Braley Bytes: "Debt for Clunkers" Edition

Besides helping to nearly double the national debt, Iowa First District Representative Bruce Braley's biggest achievement in Congress is his co-sponsorship of the 2009 "Debt for Clunkers" program. (This program is sometimes erroneously called "Cash for Clunkers" under the mistaken assumption that an organization that's $13 trillion in debt and hemorrhaging $1 trillion more than it's taking in each year actually has "cash" to hand out.)

Chris Edwards, director of tax policy studies at the Cato Institute, a free market think tank, wrote a good summary of the program shortly after it ended in 2009. Forgoing the usual academic niceties, Edwards dubbed Debt for Clunkers as "the dumbest government program ever." Here's Edwards' rundown of the program's dubious achievements:

• "A few billion dollars worth of wealth was destroyed. About 750,000 cars, many of which could have provided consumer value for many years, were thrown in the trash. Suppose each clunker was worth $3,000 at a guess, that would mean that the government destroyed $2.25 billion of value.
• "Low-income families, who tend to buy used cars, were harmed because the clunkers program will push up used car prices.
• "Taxpayers were ripped off $3 billion. The government took my money to give to people who will buy new cars that are much nicer than mine!
• "The federal bureaucracy has added 1,100 people to handle all the clunker administration. Again, taxpayers are the losers.
• "The environment was not helped. See here and here.
• "The auto industry received a short-term “sugar high” at the expense of lower future sales when the program is over. The program apparently boosted sales by about 750,000 cars this year, but that probably means that sales over the next few years will be about 750,000 lower. The program probably further damaged the longer-term prospects of auto dealers and automakers by diverting their attention from market fundamentals in the scramble for federal cash." 

Edwards' last point is vividly illustrated in the following graph from John Stossel's website. Although there's a temporary "blip" when the $3 billion in borrowed money is injected into the automobile market, as soon as that is removed auto sales drop right back to where they were. The only lasting effect of "Debt for Clunkers" was to put America's children $3 billion further in debt to the Red Chinese.

If the "dumbest government program ever" is his crowning achievement, it's easy to see that Bruce Braley is a real lemon. If 1st District voters are willing to push, pull or drag Braley out of office in November, there are a couple of newer and better models just waiting to be driven off the lot.

How about a 1979 Republican Ben Lange?  The Lange features lower taxes, lower spending and higher integrity than our current clunker.  If you really want to save some bucks we also have the economy model, a vintage Libertarian Rob Petsche.  The Libertarian has many of the same fine features as the Republican model, but with much lower imperial maintenance costs.  Either one would be fine for us to park in DC for a few years.

So, now what can I do to set you up with a new representative today?