John: Let me make a couple of points.
First, $3 billion isn’t so much in the grand scheme. And it would have been fine, as far as these things go, to run this program without destroying the used cars. Oh sure, getting these cars off the road helps clean up the environment to some degree, but manufacturing new cars has its own environmental cost. And trading them in and then reselling them would have still gotten more people into fuel efficient cars without hitting low-income Americans in the used car market. Eventually these cars are going off the road anyways, but if we give it time there will be more newer, more fuel efficient used cars to replace them with.
Second, why is this program a better stimulative or environmental program than spending $3 billion on solar energy credits? Or any other credit toward green, sustainable energy? Even just more credits toward buying fuel efficient cars? It’s the destruction of the used cars that’s the problem here, not the spending of tax dollars. At least that’s my take.
Third, of course the program was a success. If your program is basically handing out money and lots of people take that money and you measure the success of the program by needing to give away even more money, well then how could that not be a success?
And last, yes C4C kept the auto industry afloat for a while. But we have a history of keeping that industry afloat and it hasn’t helped them in the long term. Even so, we could have kept them afloat by offering credits rather than destroying cars.
What next – should we save the publishing industry by burning books?
Was C4C the worse program ever? No. Did it provide short term stimulus? Yes. I’m simply saying that A) we could have done it in a way that was more fair to used car buyers, and B) we certainly could have made a more environmentally friendly program that was also very stimulative – in both the short and long term. Judging C4C on whether people participated and liked it is a pretty poor way to gauge a program’s success.
Chad S
Considering that Ford’s sales jumped dramatically thanks to C4C(which allowed them to refinance their debt) and that GM/Chrysler were saved by the Gov reorganization+C4C, it appears that we didn’t just “keep them afloat” they were saved.
roshan
BWAAHAAHAAHAAHAABUAHAAHAA!
me
As long as they are Glenn Beck’s.
Really though, that’s a bad analogy. Did you even read the comment thread on your previous post?
Tone In DC
Gotta agree with Roshan on this.
And we could use some $ for solar and geothermal, ALONG with C4C.
KRK
Kain responding to a JC post (rebutting an earlier Kain post) by starting a new post is not good for long-term BJ readability.
Just saying.
geg6
Well, I don’t really give a shit whether or not the publishing industry gets saved and I’m definitely against burning books.
But I like the idea. Can we, instead, burn down the MSM? That would be win/win, no matter how you look at it. Especially if the spokesmodels/newsreaders/pundits are included in the conflagration.
In fact, scratch that. Let’s just burn the witches (the spokesmodels/newsreaders/pundits) and keep the media hardware. Save us all the trouble of having to rebuild or reinvent.
licensed to kill time
Today is Cash4ClunkerDome day, huh? Two men enter, one man leaves?
scav
@roshan: come come, you know the old maxim about it all being very nice that it works in practice but what matters is if it works in theory.
Josh James
junking old cars = burning old books
An incredibly agile feat of False Equivalency, seriously, even the Russian judges scored that a 10.
MikeJ
Let’s pretend your argument isn’t stupid and already debunked (see previous threads).
If C4C drove up the value of used cars, how much wealth did it create for the working poor who already own a car? Can we compare the aggregate gain in wealth to the aggregate loss to people who want to buy a used car and will not accept a new car under any circumstances?
NonyNony
The used cars were destroyed to get older cars that cause more pollution and are less fuel efficient off the road.
That’s the entire environmental upside to the C4C plan. Without that part it would have just been a stimulus for the new car industry.
Kain, it sounds like you’re whining because you didn’t get a government handout because you buy used cars. I didn’t get a government handout either because I didn’t buy a car in that timeframe – should I be whining too?
And BTW – your specious bookburning analogy is just an emotional tug. There is no net environmental benefit to destroying old books but there IS a net environmental benefit to removing older, less efficient, more polluting cars off the road. Come up with a better analogy instead of just trying to pull at the heartstrings of booklovers.
John Cole
When was the last time your 1978 copy of Atlas Shrugged got 7 miles to the gallon and shot shitty levels of emissions into the air while needing a quart of oil poured into the leaking crankshaft every time you stopped and dripping coolant everywhere you parked it while operating with substandard brakes on public highways?
j low
First post was stupid. This one is one just adds to the pile.
Trinity
@John Cole: This.
beltane
@roshan: Grab your McCalculators folks. C4C was a failure 163% to the fourth power and that is the gospel truth. Don’t go believing those lying eyes of yours.
MikeJ
@me:
As I point out, he’s already said that at work he can’t read comments and at home he doesn’t want to trouble his beautiful mind with them. He can’t be engaged by commenters and he doesn’t want to be engaged by commenters.
Violet
@John Cole:
My copy of “Atlas Shrugged” does that every day.
geg6
@scav:
Heh.
Kinda reminds of the bullshit Jim Kramer was slinging on The Today Show this morning. He was just fine with the housing numbers. He said that a month like July was exactly what we needed to get the housing market moving again and create jobs. When the host asked, well, shouldn’t they extend the home buyer’s tax credit that expired just as the housing market tanked again? Kramer just pooh-poohed it as a temporary measure that really wouldn’t have any real effect on jobs or confidence and probably had nothing to do with the upticks in the housing market earlier in the year.
I just sat there with my jaw on the floor.
soonergrunt
Where I don’t agree with you, Erik is the viability or necessity to make the used-car market cheaper by flooding it with sub-standard stock.
The cars that were taken off the road by C4C were the worst of the worst environmentally. We know that given the option between buying the $2,000 car with 16mpg vs. the $2,200 car with 20 mpg, the vast majority of people will buy the cheaper car because they don’t think long term.
So this program caused a temporary fleet cost increase in the used car fleet. It also caused a longer lasting fleet value increase for the nation’s used car fleet.
Those cars that were truly on their way to becoming classics still will. In fact, their values will appreciate faster because there may be fewer of them available when they hit ‘classic’ status, however that happens.
Besides which, there’s a sidebar ad on BJ right now that tells me I can buy a used car for under $1,000 so it must not be that bad of a problem. ;)
J
ED,
You may not have noticed, but this “rebuttal” has already been preemptively rebutted in the comments on your previous post.
Is this a case of ignorance, or willful ignorance?
Southern Beale
…but manufacturing new cars has its own environmental cost.
A cost we ALREADY PAID because those cars were sitting on car lots for MONTHS. The cars were already manufactured! The inventory was already there! The big three had been churning out new cars no one could buy for years. Remember that photo of all those cars stacked up for miles and miles and miles out in the California desert?
Shinobi
We could also judge the program based on whether or not it helped the auto industry (it did). And if that’s not enough we could judge it based on whether or not it got bad gas mileage vehicles of the street (It did, in fact my car was one of the most traded in models because it gets only 15mpg.)
So, it wasn’t a success because we destroyed cars? Instead of carefully preserving vehicles that are harmful to the environment so that more people can use them?
If these cars aren’t destroyed how exactly are we supposed to stimulate demand? Wouldn’t that have just flooded the market with cars that no one should really be driving?
Also, destoryed makes it sound ike all these cars are sitting in a junkyard somewhere as big metal squares, in fact, they were recycled according to environmental standards set out in the act.
me
@MikeJ: It’s funny becuase the earlier thread was polite and informative. That just misses the point of a blog.
AnotherBruce
@John Cole: Well, metaphorically speaking, I can see Atlas Shrugged doing all that as a novel.
Southern Beale
What next – should we save the publishing industry by burning books?
Apples and oranges. The two are not close to being comparable industries or comparable scenarios. And Kain you are smart enough to know this.
Here’s a comparable scenario: let’s save the solar and wind power industries by blowing up coal fired power plants.
JAHILL10
Seems EDK is fighting a losing battler here. Trying to jump on the “all government intervention is bad” bandwagon and running up against the whole reality thing. Ignoring that the stimulus also pumped money into clean energy innovation and smart grid technology/infrastructure, doesn’t really make your point. Old dirty running cars were removed from the road, newer fuel efficient cars were put on the road, jobs were saved, and an industry was saved. BTW the human suffering that would have resulted in this country if those last two had not occurred far outweighs a short term shortage in the used car market, no?
geg6
@MikeJ:
Funnily enough, I bought my used car right about the time C4C ran out. Didn’t notice any sort of price inflation due to it. And my friend who owns a used car dealership has had no trouble at all in finding cars to fill his lot at prices little different than in previous years.
These lovely economic theories spun by conservatives and libertarians never seem to have any sort of anchor in the real world, I’ve noticed.
Belafon (formerly anonevent)
Someone needs to keep reposting this link from DanF until EDK acknowledges he’s read it. And he needs to go and read all of the comments on his original post before he posts anything else.
AnotherBruce
@Violet:
Shoulda known that someone would beat me to it. Damn slow work compooter.
Michael D.
Is the new policy of this blog now to respond to posts by writing posts? Can eveyone have an account for this, please?
Shinobi
@AnotherBruce: It certainly does seem to result in a lot of hot air and methane emissions (y’know from all the bullshit.)
NewHavenReview
My, my, how the abuse doth fly. Let’s take arguments as arguments.
The increase in user car values probably did hurt working poor seeking to purchase used cars. But the better solution is to pay people better wages, something that wage stagnation has made impossible owing to the forces of bad corporate citizenship, overzealous deregulation, anti-unionism, and capitalist system that remains far too heavily tilted towards the making of money off of the transfer of capital (see Goldman Sachs employees).
One possibility that might have been considered–nightmare though it would have been to administer–was to arrange a “progressive” C4C credit, giving poorer folk more money to trade in their cars. This would have been especially effective since poorer folk tend to be those driving the most inefficient vehicles anyway.
demo woman
There is also a health benefit that should be factored in. If new cars lower the pollution level in major commuter cities, it also lowers the rate of asthma.
georgia pig
@John Cole: Agreed, E.D. should stick to barbershop analogies, they’re much more fun to ridicule. Again, why the fuck bring up some pseudo-analogy? Because you got nuthin’ and you have to resort to a cheap rhetorical trick. This guy is getting tiresome.
Chad S
Also never mentioned: C4C flooded the market for replacement parts(the traded in cars couldn’t be resold, but they could be cannibalized), which brought down repair prices for SUV mainly.
Tonal Crow
@John Cole: The problem with your rejoinder is that “Atlas Shrugged” does cause pollution, just indirectly.
MikeJ
@geg6: Yes, but you’re just talking about reality, something Kain wants no part of.
If instead we argue theory and ignore the real world, we get this: he claims the price of used cars went up across the board because of C4C. Let’s call it 10%. That means that the owners of the 250 million cars in the US just gained 10% of the value of their car. Let’s say 1 million people wanted to buy a used car and flatly refused to buy a new car. Those 1 million people (10-20% of the people who bought cars!) had to pay 10% more.
The cumulative wealth created far exceeds the cost to those people who insist on used cars. If every car in the country was worth $1000 before C4C, it would be worth $1100 after. The total value of the US fleet would have gone up $25 billion overnight. Those million used car enthusiasts would pay an extra $100 million. Please check the math on a McMegan calculator.
numbskull
@NewHavenReview:
I keep hearing this, but there are no data that support it that I know of, and certainly no data presented here. I’m not dinging NHR, just asking for data to support this claim that I keep hearing.
arguingwithsignposts
@John Cole:
I’d argue it’s done the equivalent to our political discourse.
ETA: I see others have been here before me. You’re a good straight man, JC.
Alice Blue
I think what’s really bothering EDK is that C4C was a government program that was popular. Few things get a conservative’s knickers in a wad more than that. It’s like sunlight to a vampire.
gex
@JAHILL10: Um. Can you put a dollar value on someone else’s suffering for these libertarians? Those things are externalities and thus don’t factor into the free market thought experiment they want to run on humanity.
Guster
Actually, a cool way to
savehelp the publishing industry would be for the government to pay authors a couple cents in royalties when their books were taken out of the library, as is the case in the UK.But somehow I guess that’s not the real question, huh?
Shygetz
Everyone else has pretty much eviscerated E.D.’s other “points” so I think I’ll just weigh in on this one.
How on Earth do you reconcile “new efficient car shortage” with your previous assertion that some new cars are now cheaper than used cars? The problem has never been an efficient car supply shortage, and given your previous assertion, I think you know that damn well.
Yes, because we all know that the upper class was hording used cars, waiting for C4C to drive up prices so they can then gouge the used-car-less working poor.
Oh, wait, no they weren’t. If anything, the working poor probably have more than their share of used cars that they can now sell for higher prices. Combine this higher used price received with the lower prices for new cars, and you have the result of it being easier for the working poor to trade up from a used car to a new one EVEN AFTER C4C is over, due to the residual effects on the used car market. If, on the other hand, we allowed the C4C cars to be resold as you suggest, then we would have been subsidizing used car purchases by the dealerships which could then turn around and sell them for a double-profit, definitely redistributing wealth to those who already have it–isn’t that what you claimed was bad about the C4C version that rendered clunkers inoperable?
You’re lowering the resale values of brains everywhere today, E.D.
Dave
But think of the beautiful used cars!
Christ. Why, it’s like tiresome conservative arguments are tiresome even when “serious” conservatives make them.
Warren Terra
This post seemingly manages to ignore politics and timing entirely. Sure, if the goal is to pump money into the economy, while helping the economy, and I’m the unquestioned dictator, I might find all sorts of better things to do with the money (weatherizing, subsidizing purchases of alternative energy equipment, capital investment and salaries for mass transit, etcetera). But all my plans, however visionary, ignore three pretty important factors:
1) Simple politics. You have to get your plans through Congress, and not only do most members quite rightly fail to share my particular vision, all too many seem to lack any vision whatsoever. C4C was good politics in part because it was something Congress would actually do, unlike all my grand schemes.
2) C4C was a fast, visible, and understandable way to pump money into the economy. The cars were already there on the dealers’ lots, and the public understood how they could access this program and get a subsidy. A lot of other environmental programs would be slower, requiring periods of research or infrastructure building, or even the ramping up of production of consumer goods that (unlike cars) were previously neglected; many would not be marketed directly to the consumer, and even those that were would likely require commitment to a wholly new sort of undertaking (weatherizing, say, or solar panels) that fewer people understand and plan to do than buying a car.
3) Beyond its generic ability to pump money into a troubled economy, C4C was a lifeline for a desperate auto industry. While I wish our society were less built around the car, we’ve spent six decades building sprawl that won’t quickly change. There will be a market for cars in the future, and the jobs designing and making and even selling them are pretty important; saving all that has some value in its own right.
Mnemosyne
So why, exactly, is it a net good for poor people to be stuck with inefficient, polluting cars that will probably need a lot of work that they’re not going to be able to afford to do on them? You don’t seem to realize that a lot of poor people end up pouring money down the drain over and over again by buying the cheapest used car they can afford and having it poop out on them within a year.
numbskull
@Shygetz:
C’mon, give him more credit than that. He’s been lowering the resale value of brains for much more than just today.
Oh, sorry, that’s just ad hominem. I feel just awful.
arguingwithsignposts
Because there are over 200 million cars on the road in the U.S. You know who has solar panels? rich and upper-middle class folks.
Talk about your wealth-transfer.
arguingwithsignposts
@Mnemosyne:
This. Having a shitty used car sucks. Having a shitty used car that eats up entire paychecks sucks even more.
SpotWeld
Which is nonsense on the face of it, since the new cars purchased under this program were already built. (And car manufactures are locked into a minimal amount of annual production just to justify the cost of keeping the plant open.)
You seems to be ling with statistics here.
Intial State. Person A has a fuel inefficienct car. Person B has a fuel inefficient car.
Personal A uses C4C and gets a new fuel efficient car. Person B still has a fuel inefficient car.
Under your program, Person A get gets a new (efficient car) and person B gets person A’s inefficient car.
Without knowing the state of Person B’s car you cannot assume that your suggest is a net improvement. Further, the longer an inefficent car is on the road, the longer the fleet population efficiency remains low. C4C pulled out inefficient cars from the population.. That was the point. Trading them in did not.
No, you cannot honestly assume that. It’s a gamble on a future state, the best part of C4C is it was grounded in the solid reality of the actual state of cars on the road vs. the new cars already on the market (the one’s we’ve already expended energy creating.)
It’s a myth of the market that if you just wait a little bit longer you’ll have something better availabe. But the longer you wait, the longer you pay the additional cost of your current lesser solution. You need to peg a number that is “good enough” and go forward with the upgrade.
You can make the arguement that the current new cars weren’t efficient enough to support C4C, but the additional market benefits seem to have been enough to provide additional justifaction.
Additionally, if we didn;t prop up the market and keep more auto companies alive, the rate of deloyment of newer techology would be slowed under a less diverse market. Right?
No, the auto market is an existing, well integrated system that people are already plugged into nationwide. C4C worked everywhere. Solar energy credits would only work best in areas with a pre-existing solar energy infrastructure.
But they were taken out of teh market, only off the roads. The value of the cars shifted from thier most inefficient aspect (fuel and emissions) to thier inherant value as parts for (presumibly) efficient cars.
Maitenance costs of used cars that weren’t sold as part of C4C *dropped* because spares became cheaper! Poorer consumers who still couldn’t get a new car via C4C could maintain thier current used car instead of entering the used car market.
And finally I have to touch on this ugly attempt at an analogy:
No, we let the publishing industry save itself by letting it sell the part of teh book that has inherany value *the words* via a medium that is (as far reading goes) more effienct … e books, online content delivery and on-demand printing. (though some gov insentive programs for textbooks might be useful to nudge things in those directions)
A program was needed at a specific point in time to address two specific issues. C4C did both admriably well. To complain now, based on possble better future technology and a rather vague sense of fairness to the market really doesn’t stand up to examination
David
Main things that bother me about the post are the assertions that cars were destroyed, rather than just the engines. Also, the idea that we shouldn’t have done C4C because there were better stimulative/environmental options. As far as the economy goes, sure maybe there were better options, but as far as getting newer and more efficient cars off the lot, I’m not seeing it.
And let’s be realistic here, if every program has to be the “best” option, rather than just a decently workable one that the entire GOP won’t filibuster, then NOTHING will ever be done.
cmorenc
The paramount values in “cash for clunkers” program were:
1) Get the most fuel-inefficient cars off the road sooner, for environmental reasons;
2) Same as #1, except to also reduce the amount of imported fuel from unstable, or even hostile regions (along with the export of dollars needed to buy it);
3) Stimulate the auto industry.
The paramount goal was NOT to maintain the market for cheap (inefficient) used cars for benefit of lower-income people. That goal is in direct conflict with goals #1 and #2.
Goal #1 is a pure win, if it is considered more important than maintaining as cheap a supply of inefficient used cars as possible for poor people to buy.
Goal #2 is essential for our national interests, BUT is not without some perverse feedback loops. Assuming momentarily that the overall number of cars on the road stays relatively constant, changing only in that a higher percentage of them are significantly more fuel efficient, that lowers demand for foreign oil, but a corollary of lowered demand is falling prices for oil, which reduces the incentives to many people to value purchasing fuel-efficient cars, as opposed to roomier, heavier gas hogs.
Goal #3 also has potential problematic feedback loops. If a short-term stimulus program such as cash for clunkers helps auto companies clear excess inventory that otherwise retards investment in making new, even more efficient models, or avoiding layoffs, that’s all to the good. However, to the extent it simply modestly accelerates the timing of what is essentially a fairly straight-line longer-term demand for cars, all it accomplishes is some very short-term modest prosperity followed by a compensating dip in demand over what it would have been along a steady straight line. All that’s been accomplished is to shift timing for the same number of total car purchases over twelve to twenty-four month’s time.
les
Says the dipstick who cites parents’ attitudes about their kids’ schools as a gauge of education. The notion that ED Kain is somehow among the best the conservatives have to offer scares the hell out of me. A complete stranger to logic, thought dominated by inconsistent theories with no practical demonstration in the history of the world, inclined to “care about” the poor but wedded to economics demonstrated to create more of them…
Rommie
If there were books that weighed 75 pounds, had one word per page, and 1/4 inch thick paper, and LOTS of them were around, and you could trade the Big Book for a normal paperback copy, then YES, burn the Big Books!
Otherwise, wrong comparison.
Lysana
Y’know what? I’ve decided my real problem with E.D. Kain here is he can’t engage the commenters. I want a conservative who can take the bloody time to talk back. His posts are the equivalent of ringing the doorbell and running away. Every so often, you can catch the guy soon enough that he yells his logic for doing so back at you, but not always. Then he goes and does it again later.
Bored now.
Hugin & Munin
These two posts certainly serve to burnish Kain’s Glibertarian cred.
Suffern Ace
Books that aren’t being used take up space and are home furnishings that are accumulated over years. If the home furnishing industry was struggling, we could have a books in exchange for whatever small stuff will fit on shelves voucher program, and yes it would be stimulative. While it might help Pier One Imports as a retailer to have people trying to fill their shelves, I don’t think it would have the same multiplier effect as the purchase of an automobile. Had light manufacturing not been offshored in the past 40 years, I could see doing this as light manufacturing might be worth protecting as a strategic industry.
If you flesh out your proposal a little, we might be able to push for it in Congress. They need ideas.
chopper
@John Cole:
every time i read atlas shrugged, oily goo starts pouring out of my ears onto the ground. does that count?
chopper
@SpotWeld:
besides which, these new cars were collecting dust in dealers’ lots.
gex
Ha ha ha. Three threads worth of substantive arguments against Kain’s premise, no real attempt to address those arguments, set up some strawmen (there are better projects – but would they have passed?), and then take the rhetoric to an absurd level with book burning.
I don’t expect E.D. to change his opinion necessarily, but it would be nice if he appeared to have read and considered the other arguments. It really tells you everything we need to know about the American culture around the liberal – conservative divide.
Adam Lang
Y’know, there is a perfectly good case to be made against C4C.
Perhaps we could find someone who is capable of making it?
jacy
@David:
Exactly. That’s my main problem with “libertarian” arguments. They never seem grounded in reality. No program is perfect, but if were left up to libertarians, we would just have endless roundtables where all anyone did was philosophize endlessly and pat each other on the back for their fine ideas. (Which is basically what happens to Sully’s blog when he leaves it in the hands of his monkey underlings).
C4C accomplished the modest goals it set out to, and did so in a way that was easily understood and acted upon. Of course then it was lied about by conservatives to gin up outrage, but that’s to be expected, regardless of the merits of any program. Different day, same bullshit.
BTW: false equivalencies and ridiculous analogies (Hey, let’s save the publishing industry by burning books) just show that you’ve already lost the argument on its merits. It’s a really cheap rhetorical device and would get you kicked off any junior high debate team.
Comrade Kevin
This is probably the single stupidest thing posted by a front-pager on this blog.
baldheadeddork
I’m gonna end up spending more time than I should on this subject, but whatthehell…
I posted in your last thread how C4C did not affect the car market for the working poor. I won’t repeat my self, but here is some more evidence that you’re simply wrong on this point.
Just under 700,000 cars were taken in under the C4C program. That sounds like a huge number, but it’s not. There were over 250 million registered cars in the US in 2007. Even against numbers that are three years old, C4C removed less than 0.3% of the existing cars on US roads. C4C boosted new car sales, but even in the worst year for new car sales in decades, new cars bought through C4C made up just 6% of 2009 new car sales.
C4C was a literal drop in the bucket of the US fleet and new car sales. This is why Edmund’s (and everyone else who writes about the car business) is not blaming C4C for the rising price of used cars at wholesale auction. The numbers of cars involved in C4C are just too small compared to the overall market.
A couple of reasons off the top of my head: As stimulus, auto manufacturing employs 700,000 people in the US. Another one million are employed by car dealers. The auto industry last year also had a lot of existing excess production capacity to quickly bring people back to work if there was an increase in demand.
I want renewable energy manufacturing to be as important to the economy as the auto industry is today, but we’re most likely a decade or more from reaching that point. Putting $3 billion into consumer incentives on solar and wind last year would have just created a huge amount of unfulfillable demand.
As energy policy, the advantages of C4C are obvious. Transportation fuels are our largest energy source and a large majority of that is on vehicle fuels. According to the DOT, the average C4C deal resulted in an increase from 16.3 to 24.8mpg. That’s a 58% increase. At 15,000 miles per year, each new car will use 315 fewer gallons of fuel per year – or a total of 220 million gallons for the entire C4C fleet.
Again, that is a drop in the bucket of the total US energy consumption, but if you want to say an equal program for solar panels or home wind turbines would have created greater energy savings, you need to bring some data.
I’d like to see your work on our ” history of keeping that industry afloat”. In 1979, the government offered loan guarantees to Chrysler – and that’s it before the GM and Chrysler bailouts last year. Renewable energy has received immensely greater federal funding over the last thirty years than the US auto industry up to the GM and Chrysler bailouts.
And when you write “it hasn’t helped them in the long-term” , you seem to be under the impression that the US auto makers have failed because their market share has dropped so dramatically from the 1960’s. This is a common point of view, but it either reeks of ignorance about changes in the US and global economy since the 60’s, or ignorance about the car market in most of the world’s markets today. Or both.
The Big Three (used to be Big Four) dominance of the US auto market in the three decades after the end of WWII was a direct result of the war itself. We were the only first world country that started 1946 with the ability to build anything. It wasn’t just that Ford, GM, Chrysler and AMC owned the US market because there were no high volume competitors to come in, GM and Ford became huge players in Europe where they had had almost nothing before the war.
As Europe recovered in the late 50’s, and as Japan rebuilt itself, it was inevitable that those countries would develop manufacturing bases of their own. It started with small appliances and built into auto manufacturing by the early 60’s as the countries established the industrial, financial and intellectual infrastructure needed to create complex objects like cars. (In at least one case that was the actual process. Honda began as a company that made rice cookers.)
The US auto industry was fat and complacent when the world arrived on our shores in the 1970’s. But the arrival and acceptance of foreign car brands was inevitable in a world with anything approaching free trade. The 90%+ market share Detroit had in the 50’s and 60’s was unsustainable.
This wasn’t just true for cars. It happened in consumer electronics, apparel, industrial goods, processed raw materials, and in every other sector of the economy. By comparison, the US auto industry has actually done pretty well at retaining its market share. The US consumer electronics industry is totally gone. US computer companies have shifted nearly all of their production offshore in a single generation. US apparel manufacturing has gone from 90% in the fifties to about 15% today, IIRC. By comparison, the US automakers still hold 44% of the US market.
The markets of other countries (save Japan) are no better than the US. German companies don’t have a huge majority of the German market, same for Italy, GB and the other auto manufacturing nations.
taylormattd
Wow, burning books? And this guy is supposed to be one of the “reasonable” ones?
Tax Analyst
Just when I thought it would be impossible for E.D. to post a more tone-deaf thread than his Anti-Clunkers piece he comes right back with another “clunker” right on the heels of the first one, the only difference being the addition of a painfully strained and cluelessly presented analogy between used cars and books.
Plus when I saw the thread title I really thought the piece was going to suggest that the publishing industry needed to make a more determined and concerted effort to promote the sale and distribution of pornography, so I was doubly dissappointed to find myself perusing yet another simple-minded personal whine about “WAH! I couldn’t find a used car that I wanted at the price I was willing to pay, so therefore the Cash-for-Clunkers program was bad”. Yeah, I know I was personally severely disappointed to find out I would no longer be able to buy a used ’73 Pontiac that would get about 8mpg and would probably end up being in an auto repair shop every other week. I mean, c’mon John, give the poor guy a dollar and ask him to go call somebody who gives a fuck.
taylormattd
@arguingwithsignposts: Not to mention the fact that members of his party would never consider letting such programs pass.
Joel
Le mieux est l’ennemi du bien.
BombIranForChrist
Ugh, these back and forth posts suck. Can’t this get handled in the comments?
I love this site, but hot damn.
More DougJ, less … whatever this is.
Midnight Marauder
@Southern Beale:
See, I think this misses what’s actually happening here. There was a post on Kain’s home blog not too long ago, The League of Ordinary Gentlemen, that discussed the differences between the approach of their stable of writers to “real world issues” and the approach of the commentariat here. To wit:
I don’t know if he’s smarter than this. This is who he is, it would appear.
Allan
We’re starting to see why John has a soft spot for keeping EDK around. He fills the role usually occupied by Lanny Davis or Alan Colmes on right-leaning sites, offers weak-sauce and gives the regulars someone else to beat up on for a change.
Martin
We’re doing that. It’s called a Kindle.
I have no problem if the big 3 went under, but the catastrophic whining from the right about how Obama destroyed 3 million good jobs and the effects on those state economies would have been little different than if we had told West Virginia and Kentucky to kiss their coal industries goodbye in order to make the green energy investments pay off – and in your proposal he’d be doing both.
The reason why we make bad policy decisions is because we have a political climate that brutally punishes making good policy decisions. You want better policy, convince the idiots on the right to not demagogue every single reasonable proposal and vote against anything that happens to have a Democratic co-sponsor. When 40+% of your elected government shows up to work and throws their shoes into the wheels of the machinery, just for their personal edification, you’re ceding any ability to achieve positive outcomes.
Trinity
@Midnight Marauder: Thank you for sharing this.
Midnight Marauder
And let me just echo the sentiment that this entire post should have just been a comment in the previous thread. I know it’s difficult to grasp, but that’s kind of how the site has worked this entire time.
birthmarker
@Midnight Marauder: John C, I just thought this was a dog/cat/food blog.
AnnaN
I think you missed the point about where one of the major targets of the bill is to get these gas guzzlers off the road. If you don’t destroy the engines, you don’t accomplish that.
And, this program hurt poor people by not allowing them to spend their meager earnings on a non-necessity? Because, obviously, public transport is MUCH more expensive than insurance, gas at $3/gal, and the crazy upkeep required of an older gas guzzler.
The only way that destroying these cars made it harder for poor people was by nominally raising the price of used engine replacement parts for those makes and models.
Honestly, I don’t think you should be declaring anything a success or failure based on your EMOTIONS regarding the topic, i.e., “I feel that this was a failure and therefore, it was.”
Jesus Christ on a skateboard.
Warren Terra
@Midnight Marauder:
Kain says he can’t comment from his work computer, but can read and can post. Although, if I were his employer and had set up the computers with such restrictions I might question him spending any time here at all.
Midnight Marauder
@Warren Terra:
Sounds like a personal problem.
Mnemosyne
@Midnight Marauder:
It seems especially lazy when the person using the conversational approach can’t be bothered to actually check his facts before posting and thus causes his readers to wade through a lot of bullshit about “theoretical” things that have already been disproven.
It’s like he keeps posting about astrology and pouting because we point out that the planets don’t actually work like that.
calling all toasters
@Martin:
Don’t give him any ideas. His next post will be about saving Detroit by digitizing cars.