I have to agree with USA Today’s editorial on Cash for Clunkers (via), but they don’t even mention opportunity cost. Even with the minor fuel economy savings, “helping” people into loan payments further redirects money away from local economies and family savings. I feel for the auto workers, but the auto industry has enjoyed riding the wave of the housing bubble (buyers relying on home appreciation to offset auto depreciation) and the wave has crashed.
So this seems like a bad deal for buyers, local businesses, the environment, and the taxpayers who’ll pay for it.
Anti-new car propaganda:
- Why You Shouldn’t Buy a New Car
- Don’t Do It! (Cars are not invenstments)
- Drive Free, Retire Rich doesn’t include used car risk, but should still work
Buying a used car was the best financial decision I’ve made in years. Interest on a car loan is money down the drain.