Cash For Clunkers Runs Dry

The US Cash clunkers program is effectively out of money. If you go to the government website and read the fine print in the bill, then it suggests that dealers may not get reimbursed by the government if additional funds are not appropriated by the senate. I’m not sure how dealers are handling this with the customers. If dealers complete the paperwork at the discounted price and then do not get reimbursed, then they could have the funds taken out of their profits. This would weaken the financial stability of the dealer operations.

If the dealers pass through the rebates and/or failure to get reimbursed to the customer, then the customer will take the hit. It won’t matter at that point though - the sale will have already been made. This program looks and sounds a little shady. This is a one-time stimulus measure that is taking money from taxpayers to support cars.

Is this really any different than the subsidy to support the mortgage market? Isn’t this what created the problems in the first place? The government provided money so that people could buy houses. I guess this time around the government is providing money for cars.

What a joke. Talk about a “planned” economy.

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