Will quotes the study’s conclusion: “The $2.85 billion in vouchers provided by the program had a small and short-lived impact on gross domestic product, essentially shifting roughly a few billion dollars forward from the subsequent two quarters following the program.”
Will also extracts a view of the past as prologue from the study:
Cash for Clunkers lasted 55 days and ended with confusion that was a preview of things to come. The New York Times explained in August 2009 the final surge of demand for clunker funds:
“Around the country, dealers had put off the laborious task of applying for the rebates . . . which requires entering the 17-character identification numbers of each vehicle to be scrapped, scanning images of proof of insurance and filling out other paperwork. The computer system was overloaded, according to the dealers. They said they would finish one page in the application, hit enter and nothing would happen. Eventually a message would appear notifying the dealer that the page had ‘timed out.’ Tom Frew, the business manager at Galpin Motors in Los Angeles, said that he needed 35 tries to register just one of the company’s 11 dealerships on the day that the program opened because of problems with the government Web site. On Friday, he spent an hour processing just one rebate application, he said.”
The recovery from the recession began in June 2009; 53 months later, vehicle sales still have not yet reached the pre-recession peak. Cash for Clunkers was prologue for the government’s vastly more ambitious plan to manage health care’s 18 percent of the economy.
Cash for Clunkers is ancient history, but of what is it the prologue? The thing represents the handout of other people’s money for allegedly worthy goals that it is manifestly incapable of achieving. Judged by the means calculated to reach the purported ends, it is unbelievably stupid. Something else explains it, something that stimulates liberals more than it stimulates the economy.