A few weeks ago I wrote a post entitled "Clink, Clank, Clunk" regarding the efforts of the House of Representatives' to get YOU a piece of the TARP bailout billions. Yesterday, the House (MOTTO: "There's Nooo Money Like Your Money, Like Nooo Money We Blow") approved a bill by a vote of 298 - 119 which would, in effect, give you money which, in actuality, the government 'doesn't have'.
Q.: Mike, why would the government want to give me money to buy a new car?
A.: To encourage you to buy a GM or Chrysler vehicle to protect the $50Billion they've already pumped into those two companies to keep them from failing.
Q.: Why were GM and Chrysler and GM failing?
A.: Because GM and Chrysler have made inferior products (when compared to the Japanese, Korean, and a certain American Auto Maker smart enough NOT to take bail-out money) and have on average an embedded cost of $1,700 per vehicle manufactured to pay for UAW (United Auto Workers) healthcare and benefit costs. ($1,700 PER vehicle of 'overhead' prior to ever paying for a single 'bolt' -- Sing with me now: "Look for the Union Label...")
Q.: So, are GM and Chrysler financially stable now?
A.: No. However, analysts are expecting you (oh, sorry, I meant the 'Federal Government') to pump in an additional, meager, $50 BILLION into both companies by the end of calendar 2009.
Q.: Umm, that doesn't sound good at all, does it?
A.: No. And don't ask any more annoying questions which you already know the answers to.
Q.: Will I be able to get money if I buy a new car, truck, or van?
A.: Yes, provided it gets better gas mileage than the vehicle you are driving today. (Your old 'clunker')
Q.: How much money will I get, and how much better mileage would I need to get in a new vehicle to qualify for the TARP Lotto?
A.: Under the guidelines of the current bill approved yesterday, you would receive $3,500 for purchasing a car which, on average, gets 4 or more miles per gallon than the vehicle you're trading in. If the vehicle gets 10 or more miles per gallon, you will receive a $4,500 hand-out (I, of course, mean 'incentive') from Uncle Sam.
Q.: Why is Congress doing this?
A.: There is a three-part answer to this very pesky question:
1. Because it's not their money
2. To stimulate new vehicle sales for GM and Chrysler
3. To SAVE the planet (and life as we know it)
Q.: But would I get a hand-out (incentive) if I purchased a non-GM or non-Chrysler vehicle?
A.: Umm, yes
Q.: Have GM and Chrysler designed new vehicles, re-negotiated labor contracts, and in general, lowered their associated manufacturing costs to be more competitive with Japanese manufacturers, or even (gasp!) Ford Motor Company? I guess what I'm wondering is... has anything changed with these two companies since they took their FIRST $50Billion from us? And are there any provisions on the next $50Billion they're expecting to receive?
A.: Again, please stop asking questions which you already know the answers to...
Q.: O-k-a-y. So how does this bill result in the sale of more cars for GM and Chrysler?
A.: It doesn't, but it will SAVE the planet!
Q.: Because, all things being equal, I'm buying a Japanese, Ford, or other 'off-shore' branded vehicle with higher gas mileage and lower initial cost. This wouldn't help GM or Chrysler, would it?
A.: No, but remember the planet! It will be saved!
Q.: Yeah, right.
A.: (Ding-ding-ding) I'm sorry, but you must state your inquiry in the 'Form of a question', please.
Q.: Assuming that these incentives are made available to me, can I get financing for a new vehicle?
A.: Is your credit excellent?
Q.: I've got a credit score of around 620. Is that considered 'excellent'?
A.: Ah, no.
Q.: Well, how can I pay for the car if I don't get financing?
A.: You will need to call the White House and apply for a federally-insured: "I need a new car but can't buy one because my credit isn't great and the economy is in the dumper and no one in DC seems to care and all they do is spend more money they don't have AND I can't improve my credit score by getting a better job because the economy is still in recession 'cause the Stimulus Bill didn't fix anything" loan.
Q.: Can you repeat that for me? My pen just ran out of ink.
A.: No. Just call the White House and tell them you want money.
Q.: Is it really that easy?
A.: Yeah. It's easy when it's not YOUR money you're giving away in the first place.
Q.: What will this CARS Act (Clunker Bill) cost this year?
A.: In U.S. dollars? Or, in Canadian dollars?
Q.: Do I look like I'm from Canada?
A.: Well, you don't look like an American. You don't appear to be 'needy' enough...
Q.: Come on, what's the number?!?
A.: This year the House is projecting the Clunker Bill payouts to run about $4Billion.
Q.: So will the White House spend $4Billion less on the payouts to GM and Chrysler this year? Since it's being spent on their behalf anyway?
A.: Ha, ha, ha, you are one funny guy! No, they'll spend that money too. Doing the Math in my head, that'll be approximately $72Billion in US dollars.
Q.: But didn't you say it was $50Billion PLUS $4Billion, wouldn't that be $54Billion?
A.: We're talking about the government here. You forgot the seed capital for the new "Gas From Cows" Bill. And before you ask, it's really long tube to collect 'Gas from Cows' to power electrical generators and...
Q.: Save the planet?
Q.: Does the Federal Government have it? You know, the money?
A.: The presses are rolling as I type this.
A.: No, that's incorrect, correct question was 'Sigh?'
For an overview of this Boondoggle in the making, here's the article I found on MSN.com this morning... Clunk