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Govt "Cash for Clunkers" a failure

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posted on Aug, 19 2009 @ 03:43 PM
And people want this incompetent organization to handle our life and death.

NY dealers pull out of clunkers program
Aug 19 02:00 PM US/Eastern
AP Auto Writer

NEW YORK (AP) - Hundreds of auto dealers in the New York area have withdrawn from the government's Cash for Clunkers program, citing delays in getting reimbursed by the government, a dealership group said Wednesday.
The Greater New York Automobile Dealers Association, which represents dealerships in the New York metro area, said about half its 425 members have left the program because they cannot afford to offer more rebates. They're also worried about getting repaid.

"(The government) needs to move the system forward and they need to start paying these dealers," said Mark Schienberg, the group's president. "This is a cash-dependent business."

The program offers up to $4,500 to shoppers who trade in vehicles getting 18 mpg or less for a more fuel-efficient car or truck. Dealers pay the rebates out of pocket, then must wait to be reimbursed by the government. But administrative snags and heavy paperwork have created a backlog of unpaid claims.

Schienberg said the group's dealers have been repaid for only about 2 percent of the clunkers deals they've made so far.

Many dealers have said they are worried they won't get repaid at all, while others have waited so long to get reimbursed they don't have the cash to fund any more rebates, Schienberg said.

"The program is a great program in the sense that it's creating a lot of floor traffic that a lot of dealers haven't seen in a long time," he said.

"But it's in the hands of this enormous bureaucracy and regulatory agency," he added. "If they don't get out of their own way, this program is going to be a huge failure."

The program is administered by the Department of Transportation. Transportation Secretary Ray LaHood said Wednesday that dealers will be repaid for the clunkers deals they have completed.

"I know dealers are frustrated. They're going to get their money," LaHood told reporters. He said the Obama administration would soon announce how much longer the $3 billion car incentive program will last.

Through early Wednesday, auto dealers have made clunkers deals worth $1.81 billion, resulting in 435,102 new car sales, according to the DOT.

posted on Aug, 19 2009 @ 03:59 PM
Its not surprising, is it? Hell, it ran out of money in the first WEEK. Great government cost control there
. And as you said, these are the idiots that people want running healthcare. Sigh...

As for this program, over the next few months, we'll see several unintended adverse consequences.

-One, demand for new cars will fall off a cliff at some point. All they've done is artificially shift demand from the near-future to the present.

-Second, prices for used cars will increase as they destroy these vehicles. Basic supply and demand. This will increase the financial burden on low income buyers.

-Third, it will rob consumer purchases from other areas of the economy, weakening an already tepid recovery. We've already seen that happen in the economic data for July.

And finally, we just suffered a massive economic meltdown because the government and the banks were subsidizing home purchases for people who had no long-term financial ability to pay. Now, we're essentially doing the same thing with the auto industry. How long until we see an uptick in auto repossessions? Not long, I think.

Stupid politicians. Oh well, at least Michigan will vote for Obama in 2012...

posted on Aug, 19 2009 @ 04:04 PM
How was it a failure?

They upset people, wasted money, and did what they always do.

Looks to me like they did exactly what they planned to do.

They are not complete idiots are they? It has to be a concerted effort.

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