The Cash for Clunkers program, extended last night by the Senate, is widely unpopular in conservative and free-market circles. Economics commentator Larry Kudlow, usually found in those very same circles, explains in National Review Online why it’s a successful example of government stimulus.
There’s the consumer confidence, consumer enthusiasm angle:
In virtually no time, the clunker program has become a national pastime. It has captured the public’s imagination in a way that no other federal stimulus has. Everyone is talking about it. And I truly believe that consumer spirits have been buoyed by the prospect of going out and buying a new car — even with federal assistance, and even under the duress of federal mileage standards.
And the stimulus angle:
Now, I wouldn’t want the government to pass out free money for everything. But in this particular case, the cash-for-clunkers rebate program is working. It’s working so well that it’s running way ahead of the computers that are administering it at the Transportation Department and Citibank.
Well, sure. That’s government for you. But unlike most of the rest of the fiscal-stimulus plan, this program actually works because the federal cash rebate actually contributes to a consumer purchase. It’s not just another welfare-type transfer program.
And the dealers say, can we now pleased be paid? From The Dallas Morning News, “Dealers want government to accelerate their ‘cash for clunkers’ rebate checks“
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