagement. -
"Jack Fitzgerald, who owns several dealerships in the Washington region, said his stores have already taken in about 200 clunkers. He said the government hyped the program too much before setting clear rules and guidelines on it."
hmm... AUTO DEALERS... not reading the FINE PRINT... got to be a joke in there somewhere -
lol
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That was in the NYT as well.
So many people took to the program that they became inundated, and also ran out of funds.
I guess it wasn't such a bad program!
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Congress can sometimes act quickly. The House has already approved another $2 billion to extend the program. Next stop: the Senate. Seems like it should pass.
www.npr.org/blogs/thetwo-way/2009/07/house_approves_2b_more_for_cas.html?ft... -
it seems to have succeeded in doing what it set out to do, which was to push inventory out of showrooms... whether one believes in such keynesianism or not.
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Our local dealerships aren't complaining - several were on the brink of closing, but they're up and running now.
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yeah for now
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The program was funded with one billion, and thought to run until November... 4 months,
They ran out after 4 days... And now have to fund more money so that tax payers can pay for other peoples cars.
1. A calculation error in the range of being 30 times off, and they sit with a straight face and promise that they won't run the healthcare plan over budget.
2. They give away 4500 dollars, and are surprised when people take the money... Even a college freshman knows that free pizza is the way to get people to attend. This has to be the greatest "DUH" moment of the administratoin so far.
3. All they managed to do was to mess up the market completely.
A) Cheap cars won't be around for those that can't afford expensive ones. We just diminished the stock of cheap automobiles by 250 thousand. Leaving the newer more expensive as the only alternative.
B) Car dealers have had one of the slowest summers ever so far, (Like anok said they were going out of business). Because the gov't has been hyping this for months. No wonder people were holding off trading in their cars until the program hit. All they managed to do was to pack the sales into 4 days instead of spread it out over time
C) And these cars were the future buyers of used cars, now the curren't owners of cars in the 4-6 year range have lost a large customer group for trading in. Which means that they'll have to either sell at a greater loss to the ones that would have bought these cars, or not trade in their cars at all until they reach that value level, which will damage new car sales in the future.
All in all, a gigantic flop.-
1. We have data on health care. We had none on how people would react to an incentive program for buying cars. Apples and oranges.
2. That give-away includes the requirement that people spend a huge chunk of cash or that banks lend it. Given consumer and banking behavior, I'd say predicting people's behavior was anything but clear, though obviously they set the incentive high enough to promote a significant result.
3. Your arguments about the market assume those dealers would even survive without the car sales. You haven't heard of enormous inventories going nowhere? This can also help Detroit. As far as used car sales go, I know that there was a glut of used SUVs on the market already because of Detroit's own rebate programs. Really, though, I don't see the problem. Maybe used cars should be losing their value, considering how costly they are to the environment. But is that really what will happen? You do realize that these used cars are being removed from circulation, right? Seems that that would be creating a demand for cars, both new and used.
Seems to me that your point is more about faith in free markets per se, so no matter how well the program is executed, no matter how stimulative it is, no matter how good it is for the environment, and no matter how many happy people there are, you will harp on the interference with markets. Of course, the desirability of free markets is based on nothing more than an article of faith, and not a small amount of illusion about how "free" many markets even are. Indeed, your faith is so powerful that you speak of "the" market, like others with a similarly profound faith in its beneficial workings if only the government would never stimulate or regulate. Maybe the government should also get out of the currency business too? -
I think it is worth noting, that when this scheme was dreamed up the stock market was well under 9000, and credit was a bit tighter, so it might well have, under such circumstances, been harder to get people to put up their own money forthier portion, or to get a bank loan.
As far as it's keynesian intent--to turn the spigot on, it has been successful -
csi, you make excellent points. I said when this was announced that it would screw dealers in the long run. Yes, they had sales now, but having to crush the trade-ins hurts the dealers because their bread and butter is selling used cars. More profit per sale - always. Also, as you pointed out, it hurts the car buying public that shy away from the exorbitant new car prices and opt for nearly new (used).
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Don't know if it is true, and I don't have the time to research it, but I heard it mentioned that when this was done in Germany, it was supposed to be a temporary thing and they ended up having to make it permanent.
Anyone know? If not, I will look it up later. -
It would be impossible to make permanent here. We buy more cars than Germans do... we'd go bankrupt
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I don't have time to read all the hits on the German sites, but the premium from the government certainly looks temporary, though it was very popular and was thus extended. One piece mentioned some 5 billion Euros being spent. The premium for new cars was a bit more modest than here, 2500 Euros.
Since the search result hits are from 2008 and 2009, speaking of "permanent" would be a bit bizarre, and completely contrary to the principles of their social-market economy, though who knows what goes on in the minds of right-wingers in the United States when they imagine Europe. Besides discussion of the premium, I also saw talk about how cars that do less ecological damage are or should be taxed.
It also looks like Sweden had a comparable program in 2007 for 1100 Euros.
The point in their case and that of the Germans seems to be ecology, though in the Germans' case stimulus also appears to have been the issue, since German car businesses were moving no inventory. I imagine it's tough, though, since as large as their domestic market is (the biggest in Europe), they also depend on exports. I taught someone this winter whose Dad works for a company that supplies auto firms. Really bad business.
If you want news from Germany in English, you might root around the Deutsche Welle's site: www.dw-world.de/english/. Der Spiegel also has an English edition: www.spiegel.de/international/ I haven't looked at these sites, but I know their German equivalents. Presumably they covered it, even if the first page of hits I got from Google didn't include them. (I got more TV and also car sites on the first page of German hits.) -
"...though who knows what goes on in the minds of right-wingers in the United States when they imagine Europe." As if only left wingers are intelligent enough to understand what happens in Europe?
If I had a nickel for every time you answered a question with an insult embedded in it, I would be in a higher tax bracket. -
False stereotypes of Europe have played a clear role in the rhetoric of the right when it comes to painting everything Obama as "socialist." I read your comments about hearing Germany's temporary program had supposedly gone permanent in that context.
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You heard me say that I thought it was reported as such. I asked if anyone had info. I didn't ask to be insulted. But as usual, you supplied one anyway.
Tell me, how is Obama NOT a socialist? Unless by implication you mean he is a marxist? That being the case, I must concur.
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Cash for Clunkers is largely corporate welfare, so i don't know why the right has its dander up about it. o_0
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