The heathcare bill is 150 times longer than cash for clunkers — guess how well that’s likely to work out for the American people. The NYT describes the chaos associated with one tiny ($3 billion) government program called cash for clunkers:

“As of this morning, they’re not really confident about any deals, and no one can give them advice about what they should be telling their customers.” One thing still not clear is how many older cars have actually been sold and scrapped with the original $1 billion, and how many more the new $2 billion will be able to cover. Mr. Kurkin tells us that the government Web site where dealers are supposed to register their deals has been crashing, and the dealers haven’t been able to plug in their information.

We spent a couple of days earlier this week following the whole complex program, from dealer to scrap heap, and found twists and turns in it that are making it a nightmare now for everyone involved.

The program requires that the clunkers be put out of service for good, so dealers must destroy the engines on cars that are traded in. We watched this process yesterday at the DCH Paramus Honda in Paramus, N.J. It is quite laborious and potentially dangerous. And it certainly is final.

Nick Clites, who is in charge of used cars for the dealership, was prepping a 1988 BMW 535IS, with 214,000 miles on the odometer, for its death. He drained the oil, then donned a silky blue protective suit, goggles and gloves and poured a sodium silicate solution into the engine. He revved the car, and within a few seconds, the solution hardened into a glass-like substance, the engine seized up and the car was dead…

Ms. Maggio said she generally makes her profit by reselling the engines, the most valuable parts of the cars she takes, but that’s not posible with the cars coming to her because of the cash for clunkers program, because they have been rendered unusable. That cuts down the salvage value of the cars — and the incentive for salvage yards and wreckers to take them — to almost nothing, considering the time and energy they must spend in going to the dealer, towing back the dead cars, removing the engines, crushing the bodies and shipping them to a metal scrap shredder and recycler.

And, of course, the process reduces the supply of used engines for people who can’t afford to buy a new car and come to the salvage yard looking to fix up old ones. In any case, Ms. Maggio said, dealers are “hitting the panic button” today.

The cash for clunkers bill is a mere 8 pages long, and it has created chaos and all sorts of nasty unintended consequences. Do the fantasists in Congress or the President know the magnitude of the mess they will create with the 1000 page healthcare bill and its trillions of dollars in costs? How can people be both so ignorant and so arrogant?

This entry was posted on Sunday, August 2nd, 2009 at 3:57 am and is filed under business, Democrats. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.