We Need a Way Out- Cash for Clunkers

I forgot to mention in the post below about how Cash for Clunkers fits in.

Well, it should be obvious. They are removing around three quarters of a million cars from the road, not only immediately increasing the demand for new cars, but also taking these vehicles from the used car pool, lowering the supply of used cars and again increasing the demand for new cars, especially the fuel efficient ones.

Japan has had a device for years to get their older cars off the road and spur demand for new ones. It is called Sha’ken, a process of inspection that gets increasingly more expensive as a car gets older. If you think about not just the automobile manufacturers, but all of their suppliers as well, and the suppliers to the suppliers and the service industry that surrounds all of this, you can see how car sales are a serious economic engine, and why the push to make cars disposable, especially in this country. There are almost 251 million vehicles in this country. Can you imagine the economic impact if we replaces just 10 percent of them a year?