I have always viewed cynicism as a form of deep moral cowardice—particularly in public policy where choices matter
and the opportunity to make a difference is often determined by stubborn and righteous persistence.
The Cash for Clunkers program has seriously challenged my high-mindedness. It is time for a bit of soul searching.
In order to promote full disclosure, I admit to supporting a much more scaled-down fiscal stimulus plan. In some, limited ways, the fiscal stimulus plan worked. In others, it failed. I will write more on that later. But it seems that after the stimulus was passed, the banks were safely bailed out, and the domestic auto industry was supplied with a huge gift, Congress descended into true madness.
To a cynic, the clunkers program was cynical excellence writ large. Given the weariness of the American taxpayer to recent spending, the $4 billion price tag looked like chump change. This protected those who supported it from persistent criticism that they are now receiving on health care, which, according to the Congressional Budget Office, is at least 350 times more expensive. Who would waste ink on a scant $4 billion, especially for a car sale?
It was popular with voters who owned clunkers. How could it not be? The largesse of government spending $4,500 per trade-in has a guaranteed voting bloc. The great chronicler of early Americans, Alexis de Tocqueville, worried that the undoing of the American experiment would be the realization by vapid masses that Congress could vote them money. Here was the French nobleman’s predictions come true in a plan to eliminate the 1989 Chrysler LeBaron. How deliciously ironic is our folly.
Congress really won big here because the beneficiaries of this $4 billion bounty were not limited to consumers. Environmentalists could rejoice that perhaps a million clunkers could be resigned to the dump. At the rate of this program, we could meet the Kyoto Protocol standards for a mere $3.7 trillion more in subsidies to car owners. That makes cash for clunkers a serious competitor to cap and trade.
Folks who sell cars benefited and it was a rare respite. But given the reluctance of the Department of Transportation to release data, I’m going to guess it was Toyota and Honda who danced to the bank. The program also gave many American businesses the reminder that dealing with a federal bureaucracy makes a root canal seem an uplifting, almost joyful experience.
One group was left out. Among the parade of Camaros and the ghastly last seven 1983 GM model-year cars still running, were some classics. A GM roadster, an elegant Volvo and perhaps even that memory-packed 1975 Dodge Dart I that sold for $300 and a tank of gas in 1987 were unceremoniously destroyed.
Now, more than ever, we need a classic-car enthusiast bailout package. Though he is a Republican, given his political and cultural significance, Clint Eastwood should be Classic Car Czar.•
Hicks is director of the Center for Business and Economic Research at Ball State University. His column appears weekly. He can be reached at email@example.com.