The perfect stimulation may not be perfect after all . . .

According to a survey of new-vehicle buyers who participated in the recent Cash for Clunkers (C4C) program, more than 17 percent now harbor “some” doubt or “serious” doubt about letting a government subsidy convince them to go further into debt. CNW Research of Bandon, Oregon, a firm specializing in automotive marketing research, conducted the survey in late August.

Buyer’s remorse is not a new phenomenon as anyone who ever opened an envelope containing Visa’s autopsy of that Spring Break trip to Margaritaville can tell you. The significant revelation of the CNW survey, however, is that under normal conditions only 6 to 8 percent of new-car buyers suffer the shouldn’t-a-done-that syndrome.

That means that over twice as many C4C participants as normal buyers are worried about the negative impact a brand spanking new payment book with $275 printed on each of its 72 pages might have on rent and Hamburger Helper expenditures. (The actual C4C numbers were an average loan length of 49 months and an average payment of $317.) No wonder. I’m surprised that the survey didn’t find half of the C4C spenders sitting up nights watching Suze Orman and Dave Ramsey re-runs.

If you are someone other than the owner of a Treasury Department printing press, you might be allowed a mild case of regret over adding $20,000 or $30,000 to your household debt during what can be called a time of economic uncertainty.

Three revealing line items in a separate CNW survey noted that the drain on the family coffers would be offset by reducing the pay-down of credit card debt, deferring home improvement and removing money from non-targeted savings. About one-fifth of buyers surveyed cited each of these categories as the number one source of their car payment bucks.

Leaving aside the prospects of leaking roofs or empty savings accounts, just consider the act of slowing up on reducing those credit card balances on which you are paying 19 percent interest or worse. Thinking about that in the cold light of early dawn could do more than induce buyer’s remorse; in a clear-thinking head of household able to do basic arithmetic, it could result in thoughts of panic.

When the government set out to stimulate auto sales, do we think its minions intended to pile more debt on the American public? And if so, were they aware that our country’s revolving consumer debt, according to the U.S. Congress’s Joint Economic Committee, has reached a staggering $950 billion, almost all of which is credit card debt and does not include mortgages?

Not Saving Much Fuel

Call me a naysayer, but I do not think adding individual household debt will lead us out of the financial wilderness. Nor will it, as applied in the C4C experiment, do much to lessen our dependence on fossil fuels. Quicker than you can say, “Holy statistics, Mr. Wizard,” the numbers nerds ascertained that the new vehicles sold under C4C will use more—not less—fuel than the beaters that were turned in and destroyed.

How can that be? Think of it on a personal level. Suppose you had a 10-year-old particulate belcher that, as the euphemism goes, needed work. Even if you lived in an Orlando suburb, you’d still be less than excited at the idea of piling the kids into it and lighting out for Disney World. But that new Malibu that gets a hell of a lot better mileage is a different kettle of green. You trust it; it’s economical; you drive it more. A lot more, according to another piece of research.

CNW surveyed drivers involved in the purchase of the first 239,000 C4C vehicles. The average intended annual mileage was 10,894, up from the actual clunker mileage of 6,162. For those of you without a calculator falling readily to hand, that’s nearly double.

But what about that miles-per-gallon improvement we were promised? Well, we got it. The average fuel economy reported by C4C buyers rose from 16.3 mpg for Old Clunker to 24.8 for the new wheels. A monster step in the right direction. Add to that the over-90-percent reduction in tailpipe excretions and we’re still looking good, right?

Not as good as we might've thought... The new car, because it’s new and fun and green and clean and smells good, will be given some 61 additional gallons each year by its grateful owner. For those first 239,000 C4C vehicles, that’s 14.6 million gallons that the clunkers wouldn’t have gobbled up. The approximately 700,000 total vehicles moved under the program will therefore use an additional 42 million gallons of fuel annually during the first years of ownership.

One can, and we can be sure that the government will, argue that the program at least generated showroom traffic, sold cars and helped dealers reduce inventory. Cars for Clunkers did all that, and when the noise abated, most of the critics had to content themselves with claiming that the program did little more than pull a large number of sales forward and get some old cars off the road, many of which were already on their way to the crusher.

Other critics groused that Cash for Clunkers took $2.8 billion from the general roster of 300 million citizens and handed it tax-free to a small group of 700,000 citizens.

To those negative conclusions I would add my own concerns about giving the consumer incentive to ladle more debt into an already reeking punchbowl. Program proponents point with pride to the disproportionate number of young buyers who bought C4C vehicles. I worry about their already disproportionate debt.

I admit that from the outset I was suspicious of the scheme. Its very name, the Car Allowance Rebate System, occasioned seditious thoughts. Exactly how many fresh-faced little bureaucrats did it take to devise such an overwhelmingly clever acronym (CARS)? Why couldn’t they have just called it Cash for Clunkers like the rest of us? Or used the ubiquitous C4C, and alphanumeric doubtless created by the thumbs of a creative texter within minutes of the program’s announcement?

Better still, why didn’t they call it P2P, as in robbing Peter to pay Paul...?

An article I got off AOL, that deserved wider dissemination...

quote:

The perfect stimulation may not be perfect after all . .

And there you have it:

The Rock upon which the Contrarian Philosophy is built.

Its roots are deep--think of the ridicule faced by anyone advocating checking tire pressure and installing tune-up parts to save 2 miles per gallon--doesn't 'fix' the problem. Pay no attention to the concept of chipping away at a problem too large and complex to be solved in one fell swoop. A ten percent improvement isn't a solution, right?

Never mind that a Clunker--some might call them Hayburners--spews not just emissions, but coolant, oil, brake and transmission fluids at a financially and environmentally significant rate. Pity the poor tow truck drivers and mechanics suffering because the car starts on cold days and actually gets you (and your children) where you're going, safe and warm. Feel sorry for the commmuters who face a few less bottlenecks caused by those venerable pieces of 'reliable transportation' breaking down on the freeway...again.

Those poor, poor, Republican dealership owners--92 percent in another thread here about the accusation that dealerships were selected to be 'closed' based on the history of political contributions of the owners. If they weren't just RINOs, they'd have turned those sheeple away for their own good--**** a bunch of selling cars.

Imagine a society where Suzy Orman doesn't get to decide who replaces the POS 20 year old Buick instead of making extra payments on the mortgage or paying down the credit cards...and the Contrarians still get to blame the government for making that decision.

Let's throw in some irony for good measure--see if you can find any in this screen capture from the original AOL article...

http://autos.aol.com/article/cash-for-clunkers-greenwash

See this Video .. Engine Disabling of a NICE Volvo!! "http://hotair.com/archives/2009/08/01/just-a-reminder-cash-for-clunkers-requires-destroying-perfectly-usable-cars/" FROM HotAir. TITLE: "Just a reminder..Cash For Clinkers Requires DESTROYING Perfectly USABLE Cars" **Not all were ""CLUNKERS"" as evidenced by the destruction of this Volvo*** Watch the Video please! Thank You.....signed Agent 99

I just signed the paper work and traded in my wife's 2007 Camry XLE Clunker for a 2010 Camry Hybrid. I got the Hybrid for the same price as the 2007 Camry. Talk about a sweet deal! And I made it happen simply because I am not stupid and have good credit. Now I'll tell you all something else. Last year my 2007 Tundra had a trade in value for $20,000. If I trade it in this year for a 2010 Tundra the dealership will allow me $26,000 for it. I told him to stuff it that I will drive the truck for one more year and trade it in on a 2011. Then as soon as Obama is out of office I am going up to Wilmington NC and buy a new 19' Boston Whaler.

Seeing that Volvo fried made me sad. The fact that it made noises like a dying animal didn’t help either. The Volvo is just ONE of Many that were NOT "Clunkers"

quote:

Originally posted by Agent991:
Seeing that Volvo fried made me sad. The fact that it made noises like a dying animal didn’t help either. The Volvo is just ONE of Many that were NOT "Clunkers"

And I’m sure that big bad Obama held a gun to the poor Volvo owners head and threatened to kill his kids if he didn’t trade in the car.

"http://www.youtube.com/watch?v=waj2KrKTYzo" Volvo Death! Sad! YouTube has other Video.. Search "Cash for clunkers Volvo" on YouTube and OTHER Videos will show up including OTHER ""NON-'CLUNKERS'"

This post brought to you by the proud makers of...

BRAWNDO!!! - The Thirst Mutilator. It's got what Plants Crave!




Devolve, America! It's your only chance!

Instead of cars that get better gas mileage, we should be building cars that get even worse gas mileage! That way, we'll save Americans money by only offering them cars they can't afford to drive.

It's genius, I tells ya! GENIUS!!!

No more dependency on foreign oil because Americans will no longer be able to afford foreign oil... OR ANY OIL.

Welcome to the future, people.

BP Announces Giant Oil Discovery in The Gulf Of Mexico "http://www.bp.com/genericarticle.do?categoryId=2012968&contentId=7055818" We Use Foreign Oil but we don't HAVE to! Drill HERE!! (Wind can not Power Planes) If so, then it must be ''light-years'' away) Planes like AF One and our jets..{IN THE MEANTIME..I'm Trying to locate the NO DRILL ZONES right off the US Coast.}

Aw...Hell, The_Bonehead, Mea Culpa

I had forgotten that only good news of the anointed one, and his misadventures, is what you and Yoopie want to read about...

That evil AOL article highlighting that maybe, just maybe, the C4C Program wasn't well thought out, would possibly irritate your and Yoopie's sensitivities...

No, Elliott...the fault is mine.

I must have thought this was point/counterpoint.

Can you possibly forgive me for not rolling over and kissing up to adopting the contrarian position as my own?

The original reply was childish on my part---I'm working on it.

Hey does cash for clunkers include politicians... I've be willing to pitch a few bucks to get rid of the baggage in DC...

quote:

t has been nearly a month since the car-buying frenzy of the Cash for Clunkers program ended, and many area auto dealers are longing for the good old days of July and August.

Like consumers nationwide, Massachusetts residents rushed to take advantage of the federal voucher program, which offered them up to $4,500 on old gas-guzzlers to be put toward the purchase of new, more fuel-efficient vehicles. About $65 million worth of vouchers were handed out statewide during the monthlong program that ended Aug. 24.

But once the federal money dried up, so did the sales rally. Now, customers at dealerships like Silko Honda in Raynham are few and far between, and inventory is once again accumulating.

Manager Adam Silverleib said business was “pretty intense’’ as a result of the federal stimulus program, with the dealership hustling to accommodate customers and handle the piles of paperwork required for them to receive reimbursement on vouchers. “Now we’re kind of back to where we were in the spring,’’ he said.

In an attempt to draw customers back to showrooms, some dealers are offering new incentives, albeit none as enticing as a $4,500 for a rusting junker. Silko, for example, is promoting 2.9 percent financing on new Accords, along with other deals on its website.

Nationwide, customers snatched up 700,000 new cars, most of them foreign-made, and the government ended up paying out nearly $3 billion toward the purchases. But from the start, analysts predicted that Cash for Clunkers would not boost sales for the year. September’s sales swoon seems to be making their case. Car sales are usually slow after Labor Day, but because of the recession consumers this year are especially reluctant to say yes to major purchases. To make matters worse for dealers, most are still waiting for voucher reimbursements.

“It was probably, in the end, a complete waste of taxpayer money,’’ said John Wolkonowicz, a senior auto analyst at IHS Global Insight, Lexington forecasting firm. “The dealers, who were supposed to be the primary beneficiaries, many were forced into cash flow problems because the government didn’t pay them in a timely fashion.’’

From the outset, there were problems with the Car Allowance Rebate System. It was supposed to start July 1 but was delayed until July 24. The rules were complicated, and the list of qualifying vehicles and other requirements changed repeatedly. And in addition to the formidable paperwork, the government website set up to process the deals kept crashing, creating a backlog.

-http://www.boston.com/business/articles/2009/09/19/car_showrooms_quiet_after_clunkers_clamor_ends/

Saturn - one of the better cars on the road - - CLUNK!!

300 Dealerships 15000 jobs CLUNK!!