Re: The 2nd Term - Round 1 - Diving for Dollars
I must have been the only person to have benefited. The car I have today was bought through that program.
One can benefit personally while lamenting the unfortunate side-effects too. This was one of the most absurd government programs I've ever seen, and I've lived long enough now to have seen plenty of nonsense!
We traded in a 1998 Explorer for a 2010 Corolla under that program too, while ridiculing the program the entire time. What a tremendous waste it was all around!
> it did nothing to increase car sales, it merely moved car sales forward in time. All the cars traded in during the program's run would eventually have been traded in or junked anyway. As soon as the program ended, car sales immediately declined dramatically.
> it removed a tremendously valuable asset from purchase by lower income people: usually a trade-in is reconditioned and sold; none of these trade-ins were resold. So that program actually
hurt lower income people by removing all those potential used cars from the market, driving
up prices for used cars.
> as the article noted, it also hurt the used parts market by not allowing dealers to sell parts after 180 days. So people who repair cars also lost out on the ability to use all those spare parts.
It was a government give-away pure and simple. "Free" money if you were lucky. It was really funny for us because of Obama's "screw the rich" rhetoric, while in order to qualify for the program you had to be able to afford a new car even after the trade.
We took a car with a resale value of maybe $1,850 at most, that needed substantial repairs to boot, and instead got $4,000 toward a new car. On top of that, dealers were bidding against each other to move inventory which means we got a lower purchase price than otherwise as well.
Meanwhile, economy-wide, most of the vehicles purchased were made by Honda and Toyota, probably manufactured in right-to-work states, while the program was touted as a way to help the US auto industry. Fiasco.
Do you think they've learned anything in the meantime?