Wednesday, August 5, 2009

From incentives for SUVs to Cash for clunkers

Hard to believe that it was six years ago that Bush put into the tax code a deduction for SUVs. It was obvious who this tax break was geared toward. At $75,000 it only benefited those at the very top, the wealthy. CEOs doctors and lawyers could now stroll into a showroom and pick out their wet dream Hummer or Navigator knowing that most of the cost could be written off in taxes. It was once again Bush thumbing his nose at the environment as well as the middle class. And why not he was a representative of the "conservative party". You remember them. The ones who were supposed to be tight with a buck. The ones who wanted to shrink government and drowned it in a bathtub.
Who else did this wonderful scheme benefit? Most of those SUVs had the highest profit margins of anything made in Detroit and not to mention that the gas milage was the worst of anything on the road. Even Detroit had to blush and redesign the Hummer to a smaller more fuel efficient version.
Then there's the Ford Explorer. I haven't checked the milage on this gas guzzler but I have to assume that it hit's the top of the charts as the number one fuel sucker. The top three trades in the Cash for Clunkers program are Explorers of different years. What no Hummers? That's an easy read. With the older Hummers original sales price topping out at over 100 grand who in their right mind would dump it for a meager $4500. So you just might be stuck with that white elephant and hope somebody steals it for a joy ride or maybe you could park it in front of Green Peace headquarters with a sign that says Screw the Environment.
Who benefited from Bush's little scheme? The car companies were cranking out high profit rigs while the oil companies saw a spike in their sales. And where did the blame fall when the economy collapsed? It wasn't the CEOs or the White House that hatched this little plan. Of course you must blame this on the worker who was finally making a decent wage and benefits yet gave concessions to try and save his job while CEOs got fatter wallets by cutting costs and jobs that fell on the line worker.

So now finally the adults have taken over and put some true conservative thinking into play. How's spending $1 billion considered conservative you ask? Simple, it's just like you adding insulation to the attic or changing to CFL bulbs in your lights. Yes it costs a little up front but over the long haul it saves quite a bit. It saves tons of gas. It gets the dealers back to work instead of playing cards all day or worse hitting the unemployment line. It will eventually get the parts people back to work. And it helps the environment. This is a win win situation. Not to mention it gets some much needed tax dollars back in state coffers.

It's so obvious that all that Bush and the republicans did to this country was WRONG. It should be easy to see that the best way to undo the mess is do just the opposite of what he did. Can we now call George W. "professor backwards"?


Holte Ender said...

You were right about the Explorer

The Top Ten Cash for Clunkers Trade-Ins:

1. 1998 Ford Explorer

2. 1997 Ford Explorer

3. 1996 Ford Explorer

4. 1999 Ford Explorer

5. Jeep Grand Cherokee

6. Jeep Cherokee

7. 1995 Ford Explorer

8. 1994 Ford Explorer

9. 1997 Ford Windstar

10. 1999 Dodge Caravan

Tom Harper said...

This Cash for Clunkers program seems to be working pretty well. No wonder conservatives are slamming it. Not only do they hate it, but their Talking Point of the Week is "the government can't even handle the Cash for Clunkers program, and they want to take over your health care?!?!?!?!?"

an average patriot said...

I saw a story about India and how they took 88,000 cars off the road for polluting. We should add those to the clunkers program. Green for going green! They okayed the extension for the clunkers program. Many including the 7 million who lost their jobs certainly won't be benefiting from the program.

S.W. anderson said...

The bigger, heavier Ford Expedition is more analogous to the Hummer. The '06 model is rated 14 mpg at Edmund's site. I take that to be combined city/highway.

Demeur, you're right about the good features of cash for clunkers. It kills at least three birds with one stone. It's a decent investment.

My one concern, which no one else seems to have thought of, is that dealers have mostly been selling off stagnant inventory. That's good, of course.

However, if factories now step up production, with unemployment still nipping at 10 percent (or more), manufacturers and dealers will soon find themselves with inventory backing up again. That's not good.

The key to restoring the economy, the automotive industry included, is getting unemployment back down to 4.5 percent or less. Cash for clunkers might help a little, but only a little and only temporarily.

BBC said...

I'm not fond of the clunkers program because everyone, well, you working stiffs, have to pay for it and it's mostly folks using the program with crap cars and may end up defaulting on the payments on the new rigs because they can't keep up the payments, that you will get stuck paying for also in the long run, but whatever.

If you want to help others own a new rig I guess that's okay with me, I'm retired, baby, I won't have to help pay for them.

I don't recall that the Ford Explorer was all that bad on fuel mileage. It was maybe a sort of a clunker but there was worse, like the Jeep line.

The rigs that irritate me are the ones like the Lincoln Navigator, and of course, the Hummers.

BBC said...

Hey, you had better get back to work so you can help pay for those cars. After all, you are the government, he he he.

Demeur said...

Holte this doesn't include all the gas guzzling pick ups that are out there but then I figure that those owners just might be upside down in their loans and can't trade.

Tom of course they're against anything that might work especially when it comes from the Democrats.

Jim I don't think we have that much of a problem with polluters as most states have emissions testing. Yes I'll be one who the program won't benefit but if it helps get the economy rolling I'm all for it.

dana said...

I can't understand all the large 4 wheel drive vehicles in Florida. We USE ours in Indiana to haul our old asses through the snow, but down here? There's isn't even MUD!

Demeur said...

Billy my car's paid for and gets 26 mpg. I'd love to get back to work as our union contract just gave us a raise but with no work it's just an empty promise.

BBC said...

My truck is about as small a rig as I can use for camping, pulling the 5th wheel anyway, and only gets about 18-20 mpg.

But it runs great and I'm not getting rid of it. I make up for the mileage by not driving it anymore than I have to and only use about one tank of fuel a month.

I do a lot of walking and biking, and use my new wagon for shopping and such.

Dana, you need to learn how to drive. :-) I've lived in snow country all my life and have owned but one 4 wheel drive, but not for long.

I've plowed pretty deep snow with a 2 wheel drive pickup. You just have to put a fair amount of weight in the bed. For me a 300 gallon water tank worked well.

I must be an old fuck now, I don't much like front wheel drive rigs, they're okay in ways but I spun the Toyota around two times during braking.

Once because of a sudden wreck in front of me (in Seattle), and once on an icy road.