Responsible Spending

Responsible Spending

  • Submitted By: leemc903
  • Date Submitted: 09/10/2009 5:11 PM
  • Category: English
  • Words: 304
  • Page: 2
  • Views: 354

Responsible Spending
Recently the powers that be have decided that “cash for clunkers” is an intelligent idea to help prompt economic stimulation in the automobile industry and push consumers to spend money; this is a mistake. At first glance, the "cash for clunkers" plan making its way through Congress might have had some appeal. Buyers of new cars would qualify for government vouchers of up to $4,500 for trading in old gas-guzzlers. Think of it as economic stimulus and energy policy rolled into one. Similar European programs have boosted car sales significantly. That was in a different economic climate, now this plan has squandered money the nation doesn't have without addressing the fundamental problem. This policy applies to trade-ins that improve mileage by only 4 mpg for cars and 2 mpg for most trucks and SUVs. An owner of an old SUV that gets 18 mpg would get $3,500 toward a new SUV that gets a whopping 20 mpg. Meanwhile, an environmentally conscious driver with an old car that gets better than 18 mpg could buy one of the most fuel-efficient cars on the market, the 46 mpg Toyota Prius, and wouldn't get a dime. If the goal is to promote fuel efficiency, higher energy prices are a far more effective means. Cash-for-clunkers does nothing to address the automakers' basic cost and overcapacity problems, except slightly delay the day of reckoning. The idea most closely resembles those end-of-month dealer blowouts designed to boost short-term sales at the expense of future ones. With large numbers of people driving new cars, they would be out of the market for some time. This plan was poorly constructed and is a blatant waste of taxpayers money and in no way promotes an environmentally friendly America.

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