---

‘Cash for Clunkers,’ By the Numbers
...He added that the average annual income of those who bought cars with their rebates was $57,700, just under the $61,000 for all new car buyers these days. That suggests that consumers with the lowest incomes who, in theory, need the rebates most, are not benefiting from the program.

One of the problems, Mr. Spinella said, is that even a $4,500 rebate may not be enough to persuade consumers to turn in their cars, particularly if they are unable to borrow from cautious auto dealers.

“Some of the folks who drive a beater all the time are unlikely to get a new car loan,” he said. “That’s one of the problems with the program.”

---

The WTO Subsidies Rules and “Cash for Clunkers”
The government’s new “cash for clunkers” program has been wildly successful. Under the program, consumers may receive up to $4,500 towards the purchase of a new, more fuel-efficient vehicle. What is surprising is the impact this it is having on consumer spending patterns regarding domestic vs. imported vehicles. According to press reports, more than 70% of the clunkers that were traded-in were domestic. Moreover, as reported here, consumers are showing a preference for imported cars when they purchase under the program, with Toyota (17%) and Honda (14%) leading the way. The top ten sellers under the program are Ford Focus, Honda Civic, Toyota Corolla, Toyota Prius, Ford Escape, Toyota Camry, Dodge Caliber, Hyundai Elantra, Honda Fit, and Chevy Cobalt. In other words, six of the top ten sellers are foreign cars (although the Camry is built at home and abroad).

Cash for Clunkers is one of the few government subsidy programs that I am aware of that clearly has the de facto effect of promoting imported over domestic goods. ...

---

Cash for Clunkers Falls Flat
Only in Washington could a program that is spending money 13 times faster than was planned be labeled a "success." The "cash-for-clunkers" program ground to a halt last week because in less than a week, a program that was supposed to last until November 1, had spent the entire $1 billion allocated to it. Let's just hope that the government takeover of the rest of the health care industry doesn't result in similar "success."...

...The Obama administration also got the program's costs all wrong. The money was spent so quickly that it lasted less than a week-- just 8 percent of the time that it was supposed to last. If the government gets the health care numbers this wrong, one can only imagine the damage to the deficit....