Saturday, August 29, 2009

Cash for Clunkers Doing What It Was Supposed To

There's been a lot of Republican griping about the Cash for Clunkers program. The complaints are downright ridiculous -- that the cost of used cars was going to be driven up, for example. As if getting rid of 700,000 cars in a nation that sells from 10 million to 15 million cars every year would make much difference. Or that used car parts would increase in cost, as if junk yards were not full of decades of car parts. Or that people who bought them can't afford the new car payments. As if credit weren't so tight now that even good risks have trouble qualifying.

The Detroit Free Press for Saturday (August 29, 2009) has a brief round-up of the impacts of the program.

One of the complaints has been that the program only moved up sales that were going to occur later. But of my three relatives who bought cars, none was planning to until the cash for clunkers came along. Someday they were going to have to buy a new car for a child or for themselves, but they weren't thinking, "Oh, we'll do it in November or next spring." But when cash for clunkers came along, they acted, and put money into the economy.

One relative told me the sales person said he had been in the car business for 15 years and in his best month he had earned $10,000. But in the last month, he had earned $49,000. He'll probably spend a chunk of that money at local restaurants and businesses.

And that's what we need right now. Not more Republican griping.

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