Evaluating ‘Cash for Clunkers’

“It’s been a fun ride, hasn’t it?” said John Neff in Autoblog. The federal “Cash for Clunkers” program, which “began with a bang” on July 24, has nearly run through its $3 billion pot and will end Monday night at 8 p.m. Eastern time, hinting at a “very busy weekend on dealer lots.” Was it a success? Well, it was a “logistical mess,” but it indisputably did “exactly what it was designed to do: sell cars”—457,476 of them as of Thursday.

“Cue another round of congressional self-congratulation,” said Stephen Stromberg in The Washington Post. But what happens to auto sales next month, or to the industries hurt by the government’s “manipulating” of consumer buying decisions? Sure, Americans like it “when the government buys them cars.” That doesn’t mean it’s a “wise” idea.

Well, we “ran some numbers,” said Eric Evarts in Consumer Reports, and “the jury’s still out” on the economic boost: if Cash for Clunkers directly pushes 700,000 new cars off the lot by Monday, as expected, that’s a modest $20 million stimulus. Fuel-wise, the autos purchased get an average 9.6 mpg more than those they replaced, saving 213 million gallons of gas a year. But “it’s hard to put a price” on maybe the biggest benefit: the newer cars are safer.

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