The "Cash For Clunkers" Bill passed the Senate on Friday, June 19, and is headed to the President's desk for his signature. Some of the repercussions of this bill are going to be interesting. When I did an internet search on "cash for clunkers", I found ads from junk yards willing to sell their clunkers to consumers so that the consumers could get government money to buy a new car. According to one website, there will only be $1 billion (only??) spent, so you have to move fast if you want any money.
American Thinker posted an article today detailing what "Cash For Clunkers" will actually mean in terms of dollars and impact of the automobile sector of the economy. The article points out:
"It got this crazy in part because of Federal mileage and other requirements that ignore what people really want in a car and in a fuel supply. As recently reported by the Insurance Institute for Highway Safety, the death rate per million vehicles was 44 for SUVs and 35 for large cars, while for small cars it was 96, or more than double!"
"It got this crazy also because in a decades long fit of self sabotage, the Federal government banned off-shore drilling for most of our coast line and on land in Alaska. The ban has been critical in keeping the price of gas high. When the market realized that the ban might expire in September, 2008 creating more supply, the price of oil fell from a peak of $147 per barrel to a low of $32 per barrel, over a 75% drop. Now that the Administration and Congress have effectively re-instituted the ban, the price of oil has more than doubled again. The real point of the legislation is to goose car sales. But rather than create unsustainable phony demand that requires a voucher, wouldn't we all be better off with a lower gasoline price so the average American had more money to spend? And wouldn't it be better to get our own oil out of our own ground and our own seabed, collect taxes on it, create American jobs by so doing, support the dollar in the process, enhance our national security and lower the price of gas for every US citizen?"
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