I heard recently from an old friend — a former employer with whom I've maintained sporadic contact over the years. He owns a used car lot, and he was singing the blues.
(Disclosure: I spent 25 years in the automobile business.) Until now, my ex-employer's primary source of merchandise was local trade-ins at Modesto area new car dealers. He'd buy the ones he liked, recondition them (he has a very complete shop) and sell them.
Unfortunately, most of these vehicles are now classified (by our government) as "clunkers." The term — and this is surely not accidental — conjures up a vision of a clapped-out rust bucket, belching out a trail of smoke. This is totally misleading; some of these cars, properly maintained, can provide years of reliable service. Regardless, once a "clunker" is traded in, it cannot be resold. It has to be destroyed.
Now, for someone with a good income and a decent credit rating, this program is like found money. Problem is, there's a whole class of people — we call them the underclass or the working poor — who can't afford a new car, even with the government's help. These folks generally live off the public radar, but they are real, numerous, and they need transportation just as much as do the more affluent.
These are the people who constitute the bulk (though not the entirety) of my ex-employer's clientele, and they, like him, are bumping into the law of unintended consequences: Vehicles they might normally consider (and afford) are simply gone — crushed and shredded. And, as a result, the competition for non-clunkers has become correspondingly intense, driving up prices to the point where it is very difficult to acquire one, recondition it, and resell it at a price lower income people can afford.
These consequences may have been unintended, in as much as they were hardly the point of the program, but they were certainly foreseeable It doesn't matter, though, because the real aim of "Cash For Clunkers" isn't better gas mileage (attrition would have taken care of that over time), nor is it about shiny, happy people driving away in their new car.
It's about GM — General Motors or Government Motors, depending on your degree of political cynicism, I guess. That's why the program didn't apply to buyers who wanted to trade up to a more fuel-efficient used car. Which makes it somewhat ironic that the top three new vehicles purchased through this program are a Toyota, a Honda, and a Ford.
No matter — the program has generated a good-sized spike in new car sales; it's also known as forcing the market, which means most of these sales would have occurred eventually, and once the market is sucked dry — probably before the funding is — there's going to be a dry spell. Maybe even a drought.
And as for the limited income folks? All they can do is pray that whatever they're driving now holds together, because it's for damn sure nobody's going to bail them out.
Flint is a Modesto resident. Write him at email@example.com.