Should We Do Cash for Clunkers for Computers?

Here we go again ... again. Cash for Clunkers, the car edition, burned through a billion dollars in a week. Cash for Clunkers, the refrigerator edition, is going strong in New England. Can we get the government to pay us to ditch other things: Televisions? Dining room furniture? Snuggies?

Yes, we can! Computers. Dude, you're getting a Dell... rebate from the government!


Michael Mandel of BusinessWeek is the brainfather of this newest C4C child. Here's his plan for having the government give us money to trade in our old cruddy computers.

Your "Clunker Computer" will have to meet some minimum requirements: Too little RAM, slow microprocessor, too few USB ports, Windows 98. In return, you will get a rebate to purchase a new computer that will let you roam the Internet at will, downloading all sorts of video and multimedia (Advertisers will love it).

Yes, I'm quite sure the only thing holding back online advertising as a viable revenue model is a government-sponsored buy-back program for your old Compaq desktop. End snark.

I think Mandel (whose work I normally love) is a bit off here. It's not simply the idea that we should jump-start every sector of the economy by paying people to destroy their possessions. It's also this computer idea, in particular. Scrapping an old computer just because it's an old computer might not lead to much productivity gain. Working capital shouldn't be destroyed for money because there are often people willing to buy it. Aren't computers really easy to trade in anyway? My local Mac store in Chicago was willing to pay $300 for my dying laptop. The parts are easy to harvest and there's no reason to waste them by giving them to the government. Usually these trade-ins have an environmental angle, but there's no eco-argument here. Old Dells aren't quite the emissions hazard that was your traded-in '98 Ford Explorer, or your clorofluorocarbon-spitting fridge.

Mandel goes on to suggest that perhaps the government should write part of the bill to favor domestically built computers. Cash for Clunkers marries the Buy America clause! I don't want to see that baby.

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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