Auto Industry: "Cash For Clunkers" Program Now Cashless?

The Cash for Clunkers program, or the Car Allowance Rebate System is such a great program.  Individuals that are looking to buy a new auto can go and take their car of less than 25 years old I believe and some other requirements and they can get a rebate for it of up to $4500 off of the purchase of a more fuel-efficient car.  This billion dollar program is great:

1) it incentivizes the purchase of new cars which provides heightened focus on the auto industry.  The American auto-giants can benefit greatly from this from an advertising standpoint and as a rebuilding standpoint because consumers want to take advantage of a great deal.  It is just up to the American car producers to offer a car that is competitive with f0reign models.

2) Focusing on fuel efficiency.  That is the name of the game right now.  Gas prices are a fickle animal.  i am sure we could all benefit from reduced expenditures on fuel costs due to a more fuel-efficient car.  Having government funds for a major discount to get one makes it even better.

In fact, it is so clear that this will help many Americans, that it might be a little too well designed.  Why do you say that?  Well within one week of the program becoming official and auto dealers advertising it, a plethora of people have submitted for the rebate, and $1 billion suddenly is not enough money to meet the outpouring of interest from Americans.  

While the Obama Administration is trying to secure more appropriations for this before the 111th Congress goes on recess, I must say this is not the program to leave strapped for cash.  It would miss an opportunity to take advantage of high consumer demand and willingness to spend money.  But indirectly the flowing of money from buyer to supplier, can be a kick in the pants for an economy still struggling up the mountain toward stability.  

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