Cash For Clunkers: Government Math

I guess I must be on the wrong page on this "clunker" stuff...

A vehicle at 15 mpg and 12,000 miles per year uses 800 gallons a year of gasoline. A vehicle at 25 mpg and 12,000 miles per year uses 480 gallons a year.

So, the average clunker transaction will reduce US gasoline consumption by 320 gallons per year. They claim 700,000 vehicles – so that's 224 million gallons per year.

That equates to a bit over 5 million barrels of oil…
5 million barrels of oil is about ¼ of one day's US consumption. And 5 million barrels of oil costs about $350 million dollars at $75 per bbl.

So, we all just spent $3 billion...to save $350 million.

Hmmmmmmmmm. How good a deal was that?
But, I'm thinking that they’ll probably do a great job with health care, though!

* - I got this in an e-mail. Origin unknown

Surprise! Government Free Money Program is a Success!!

Some guy named Dave Johnson over at Huff the Magic PuffPo aims a tired, intellectually flaccid finger at the eye of conservatives who are criticizing the Cash for Clunkers program.

Government can work, and the "Cash for Clunkers" program proved it. So, naturally, conservatives have to hate on it. The "Cash for Clunkers" turned out to be one of the most successful government programs in some time.

This was my favorite part:

What could be wrong with that?

Well, if you are a conservative, plenty is wrong with that. First of all, it makes government look good -- and conservatives just hate government. Government is those people who get in the way and tell companies they can't pour toxins into our rivers. Government is those people who show up and ask big companies to share what they make -- after building the roads and courts and schools that enabled them to do so well. That goes against everything conservatives stand for: dirty rivers, big corporations doing and taking anything they want for free, etc.

Yeah, we conservatives just love toxic rivers--makes the fishing so much better! And I guess he hasn't visited opensecrets.org recently, or he would know that even the hated pharmaceuticals industry gives more to the Dems than the Repubs. Can't let the facts get in the way of good lefty rant...

Here's my comment to his post, which I'm surprised made it through the censors:

A program that gives money away is a success. And you're surprised?

Let's go one better. Let's break every window in the country to stimulate glass manufacturers and construction business. We could kick off a really big construction boom by burning all our houses down.

Why not cash for refrigerators? Why does the car industry get subsidized but not home appliances?

The point here is that programs like this produce no net gain to the economy.

And don't start with the whole "helping people" trope. If Bush, and Obama in continuation, really wanted to help people they would have given all that government cash directly to the taxpayer instead of favoring businesses and Wall Street with it.

I only added the last part in to placate the censors. What I really mean to say is, if Bush and Obama wanted to stimulate the economy they would have drilled everywhere, built new refineries and new nuclear power plants, and given corporations a one-time good deal tax saving so they could repatriate the hundreds of billions of dollars they have sitting overseas.

That probably would have produced overload for the puffers...

HuffPo - Dave Johnson