On some level that makes sense, but this direct application--encouraging more consumer loans for car purchases--just seems idiotic on so many levels.
Not to mention the environmental impact. The lack of reuse. No recycling of working vehicles. The CARS bill mandates the vehicle be destroyed by the dealer.
When I first learned about this program I spent a great deal of time analyzing the different ways I could trade-in my 20 year-old vehicle to get a new car. I'd love to have a new car, but the more I thought about it, the worse I felt about it. My 1990 Pathfinder is a perfectly workable vehicle. It's got low miles, runs well, and is a pretty comfortable ride. It just seems ludicrous to have the vehicle scrapped.
"But I can get a new car for $4500 off, " I thought...
What if the humane society had a program where they paid you for your old dog, shot it dead, and then gave you a new puppy at a discount?
The cash for clunkers program sets my inner environmental pragmatist against my inner economist. I hate you lawmakers that signed this bill, I hate you. (shakes fist)
And why single-out the automobile industry? There are a lot of other ailing industries that could use their own cash for x program.
Cash for crappers, toilet upgrade program
Cash for consoles, video game upgrade program
Cash for kittens, cat upgrade program (wasn't this an SNL sketch?)