AP reports the the House rushed Friday to pump $2 billion into a popular cash-for-clunkers program running near empty, with a leading Democrat saying "consumers have spoken with their wallets."
They couldn't run that properly or figure out the demand for for "free money". How are they going to run Obamacare?
The government hasn't thought about the consequences of their actions.
Used car prices are going to rise. The Clunker program will cause these cars to be destroyed. Well if you destroy used cars, that will deminish the supply. Limit the supply, and you increase prices.
Car Part Prices are going to rise. I don't know how many people have ever got rid of a car by selling it to a salvage yard, but I have. I bought a 1970 Plymouth Valiant for $25. It had 190,000 miles on it. I bought 4 tires and some engine parts from a salvage yard for $200. I drove it for about 6 months, 10,000 miles. I got a full time job , bought a new car and sold the Valiant to salvage yard for $100. The car cost me 70 cents a day plus gas and insurance.They dismantled it and sold many of the parts. Everyone was happy. Well the salvage yard wouldn't get my Valiant today. The dealership would get it, and I would get $4500. No parts to recycle. Again supply and demand.
Charities will lose out. Have you ever donated a car to a charity? Again, I have. I gave a car worth $2100 on the books to a charity. I got a right off worth about $700, goodwill and the knowledge that I was helping out children. Well will people donate their car for a $700 dollar value, or trade it in for $4500?
Prices paid on autos will increase. A person knows they can afford to pay $500 a month for their car payment after putting down $2000. That is a $21700 car, out the door, with a $19700 loan at 4%. Well if you give the customer $4500, they are going to afford a $26700 vehicle. A Car salesman is not going to let that money go. They are going to figure out how to get that cash into the dealership and into his commission check.
Hypothetically, if the program becomes so popular that every taxpayer in the country buys a car with that $4500, Then every taxpayer is actually buying a car with a loan from themselves. They get to pay it back with their own taxes. The way it stands, the taxpayer is subsidizing other peoples auto purchase. Instead of Cash for Clunkers, we should just call it the Clunker program.
I agree. The good part is that there are so many restrictions that many cars won't qualify. Those people always have the option of charity car donation. Details at http://www.cars4charities.org.
ReplyDeleteLook at my blog, there is a video of how they murder the cars. It is terrible. It sickens me. Obama is just trying to get normal cars off the roads so everyone will be running around in those stupid "green" cars.
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