Cash for clunkers closing down Monday: The Swamp
The Swamp
Chicago Tribune
Posted August 20, 2009 4:38 PM
The Swamp

by Christi Parsons and Mark Silva

The popular "cash-for-clunkers'' program in which the federal government has offered car-owners $3 billion to trade in older vehicles for newer, more fuel-efficient models, will end on Monday evening, according to the Obama administration.

As of 8 pm EDT on Monday, the program will be shut down, a senior
administration official said today.

All valid transactions under the federal trade-in program must be submitted before then, this official said, so the Department of Transportation is advising both consumers and dealers heading into this "wind-down'' period to only agree to deals in which all of the necessary paperwork has been reviewed and approved.

The program has offered rebates of $3,500 or $4,500 to car-buyers trading in older vehicles for new, more efficient models.

After the initial $1 billion which Congress approved for the program was quickly committed, Congress swiftly approved an additional $2 billion before leaving for its August recess.

Critics have accused the government of confusion and hasty spending, but sponsors of the program say the speed with which the money has been committed is a measure of its popularity.

"This is actually a high-class problem to have,'' President Barack Obama said of criticism that the government has quickly spent the money, during an interview on a nationally syndicated radio show today. "That we're selling too many cars too quickly and there's some backlog in the application process. It's getting fixed.''

Administration officials have branded the program a major success, both in taking polluting cars off the road and in stimulating the economy.

"This program has been a lifeline to the automobile industry, jump-starting a major sector of the economy and putting people back to work," Transportation Secretary Ray LaHood said today. "At the same time, we've been able to take old, polluting cars off the road and help consumers purchase fuel efficient vehicles."

The Labor Department this month also reported that manufacturing output was up in July - for the first time in months - and attributed the uptick during a recession to the vehicles being sold under the Cash for Clunkers trade-in program.

"The ramp-up in capacity in response to the unexpected increase in demand in the program has been intense,'' the administration official said today. "That's going to continue. We all anticipate that the volume of the reviewed and approved transactions is going to increase substantially as a result in the coming days and weeks.''

Asked if any thought has been given to extending the program with a third infusion of money, this official said: "Right now we are focused on winding down the program in an orderly way, providing a soft landing and getting the applications process and the dealers paid.''

There is "no plan to seek additional funding,'' the official said speaking on condition of anonymity because he was not authorized to speak publicly about the plan.

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Comments

Where are the GOPer Cash for Clunkers Protesters?


The GOPer's used the overwhelming success of the program to prove that government is "incompetent" because they underestimated the cost of the program - thus by Wingnut logic this "proved" that govt could not possibly run health insurance or estimate its cost (although the govt already runs Medicare and the VA healthcare!!).


I never head the GOPer base nuts complaining about how incompetent Bush was when he grossly underestimated the costs and length of the Iraq war.


GOP base = toothless rednecks with the IQ of a tin can.



Is it possible for the Chicago Tribune to report truthfully and with the facts? I'm beginning to think not.

Here are the facts the Tribune and its reporters are unable to report:
1. The program is NOT a success. Dealers are waiting for their money. The New York Dealers Assn are OPTING OUT of the program because of its FAILINGS!
2. An Ohio dealer sold 35 cars, for instance, and has received money for only 2, that is two, of them. That means the dealer is still on the hook for over $120,000. Unlike the federal government, a business cannot swallow that money indefinitely.
3. Dealers have had paperwork rejected because they apparently made an error, so they have to wait even longer for the money.

Dealers cannot wait until the government gets its act together. And we're suppose to let the government take over our entire health care system?

This program is not the success Obimbo portrays it nor the corrupt reporting of the Tribune.


In spite of what Obama claims, the feds have really not spent much money. Hardly any of the dealers have been paid.

So, these guys can't handle a little program like "cash for clunkers", but what could possible go wrong with taking over health care?

Rick


This program is not the success Obimbo portrays it nor the corrupt reporting of the Tribune.

Posted by: John D | August 20, 2009 6:25 PM
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Lil Johnny Meatball,


'Cash for Clunkers' is so successful, and so 'Main Street' that it has paid big dividends all the way around -- stimulus on the economy, helpful to ordinary people, helpful to small business (car dealers, etc.), helpful to big business (auto mfrs.), helpful to the environment, and a real 'feel good' program for the country.


And to think, the Obama Administration is accomplishing all of this with a tiny $3 billion! Pin the GOPers (see cry baby JohnnyD above) tail to the wall on this one, people.


You have to be a lefty to claim that a government program that gave away free money was a "success". To a lefty, the fact that the dealers aren't getting paid, is just more sign of a successful program.

It is doubtful that "community organization" (didn't that use to be "community organizer"? What, ya' need a name tag to remember your name, dummy?) even understands the program. It is pretty likely that all the program did was move future purchases into the "now" time frame. You can tell that because sales fell off after the first week. It didn't actually add value. It is also clear it reduced the supply of used cars forcing the poorest among us to pay more for their ride. On top of it all, if you look at the tiny increase in fuel efficiency required and the costs involved, someone would have to drive about 200K miles before the price/performance curve crossed. Some success.

So, you are applauding a program that did nothing but give away money and harm the poor as a success, even though it can't seem to pay the dealers what they are owed. You realize the dealers are floating a free loan to the feds, right?

That exactly explains why your opinion is less than worthless.

Rick


I just saw the "Real Clear Politics" average poll of Obama and the dumbocrat party...I didn't think it would tumble down this fast with the MSM propping them up to high heaven.

Life is good, America has woken up...finally!

Paulo


So, you are applauding a program that did nothing but give away money and harm the poor as a success, even though it can't seem to pay the dealers what they are owed. You realize the dealers are floating a free loan to the feds, right? That exactly explains why your opinion is less than worthless.
Posted by: Rick Caird | August 20, 2009 7:53 PM
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Yeah Ricky, it's much better when the Right-Wing whackjobs run the gov't and funnel billions in taxpayer money to the Military Industrial Complex for a phony war (Iraq) like the BushCo Republicans are so fond of doing. Go America!


I love the way Wingnuts have tried to pass off 'cash for clunkers' as a failure, shows how delusional todays right-wing lunatic fringer is.


The economy is recovering and the automotive sector is slowly coming back (thank you Pres Obama and Dems).


I wonder what the GOPer's are going to be fake outraged about next?



--------------------------------------------------------------------------------

You have to be a lefty to claim that a government program that gave away free money was a "success". To a lefty, the fact that the dealers aren't getting paid, is just more sign of a successful program.


I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

Margaret

http://grantfoundation.net


Well, Blutto, after quite a bit of misdirection from you, it is clear you did even try to refute a single one of my points.

So, tell me, why do you think giving away money to move sales up by a few months while at the same time making it more expensive for the poor to buy a used car and maintain their current car is a success?

Riddle me that, Bluttoman. What? when we deal in facts, you are speechless? Figures.

Rick


"Is it possible for the Chicago Tribune to report truthfully and with the facts? I'm beginning to think not... John D"

"John D", you don't expect honest reporting in The Swamp, do you?

The Clunkers program has, in reality, been yet another government fiasco. Computers crashing, costs three times the estimate, red tape, delays in payment such that dealers all over the country opted out of the program ....

It's a reminder how government can't run things well, even a relatively small and simple program like this.


Hey," Rick ", prove your nonsensical facts. Just because you say so, doesn't make it so. Here's a fact, found in any reputable newspaper, or on any reputable network, reporting of the auto industry starting to gear-up again, for production. 10,000 more workers back to work is no small matter. I wonder how that came about !!? Of course, you Republican/Libertarians like your puppet points: The Democrats can't get anything right !! Well, " Rick ", here is one, where we got it right.
Remember, a lie said often enough and loud enough, is still a lie !!
SUPPORT OUR TROOPS, BRING THEM HOME, ALIVE AND WHOLE. NOW.


Wonder if we will ever know the ratio of foreign car sales aginst the Big Three?


Wonder if we will ever know the ratio of foreign car sales aginst the Big Three?

Posted by: Inky | August 21, 2009 10:28 AM

Maybe instead of waiting for Faux News to feed you misinformation, you could use your computer to find the facts instead of pasting bumper sticker slogans on the site. Many of those "foreign" cars are built in America.......which of those Americans do you wish terminated?


Don Fitz, just what are "nonsensical facts"? Isn't nonsense not factual, and facts, by definition, not nonsense?

In their infinite lack of wisdom, our elected representatives included two things in the CARS bill that limited its effectiveness. First, they required that the "clunkers" be traded in on a new car. Second, they required that the "clunker" have been owned for at least a year. The first fenced out the low-income people who drive most of the real clunkers - the ones with the mismatched doors, whose exhaust you can smell as you follow them down the highway. The second prevented someone who was able to buy a new car from going out and buying a real clunker to trade in and be crushed. The result is that a lot of serviceable vehicles will be crushed, and the gross polluters will still be out there.

A couple of weeks ago I followed a car down I-55. A first-generation Chevy Lumina driven by a young black man, it was scratched and dented, the right rear tire was a space-saver spare, and its exhaust made my eyes water. If the bill had included a provision that allowed him to trade that car even up for a traded-in "clunker," just show clear title, sign the papers and drive away in his "new" car, it would have been an environmental benefit and it might have been one of the best things that ever happened to that young man. It's futile to expect lawmakers to be that far-seeing, though.

The other problem with the CARS bill is that it doesn't address the major problem with the industry, which is overcapacity. The auto industry has been fighting overcapacity for years now; consumers have seen it in the incentives that are continually used to force cars into the market. The CARS rebates are just another way to force-feed the market; and once they are over with, we can expect demand to crash once more, and Don Fitz's 10,000 people to be on the street again. It's like treating a heroin addict by shooting him up again. What the industry needs is to get back to a situation where capacity matches demand, and demand is driven by turnover in the vehicle fleet, not by inducements to buy.

So is the CARS bill a failure? I'd say it's a short-term and very limited success, but over the longer term it will make the situation worse, not better.


Cash for clunkers can't end soon enough for car donation charities, used car dealers, auto repairs shops and auto parts stores.


Bill r., many of those foreign cars are made in the U.S. And you know what? They are NON-UNION workers who still make a good buck, make a darn good car and help their companies be profitable.
Might be a plan the U.S. companies and the UAW might want to look at!


The above article quoted only Obama administration officials. Perhaps Swamp journalists should ask auto dealers about the way the Obama administration has run the Clunkers program:

"Initially hailed as an economic shot in the arm for the auto industry, the program has become a poster child for government incompetence. In violation of the federal law that required dealers be paid within ten days of turning in a transaction (the program is now 27 days old) DOT has paid a paltry $140 million to dealers — or just 7.3 percent of the $1.91 billion in rebates submitted.

As a result, dealers like Ron Morehead Jr. — general manager of a Honda dealership in New York — have already shunned the program. "I've got to start getting paid," Morehead told Automotive News, adding that he is out $175,000 for the 42 clunker deals he’s made. "Enough is enough."

In a News survey, more than 90 of 710 dealers who responded said they had suspended clunker sales because of repayment concerns and other bureaucratic headaches. "It's just a mess, an absolute mess," says Duke Brubaker of Champion Ford in Kentucky.

The mounting disaster spurred the industry’s trade group, the National Automobile Dealers Association, to warn dealers Wednesday that they faced a "growing risk that they may not be reimbursed" for vehicles sold through the program."" [NRO]


As someone who has a car that qualified as a clunker (although still useful), I was appalled by the lack of preparation from the government and the automakers in the execution of this so-called incentive program.
After the first three days inventories of the two vehicles I wanted - the Ford Escape and Jeep Patriot - were wiped out. Because Chrysler shut its plants down FOR A WHOLE MONTH before the program went live in July there were no more Patriots to be had at participating dealers until the new model-year came out. Ford had a few 09 Escapes coming in, but all with the bargain basement options. Not what I wanted. The government refused to allow you to custom order the car you wanted and still get the cash for clunkers money because no dealer knew how long the money would last or even if their already made sales would be approved. You were essentially forced to buy off the lot. When the new Patriots and Escapes started coming in Chrysler - and Ford to a lesser extent - started yanking the matching offers and other incentives that made a Patriot or Escape a REALLY great deal in the first place. Sticker prices jumped up to $2,000, too, once the dealers knew what the "hot" cash for clunkers cars were. One dealer told me he had seven Patriots coming in and I could have one (without seeing it or ever having testdriven it) as soon as it got to the lot if I put down a $1,000 deposit (which he wouldn't put in writing would go toward the purchase principal) and turn over the title to my "clunker" car. No thanks. I'll keep my "clunker" rather than be extorted for a car I've never even seen or drive. Good riddance cash for clunkers.


Good…, as they say, all good things come to an end. Actually, this could be considered a BAD thing b/c it’s CRAZY, we are giving people money to live more vicariously and lavishly than before all this economical bust took place? What are we doing? Spoiling every single last American? Let’s learn to live in moderation, then we wouldn’t have so much debt…Well, the fish sticks from the head..so the head is the While House…right?


Today's cash for clunkers story comes to us from New Mexico where dealers are owed $3.6 million and have collected $14,000. Yep. Success. Sure.
http://www.krqe.com/dpp/news/business/business_krqe_albuquerque_dealers_stiffed_as_clunkers_pile_up_200908200033


Posted by: Jeff | August 21, 2009 2:45 PM

You're a little late Jeff. Another poster brought that up yesterday. After he did, I cut and pasted a nice big ad from him from yesterday saying come on down the cash for clunkers is running hot. Get a car quick. Yep...sounds like he hates it. By the way...when did the second bill for this pass? 2-3 weeks ago?


He does hate it. I'm sure there are signs in all the dealerships for it, after the panacaea it was supposed to be. Read the story. You're political hack cut and paste doesn't prove a thing. They're pulling out. Signs or no signs. You can't community organize your way out of that one.


Testimonial in the comments of the actual news story that refutes Bill R's lie that the dealerships from New Mexico are still in the program:
"I work for a small dealership, we did one cash for clunkers weeks ago and still have not been paid. Even though we have had tons of inquiries the dealership is unable to wait for the money from the government so we are not participatiing in the program any longer."


The NY Post has an excellent editorial, noting that the Clunkers fiasco is a "teachable moment" for those wishing for ObamaCare. See http://www.nypost.com/seven/08222009/postopinion/editorials/clunker_health_care__185896.htm for more.


Just as the Cash for Clunkers program was riding off in the sunset, a new breed of vehicle emerged to the rescue.

At the strike of midnight, August 25, the song Oildale Limousine, from the CD, From Buck Owens Blvd to Merle Haggard Drive, was released here:
http://www.drblt.net
(hit "music" button and head for the CD)

A sample of Oildale Limousine can be heard via this link:

Oildale Limousine
Dr BLT and Rockwell
(also featuring Brian Benson and Mark Yeary)
words and music by Dr BLT copyright 2009
http://www.drblt.net/music/OilDemom.mp3


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