The government’s recent “Cash for Clunkers” program has been hailed by the left and right as a major success in the fight to help the struggling US automakers and car sales and to ultimately bring an end to the recession.  But in the wake of the celebration of slightly better than projected sales numbers, an important fact has been overlooked.  While people were busy trading in their older, less fuel efficient, and often times otherwise sufficient vehicles for the latest and greatest models on the car lots, the average American consumer has been stuck with a new bill, and it has nothing to do with higher taxes or government spending per se.  Those people who traded in a paid-for vehicle that got 20 miles per gallon for a newer, $30,000 vehicle with hybrid technology that is good for over 35 miles per gallon have racked up a ton of new debt.  This new debt has come at a time where the FED has predicted over 200 more banks will fail, and unemployment will rise another couple of percentage points (officially) before it even begins to cool off.  “Cash for Clunkers” was a great idea, but did it really help US consumers or did it allow them to become even more saddled with debt?

The average consumer should be encouraged to both help the environment and the economy.  These behaviors are not mutually exclusive.  Why not give government rebates or incentives to those who would be willing to upgrade or modify their already-existing vehicles to make them more fuel efficient?  That way, the government could stimulate that particular part of the US or global economy that deals with engine and emissions modification while driving inventors and companies to come up with more bolt-on solutions instead of expecting the government to mandate that all “unacceptable” cars be needlessly and very wastefully crushed into big metal cubes.

I am all for higher fuel efficiency standards, as long as they are put in place in a standardized, intelligent manner.  The “Cash for Clunkers” was a great way to help boost the average fuel economy in the US and promote some of the more fuel-efficient models and technology, but if the US government was really trying to drum up auto sales, why didn’t they only apply the rebate to US-made autos?  The top three best-selling autos during the program were Japanese-made.  They are great car makers, and I bet those who bought those Japanese-made cars are happy that their vehicles are, by and large, more reliable than their US counterparts, but the US economy would have benefited more from a US-made auto swap.

The “Cash for Clunkers” program certainly incentivized the fight to keep America’s auto fleet more fuel-efficient and technologically advanced, but it also hurt the US consumer and US-based auto companies in ways that are not really being discussed in the mainstream.  If the government wants to reinstate the program, it would do them much good to retool it in order to achieve maximum positive economic and environmental impact first inside the US, and then abroad.