Oh goodie, another 2 billion dollars that my children will have to pay back in taxes so that other people can go out and buy brand new cars.

@Shawn4168: Drop in the bucket.

@Shawn4168: No kidding, right? It seems, as with a lot of this administration's actions, that the good intentions are there but none of the common sense that is needed to look into the future and wonder, "So, we just blasted the last administration for creating a huge deficit, but are all these 'great' new programs helping alleviate that?"

@Shawn4168: Yes, because the government only takes in about $1,000,000 in income a year.

Way to crack the code and present a factual account of the program! I'm glad that you showed everyone how it will take an entire generation to pay back the monies spent from this program.

Phew, let's hope none of those knee-jerk, "I hate me the government" folks get in here this morning. Those people always say idiotic things.

If the gov't is going to pour money into the economy (and most economists seem to think this is the right thing to do), I'd rather see it spent on something like this with a positive contribution to society as a whole, rather than going into the bonuses of the idiots in the financial firms who got us here in the first place!

@Stephmo: It doesn't matter if this waste is only 1% of their budget. Waste is waste.

That's 1% that could've been saved at a time we really need to be more frugal.

@Stephmo:

The government does not have "income". They don't earn money, they take it. From us.

@xenth: How much money could this program potentially save, though? People never seem to take that into account. We've spent plenty of money propping up big insurance companies, which will earn the government very little in the way of return.

This program, on the other hand, has the potential to reduce our dependence on foreign oil, inject money into the economies surrounding the auto industry, and help forestall the destruction of the environment, all things that will save us money in the long run. Plus, it's a capitalist's program: the government is encouraging people to spend money, instead of just giving handouts. What's not to like?

Every government program is waste to someone. I'm pretty sure frugality didn't get the US out of the Great Depression: it was massive spending, first through New Deal Programs, and then finally for war-time production efforts in WWII, that got us out of the "frugality" tailspin we were in.

Of course, I won't be spending my money on another shiny vehicle, but if the government can get other people to do so, with a little prodding, fine by me.

@Stephmo: Yes, as this program is not part of the 09 budget, it goes straight to debt.

It also takes low end cars off the market increasing demand thus raising prices on older, used cars. Who does this hurt? Try the working poor. This was a terrible idea from the start. It didn't work in Germany and, in the end, won't work here.

As for the unintelligent people who disagree with you a la "I hate me the government." If I'm going to hate anything, it's going to be the ignorant and elitist people who blindly trust their ever growing government.

Yay, $2 billion more in wasteful deficit spending!

Great, let's take away a huge amount of perfectly-working cars and remove them from the market so that those people who are barely making ends meet will not be able to find affordable cars for the next few years. Same goes for replacement engines and parts for the aging cars on the road.

Not everyone can afford to replace or even properly repair their cars. These cars being taken off the road aren't "clunkers" by means. I know quite a few families who would have loved some of the "clunkers" people turned in. This Volvo still had many years of serviceable life left in it:

The real sick part of this is many families are trading in cars which are functional fully paid off, taking on new debt to buy replacements. Didn't this country just go through something recently involving large #s of financially naive people taking on more debt than they could handle?

I wish they'd call this what it really is -- a bailout, rather than claiming it's for the environment. If it were for the environment, cars would need to be > 20 years old. Even then, the amount of pollution put off by a "clunker", especially what the US gov't definition of one, is far less than the pollution involved in making a new car.

@I Love New Jersey: Get me back my Iraq war money, my abstence only education money, my faith-based grants that were used to evangelize and then we'll talk.

This is a drop in the bucket compared to those programs. And at least program has an arguable impact. We can debate the environmental impact, but it is encouraging people to buy cars and consumer spending on big ticket items are sorely needed.

WSJ had a good article on some of the unintended consequences us normal folk have to live with, now that our political overlords have decided this for us. Among them: (1) fewer used vehicles and used parts will be available, driving up the costs for the remaining supply of both; (2) pushing some mechanics into unemployment, since there will be fewer used vehicles on the road requiring work. You can extend it to parts manufacturers and the jobs they now must cut back, since fewer used cars and more new cars means less demand for parts and service.

But then, the political class and their suck-buddies don't need to worry about consequences. One of the mechanics in the article asked, "So who's looking out for my interests in Washington?" No one, buddy, you're on your own. Hope and change? Only if you're in the select group; maybe some auto mechanics can retrain as aviation mechs, to work on those new aircraft the overlords have ordered up for themselves.

@AlexDitto: Only problem: All top 10 cars being traded in under this plan are American. Those were American cars being serviced at US dealerships, using US parts (for many things).

8 of the top 10 replacement cars are foreign. I don't mind helping foreign auto makers -- I'll do that when I purchase my next car in another 5 or so years. I DO mind using our tax dollars for it.

Quick-fixes and knee-jerk reactions are NEVER the right way to do anything and have long-lasting consequences.

@FLConsumer: 8 of the top 10 replacement cars are foreign cars MANUFACTURED IN AMERICA. Like it or not, foreign car makers do represent a decent chunk of jobs in this country.

Unemployment near 10%, a credit crisis in progress, so the government wants people to get rid of cars that are paid for and take out loans on new, expensive cars? And gives you barely a fifth of the price?

I don't know where this $2B plus whatever else they spent is going to come from. And in a year or two, there will be an auto loan bailout when all these new loans start defaulting because people don't have jobs and can't afford them.

Does any of this make any sense at all?

@AlexDitto: There are a couple of problems with your post. Where did the government prop up big insurance companies? Do you mean Financial institutions which is a much larger group? If so, I agree that was a bad move as well. Thus don't make a second bad move.

This program will do very little to reduce consumption of oil. If the goal of the program is to reduce oil use then the MPH reduction should have been much higher.

Government spending exasperated a recession into a depression that only a world war ended....let's not have to repeat that fix.

Government spending exasburated a recession into a depression that only a world war ended....let's not have to repeat that fix.

@Shawn4168: And takes perfectly good affordable used vehicles out of commission and inflates used car prices, don't forget that part!

If you measure the success of the program by putting cleaner cars on the road, then I'd say it was successful:

[www.cnbc.com]

If you measure it in terms of sales impact, I'd say it's pretty dismal:

"Auto industry executives expect the program to add about 250,000 vehicles to the 2009 sales tally"

To put that in perspective, 2008 (which was a very bad year for auto sales), sold 13.2 million cars, and 16 million in 2007

@Shawn4168:

this isn't so bad... I paid $3500 cash for a 1996 Crown vic LX back in 2004 with 99k miles. as of today... the car has 210k miles, KBB says its worth roughly $1100 (in perfect condition)... and i'll be trading it in and getting triple what its worth... and more that what i orginally paid for it 5 years ago!

hahahahaha!

@spankyshay: Because the mass of unintelligent folks who always go, "the government never does anything good" are infinitely wiser.

And seeing as how those disagreeing with this program refuse to even remotely acknowledge the long-term benefits of the extra 10mpg in the big-picture, it's really difficult to even remotely take your argument seriously.

As to your Germany claim - it all depends on who you read. There are those that call it a success and those that will call it a failure. Hell, when Fox News can spend a segment calling out Obama for drinking Bud Light as an Un-American thing, you should know that anything can be spun. The fact, however, remains that Germany has spent FAR more money on their program. (6 billion, compared to our proposed 3 billion.) So someone in Germany must actually like their program.

You might want to look into something other than talking points and talk radio. It's a bit boring - and a lot like having to hear people talk about how health care in England and Canada involves waiting 18 months to get a broken leg set or going to a veterinarian to have a pelvic exam because government run medicine is literally like that.

The program was drafted in March and just went into effect. To call it a "massive failure" when it's actually done well for the economy is just refusing to acknowledge any good.

Then again, you probably agreed on the stupid Bud Light/foreign beer Fox commentary.

@FLConsumer: No, you can blame the US government for not allowing cheap used cars from other countries to enter the market. Countries where you can get a roadworthy, decently safe car for what in US$ would be 3 figures (US$1xxx once you factor in shipping).

@ElPresidente408: Even if you look at putting cleaner cars on the road, you're still creating an incredible environmental impact. You're destroying (in many cases) perfectly good vehicles. Even if the fuel efficiency is considerably lower, the best thing you can do for the environment re: cars is to buy a used one.

@Trencher93: Here are all of your assumptions:

- All of the people trading in the cars cannot afford them.

- The banks have lent everyone money on new cars with little to no consideration for the risk that they present.

- Those that had the clunkers had zero desire to purchase a new automobile and were only tempted by the program.

- Getting more than the value of your clunker offers you no advantage at all (average value of clunkers has been $1500, average credit has been $4200).

If this is your assumption, then the program makes no sense to you. But based on the current credit environment, consumer confidence and a year's worth of consumer spending habits - it's a difficult perfect storm to recreate.

@FLConsumer:
I didn't realize I had to ship my Toyota to Japan to get it serviced. I guess that guy at the shop down the street who last changed my oil wasn't a US citizen, and that sales tax I paid didn't go to my state?

@cc82: Were you going to send it to that Toyota plant in Fremont, California, Japan - or the one in Huntsville, Alabama, Japan? OH - or maybe the one in Georgetown, Kentucky, Japan? Of course, there's always the one in Princeton, Indiana, Japan...

What happened to this once-great republic? I thought that massive, multi-trillion dollar, taxpayer-funded expenditures requiring our great grandchildren to pay off were only supposed to go for invading the wrong country for made-up reasons, to richly reward campaign cronies or be given with no strings attached to reward Wall Street malfeasance.
THIS is not the America I grew up in. This is not.

@cc82: Where do you think the parts themselves come from? I still have the window stickers from my Infiniti. Completely assembled in Japan, 98% Japanese parts. Every single part comes from Japan other than the tires and fluids. It sometimes takes two weeks for parts to arrive from Japan.

Sure, US mechanic, but the parts are being made in Japan by Japanese workers, profit goes to Japan. These are resources which could have gone to the US instead.

Did anyone see a news report on this? 4 of the top 5 cars being bought under the C4C program are....drumroll....foreign!

I bought a foreign car last fall because it was a better value. America is a capitalist country - buy what you want at a price you want to pay. Don't be forced into buying something because you feel guilty about the economy. The economy cycles, it'll all get better without every family going out and buying an American car.

However, I feel bad that America basically just dumped $? (I don't remember the initial amount) into foreign car companies' laps when the obvious goal was to bolster the U.S. economy buy having people spend money on American products. I am sure a lot of people who traded in their clunkers can't really afford car payments right now, meaning they might be in worse shape than they were when they were driving a 15mpg car.

@j-o-h-n: /agree

@Trencher93: I agree. People are going to overextend themselves. Even if the car is $5400 less, people are buying Camrys (one of the top 5 under this program), which start around $25,000. I bought a $20k-ish car at a 2.9% interest rate for 5 years and I pay $340 a month. I am in grad school and have a steady income, fortunately, and get to live with my parents rent free, but I bet at least some people taking advantage of this program can't afford a payment of nearly $400 a month.

Also, one can buy a 2-year-old lease turn-in for probably $5k less than the price of the new car. I probably should've bought used but I didn't. However, my parents always buy 2 year lease turn-ins. 2 out of the 3 they've bought over time have been good ones. Their Buick Rendezvous is a piece of crap so they won't be buying GM again but still, not everyone has to have a new car. Talk to Dave Ramsey and he'll tell you most filthy rich people drive used cars.

@Shadowfire: Well, define "perfectly good". In that they run at all? Unsafe, belching smog through a busted catalytic, guzzling gas instead of sipping, etc are all judgeable metrics.

Also, don't underestimate how good salvage yards are at removing working parts to resell.

@Trai_Dep: Yeah, I demand they spend money on useful things like Star Wars Missile Defense. I grew up in Reagan/Bush1's America, and it was shitty then too. :)

@Shadowfire: Not necessarily. You'd have to analyze the environmental impact of both cars and the environment build and recycle costs. Granted if you're trading in a very good used car that gets 20 mpg for a new car that gets 25 mpg, in the long run, it's a losing prospect from an environmental standpoint. But if you're taking an old Bronco off the road in exchange for a corrolla, then you may have a long term net positive environmental impact. And we haven't even touched the indirect costs. How much does it cost per gallon of oil when you factor in the wars, foreign aid, etc. compared to the resource costs for a new car.

It's fairly complicated, which is why people like to simply throw up their hands and scream "failure!" rather than doing the math.

@FLConsumer: I'm unsure why you're arguing that Japanese-manufactured parts are worse than Canadian or Mexican-manufactured parts for Amerika.

@j-o-h-n: Car manufacturers get bonuses too. As do the sleazy dealers. Also, most economists have been shown to be morons again and again.

1) the most popular vehicles being purchased with Clunker cash are Trucks and Crossover SUV's (check edmunds for data)
2) most new car purchases are financed. More consumer debt at a time when we should save.
3) the carbon footprint required to produce a new car far exceeds the carbon footprint of maintaining and driving an old "clunker"
4) The Treasury (thanks to Fed Reserve) is insolvent. Printing more paper money will just make things worse
5) more people are concerned with 3 Billion ($12/person) spent on clunkers than 3 Trillion spent on Iraq in order to control mid east oil, hypocritical

@FLConsumer: Since most terrorists get funds from Middle Eastern potentates rolling in petro-dollars, I am forced to ask: why do you love terrorists so?

@italianscallion33: Define foreign. Do you mean like Toyotas made in America? Or Fords made in Mexico?

@Trai_Dep: I want tax cuts for the wealthy that we fund by going into debt and the increase in economic activity never gets close to paying for those cuts.

When did the comments section here start to take a jerk to the right? My wife and I (pinko bleeding heart treehugger tax and spend leftists both) just turned in a dying 1993 Ford Explorer, and got a shiny new Mazda3.

That we paid for outright out of savings.

According to the dealer, much like many of his other sales over the week.

But hey, I feel terrible for giving a check to the sales manager, since you KNOW he's just going to go back to the motherland to spend it, and getting "our" sales guy a bonus... you know, he looked like he might have been foreign at one point. It's a pity that all that money I spent is going straight to Japan with no pit stops in America at all.

A few points I can't resist making:

1) I doubt any of you complaining of deficit spending said a word when Bush lied about WMDs and Sadaam's connect to 9/11, started an unnecessary war and spent 1 Trillion Dollars.

2) Classic Keynsian economics, which despite what the rightwing claims, is proven to work, says you deficit spend to prop up the economy in recession.

3) You know how to make wages go up? Give people health care that isn't dependent on employment- this gives people a real opportunity to be entrepenuers and sell their labor for what its worth.

The Republicans had complete control for 6 years, and effective control for 10 (last two years of Clinton after Monica, last 2 years of Bush)... and we see where that's got us. Obama's only been in office 200 days... not enough time for anything he's enacted economically to have any impact. We'll talk 1 year from now and see how we're doing.

@FLConsumer: Andy Camry's origins are 75% US/Canadian - the Ford Fusion is 50%.

Nissan isn't actually the end all/be all of Japanese car products. Toyota and Honda are the 2 biggest sellers here and they both have significant US/Canadian content.

But, yes, you're right in that Nissan's presence is anemic at best in the Infinity line for US manufacturing with their one line in Mississippi. Uh, go you? But when one of the best-selling cars in the US is actually pretty American despite its Japanese pedigree, well, he's got a point.

@FLConsumer:

I agree 100% with you. This is nothing but a bailout and only benefits those who wish to purchase new cars. I don't buy new cars, I buy used cars because I don't want car payments. Gee, thanks for helping me out!

As for people taking on more debt, yes, nothing has changed, despite all the talk about a 'new' economic reality.

What a friggin' joke!

@Trencher93:

No, it doesn't make any sense. I guess I will have to take solace in the fact that I still am stuck with my 12 year old car that gets too good gas mileage to comply with this inane program, but at least I don't have any car payments.

Seems like it would be easy to take advantage of this program if you were planning on buying a vehicle. Go to dealer, pick out car, get price and everything worked out then go out and find a $500 junk vehicle and drive it there to trade in and get your gov rebate.

@JGKojak: I couldn't agree with you more.
It really hurts to see people argue at the level of Fox talking points and willfully forgetting the ineptitude of the previous government. In fact, the housing market started going bad already under Bush, and he, at the advice of economists, started bailing out companies. We didn't hear much complaining from the right at that time, did we? He didn't have any problems getting his aid packages through congress, did he?

And, as you point out, money for the war on Iraq has been spent much, much worse with very little oversight, if any. When you can read reports of private contractors hired to do the work of the military and padding bills and committing fraud left and right, you just have to shudder.
I can't help asking myself why American taxpayer money can't be spent in the US, to benefit Americans of all levels and social classes, as opposed to being spent on wars abroad benefitting the citizens of those countries.
Think about it: If you spent just a fraction of the US military budget on health care for uninsured people here in the US, you would, each year, save more people than have ever died as a result of terrorist actions on American soil. Just something to think about...

@enine: Except you have to have owned the car for 1 year.

A point of information.

The toy car you have illustrating this article is a replica of a Citroen 2CV, also known as the Ugly Duckling in France. It was designed as a response to the Volkswagen Beetle and was mass produced beginning immediately after WWII until the early eighties (?).

While it may look old, the car was and is still considered an amazingly thoughtful design. Weighing in at approximately 1200 lbs, it achieves a gas mileage of nearly 50 miles to the gallon.

2cv's were designed for the rolling county sides of France and are nearly impossible to tip over. They were one of the best selling cars in the history of autodom ranking third (I believe only the Bug and the Mini sold more).

They can be disassembled with the tire lug wrench and it was not unusual for pranksters to take apart a car overnight and leave them in that condition on the front yards of their surprised owners in the morning.

It's seats can be easily removed for picnicking and are a joy to sit on when out for a drive. In fact, unlike cars today the entire layout is designed for easy repairs by their owners. They were amazingly cheap to own.

Compared to the gas guzzling sedans and SUV's targeted by the Cash for Clunkers program, 2cv's are a far cry from the clunkers. In fact, it would be wonderful to see cars as simple and thoughtful as these on the road again.