I am sure that the President of Japan was thanking Obama for Cash For Clunkers, because in effect it served as a stimulus plan for foreign auto makers, as demonstrated by the statistics presented in the following article:
Cash-for-Clunkers = Cash-for-Foreign Automakers?
By Alan Tonelson
Sunday, September 13, 2009
U.S. AUTO INDUSTRY TRENDS
U.S. auto sales during first month of Cash for Clunkers program* (June-July, 2009): +16.02%
U.S. auto imports since Cash for Clunkers bill introduced** : +27.62%
U.S. auto parts imports since Cash for Clunkers bill introduced: +4.06%
U.S. auto trade deficit since Cash for Clunkers bill introduced: +56.10%
U.S. auto parts trade deficit since Cash for Clunkers bill introduced: +16.23%
Overall U.S. automotive trade deficit since Cash for Clunkers bill introduced: +43.36%
Overall U.S. trade deficit since Cash for Clunkers bill introduced: +9.71%
U.S. manufacturing trade deficit since Cash for Clunkers bill introduced: +26.36%
*change from June-July, 2009**March 17, 2009
http://www.americaneconomicalert.org/view_art.asp?Prod_ID=3296
The person who calculated this bit of information went to high school in Pittsburgh , Pa. He is now & has been a professor at West Virginia University in Morgantown , West Virginia for the last forty some years. I never looked at the clunker program in such depth.
ReplyDeleteThink of it this way: A clunker that travels 12,000 miles a year at 15 mpg uses 800 gallons of gas a year. A vehicle that travels 12,000 miles a year at 25 mpg uses 480 gallons a year. So, the average Cash for Clunkers transaction will reduce US gasoline consumption by 320 gallons per year. They claim 700,000 vehicles so that's 224 million gallons saved per year. That equates to a bit over 5 million barrels of oil. 5 million barrels is about 5 hours worth of US consumption. More importantly, 5 million barrels of oil at $70 per barrel costs about $350 million dollars So, the government paid $3 billion of our tax dollars to save $350 million.
We spent $8.57 for every dollar we saved.
I'm pretty sure they will do a great job with our health care, though.