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People Think Cash For Clunkers Is Funny…

August 3rd, 2009 · 4 Comments

I will write more about the (questionable) economics of the federal “Cash For Clunkers” program, but for now I will leave you with a quote and a cartoon which tie in nicely together. First the quote, from the WSJ Online:

“Americans are streaming back into auto showrooms, and one reason is the “cash for clunkers” subsidy. Democrats are naturally claiming this is a great success, while Republicans are claiming that because the program has run out of clunker cash so quickly, this proves government can’t run the health-care system. How do we elect these people? What the clunker policy really proves is that Americans aren’t stupid and will let some other taxpayer buy them a free lunch if given the chance.”

I’m not sure that I see the definite link between being able to manage a spending stimulus and being able to run a healthcare system, so I will withold judgment. That said, reader Jason alerted me to a the fact that people are using the Cash for Clunkers snafu as ammunition against a government healthcare plan. From The Chicago Tribune:

Hm. I wonder if the cost of the political capital spent on the program was factored into the Cash for Clunkers expenditure. *smirk*

Tags: Policy

4 responses so far ↓

  • 1 Tony // Aug 3, 2009 at 7:10 pm

    “[…] Americans aren’t stupid and will let some other taxpayer buy them a free lunch if given the chance.”

    When I heard that clunkers was out of cash, that’s what I thought too. But, I wonder if Americans accounted for the fact that they don’t get the whole clunker subsidy.

    Just as the burden of a sales tax doesn’t fall exclusively on consumers, the benefit from a subsidy won’t go completely to the consumers. Auto dealers will get their share too.

    As bartering makes auto prices murky, it’s hard to tell what price you would have paid in the absence of the clunker subsidy. I wouldn’t be surprised if more consumers thought they were getting a better deal than they actually got.

  • 2 econgirl // Aug 8, 2009 at 11:59 am

    Hehe, people seem to like making Cash for Clunkers cartoons. Here’s another:

  • 3 Steve Myers // Aug 8, 2009 at 2:56 pm

    I like that cartoon. My take on this is far less funny

    Thanks for helping me laugh too.

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