Stumbled across a very good write-up on The Law of Unintended Clunkequences today, by AOL Auto's Editor-at-Large William Jeanes: link. What I really like is Jeanes' suggestion to change the acronym of Cash for Clunkers from "C4C" to "P2P" -- short for robbing Peter to pay Paul.
"According to a survey of new-vehicle buyers who participated in the recent Cash for Clunkers program, more than 17 percent now harbor “some” doubt or “serious” doubt about letting a government subsidy convince them to go further into debt. CNW Research of Bandon, Oregon, a firm specializing in automotive marketing research, conducted the survey in late August.
Buyer’s remorse is not a new phenomenon as anyone who ever opened an envelope containing Visa’s autopsy of that Spring Break trip to Margaritaville can tell you. The significant revelation of the CNW survey, however, is that under normal conditions only 6 to 8 percent of new-car buyers suffer the shouldn’t-a-done-that syndrome.
That means that over twice as many C4C participants as normal buyers are worried about the negative impact a brand spanking new payment book with $275 printed on each of its 72 pages might have on rent and Hamburger Helper expenditures. (The actual C4C numbers were an average loan length of 49 months and an average payment of $317.) No wonder. I’m surprised that the survey didn’t find half of the C4C spenders sitting up nights watching Suze Orman and Dave Ramsey re-runs."
As P2P participants begin to fall behind on new car payments -- to default on loans they couldn't afford and wouldn't have taken without a cash incentive from good old Uncle Sam -- how long before we'll be hearing calls for a "repo rescue" by Washington, eerily similar to the sub-prime borrower bailout, as "victims" of the clunkers program come forward, using the "government-made-me-do-it" excuse? Not long at all, I'm guessing.
No wonder Gore Vidal called this The United States of Amnesia.
The United States of Myopia, better yet.