Was Cash For Clunkers Good For The Economy?

Aug 26, 09 Was Cash For Clunkers Good For The Economy?
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Cash For Clunkers was a federal program that subsidized car down-payments for qualified citizens.  In order to qualify, your old car must fall below certain emission standards; and you must agree to purchase a new, greener model.  Customers receive vouchers worth between $3500 and $4500 dollars.  Since its initial inception, over 500,000 cars have been sold.

The program was so successful, that Congress approved more money, which brought the program’s total to three-billion dollars to continue funding it.  Due to the brisk pace of sales, Congress was forced to end the program on August 24th.  Many last minute car buyers were turned away because overworked dealers would be unable to make the paperwork deadline.

While this could be considered an example of a successful, government implemented plan, the Cash For Clunkers program was not without detractors.  Calling the program a “government handout” and “bloated, and wasteful”, many conservatives believe the program was another form of ineffectual governing by the Obama administration.  However, the popularity of the program belies the criticism.

Exchanging gas guzzling, outmoded cars for newer fuel-efficient models, providing a temporary stimulus to a lagging economy, and saving dozens of struggling dealerships from going out of business, would normally be met with waves of effusive praise.

However, there are some who have a financial and political stake in proving that the government is incapable of successfully administering a program.  While the Cash For Clunkers program is not the solution to all of our economic woes, it does demonstrate that there is popular support for effective and innovative, government led solutions to some of our common problems.

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