Another Efficiency Measure for "Cash for Clunkers"
An old friend from my think-tank days emailed me another measure of the inefficiency of the Government's Cash for Clunkers program. It's common sense and so was lacking in the program. The calculations:
A 15 mpg vehicle at 12,000 miles per year uses 800 gallons of gasoline per year.
A 25 mpg vehicle at 12,000 miles per year uses 480 gallons per year -- 320 fewer gallons per vehicle.
The Government's (tax-paid) Cash for Clunkers program subsidized the purchase of 700,000 new cars; it will save (700,000 times 320 gallons of gasoline per year, or) 5.3 million (42-gallon) barrels of gasoline -- 1/2 day of US gasoline use.
US refineries convert oil to 46% gasoline and 54% other products, so it would take 11.5 million barrels of oil to "save" 5.3 million barrels of gasoline.
A barrel of oil costs about $70, so we spent $3 billion to save $803 million.
And we got no environmental credits nor greenhouse gas accounting, and no follow-up survey information to see what (if any) social benefit derived from the program.
That's our government in action.
Read more!
A 15 mpg vehicle at 12,000 miles per year uses 800 gallons of gasoline per year.
A 25 mpg vehicle at 12,000 miles per year uses 480 gallons per year -- 320 fewer gallons per vehicle.
The Government's (tax-paid) Cash for Clunkers program subsidized the purchase of 700,000 new cars; it will save (700,000 times 320 gallons of gasoline per year, or) 5.3 million (42-gallon) barrels of gasoline -- 1/2 day of US gasoline use.
US refineries convert oil to 46% gasoline and 54% other products, so it would take 11.5 million barrels of oil to "save" 5.3 million barrels of gasoline.
A barrel of oil costs about $70, so we spent $3 billion to save $803 million.
And we got no environmental credits nor greenhouse gas accounting, and no follow-up survey information to see what (if any) social benefit derived from the program.
That's our government in action.
Read more!