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‘Clunker’ program isn’t

It doesn’t take a rocket scientist to recognize which of the many federal economic stimulus programs is the biggest hit. The CARS – cash for clunkers – program burned through its original $1 billion allocation in its first week of operation. Congress took notice, approving another $2 billion for the program. President Obama signed it Friday.

CARS, the Car Allowance Rebate System, aims to get fuel hogs off the road in exchange for more efficient vehicles. To that end, it pays a chunk of cash to dealers retiring the offending clunkers.

Here’s what else it’s doing, and here’s why the program is so attractive. Unlike so much of the cash that Uncle Sam has hurled at the states in recent months, this money is providing instantaneous and direct stimulus to local merchants and local economies.

CARS dollars are going to just plain folks. It’s no bailout of Bank of America or Chrysler, but something that helps citizens directly. It’s providing a boost for automobile dealers, too. They’ve suffered mightily in recent months, and some have been hit not only by the sagging economy, but also by the bankruptcy of their suppliers.

While the larger stimulus package is doing things that clearly need to be done – helping keep school districts’ financial heads above water is nothing to sneeze at, after all – CARS is immediate and very, very visible. At the original $1 billion allocated for it, somewhere between 222,000 and 283,000 Americans will have traded up to new cars when all is said and done. Others will have purchased cars without the incentive, simply because the incentive lured them in to local dealerships.

That kind of spending is good for nearly every community in America. And as programs that benefit the automotive industry go, it’s a lot easier to stomach than buying General Motors.


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