Cash For Clunkers – A Clunker Of A Program
A new study from the University of California at Berkeley offers some insight on the economics of the “Cash For Clunkers” program. The legislation was originated by two of the Congresses most liberal, and insulated, Democrats, Henry Waxman, and Ed Markey. Neither person will ever be in danger of losing an election, and are basically not held responsible for there unwise economic initiatives. With these two, it is always PORK, PORK, PORK.
Here is an excerpt from the study:
Suppose the driving habits of both the clunkers and new cars are same, say an annual vehicle milestravelled of 12,000 miles. If the clunker’s fuel economy is 16 mpg, while the new car’s fuel economy is 25 mpg, then the scrappage program saves 270 gallons for every year the clunker would have been on the road. When burned, a gallon of gasoline creates roughly 20 pounds of carbon dioxide. Therefore, the program saves 2.7 tons of carbon dioxide each year the clunker would have survived. If the clunker would have survived another four years, the program has saved 10.8 tons of carbon dioxide for $4,500, or an average cost of over $400 per ton.
4 Conclusions
The Cash for Clunker program is both a stimulus and environmental program. In this note, I calculate the implied cost of greenhouse gas emission reductions and find that they exceed those estimates from the Waxman-Markey bill by nearly tenfold.
They say I like pork so much I look like a pig.
Surprise! Surprise! The worth of the program was over-estimated by a factor of 10! That’s the usual Democrat arithmetic we are getting used to. Who voted for these guys?
bb
UPDATE – 07-18-2009 from Ace of Spades blog quoting from this source.
Rep. Joe Sestak, D-Pa., called for “immediate action” to address the problem in a statement Sunday, after writing a letter to President Obama Saturday expressing his concerns.
In the letter, Sestak said only 2 percent of claims have been paid and that four of every five applications have been “rejected for minor oversight.”
The federal government has only reimbursed auto dealers for 2 percent of the claims they’ve submitted through the popular “cash for clunkers” program, a Pennsylvania congressman said, calling on the Obama administration to help speed up the process.
And the Obama-ites think they can run a national health care program with hundreds of millions of claims? Keep on smoking, dude!