Naysayers overlook CARS’ value

Five hundred and thirty-six horsepower. 551 lb-ft torque. 191 mph top speed. The 2009 Cadillac CTS-V delivers nothing but joy out of its 6.2L supercharged V8, coupled with a six-speed manual, fully synchronized with two overdrive gears. Engineers have poured their hearts and souls into this performance machine.

The result: 0 to 60 in 3.9 seconds and the quarter mile in 12 seconds flat. But wait, it gets better. The performance tuned CTS-V completed Germany’s famed Nürburgring race track in an astonishing 7:59.32, putting to rest any notion that American cars can only move in straight lines.

Katie Kittrell | Daily Trojan

Katie Kittrell | Daily Trojan

The trade-in value for all this? $4,500.

At least that’s what you would’ve received under the government’s Cash for Clunkers (CARS) bill a few weeks ago. That’s right. The 15 miles per gallon rating on the Cadillac CTS-V basically makes it a clunker, a fact so bothersome that Gregg Easterbrook, a sports enthusiast of all people, took time to point this out.

Alright, so no one in their right mind considers this car a clunker, but people have every right to be enraged that while their tax dollars kept GM afloat, they continued working on this behemoth. Certainly this is upsetting, but to focus solely on what went wrong with this government program ignores everything it did right. From a purely financial standpoint, the CARS program should be considered a success despite small speed bumps like the Cadillac CTS-V.

Although cynics will point out that the $3-billion bill is just another example of the wasteful government spending that led to the unprecedented trillion-dollar deficit the United States is facing and that it has driven up our taxes, the reality is that CARS has generated tremendous profit. Nearly 700,000 cars were sold, keeping dealerships in business by moving idle inventory that would otherwise cost them up to 25 percent of the car’s face value. This outweighs the short-term cash flow problems dealers are currently facing as they check their mail daily for rebate money.

Not to mention, it was a better way to keep jobs alive in the auto industry than just giving the money directly to car companies as was done during the bailouts. In this manner, car companies must pour their shared profits into restocking vehicles and keeping manufacturers that build foreign and domestic vehicles in business too, while customers get to upgrade their vehicles.

Obviously, this comes at an expense to the American taxpayer, but let’s face it: citizens can’t pay taxes if they don’t have salaries.

Some activists are in fits regarding the manner in which used cars are disposed. Their key piece of evidence remains a popular YouTube video demonstrating a clunker’s engine being disabled. A liquid composite is poured into the engine then revved at high RPM until the engine fails, as evidenced by clouds of white pollution spewing out of the exhaust and engine.

Again, though, the benefits outweigh the detriments.

Each traded-in car averaged a 9 mpg upgrade to its fuel economy. Based off an average 12,000 miles driven annually by Americans, this equates to 278 gallons per year saved per vehicle. Multiply this by the nearly 700,000 cars sold, and the public is looking at about 190 million gallons of fuel saved. Moreover, those 278 gallons annually saved 2.8 tons of carbon dioxide from being released. Across the total vehicles sold, the environment was spared 390 million pounds of carbon dioxide. Of course, these figures are approximate and just for one year. It’s safe to bet the clunkers traded would’ve been around for a couple more years. These savings, however, help justify the manner in which the cars were disabled.

Cheaper alternatives like rebates for low-income drivers or higher gas guzzler taxes may have been just as good for the environment, but the financial boost to the economy would’ve been lost. When the environmental aspects to the bill are considered along with the financial benefits, CARS is about as successful as a stimulus program can be.

Hopefully, the success of CARS can calm the public’s inherent opposition towards government programs that enter the private sector and help convince citizens that big changes, like health care reform, actually have a shot at success.

Robert Fragoza is a junior majoring in chemical engineering. His column, “Reality Check,” runs Fridays.