??? Cash for Clunkers and the Auto Bailouts

[Coyote_Bandit]

Can someone please explain why there weren't greater incentives to trade those clunkers in for cars manufactured by bailed out and/or US auto makers?

Seems to me that it would have been a better use of taxpayer dollars. As is, tax dollars are subsidizing profits of foreign auto makers.

If I'm going to bail out a car company and effectively assume an ownership interest in the company then doesn't it make sense that I would use additional funds to encourage customers to purchase from that company as opposed to competitors in whose performance I have no financial stake?

[Eric J in MN]

1. Trade deals with other countries. NT

NT

[Coyote_Bandit]

5. I don't believe

those trade deals require the US government to subsidize the purchase of imported goods.

Cash for Clunkers does not alter or create import limitations, tariffs or taxes on imported goods.

Why shouldn't a Clunker bring up to a $4500 government subsidy if traded for a Chryser or GM product and something less for an imported auto?

[Statistical]

2. Growing the pie theory

For companies to grow they either need to grow their slice or the whole pie needs to grow.

The "pie" for auto sales fell from 16 million to 10 million. That is brutal. The pie shrunk massively that is why all the car companies are losing money now.

CforC likely would never have passed the house if it was seen as pork for auto companies.

It is a simple bill hard to deny it works. Grow the pie.

If auto sales can stabilize at 12 million units per year the auto companies will be fine. If they get back to 13-14 million they will be profitable.

[Coyote_Bandit]

6. And yet pork for

health insurers is obviously acceptable?

And with the number of uninsured/underinsured that too should be a pie that isn't exactly growing.

[endarkenment]

3. That would be a treaty violation.

But the program is working. Relax. People are buying new cars from all of the manufacturers. It is working. A program that provides direct benefits to working american families and demonstrates that trickle up actually works and is becoming wildly popular and was implemented by a Democratic Congress under a Democratic President. How about we all stop looking for the cloud here?

[Romulox]

9. Nonsense. Please cite the unnamed "treaty" that would've been violated. nt

[endarkenment]

13. GATT prohibited subsidies and countervailing measures

GATT Uruguay round. We can quibble over my use of the term 'treaty', but "subsidies contingent upon the use of domestic over imported goods" are explicitly prohibited.


Prohibited subsidies Two categories of subsidies are prohibited by Article 3 of the SCM Agreement. The first category consists of subsidies contingent, in law or in fact, whether wholly or as one of several conditions, on export performance (“export subsidies”). A detailed list of export subsidies is annexed to the SCM Agreement. The second category consists of subsidies contingent, whether solely or as one of several other conditions, upon the use of domestic over imported goods (“local content subsidies”). These two categories of subsidies are prohibited because they are designed to directly affect trade and thus are most likely to have adverse effects on the interests of other Members.
http://www.wto.org/english/tratop_e/scm_e/subs_e.htm

[Romulox]

14. There are about 3 things wrong with this answer.

1) "We can quibble over my use of the term 'treaty'".

No we can't. "Treaty" is defined in the US Constitution. GATT wasn't a treaty.

2) Quoted from your link:

"Part I provides that the CM Agreement applies only to subsidies that are specifically provided to an enterprise or industry or group of enterprises or industries, and defines both the term 'subsidy' and the concept of 'specificity.'"

Thus, GATT wouldn't have applied to C4C, which was a subsidy to consumers.

3) Finally, GATT is defunct. :hi:

[grahamhgreen]

4. Also I am dismayed that only gas-guzzlers were eligible, so those of us who drive responsible, fuel

efficient vehicles were punished, while those who bought the gas-guzzlers under the previous tax incentive for buying gas-guzzlers were rewarded....

[Coyote_Bandit]

7. The point of the program

does not seem to be the removal of gas guzzlers from the highways. It simply is not cost effective to trade in many of those vehicles under the Cash for Clunkers program.

The primary point of the program does in fact seem to be to stimulate auto sales - which is what prompts my inquoiry. The positive environmental impact is a bonus. As is the potential political loyalty of some who are benefitting under the program.

Yes, there are folks who drive clunkers and need better more reliable and more econmical transportation who simply cannot qualify to benefit under this propgram. But that has been true of most government programs. Take heart. This will stimulate the broader economy and the benefits will trickle down and you too will eventually benefit. Isn't that how it always works?

[grahamhgreen]

17. No. Trickle down does not work - that's why the world's economy has collapsed, IMHO, nt

[Coyote_Bandit]

25. Of course trickle down doesn't work

but if you are one of the folks who is not directly benefitted by government programs which are arguably supposed to benefit the broader economy then your only possible benefit is through some dumbshit trickle down theory. That could be cash for clunkers or the stimulus program or the AIG and bank bailout.

[taterguy]

12. How exactly were you "punished"?

[grahamhgreen]

15. By not being treated equally with those who chose to drive the gas guzzlers.

I have an old car that I'd love to trade in, but i cant because it got over 18mpg when i bought it.

There was (is?) a program to give a tax break people who bought giant gas guzzling trucks a tax credit, this is what spurred the SUV boom we've seen.

As a conscientious environmentalist, I felt this program was morally bankrupt and chose not to participate, in fact, made a few phone calls to try and stop the program as i knew the world was running out of oil and this was a bad idea.

Now, the people who bought these monstrosities are being awarded for their bad behavior by giving them a further benefit in the cash for clunkers program.

Not a big of a deal as not putting single payer on the table, or continuing the wars for profit, or rendition, or no prosecutions for war crimes, but still feeling a little miffed.

[shiftingbaselines]

19. yeah, but it is a huge benefit getting them off the road

so many people felt pressured to buy big hogs to not get killed by them

[blue_onyx]

20. If you think the "program is morally bankrupt"

why are you complaining about not being able to participate?

The program is a great idea. It helps consumers, auto dealers, auto companies, and the environment by getting larger, older, less fuel efficient vehicles off the road.

[taterguy]

21. Sorry, you don't get to play the "environmentalist" card if a car is your primary mode of transport

It's in the rule book.

Look it up!

And don't waste time replying with the lame excuses why you need a car. I've heard them all.

On a less snarky note, do you really equate not getting the same tax break that someone else gets with punishment?

Am I being "punished" for not having kids?

Should I get to claim my dogs as dependents?

[grahamhgreen]

34. Actually, I've given up on the car and gone to my bicycle! It was quite the clunker....

I'd love to buy an all electric vehicle, the new Nissan leaf looks good.

The Leaf: Nissan Unveils New Electric Car, 100 mile range, great power, looks normal, $10K-$15K, available 2012, Finally http://bit.ly/2pLjH

I know, I'm whining too much...

[taterguy]

35. A few hours ago you said you had an old car

Now you're just making shit up

[grahamhgreen]

36. The car is parked front of my house. I have not driven it in 5 months. It is a real clunker.

I'd love to get some cash for it. But I guess I'll just subsidize those who bought the gas-guzzlers.

Would you like me to post a picture?

[taterguy]

37. By all means, post a pic of your bike

I'd like to see what a good commuter ride looks like

[taterguy]

38. Thanks for confirming my suspicion that you were just making stuff up

Of course I'll apologize profusely if you post a plausible photo of your non-existent bicycle.

[grahamhgreen]

39. Sorry, I work full time and could not get to it til now - here's a video!

http://www.youtube.com/watch?v=8Uc9z9mQ_Yw

[taterguy]

40. Or else you just needed time to Google something

Color me unconvinced

[grahamhgreen]

41. Surely you jest! What would convince you?

Did you watch the entire video and hear me address cash for clunkers?

[taterguy]

42. My bad. I didn't know I was supposed to actually watch the video

But maybe you should post a still pic of the bike just to be sure

[grahamhgreen]

43. On the other hand - the Jamis Coda Comp really is a great commuter bike...

It's those skinny little tires, the only issue is they're a little lightweight for jumping curbs.

It's a smaller Oregon company, I think, but unfortunately the frames are now built in overseas....

http://www.jamisbikes.com/usa/history/index.html

On the car front, there are a couple of new cars on the near horizon that look great:

All electric 100 mile range Nissan Leaf $15,000, built in Tenn.: http://www.autobloggreen.com/2009/08/06/nissan-to-begin-retail-sales-of-leaf-ev-next-year-in-five-major/

Honda CR-Z Hybrid - great looking! : http://www.autoblog.com/2009/07/13/honda-confirms-production-of-cr-z-fit-hybrid-in-2010/

Yaris and Fit hybrid: http://bx.businessweek.com/green-business-acceleration/view?url=http%3A%2F%2Fwww.reuters.com%2Farticle%2FGCA-GreenBusiness%2FidUSTRE56R08Y20090728

And of course, GM keeps threatening us with the Volt...

[grahamhgreen]

44. Also, this is an interesting electic bike from Scwhinn - 60 mile range, 20 min charge time, goes on

commuter trains.. $3,000

http://www.schwinnelectricbikes.com/tailwind/electric_bike_technology.html

[grahamhgreen]

45. Photo

http://gallery.me.com/grahamhgreen/100014/Jamis

[taterguy]

46. I don't know why I was so convinced that you weren't actually a cyclist

Mmmmmmm crow

[grahamhgreen]

47. No worries, it are the internets, after all!

:puffpiece:

[Greyhound]

22. It is the Democratic continuation of Idiot Frat Boy's Hummer subsidy.

We seem desperate to cling to the notion that, now that the Democrats are in charge, the agenda has changed. It hasn't.

Take a step back and look at what has been done just since the collapse of the financial industry. The people that control our government have poured trillions in guarantees and outright gifts into this sector that employs few and produces nothing, yet sucks up almost a third of all the productivity of the country. The single industry that did get some assistance that does actually make things got less than 1% of that amount. In both cases the money, our money, was given to them with few requirements or restrictions and neither of them is of much help to the actual people that are most in need of help.

The recipients of virtually 100% of these gifts are the huge inefficient, bloated, corrupt corporations that caused the damage in the first place. Companies that have grown so large that they control the entire sectors of the markets and are at the stage in the business life cycle that their primary goal, employment-wise, is to shed as many jobs as they can while maintaining their share and control of that market. None of the money taken from us and distributed to "fix" the problems has gone to small businesses that create employment and produce things, the engine that drives the American economy.

When IFB was installed in the coup of 2000, one of the very first things he did was to eliminate the tax credit for purchasing high efficiency vehicles. He followed this up with a "bi-partisan" $75,000 subsidy toward the purchase of the most inefficient and polluting vehicles "Detriot" produced and increased it to $100,000 the next year. Now we have this "cash for clunkers" program and, as you have pointed out, it excludes most of the vehicles driven by those on the lower end of the income spectrum.

So, what we see is a government that continues to give our money to those that steal the most with a few tiny scraps thrown to their gatekeepers, those that are still doing OK, while the people most hurt are ignored.

Look at the "health care reform debate", the primary agenda is to ensure the profits of the entities that have destroyed the health care system in this country, and they are completely willing to let millions more die for lack of care in that cause.

[Coyote_Bandit]

26. And hardly a damned thing for

the long term une ployed or to encourage small business creation and development.

Indeed, the agenda does not seem to have changed.

[Greyhound]

31. I don't know whether to laugh or cry.

We are so scared and isolated and we feel like we're in this alone.
:kick:

[ContinentalOp]

8. Yes, if the point was to stimulate auto sales, the rules were rather dumb.

It should have been restricted to U.S. automakers only. On the other hand if the main point were to reduce oil consumption and emissions, the rules should have been much stricter and required a bigger increase in mpg. As it is, it seems like a weird halfway measure.

[shiftingbaselines]

16. By restricting it to Gas Guzzlers it WAS "restricted" to US companies

so what is the problem?

The rules were well designed to get the worst (under 18 mpg) off the road, and it succeeded. According to Gas 2.0, Detroit was the winner: the mpg increase is 17 mpg!!!!

http://gas2.org/2009/08/04/detroit-captures-market-share-of-dumped-clunkers/

and according to http://news.prnewswire.com/DisplayReleaseContent.aspx?ACCT=104&STORY=/www/story/07-29-2009/0005068374&EDATE=

More than 70% of the clunkers were domestics and the efficient Ford Focus was the winner - fuelly .com says it gets 40 mpg

[Coyote_Bandit]

28. Ummmm......No

Maybe the clunkers being removed from the streets were primarily domestic vehicles but if you qualify for the program you can get the same $4500 to apply to the purchase of either an imported or domestic vehicle. As a taxpayer who has a financial stake in the success of GM and Chrysler I think that's fucked up.

[Romulox]

10. Something like $100 B of the AIG bailout went to foreign corporations, too.

This is the end game: a wholesale transfer of public funds to multinational corporations.

[Coyote_Bandit]

11. I wasn't exactly

delighted by that either. I'm still waiting for a few pennies of my tax dollars to trickle back to my benefit. Hope? Change? From my window all I see is the same corporate loyalties dressed in different clothes.

[shiftingbaselines]

18. Nonsense - domestics are the big winners

and losers.

This resulted in Domestic companies topping the lists for trade ins - and buys!
http://www.alternativeenergynewswire.com/detroit-captures-market-share-of-dumped-clunkers

[quiller4]

23. Trade policy the reason although the car outselling all others

in the Cash for Clunkers program is the Ford Focus. Ford seems to be doing better than all other car makers in Cash for Clunkers program.

[Greyhound]

24. K&R.

countered the unrec.
:kick: & R

[NNN0LHI]

27. Wouldn't it be nice if people just had enough brains to support the companies our govt. now owns?

Guess that would be asking too much of the imbeciles?

Then the same people wonder why the only jobs for them and their kids are in the army guarding oil pipelines.

Some folks just aren't very bright.

Don

[Coyote_Bandit]

30. That would require

that folks put the interests of the national community above their own selfish desires and preferences.

[madokie]

29. I don't think its worth the fallout that would surely be if they were to exclude

foreign made auto's. I feel the whole issue would then be so tainted as to be of no good for the idea of jump starting the economy. The pukes would be screaming bloody murder and that would take the focus off the benefits. The benefits of which is for one phase to get the car companies back up and running, paying wages, people working making those wages so they can spend some money down at the other stores besides just the auto stores. This cash for clunkers has and is good for the whole of us as a country.

[Coyote_Bandit]

32. Sooooooo.......

political expediency trumps support of domestic labor and manufacturing - not to mention profits of corporations partially owned by the US government?

There is no guarantee that personal financial and employment situations will improve even when the broader economy does. Whatever trickles down doesn't water all lawns evenly.

[madokie]

33. In this case some is better than none

the only way for 100% would be for the government to give all of us a new vehicle. There will always be a need for a line drawn, always. IMO

Don't be reading in anything and then accusing me of it on anything I typed. I said what I wanted to say as plain as I know how. m'k