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Thursday, August 20, 2009

Cash for Clunkers - was it just another scam?

What’s that clunking sound?
Oh. Pay no attention to the man behind the curtain. That’s just the sound of another government program grinding to an ugly halt.

Yep. The latest word is that “Cash for Clunkers” has clunked its’ last clunk.

What a bummer. And it was doing so well! Please consider that before the program we had plenty of not-so-old cars to pass on to our teenagers, so they could smash them and compact them in a manner befitting the old war machines. We had the next generation of speeding tickets and back-seat smooch-fests just sitting in our driveways waiting for that shiny new teen driver’s license.

Now, we have clown cars. And I don’t care how much of a Meatloaf fan you are, Paradise By the Dashboard Light does not happen in a clown car.

So what’s the stats, sports-fans?

Looking at the current data, it isn’t a car wreck we’re looking at here, though. It’s a train wreck. And so, allegedly three billion dollars later, Cash for Clunkers is being put down like the lame horse that it is, on Monday. Transportation Secretary Ray LaHood has said that the program has been a lifeline to the cash-strapped auto industry, but if one looks at that life-preserver a little closer, it’s possible to see it was really made of iron (probably from melted down family cars).

Without so much as a Cheshire cat grin, the government officials which sold this wonderful thing to a gleeful public, has only paid dealers for two-percent of the claims. Four out of every five applications by dealers have been rejected by the 225-person DOT staff reviewing all this paperwork. So 98-percent of the remaining dealers have really just eaten a $4,500 cost per vehicle. Will they get their money back from dear Uncle Sam? Well, I doubt it. I think, dear reader, we have just witnessed another impressive scam, this time perpetrated by Big Brother.

But there’s allegedly an up-side to this, according to administration officials. Why just have a look at their numbers and you’ll feel all warm and safe and gooey inside. According to the administration, auto dealers have made deals worth $1.9 billion and the whole turkey-shoot has added up to the sale of 457,000 vehicles. I wonder how many of those were sold to folks who are about to lose their jobs? Remember the whole housing market collapsing because allegedly houses were sold to people who couldn’t afford it? What about cars? Some of these cost as much as a house. Just saying.

Oh, but here’s the best part...the failure to actually pay that money back will likely cause the closure of more dealerships, costing more jobs across the industry.

How much money was really returned to the dealers? We have to go to the calculator for that one, my friends. If we have a 3 billion dollar program, but only two percent of this has been paid out, what does that work out to? About sixty million dollars or maybe it’s 600 thousand. I really should have my old high school math teacher on speed-dial.

Just goes to show you – I spent too much time in the back-seat of that Mercury Montego by the dashboard lights – and too little time on my math skills. But I believe if she was asked, Mrs. Isles, the math teacher, would say what she always did about complicated mathematics – “Don’t get led down the garden path.”

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