Why 'Cash for Clunkers' Tanked

A failure of government planning, or ruined by its own success?

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As quickly as it came, the most colorfully nicknamed government program in recent memory has failed. Or wildly succeeded, depending on how you tend to view glasses with a mid-range level of liquid in them.

Cash-for-clunkers, as the Consumer Allowance Rebate System came to be known, was so deluged by demand that it burned through its entire allotment of cash in its first week of existence. Most pundits are spinning this one of two ways: either it's an ominous sign that Obama can't deliver on his pie-in-the-sky programs; or it's an amazing testament to consumers' eagerness for the program.

  • A Bad Omen for Health Care, said The New York Post in an editorial that called the program's quick demise a "sneak preview." Punch line: "And what happens when Washington runs out of health-care dollars? Suspend ObamaCare?"
  • A Case Study in Flawed Liberal Economics, says Conn Carroll in a detailed evisceration at the conservative blog The Foundry. "Does nothing for the environment...Hurts working Americans...Hurts charities...Further entangles government in market...Only adds to debt."
  • A Success for Suffering Dealers, At Least, say Martin Zimmerman, Tiffany Tsu and Jim Puzzanghera in a long report. "Dealers and automakers said the plan clearly sparked a level of interest that had been missing in new-car showrooms, which have looked like ghost towns for much of the last year."
  • A Failure for Dealers, But Good For Everyone Else, says Alex Salkever at Daily Finance. "Clearly, the program fulfilled its intended purpose of giving a boost to the auto companies...The only obvious losers could be dealers who likely took in more clunkers than they will be able to redeem. "
This article is from the archive of our partner The Wire.