It sill looks like consumers benefited, and the Government benefited by the “look what we’ve done to spark the economy” sound bits spewed all over the media, and finally, the dealerships got rid of a lot of autos sitting on their lots.

The problem is that they seem to be the ones floating the Federal Government, while they try to figure out how to make the payment processing work. That’s funny! From what I’m seeing, most dealerships are going on a wish and a prayer about getting paid.

I’m talking some major cash per dealership that is hung up in government regulations of 150 pages and some 14 different forms that need to be completed. Does that sound like efficiency to you? I think it’s totally blind faith at this point that the dealerships are going to get the money that is owed to them. Citi call centers have been awarded outsourced work, and the National Transportation and Highway and FAA employees have been brought in to process paperwork, in addition to part-time employees having been hired.

It kinda sounds like a cluster — I mean ‘Clunker’ to me. They are all working on trying to input stuff and they can’t get in because there is soooo much of it and the documentation to process just one sale with a qualified rebate takes hours to complete. The computers are overwhelmed. It’s a great program for the manufacturers, a great program for the consumers. For dealers, it’s been an administrative nightmare.

Think about this for a minute – The Obama administration and its allies in Congress propose to overhaul (and potentially run) health care for more than 300 million Americans?

I think we can say cash-for-clunkers doesn’t inspire much confidence in Washington’s bureaucratic acumen. Or its speed! Or its feel for a functioning market, the demands and expectations – - OK I’ll stop.

Will the dealers get paid? Yes, because failure to do so would be a PR disaster of epic proportions for the democrats and the administration. Will the program prove to be the jumpstart languishing auto sales need? Debatable, but probably not, though depleted inventories already are forcing increased production schedules across the industry. Those announcements were made about a week ago.

The more important question, it seems to me, is what the obvious administrative failures of cash for clunkers say about the federal government’s capability to manage programs more typically run by the private sector. And, secondly, why is there a clamor for more of the same? What is it about this poorly run program that the American people or even congress wants more of? Tell me, what am I missing? Why did the public not see or hear about the issues in the media? Clearly journalism has seen better days and major networks appear to be agencies for the Obama administration.

Sad day for the USA.

Auto dealers are in business to make money selling cars and trucks, not to serve as conduits for federal transfer payments. If nothing else, cash for clunkers proved Americans still love good deals — and that their government cannot process them.

Why are TV and media so blind and non-objective anymore?  That’s probably because so many reporters fail to heed the journalistic rules that have been a foundation of our press, and that is to note the unseen as well as the seen—to consider all the effects of a policy on society as a whole, not just the immediately obvious benefits for a select group. I’ve not really seen anything published or on TV that has put any type of high level of questioning of the program before us and tried to explain what the unseen consequences of the ‘Clunkers’ program might be.  That’s why I ask if anyone is paying attention.

The first benefit of this revised clunkers program, which was approved last night by the senate and is off to the President today, is to increase the sales price of the car.  What this $3 billion subsidy is doing is boosting sales prices and lowering trade-in payments.  It’s not as if dealers simply charge $4,500 less than they would have and pass the entire subsidy onto the buyer — dealers still charge as much as they can for a new car and pay as little for a trade-in as their customers will allow. The subsidy is split between dealers and customers.  No one has ever come out and said that.

And who are the customers? Not poor people, or the needy — they don’t shell out five figures for new cars. No, this is a middle-class to upper-middle-class subsidy, which is probably why politicians love it so much.  I continue to hear that the average FICO score of the buyers within the ‘Clunkers’ program has a 720 score.  That’s clearly not the poor but I doubt if that kind of information ever comes available to the public or gets reported.

The real benefit to business — and harm to the economy — comes after the car sale is concluded. The law requires the dealers destroy the “clunker” engine (which, to be eligible, was drivable upon trade-in), scrap the car and shred almost all its parts. This government-required waste reduces the supply of used cars on the road.  All those poor and needy, who would have benefited from having access to these autos, will be completely denied.  Reduce the supply of drivable used cars, and you drive up the price of all cars.

This supply reduction is the real stimulus for automakers and new-car dealers, and it comes at the expense of every consumer who didn’t take advantage of Cash for Clunkers — especially those who can’t afford a new car. This $3B program taxes used-car buyers to subsidize new-car buyers.  Have we all just gone nuts in the country?  So tell me, how’s that “cash for clunkers” program working out for you?

 I’d love to hear your comments.

Like sad, lost souls, they trawl the Internet and the trade magazines, desperately hoping for a glimpse of the very latest models.   They do genuinely want to buy a car, but they can never quite stick to the process involved in buying one.
  
So instead of wandering down to the dealership and picking out a car, they would much rather wait until the next cycle of vehicles comes out, with all of the extras that the newest models have, the new lights, those little things that tell the driver whatever, all of the advancements from the basic model.
  
However, when the newest model comes out, they fold.   They just can’t resist waiting a little longer for the next model, then the next update.   And the end result of all of this?  They never update their car.  They are never satisfied.

We at myAutoloan.com suggest that these people seek serious help.  Cars are wonderful things, whatever their model number and waiting for the supercharged version is pointless and soul-destroying.
  
This is a serious problem and we sure hope they get over it.   The best way to deal with it is buy a car if you need one. Update your old car, get it financed by a direct lender and enjoy life.   Even better, just buy a car that you like, drive it and trade it if you have to but it’s time to update and improve your mode of transportation.   There will always be something better out there, so there is absolutely no point in waiting, and waiting, and waiting… let’s get this ecomony moving again!