Cash For Clunkers Criticized
September 14, 2009
Prior to the establishment of the Cash for Clunkers there were a number voices that were critical of the program’s viability. The sentiment was that while the program sounded good on the surface but it wasn’t good overall for the national economy.
Even though the program is has now ended and yielded approximately 700,000 sales, the critics point out that Cash for Clunkers did stimulate economic growth but rather redistributed wealth and saddled gullible consumers will new debt loads they can’t manage.
Some opponents of the program suggest that Cash for Clunks will cause more harm to American consumers that good. According to these groups, the less fortunate among them may find themselves in worse financial shape as a result of jumping on the supposed deal.
But, is this gloom and doom at all accurate?
With all the supposed reports circulating around about the program’s debilitating effects on new car owners, you may be surprised by some of the following facts about the typical Cash for Clunkers deal. What’s clear is that there is a bit of exaggeration on the part of one group.
For instance, one the most common vehicles that qualified for a trade in was the 1998 Ford Explorer. If you had one of these and traded it in for a brand new Ford Focus, you could earn a credit worth $4,500, which would lower the MSRP on the Focus to about $11,500. With a down payment and some good negotiation for an additional discount, you could see about $10,000 in financing.
That’s for a four-year loan at approximately 7.5% interest. This would mean that your monthly payment would be below $250 a month. This is a far cry from the burdensome payments that have been suggested by the critics.
The bottom line is that the Cash for Clunkers program has been a legitimate help to the U.S. economy. It has given more people the opportunity to purchase affordable, lower-emission, and higher-MPG automobiles.
Related Entries
- Cash for Clunkers Had Some Clunker Results A lot of taxpayer money has been thrown around recently in the automotive sector. The federal government is contemplating its third round of bailouts for an ailing auto industry. What
- Cash, Clunkers and October Auto Sales You are driving down the road and the clunker of a car actually begins to go “clunk”. It’s time for a new auto! Now you’re berating yourself that you
- Sec. Paulson’s Plan For Credit Card Bailout Criticized The current sentiment among many economists regarding the latest twist in Treasury Secretary Paulson's handling of the $700 billion bailout fund is dark indeed. Any suggestions that the money
- Oil Prices Top $126 A Barrel Today the price of oil kept going up, up, up. The price of oil topped previous records and is now more than $126 per barrel. This represents and increase of
- Proposed Virginia Car-Title Loan Regulations are Criticized You see the care loan title businesses everywhere and they are often payday loan operations also. Some people are opposed to these businesses because the lenders charge excessive interest rates
Comments
One Response to “Cash For Clunkers Criticized”
Got something to say?
-
Auto Insurance Quotes
-
Recent Posts
- Getting An Auto Loan With Bad Credit
- Bank of America Commits to 2MP
- Bad Consumer Loans Begin to Level
- Consumers Must Prove Income Up Front for Loan Modification Program
- The Only Financial Rule You Will Ever Need
- How To Lower Your Car Payments Without Paying More In The End
- The Different Types Of Auto Leases
- Loans That Make A Good Impression On Lenders
- The Essential Terms Of Any Auto Lease
- Why Long Period Auto Loans Are A Bad Idea
Advertisements
-
Your article failed to mention the negative consequences of cash for clunkers. The biggest one was that 700,000 running vehicles were destroyed, many in good shape. Taking these vehicles out of the market had a tremendous negative impact on auto repair shops, parts stores, used car sales, car donation charities and low income citizens. This could easily have been avoided!