Cash for Clunkers - Yay or Nay?

I was mad that my 86 Plymouth Caravelle didn't qualify. 4500+gov rebate+3,000 for being an employee of Bank of America (they give you 3,000 toward the purchase of a hybrid) would have been a nice score. Woulda loved a Hybrid on the cheap.

So just like another poster, I say Nay because this program does not benefit me.
 
^lol ouch. Surprising the POS still runs. Sounds like your car would be a perfect candidate for what CARS was "suppose" to do...

Well, if you are planning on doing it you have til Monday.
 
Well my parents did take advantage of the offer and ditched the old, beat up '85 Ford Ranger for $3,500.

Almost didn't make it though as it broke down on the way, they got it towed to a couple blocks from the dealer, put some more coolant in it and were able to drive it on the lot (as required) from there. :D

So that was truly cash for a clunker. :D
 
now that the program is coming to a close...

did anyone get to take advantage of cash for clunkers? what cars did everyone pick up? anyone pull the trigger on a kia forte?
 
cash for clunkers is a ridiculous waste of tax payer dollars on a selective group of individuals. everything decays- why give out billions to "help" people with an old car and create an artificial boost in the automotive industry (transferring US tax dollars to stockholders, and foreign automotive car companies). I know if you took advantage of it then you're loving it (its practically "free" money to you) but its not something the government should subsidize. It's specific catering like this that creates a Democratic party following that says "the government is looking out for me." Obama is a doofus. Policies like this are insane and everyone should be outraged when the deficit is climbing to 9 trillion dollars and all the government is doing is becoming more prodigal with spending like this.

now ignore all this and think of the personal, temporary gain you got from trading in your POS to some kia.
 
[quote name='tivo']cash for clunkers is a ridiculous waste of tax payer dollars on a selective group of individuals. everything decays- why give out billions to "help" people with an old car and create an artificial boost in the automotive industry (transferring US tax dollars to stockholders, and foreign automotive car companies). I know if you took advantage of it then you're loving it (its practically "free" money to you) but its not something the government should subsidize. It's specific catering like this that creates a Democratic party following that says "the government is looking out for me." Obama is a doofus. Policies like this are insane and everyone should be outraged when the deficit is climbing to 9 trillion dollars and all the government is doing is becoming more prodigal with spending like this.
[/QUOTE]

Well you just described why the Democratic party exists in the first place and it's most productive tool they have to stay in power.

Bolded for truth.

It never ceases to amaze me how many people will actually argue that when it's citizens find a new way of robbing the treasury (i.e. robbing each other) it's good for the country.
 
what's a foreign automobile anyway? Most Toyotas and Hondas sold in the US are manufactured in the states...unlike GMs and Fords.

So it is helping American workers, but not American corporations (BFD) and American labor unions (which should have you tickled pink).
 
[quote name='mykevermin']what's a foreign automobile anyway? Most Toyotas and Hondas sold in the US are manufactured in the states...unlike GMs and Fords.

So it is helping American workers, but not American corporations (BFD) and American labor unions (which should have you tickled pink).[/QUOTE]

Exactly, and also the Honda and Toyota dealers and their employees who are Americans.

No program is going to help American cars sell better than foreign cars. They got to start making cars that are as good or better than the foreign brands for that to happen.
 
The more I think about it, the more I think this program was a stupid idea. It's end result is a lot more Americans driving around new cars they had to go into debt for, probably didn't need, and probably shouldn't have bought in the first place; all at the cost of a bigger deficit.

Those that support this program somehow believe individual debt is not only a good idea but worth increasing Federal debt to stimulate.

But, never underestimate the power of doing anything equivalent to throwing free stuff out of the back of the truck in a village. It tends to make everyone very short sighted very fast.
 
[quote name='thrustbucket']The more I think about it, the more I think this program was a stupid idea. It's end result is a lot more Americans driving around new cars they had to go into debt for, probably didn't need, and probably shouldn't have bought in the first place; all at the cost of a bigger deficit.

Those that support this program somehow believe individual debt is not only a good idea but worth increasing Federal debt to stimulate.

But, never underestimate the power of doing anything equivalent to throwing free stuff out of the back of the truck in a village. It tends to make everyone very short sighted very fast.[/QUOTE]

I think you're wrong. Think of the dozens of dollars people will save on gas by investing into an item that loses 15% of its value per year.
 
Or you could look at it as the added money made it possible for people on tight budgets to get rid of their old clunkers and get a new, more reliable car vs. being stuck with a car that has next to no trade in value and high maintenance costs.

I'm sure many people took on debt they probably shouldn't have, but many others just took advantage of the deal to get a good price on a new car they can easily afford with the $4,500 thrown in and now have reliable transportation for the next several years.

Of course, that's independent of whether the program was worth it in terms of adding to the national debt. But it's not like everyone who got a car couldn't really afford the payments. It was a huge help to some who needed a more reliable car than their old clunker. And plenty were people like my parents who are pretty well off and decided to take advantage of the offer and ditch old clunkers they weren't really using anymore anyway.
 
[quote name='dmaul1114']Or you could look at it as the added money made it possible for people on tight budgets to get rid of their old clunkers and get a new, more reliable car vs. being stuck with a car that has next to no trade in value and high maintenance costs.[/QUOTE]

I would say that couldn't happen but my 1997 Sable with a $1200 catalytic converter problem would call me a liar.

[quote name='dmaul1114'] I'm sure many people took on debt they probably shouldn't have, but many others just took advantage of the deal to get a good price on a new car they can easily afford with the $4,500 thrown in and now have reliable transportation for the next several years.[/QUOTE]

Most of that is true, but selling hundreds of thousands of cars at a deep discount also made millions of people with car payments more "underwater" with their new or relatively new car and will probably skew/screw the used car market for years.

[quote name='dmaul1114'] Of course, that's independent of whether the program was worth it in terms of adding to the national debt. But it's not like everyone who got a car couldn't really afford the payments. It was a huge help to some who needed a more reliable car than their old clunker. And plenty were people like my parents who are pretty well off and decided to take advantage of the offer and ditch old clunkers they weren't really using anymore anyway.[/QUOTE]

There was a lot of microeconomic appeal, but not a lot of macroeconomic appeal.
 
[quote name='fatherofcaitlyn']
Most of that is true, but selling hundreds of thousands of cars at a deep discount also made millions of people with car payments more "underwater" with their new or relatively new car and will probably skew/screw the used car market for years.
[/QUOTE]

I don't think it will have much impact on the used car market since most of the crap traded in were old junkers and lower MPG vehicles that don't sell well anyway.

Sure, more people are "underwater", but being in debt isn't a big deal as long as you can easily make your payments. It's only a problem for people who spread themselves too thin and end up living paycheck to paycheck and not accruing any savings, or worse fall behind on payments etc.

Time will tell how many people got into car payments they couldn't handle if we see an big spike in car repossessions etc.
 
I actually don't know anyone that doesn't live paycheck to paycheck. It's the American way.

I think what bothers me the most about the whole thing is that it's looked at as 'free money' or 'huge discounts'. Nobody stops to think about where that money came from or how the discount happened. It's not free, it's welfare. Sure the government can print money, but they ultimately make us pay for it when they do.

I think the huge problem in this country is that so many of it's citizens and elected officials really do look at the gov like a money tree, and this program epitomizes that.
 
[quote name='thrustbucket']I actually don't know anyone that doesn't live paycheck to paycheck. It's the American way.
[/QUOTE]

I don't. And know many people who don't--though pretty much everyone one in my circle of friends/acquaintances has advance degrees and make pretty decent salaries--to that may be a class thing. Not that there aren't plenty of people who make good salaries and still live paycheck to paycheck, as I know several of those too. Just that I'm sure that in lower income brackets you'll have a higher percentage living paycheck to paycheck.

I've just never been materialistic and felt a need to have an expensive car, bigger house/apartment than I needed, expensive furniture etc. I buy stuff I don't need like everyone else, but I don't go in debt for it. The only things worth going in debt for are necessities like housing and a car IMO. Or student loans as long as you're getting a degree you truly need for the career you want. No reason to go into debt for TVs, video games, vacations, clothing etc. etc. Those things are luxuries you only buy when you have disposable income.

I'm not rolling in cash as I'm just starting my real career after finishing grad school finally this summer, but I've always had at least modest savings and a decent nest egg saved up to fall back on in rainy days, even through college and grad school.

It's just the way I was raised. My parents were raised poor, and struggled themselves until their mid 30s, from where on they were solidly in the middle class--but still very thrifty with their money and have never had financial issues since then.
 
[quote name='thrustbucket']I actually don't know anyone that doesn't live paycheck to paycheck. It's the American way.[/QUOTE]

You should meet me. I have a tremendous amount of consumer debt and monthly expenses, but I run a slight profit every month.
 
Wait a minute. The government actually did something to help Americans spend less on foreign oil and you guys just bitch because it's another form of welfare? I guess you guys love sucking Saudi and Venezuelan cock.

Are you guys also pissed that there's a tax credit for upgrading your windows and/or furnace? All those lost tax dollars will just lead to a higher deficit.

It seems like you guys just want programs that benefit you personally. You want everything to be personally tailored to your personal needs and fuck the rest of the poor schmucks. Hell, they don't pay taxes so who gives a shit right?

Again, if half if you fucks picked up a rifle instead of a keyboard, I'd be more inclined to give two shits about your opinions.
 
[quote name='depascal22']Wait a minute. The government actually did something to help Americans spend less on foreign oil and you guys just bitch because it's another form of welfare? I guess you guys love sucking Saudi and Venezuelan cock.[/QUOTE]
Do a few people get to spend less on gas? Yes. Who benefits? The banks. They get thousands of new creditors, some of whom probably shouldn't have bought a new car, but did because of this program.

Are you guys also pissed that there's a tax credit for upgrading your windows and/or furnace? All those lost tax dollars will just lead to a higher deficit.
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Yeah.
It seems like you guys just want programs that benefit you personally.
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No.
You want everything to be personally tailored to your personal needs and fuck the rest of the poor schmucks. Hell, they don't pay taxes so who gives a shit right?
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No. Plus, I don't think many poor people can afford a car, so.........
Again, if half if you fucks picked up a rifle instead of a keyboard, I'd be more inclined to give two shits about your opinions.
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I don't know what this is supposed to mean, but I don't think it's good.

Also, with these billions spent for cash for clunkers, let's ask where the money came from. Not the treasury, there's nothing there. Where did the money come from then? The printing press. We will get to pay interest on it, plus the hidden tax of inflation, for printing a couple billion. You can't just keep printing money and expect it to solve your problems.
 
[quote name='depascal22']Again, if half if you fucks picked up a rifle instead of a keyboard, I'd be more inclined to give two shits about your opinions.[/QUOTE]

Yeah, right. Then, you get people complaining because you dare to show up in the same town as the President with your guns.

Amazing day, when someone tells you to use force instead of words - and thinks they're all justified for doing so.
 
[quote name='depascal22']It seems like you guys just want programs that benefit you personally.[/QUOTE]

As I said before... My 20+ yr. old "cluncker" gets too good of a gas mileage so I couldn't even take advantage of this program if I wanted to even then I'd probably have to go with a Prius and add car payments. So... yeah, kinda wondering how it "benefits me personally".
 
Huh? His point was it didn't benefit you (and others complaining about it), and that you probably wouldn't if it did benefit you.

If your car had qualified, and you really planned on buying Prius anyway, it would have benefited you by giving you decent trade in value for a 20+ year old car that had none, and thus lowering your payments.

It benefited people who needed a new car by lowering their payments. It benefited dealers by helping them move cars during a recession. And it gets some lower mileage cars off the road--though the MPG required for thew new car should have been a good deal higher.
 
[quote name='dmaul1114']Huh? His point was it didn't benefit you (and others complaining about it), and that you probably wouldn't if it did benefit you.

If your car had qualified, and you really planned on buying Prius anyway, it would have benefited you by giving you decent trade in value for a 20+ year old car that had none, and thus lowering your payments.

It benefited people who needed a new car by lowering their payments. It benefited dealers by helping them move cars during a recession. And it gets some lower mileage cars off the road--though the MPG required for thew new car should have been a good deal higher.[/QUOTE]

What people don't seem to realize, is that while this program may look good on paper, (much like the various stimulus bills) it really isn't a good thing. The money to pay for these programs is printed. That means that each one of these programs is debasing the dollar, and causing everything to rise in price, as a result of inflation. If we keep doing this, eventually countries like China, Russia, and Japan will dump the dollar. Then we will be screwed.
 
[quote name='fatherofcaitlyn']You should meet me. I have a tremendous amount of consumer debt and monthly expenses, but I run a slight profit every month.[/QUOTE]

Please share your secret.
 
There's no real secret to it. Just spend less money than you make.

Anyone on this site has to have some disposable income, or they wouldn't be shopping for luxuries like games.

Make a detailed budget of how much you bring in, fixed expenses (bills, food, gas) and see how much is left over. Then give yourself a small "allowance" of spending money to blow on whatever and save the rest. If you don't have much left over, then nix the allowance, cut out discretionary spending and save up a nest egg.

I'm mostly focused on saving now, since I couldn't build up that large of a nest egg through college and grad school (just a few thousand) so I'm really limiting my discretionary spending. Helps that I'm busy as balls and don't have much free time right now anyway.
 
[quote name='dmaul1114']There's no real secret to it. Just spend less money than you make.

Anyone on this site has to have some disposable income, or they wouldn't be shopping for luxuries like games.

Make a detailed budget of how much you bring in, fixed expenses (bills, food, gas) and see how much is left over. Then give yourself a small "allowance" of spending money to blow on whatever and save the rest. If you don't have much left over, then nix the allowance, cut out discretionary spending and save up a nest egg.

I'm mostly focused on saving now, since I couldn't build up that large of a nest egg through college and grad school (just a few thousand) so I'm really limiting my discretionary spending. Helps that I'm busy as balls and don't have much free time right now anyway.[/QUOTE]

How dare you tell people my secret? I could have sold him a book.

...

Seriously, write down your expenses and try to pay them monthly. If you're making $1000 a month and spending $1200 a month, you shouldn't be surprised by going into debt.

I have a ridiculous amount of debt by getting a second degree and spawning two offspring coupled with a spouse unwillingly to make modest lifestyle choices, but I'm still profitable by attempting to stick to a budget.
 
Bah, I have done/already do that stuff.

I don't go into debt more each month. I just pay it off rather slowly and don't save anything. Granted, that's mostly because of lifestyle choices I refuse to give up. If I wanted to cut out going out to lunch every day, cable bill, internet bill, blockbuster bill, etc. I'd certainly be able to save money. But then again, if I did those things, I'd have nothing to live for and work for - as I am resigned to believing (after dozens of jobs in several areas) that looking forward to working any job is a fantasy that doesn't exist (for me) - so life's rewards are mostly (unfortunately) in consumerism.

It all goes back to when I was a teenager living at home. I started working full time at 15. I would eventually quit, because I saw it as pointless. My parents didn't like that. I eventually realized that if I got a credit card/car that I had to pay off - it kept me working and gave me a reason to work. In other words, working to save money has always seemed extremely contradictory to me.
 
Fair enough, but no need to act like everyone is like you and living paycheck to paycheck. Especially when you're living that way by choice.

I do feel bad for you, and feel lucky that I enjoy my job most of the time, make decent money so I have some disposable income while still doing some saving, and don't have tremendous amounts of debt (and no high interest debts). Plus having a good retirement plan where I pay in 5% each paycheck and my employer 9%.

But I guess it's not lucky so much as taking time to find out what I care about and enjoy doing and not rushing into a career at a young age. And it was a lot of hard work to get the degrees to get the job.

But hopefully someday you find a job you at least somewhat enjoy. Life is pretty miserable when you dread getting up and going to work everyday.
 
[quote name='thrustbucket']I don't go into debt more each month. I just pay it off rather slowly and don't save anything. Granted, that's mostly because of lifestyle choices I refuse to give up. If I wanted to cut out going out to lunch every day, cable bill, internet bill, blockbuster bill, etc. I'd certainly be able to save money. But then again, if I did those things, I'd have nothing to live for and work for...[/QUOTE]
I like buying things too, but financial security (in lieu of all else) is something worth working towards imo.

It's a nice feeling knowing that I could lose my job tomorrow and survive comfortably for the next five months or so without having to accept unemployment benefits.
 
Yeah, that's really key.

And it doesn't mean doing nothing but working and hating life. One can find things to enjoy that don't cost a lot of money or cost less. Have dinner and a movie in with the girlfriend rather than a night out on the town. Pack a healthy lunch and take a break and eat out side rather than going out for lunch. Take up some hobbies that don't cost anything like hiking, or hobbies with a one time cost like learning an instrument etc.
 
From Get Rich Slowly:

But, not everyone is buying into the “enormously successful” label. A September article published by AOL Autos brings up some interesting facts about the CARS program:

* An August survey concludes that 17% of Cash for Clunker participates indicate they feel buyer’s remorse over their purchases. This is nearly double the traditional rate of 6-8%.

* While the average MPG of the vehicles in the program rose from 16.3 mpg to 24.8 mpg (a clear success), it’s estimated that individuals will be driving even more due to possessing a newer car. This could actually result in more fuel consumption overall.

* The program takes from over 300+ million taxpayers and rewards only a small group of 700,000.

And AOL Autos isn’t alone in the criticism of the program. Just a few weeks ago, Edmunds.com issued a press release stating that taxpayers actually ended up paying $24,000 per vehicle sold through the program.

If Edmunds’ reasoning seems a little too simplistic (I’ll admit it does for me), there’s a more-detailed study by University of Delaware, which concludes that the cost of the program exceeded the benefits by approximately $2000 per vehicle.

Studies, press releases, and government websites aside, I’m worried that these programs encourage people to buy larger ticket items during a time that may be very hazardous to their individual financial health.

The last thing most people need to be doing in a down economy is adding thousands of dollars in new consumer debt. And in the CARS example, the majority of this debt will be on a consistently depreciating asset!

The program is best suited for a financially responsible individual, who was already in the market for an upgraded automobile purchase. But it’s obvious that the majority of the transactions didn’t involve this type of situation. For that reason alone, I have a hard time considering the program a success.
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It was clear from the start it was a fail. Also, can't wait to see the numbers about how many get repoed do to they didn't actually have the funds or lost their jobs and couldn't afford to continue to pay it.

As for me... I guess I'm having a bit of remorse I didn't try to get on this deal since my 20yr old clunker has been having a lot of problems. Still runs though.
 
lol, I think Toyota's gas pedal fiasco is negating the profits they were reaping while this program was going on at this point. Especially now that Prius people are complaining about their brakes.

Sooo... glad my car is "manual". Don't make em like they used to I guess...
 
Three years later...

In 2009, the Car Allowance Rebates System (CARS), fondly known as the Cash for Clunkers program, was put into effect to take older, less efficient vehicles off the road and replace them with vehicles that get better gas mileage and release fewer tailpipe emissions. The program was mainly designed to provide a long-term economic boost to U.S car companies. But what was actually accomplished by the program? Unfortunately, CARS didn’t account for the total lifecycle of the scrapped vehicles, or the environmental cost of manufacturing the new vehicles that were sold. When the incentive was offered, automakers sold nearly 690,000 vehicles in cities with lots of used cars, only to see sales plummet again once the program expired.
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I would love to track down something showing the number of folks who traded up and still have the new car.
 
[quote name='nasum']incentives motivate behaviour, who knew?[/QUOTE]

And what, exactly, is the behavior that we were trying to incentivize here?
 
[quote name='UncleBob']Three years later...

I would love to track down something showing the number of folks who traded up and still have the new car.[/QUOTE]

That would be a pointless poll, a large majority would still be on the road. The program was only a little over 3 years ago. How many people do you know that buy a brand new vehicle every 3 years? Typically unless you lease a car or are loaded you are probably not buying a new one every 3 years and neither of the vast majority of those groups of people weren't involved in this program.

Edit: Unless someone of course defaults on the payments and the new car gets repo'd or something then it gets taken away, but that's an issue of purchasing outside your means not exactly the fault of anyone else...
 
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Cash for Clunkers increased used car prices which most likely hurt as many people as this program helped....

Not to mention, I wonder if there was a rise in repos because of people taking the bait and trading their perfectly good used car for a new car that they didn't necessarily need and probably didn't fit their budget.
 
[quote name='Knoell']Cash for Clunkers increased used car prices which most likely hurt as many people as this program helped....

Not to mention, I wonder if there was a rise in repos because of people taking the bait and trading their perfectly good used car for a new car that they didn't necessarily need and probably didn't fit their budget.[/QUOTE]

Increased prices slightly. Used car prices had already started to tick up due to people buying more fuel efficient used cars on their own. Conversely in the near future it will also slightly bring used car prices down because the average owner keeps a new vehicle for about 5 & 1/2 years.

The repo thing is an issue of personal economics. You can't fault the program for people's inability to properly manage finances. It was a discount program and goes back to the same reasoning that just because something maybe a good deal or a good sale price doesn't mean you can always afford it.

Edit: After searching real quick it would appear at least in the 2 years after the program that that repos are actually at a low number at least according to Trans-Union. Though it is likely due to lenders being more stingy with giving out auto loans than before more than anything else.

http://newsroom.transunion.com/pres...loan-delinquencies-decli-0790713#.UO2jCKC9Rbl

Edit2: Also I don't want it to seem like I thought this program has a great idea, it had a couple small advantages but also fairly large flaws.
 
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