Cash for clunkers

[1992Chevy K1500]

It's going to put americans deeper into debt, the gov't is losing billions of dollars over it, honest, hardworking americans have to pay those billions off, eventually taxes are going to go up just to pay those billions off, valuable engine parts are lost and destroyed (meaning people who scavenge junk yards for parts to refurbish for their vehicles, like me, cannot find them and end up paying hundreds, sometimes even thousands, for them brand new), and a good many of those cars sold will end up in the used car lots when people can no longer pay for them.

The problem is, every time we bail out failing companies and put programs like CFC in place, we help set the stage for another recession and eventually, a second Great Depression.

[dsoccer]

I believe it is only the engine block and drive train that are destroyed; the rest is up for grabs.

Ha, I do not know how you can say CFC and similar programs will turn this country into a second Great Depression, there is no basis or fact for that. CFC at the most looks like it will cost $3-4 billion. The annual budget for the government is around $2.5 trillion, $3-4 billion is a tiny fraction of it, and will be paid for by cutting other expenses else where. Plus what about all of those people that are now employed because of CFC, they generate tax money, that goes back to pay for that $3-4 billion (in a round about way) AND they aren’t receiving unemployment checks anymore. That money goes back into the government. It is a very productive circle.

Also lenders are verrrry tight with who they lend to, Joe Schmoe just can’t buy a car with a terrible credit rating.

[1992Chevy K1500]

The engine is also one of the most valuable components. It could be rebuilt to run like new and get excellent mileage, not to mention it could be sold for valuable parts. Junk yards go out of business because they no longer have parts to sell and can't make as much money.

Bail outs encourage bad business decisions. The reason those companies were about to fail is because they made bad decisions and were corrupt. Giving them money encourages those bad decisions. Think about it, if your child steals your car and goes on a rampage and causes thousands in damages, would you give him/her a $100 bill? I should hope not, because that would lead to the belief that the worse they are, the more money they get. It's the same with the bailouts, they think the worse off they are, the more money they get. This sets the stage for another recession and another bailout. Eventually it will cause a second Great Depression. It may not be in my lifetime or yours, but it will keep getting worse till that point.

[dsoccer]

Bailouts of certain kinds aren't that great, BUT when the time calls for it, it is appropriate. For all we know we could be at 25% unemployment, dollar value dropped, etc if we never did bailout the banks and car manufacturers, but there is simply now why to know that. If there was more regulation over the banks, this whole situation may never have happened. Thats why more regulation over companies that have infinte reaches all over the globe in virtually every sector should be in place.

Well I dont know about you, but I cant predict the future, nor can I predict a second Great Depression. History repeats itself, but each time it does we learn from it. For all we know we could have avoided a second Great Depression 10 months ago. But from your comments it sounds like you would like more regulation?

[CodyB]

I am going to agree with 1992Chevy. The CARS program is designed to help the dealers and car companies out. How is Buying a $20,000 or higher automobile a good idea when there are very well maintained used vehicles for a fraction of the cost? Sure it creates jobs or supports jobs, but if you look at it in the "green" sense your taking away a less than 20 mpg vehicle off the road for one that averages 25, thats nice. Pleas do not forget about the TOTAL carbon footprint, such as carbon emissions for mining/recycling and processing the metal, the power used in that process, the power and heat used in the manufacturing and assembly of the vehicle, and transportation costs to move that vehicle. (That is a limited example, it can be expanded.) Didnt that happen twice now? your clunker AND your new car both used those depleatable resources? Thats pollution. Now add to that fact the clunker does not incur a brand new debt, and is quite possibly restored for less than the cost of a new vehicle that can turn out to need service frequently too... Vehicles that can be fixed and restored for less than the cost of a new one are being DESTROYED. I can go out to any local dealer and find cars MUCH better than what I am driving currently being destroyed to boost the economy, I could be driving something better but it is scrap metal now, parts I could use to fix my vehicle are broken now, these engines could be rebuilt to better working order than what others are using. Dont forget that auto parts stores sell REMANUFACTURED OEM parts. Those parts are rebuilt to good working order from worn out parts. but now parts are being destroyed for what? Look at the kinds of cars this program is getting and tell me its a good thing to demolish these vehicles?

Tell me that destroying that car was a good idea. Did you see what was coming out of the engine WHILE they were rendering it unusable.... Thats not harmful to the environment at all... BS! Please tear this post apart and I will gladly clear things up when its not 2:00 am here.

[white4d96]

I posted somewhere in this thread that it would take about 12 years for a prius to pay for itself assuming your "clunker" you traded got 15 mpg. But I'll redo it with the latest numbers.

Your clunker gets 15 mpg. you drive 30 miles everyday roundtrip. So you drive (30 * 365 = ) 10,950 miles a year. At 15 mpg you use 730 gallons per year. At 3 dollars per gallon, you pay $2190.

According to the news, the avg. mpg of new vehicles sold was 25 mpg. So you still drive 30 miles per day or 10,950 miles per year. At 25 mpg, you use 438 gallons of gas. At 3 dollars a gallon, you pay $1314.

You save $876 dollars per year. Assuming you buy a $20,000 dollar car and get the full $4,500 discount, you end up paying $15,500.

Not including interest on the car, it will take you ($15,500 / $876 = ) 17.69 years for the car to pay for itself. Most people bought these cars assuming they would have a quick return on their money.

You'll notice that as gas prices drop, it takes longer for the car to pay for itself.

Emissions wise, the program definitely helped short term. But a lot of people who bought these cars who could not afford them (and wouldn't have bought them if not for this program) will lose these cars and they will end up on the used car lots by the hundreds.

...Not to mention about every 5-10 years under "normal conditions", hybrid batteries have to be replaced. The part alone costs in excess of $5k, labor is extensive, AND THE PART CANNOT BE RECYCLED!!!!!

...So buying a hybrid is bad for the environment and your pocketbook long term.

...Not to mention a Prius gets what, 40 mpg tops? You can get a USED diesel car, like a Jetta or Golf or whatever, and get anywhere from high 40s to the 60s. Most fuel efficient car what?

I think CARS was an interesting idea, but that's just my standpoint on the trend of "fuel efficient vehicles" we are on now.

[Airborne]

I am going to agree with 1992Chevy. The CARS program is designed to help the dealers and car companies out. How is Buying a $20,000 or higher automobile a good idea when there are very well maintained used vehicles for a fraction of the cost? Sure it creates jobs or supports jobs, but if you look at it in the "green" sense your taking away a less than 20 mpg vehicle off the road for one that averages 25, thats nice. Pleas do not forget about the TOTAL carbon footprint, such as carbon emissions for mining/recycling and processing the metal, the power used in that process, the power and heat used in the manufacturing and assembly of the vehicle, and transportation costs to move that vehicle. (That is a limited example, it can be expanded.) Didnt that happen twice now? your clunker AND your new car both used those depleatable resources? Thats pollution. Now add to that fact the clunker does not incur a brand new debt, and is quite possibly restored for less than the cost of a new vehicle that can turn out to need service frequently too... Vehicles that can be fixed and restored for less than the cost of a new one are being DESTROYED. I can go out to any local dealer and find cars MUCH better than what I am driving currently being destroyed to boost the economy, I could be driving something better but it is scrap metal now, parts I could use to fix my vehicle are broken now, these engines could be rebuilt to better working order than what others are using. Dont forget that auto parts stores sell REMANUFACTURED OEM parts. Those parts are rebuilt to good working order from worn out parts. but now parts are being destroyed for what? Look at the kinds of cars this program is getting and tell me its a good thing to demolish these vehicles?

Tell me that destroying that car was a good idea. Did you see what was coming out of the engine WHILE they were rendering it unusable.... Thats not harmful to the environment at all... BS! Please tear this post apart and I will gladly clear things up when its not 2:00 am here.

This is laughable. All your saying is "it didn't work as well...". It was a success period.

A little math for a second. You said these cars only do better by 5 mpg so it isn't worth it. I am going off of a low ball figure here. 450,000x5=2,250,000. In case you missed it that was 450,000 (I think it is closer to 500,000 but like I said I am low balling here) cars that are getting 5 more miles per gallon. That is 2.25 million more miles driven on the same amount of fuel boss. That means we consume less to go further, that means we burn less, that means we buy less, that means we depend less...

I heard the same argument on Boorts. This is just circle talk to give people who don't like Obama a reason to say it "didn't work". Spin is as spin does. The facts are pretty clear here. You had to have a high FICO score to get the loan from the bank. The banks are not (especially now) going to lend money to a high risk individual or piles of them because if they do when everyone is trying to get a deal they will end up owning all of these cars.

[white4d96]

This is laughable. All your saying is "it didn't work as well...". It was a success period.

A little math for a second. You said these cars only do better by 5 mpg so it isn't worth it. I am going off of a low ball figure here. 450,000x5=2,250,000. In case you missed it that was 450,000 (I think it is closer to 500,000 but like I said I am low balling here) cars that are getting 5 more miles per gallon. That is 2.25 million more miles driven on the same amount of fuel boss. That means we consume less to go further, that means we burn less, that means we buy less, that means we depend less...

I heard the same argument on Boorts. This is just circle talk to give people who don't like Obama a reason to say it "didn't work". Spin is as spin does. The facts are pretty clear here. You had to have a high FICO score to get the loan from the bank. The banks are not (especially now) going to lend money to a high risk individual or piles of them because if they do when everyone is trying to get a deal they will end up owning all of these cars.

I should mention that I support almost everything the Obama administration has done thus far. However, I personally disliked the CARS program. Did it bolster sales? Certainly! Did it replace some vehicles in our nation's fleet with more fuel-efficient cars? Definitely! Is it better for the environment?

...Um, well...

Yes and no. Yes, because the emissions standards when the cars that were traded in were built and now are vastly different, so these new vehicles are more environmentally friendly; No, for reasons I posted earlier. To recap if you didn't catch it, if Mr. John Doe buys a car every ten years, but now traded his 3-year old car via CARS, that means that, in that ten year life span, there were almost two cars made for Mr. Doe, rather than one, meaning the emissions from the production and delivery process are doubled. In a sense.

That is a hard topic to argue though, because some companies' plants are very clean, and the diesel vehicles (locomotives, trucks, etc) used to haul most new cars are surprisingly clean too (that black smoke? Soot, it settles to the ground) so really it depends on the plant and so on and so forth...

Either way, what's done is done. No point in fighting over it now.

[dsoccer]

I think you are missing the bigger picture....the program was designed to get people to SPEND money, and help the environment. The fact that over 500,000 cars were sold means people were spending money, ie putting back into the economy instead of hoarding. If you watched that video you will hear how many jobs have been created just by the large companies, even more when you factor in the small parts companies...bottom line it was a success.

[Colin - STAPUFT]

I am going to agree with 1992Chevy. The CARS program is designed to help the dealers and car companies out. How is Buying a $20,000 or higher automobile a good idea when there are very well maintained used vehicles for a fraction of the cost? Sure it creates jobs or supports jobs, but if you look at it in the "green" sense your taking away a less than 20 mpg vehicle off the road for one that averages 25, thats nice. Pleas do not forget about the TOTAL carbon footprint, such as carbon emissions for mining/recycling and processing the metal, the power used in that process, the power and heat used in the manufacturing and assembly of the vehicle, and transportation costs to move that vehicle. (That is a limited example, it can be expanded.) Didnt that happen twice now? your clunker AND your new car both used those depleatable resources? Thats pollution. Now add to that fact the clunker does not incur a brand new debt, and is quite possibly restored for less than the cost of a new vehicle that can turn out to need service frequently too... Vehicles that can be fixed and restored for less than the cost of a new one are being DESTROYED. I can go out to any local dealer and find cars MUCH better than what I am driving currently being destroyed to boost the economy, I could be driving something better but it is scrap metal now, parts I could use to fix my vehicle are broken now, these engines could be rebuilt to better working order than what others are using. Dont forget that auto parts stores sell REMANUFACTURED OEM parts. Those parts are rebuilt to good working order from worn out parts. but now parts are being destroyed for what? Look at the kinds of cars this program is getting and tell me its a good thing to demolish these vehicles?

Tell me that destroying that car was a good idea. Did you see what was coming out of the engine WHILE they were rendering it unusable.... Thats not harmful to the environment at all... BS! Please tear this post apart and I will gladly clear things up when its not 2:00 am here.

Again, 100% agreement with you. Airborne, you are laughable. ...that is your whole answer to a well written and thought out explanation???? This is laughable??? Geez. I do wish I hadn't seen the video of the Corvette though. CFC is the biggest BS I have ever seen!

You people saying that it got people to spend their money instead of hoarding it.... THIS IS AMERICA! I can do whatever I want with my money! If I want to squirrel it away and paper my walls with it, that is my prerogative. The wordage- that CFC MADE these people go out and spend money.... sheesh. CREDIT is what got us into this mess to begin with! "Everyone needs a home" and housing mortgage de-regulation is JUST like this, only this is with cars. Please someone tell me how many of these people are buying their CARS program cars full out with CASH???

Also, saying that it is just a couple of billion... what is another couple of billion compared to the rest of the debt? Good point. The Obama administration has spent more money in the last few months than were spent in Years (and no, this isn't me defending Bush, so don't bring that up...). My point- yeah really what is just a few billion more?!? Do you have it? No. THE GOVERNMENT Doesn't have it!!! So if I have 2 bucks and some guy walks up to me and asks for 5, I will tell him- Hell, you can have 20!! What does it matter???? I don't have it! It isn't real money!!

You are defending policies that are destroying Capitalism right in front of your face and you can't even see that!!!! I am so sad and upset that it is pissing me off! Capitalism that let you purchase your home with your hard earned money.... now YOUR money from tomorrow and your kids money and their kids money is going to go to pay for a car that someone financed and the government gave them 4,500 credit alllll the way back in 2009! That is one expensive ass car! It is getting financed now by the car buyer and again by the US Government from now ON!

They are TAKING your money and MINE to give to people to have NEW CARS!!!! There are Still people starving in this country and it is a "success" that people are driving new cars?!?! I hope you guys sleep well at night.