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The Spectacle Blog
I just read today that the cars traded in for the Cash for Clunkers program are rendered unusable by running liquid glass through the engines.
Has anyone considered the impact of this on the poor? What has happened is that a huge number of low cost cars are being removed from the market. These are cars low income earners would ordinarily drive or teenagers would buy them who need to get to school or work.
What happens when we radically reduce the supply of a particular good? If there are no good substitutes, then the price goes up. In effect, this is a tax on the lower end of the market.
"Progressive" policy isn't always good for the poor.
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More Blog Posts by Hunter Baker
http://spectator.org/blog/2009/08/04/cash-for-clunkers-and-the-poor
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lorna| 8.4.09 @ 4:17PM
I had my car totaled by a driver using a cell phone and now cannot find a replacement because I cannot afford payments on social security and my investments are down because of the depression so I cannot use much of that money. So, I'm car less. Does reduce my tax bill, I guess. I'm looking in the $3500 to $4500 bracket but cash for clunkers means that cars in my price range are being destroyed. Thank you Mr. President and Madame Speaker.
lorna| 8.4.09 @ 4:17PM
I had my car totaled by a driver using a cell phone and now cannot find a replacement because I cannot afford payments on social security and my investments are down because of the depression so I cannot use much of that money. So, I'm car less. Does reduce my tax bill, I guess. I'm looking in the $3500 to $4500 bracket but cash for clunkers means that cars in my price range are being destroyed. Thank you Mr. President and Madame Speaker.
ncatty| 8.4.09 @ 4:33PM
I have an electric toaster given to my parents as a wedding gift in 1946. It still works but its definitely a clunker, and probably uses too much electricity. Where is my subsidy to get a new one?
Curtice Mang| 8.4.09 @ 4:35PM
Cash for Clunkers? Who knew? I always thougth Cash for Clunkers referred to contributions made to the Democratic Congressional Campaign Commitee.
Warrior| 8.4.09 @ 4:38PM
Mr. Baker:
You also miss out on another sector. Many of these engines and vehicles would go to scrap yards, where you could go and find a used part cheaply, remove it and install in on your vehicle to keep it running. These lots will also suffer along with the people who kept their "clunkers" running with these parts.
Whenever one sector gets helped out another will suffer. The government should never be allowed to make one sector a winner at the cost of others.
Smitty| 8.4.09 @ 4:52PM
ncatty and CMang--lol! Conservative wit on display today!! Thanks for the laughs.