Another Obama program chock full of unintended consquences that hurts low income people. The Car Allowance Rebate System aka "Cash for Clunkers" cut the supply of used cars. According to study by Edmunds.com 575,000 of the 700,000 cars sold during the "clunkers" program would have been bought even if no subsidy was available. Thus each sale cost taxpayers not $4500 but $24,000.
The average cost of three year old cars has now increased 10% since last summer. Who generally buys used cars ? Low income people.
Was there any environmental benefit from removal of the clunkers from our roads ? Nope. According to research at U.Cal - Davis the reduction in CO2 cost $237 a ton. Contrast that with the international price of carbon credits of $20 a ton. The reduction in emissions is less than what Americans emit in one hour.



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