Motormouth Online

C.A.R.S. aka "cash for clunkers," finally created a buzz among auto buyers. The success is that they burned through a billion dollars in less than a week. Did the government actually get this stimulus package right?

Well yes, but not without typical foibles for any program rushed through the halls of Congress.

Before we get to the obstacles, let's look at the goals. The first goal was to provide economic stimulus to an American industry deep in crisis. Cars sales are down by over one third. Two of the "Big Three" required a hundred billion dollars of taxpayer money just to survive a hasty bankruptcy, leaving stockholders and debtors holding the bag. Thousands of shattered lives, unemployed in their middle age created a ripple throughout associated industries. This failure of one of the last vestige of American manufacturing has been catastrophic to the economy.

But the same legislators who were so free to fund semi-criminally negligent corporate enterprises required much more to stimulate individual consumers. After giving a hundred billion dollars directly to corporate fat cats, sixteen billion was proposed to initially fund the C.A.R.S. program. This program was then gutted by three quarters to only four billion. Finally, a mere one billion dollars was approved along with very high expectations. In addition to the goal of stimulating economic activity, an additional goal of removing gas-guzzling, air polluting older vehicles, seemed like a good idea. Replacing these vehicles with more efficient, environmentally cleaner cars would stimulate the economy and produce true "trickle-up" job creation.

The obstacles were great, fraught with opportunities for waste and fraud. The program was rushed, with over 136 pages of published rules for dealer compliance . Dealers had to apply to be certified, allowing direct access to computers and bank accounts for compliance and electronic fund transfers. No government agency was equipped for individual transactions, so Citigroup was tapped to administer funds. Over thirty pages of documents had to be scanned and transmitted for approval of each individual deal. Citigroup computers crashed under the onslaught of demands. Dealers were required to verify that clunkers could never return to the road. A solution of sodium silicate must destroy the engine of each "clunker" before transportation to certified recyclers. Determining the amount of the rebate requires strict adherences to published EPA Mileage estimates for both the clunker as well as the new vehicle.

Yet in spite of these obstacles, there remains a pent up demand for new cars. The success of the CARS program was surprising. In just three days, consumers turned in over a quarter million clunkers for new fuel-efficient cars. An emergency extension of two billion dollars is making its way through the halls of Congress. Still far from the sixteen billion dollars requested or even the four billion dollars initially approved, the value of this program is undeniable.

Just a few years ago, we produced and sold almost 17 million vehicles in the United States. After the last two years of steady decline, we will be lucky to hit 10 million this year. People want and need new cars, but many are reluctant to enter into a five-year finance contract for a replacement vehicle when they are afraid their job will end this year. What we need is optimism. Consumer confidence depends on a belief that the economy will recover.

Frankly, I'm getting tired of political obstructionists and their corporate media mouthpieces. It is one thing to be the loyal opposition and provide a check and balance for one party rule. Yet it is another to want and work for failure. Recently a poll revealed that over half of self-identified Republicans expressed doubts that President Barrack Obama was even an American! Issues like this, work to divide and stall progress. It is not only useless, it is in direct opposition to the interests of the United States. Texas Governor Perry recently even spoke of his state's possible succession from the Union. It's time for patriotism, not bad mouthing our government. If there is any time we must get behind our President, it is now. I am as skeptical of government as any, but we must realize that we have a government of the people, for the people and by the people. Being optimistic that government can play a role to help us solve problems is still patriotic. There are too many people more concerned about military might rather than economic might. The possibility of any foreign power doing real military damage to the United States is virtually nil. However, our economic collapse and subjection by foreign powers is much more realistic. It's time to embrace recovery.

So does "Cash for Clunkers Work? I believe the answer is a qualified, yes but we need more.