Tuesday, January 3, 2012

Cash for Clunkers Continues with CARB's VAVR Program

Bloomberg/Businessweek is reporting a surge in new car sales:
Light-vehicle sales in December, set for release tomorrow, may have run at a 13.4 million seasonally adjusted annual rate, the average estimate of 14 analysts surveyed by Bloomberg, up from the 12.5 million pace a year earlier. While the rate may trail the 13.6 million seasonally adjusted pace in November, typically a slow sales month, the number of units sold increased in December, according to the average of five estimates.
They have failed to report the fact that many low income consumers are now without transportation. Cash for Clunkers is still alive and well in California as Voluntary Accelerated Vehicle Retirement (VAVR). The misconceived program makes vehicles unattainable for young and low income people. VAVR also pushes middle income people into debt for new cars with the cost of adherence to environmental regulations combined with large cash incentives.
The State’s recently enhanced Consumer Assistance Program (CAP) was developed by the ARB in consultation with BAR and provides $1,000 per vehicle and $1,500 for low-income consumers for unwanted vehicles that have either FAILED or PASSED their last Smog Check Test. (CA.gov Car Scrappage webpage)
Maybe I need a second pair of eyes on that sentence; does it read $2500 for a clunker? (UPDATE) Thank you for helping resolve this conundrum, it is $1000 or $1500 per this application.

The VAVR program uses tax money to remove fully functional and smog compliant vehicles from the road. The California market is gentile on used cars due to the favorable weather. Southern California has the best climate in the country and many of the region's cars and light trucks gain a greater operational life than vehicles from colder, saltier and more humid climates. Regardless, our environmental overlords have decided that the back of a bus is better suited to low income citizens.
...monetary or other incentives to vehicle owners to voluntarily retire their older, more polluting vehicle. (CA.gov VAVR webpage)
This is a program that trickles down to every used car consumer in America because the "retired" vehicles are dismantled.  (A list of "auto dismantlers" can be found on this FAQ sheet.)  Here is a quick list of the immediately foreseeable negative consequences of this policy:
  • Hinders employment for those who cannot find cheap reliable transportation. 
  • Spawns a new breed of exploitative scams against the old and low income. 
  • Wastes scarce tax money.
  • Calls for higher taxes to pay for "firemen, police and teachers" when the real problem is wasted money.
  • Falsifies economic indicators as the choices to purchase used cars are reduced.
  • More union money stolen from consumers and "redistributed" into politician's back pockets.
  • Class warfare exacerbated as poor and old are left even more dependent.
  • More pollution as smog compliant vehicles are "dismantled" leaving low income people with bad alternatives.
  • Increased pollution as a few more coal powered, toxic-battery powered electric vehicles are pushed into service.
  • Increased human misery as more people are forced into illegal, immoral and undignified behavior.
  • Price gouging for new and slightly used cars due to lack of alternatives
  • That's enough for now...but more in-depth analysis is available from Beers with Demo.
This is more fascism attributed to the blind environmentalist cult known commonly as progressives. Maybe we should redefine this as Mayan Economics, in honor of 2012.

19 comments:

Dean said...

Sir Charles,
great work and great points.

Yes, I believe that $1,500 credit for low-income folks is in addition to the $1,000 for the car.

It's been proven that cars are much more effective at keeping low-income people employed and also gaining them better employment opportunities because of the flexibility afforded them than does public transpo, especially here in SoCal.

I blogged about the devastating effects of Cash for Clunkers here:

http://beerswithdemo.blogspot.com/2011/11/cash-for-clunkers-gift-that-keeps-on.html

$3 billion program to help keep people unemployed. Then again, this is an administration that measures economic success by how many food stamps they can issue.

SarahB said...

I lived off clunkers till I was 30. Have no idea how I would have commuted without $1000 air-conditioning-less beater cars. Mary Nicholes is THE single most evil person in California.

Dean said...

And thanks for the link!

Carfreaque said...

The wanton destruction of decent vehicles or anything should create sick feelings among anyone! I understand that the intent was good but learned the old adage :"WASTE NOT WANT NOT" At least, the vehicles should be available for parts for the 2% of us that know how to maintain theirs. For those of you that arn't bothered, think of someone smashing your gun!

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Mitchell said...

I have gotten rid of my car before but sold it to a junk yard using cashforjunkautos.net. It wasn't running.

I think that these cheap cars serve a purpose and why should we get rid of them?

Milliscent Morgan said...

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Jordan Mallory said...

This is an interesting article. Reasons like this is why I try to stay away from buying new cars. I personally like buying used cars because it saves me some money and I can also re-sell it if I want. I used to love the "cash for clunkers" deal because it kept the used cars business rolling. Obviously times are changing and people are starting to invest in electric and hybrid cars to help the environment. I understand the logic but I just am not at that point yet. I like buying used cars and squeezing every ounce of car left out of them before they die. Since moving to Texas I have been looking around at Car Dealerships in McAllen TX because my son just got his license. This is another reason why I prefer used cars because of young drivers like my son. I would never spend a lot of money on a new car for him because something could happen. It is just important when buying used cars that you make sure the car is safe and reliable.

junck car roy said...

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