You discover that the $1 billion that Congress budgeted for the program has been spent in FOUR DAYS. The program is now out of money. What do you do?
A. Realize that $4500 per clunker was too big a subsidy and that you can achieve the same effects with a much smaller amount.
B. Worry that maybe there is some fraud in the program and that some of the cash isn’t going to clunkers
C. Increase the budget by $2 billion
The correct answer for clunkheads is C, of course. That’s the wise choice when you are spending other people’s money. What fun that must be!
Professor Roberts is being sarcastic, but his point is valid. The quickness of the turnaround should give legislators pause. Of course, they have a comparative advantage in hastiness. As Reason's Steve Chapment puts it, "[Cash for Clunkers] proves the federal government is unsurpassed at two things: dispersing money and destroying things."