Tim Carney has a nice run-down of who benefits and who suffers from Cash for Clunkers.
- Automakers. Although not as much as you might think, since the program is probably just shifting many purchases from the future to now.
- Public transport and bus companies. People who cannot afford to buy new cars will wind up taking more busses since they can’t buy a used car to get around.
- Dealerships. Boosting sales and lowering trade-in prices is a great benefit to car salesmen.
- Rich and middle class people. Who can afford to buy a new car once they get the clunker cash.
- Nucur Steel. “One lobbyist for this bill was Nucor Steel. In Cayuga County, N.Y., Nucor turns scrap steel into sheet metal and other steel products. The clunkers are now becoming a subsidized feedstock for Nucor, which helps explain why Sen. Chuck Schumer, D-N.Y., has led the push for $2 billion extra in clunker cash,” Tim Carney writes.
- Poor people. Fewer used cars means higher prices for poor people. They’ll have to ride the bus.
- Anyone who doesn’t buy a car under the program. See your neighbour’s flashy new SUV? You helped pay for that. Thanks!
- Auto-repair shops. Your local automechnaic business depend son used or older cars, which the owners don’t take to the dealer for repair. Less old cars to repair means less business. Also, the parts dealers have fewer parts because the government is intentionally wrecking them.
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