Don't believe the hype

1) Cash for clunkers

http://news.yahoo.com/s/ap/20091104/ap_on_bi_ge/us_cash_for_clunkers

Of the $3B in federal subsidies for vehicle trade-ins, almost 1/3 went to old truck/SUV to new truck/SUV swaps (that not only guzzle more gas, but also have dirtier emissions than compact cars). There were 677,000 trade-ins in total, and 1/7 of those were for new vehicles getting less than 20 mpg. Preliminary data show that the average trade-in mpg was 16 and the average new vehicle mpg was 25. So there were 137M registered passenger cars in the US in 2005, and let's say the number is the same today. If 677K vehicles were traded in, at an average mpg improvement of 56%, the CARS program improved the American auto fleet's fuel economy by 0.28%.

The most common trade was an older Ford F-150 pickup for a new model (at a whopping 1-3 mpg savings to the planet), which happened 8,200 times. There were even $500M in deals where the new vehicle got the same or WORSE mileage than the traded in "clunker", supposedly in violation of the program rules, but nevertheless still happened. The gov't is currently investigating. But hey, Ford and GM posted improved profits recently, and the recovery underway! On the green side of things, GOP senators on the Environment Committee boycotted discussions on the climate change bill, but Chairwoman Boxer passed it anyway.

2) Bill Clinton honored with statue in Kosovo

http://news.yahoo.com/s/nm/20091102/wl_nm/us_kosovo_clinton_statue_2

The recently independent Kosovar Albanians honored their "savior" and champion Bill Clinton with a bronze statue and boulevard in his name at their capitol. First off, it was highly dubious for the US/EU/UN to grant autonomy and recognize breakaway regions at risk of ethnic cleansing such as Kosovo and East Timor, yet ignore the Ossetians, Chechens, Palestinians, Kurds, and others in similar predicaments elsewhere. But I suppose Indonesia has 17,000 islands, so losing one won't hurt too much (and Timor doesn't have much oil), and we just wanted to punish Serbia for its actions in the 1990s. Secondly, what was the deal with the mostly-forgotten Kosovo war anyway? In 1999, The ethnic-Albanian Kosovo Liberation Army (KLA, freedom fighters or terrorists, depending on who you ask) revolted against the Serb government. Albanians attacked gov't buildings and the Serb minority in Kosovo, and of course the Serb military and paramilitary gangs retaliated harshly (but not much worse than Sherman in Atlanta). Clinton and his defense secretary William Cohen made the media rounds to justify NATO intervention, claiming that "hundreds of thousands" died in genocidal attacks, akin to Rwanda or the Holocaust. Of course than number came out of thin air, and later investigations of human remains in the region uncovered ~2,000 corpses, and not all were Albanian or victims of genocide. But despite some protests, Congress gave the green light. NATO dropped the hammer on Serbia with 78 days of air strikes, including cluster bombs (weapons now rejected by most of the civilized world besides Israel, the US, and Russia), until the Milosevic government finally capitulated (at the behest of Russia). 10 years later and billions of dollars spent, Kosovo is still a dirt-poor near-failed state, there are still 14,000 Smurf peacekeepers there (including 1,000 Americans), organized crime has flourished, and Yugoslavian refugees have flooded Western Europe, so hardly a success story of American nation building. But better than Afghanistan and Iraq I suppose.

But what you may not know, and most mainstream media ignore, is that the NATO bombing campaign also killed hundreds of civilians and barely diminished Serbia's military capabilities. In fact, the bombing angered Serbs and accelerated ethnic cleansing against Albanians in some instances (the NYT estimated 4,600 Albanians killed AFTER the NATO bombing commenced). And after the Serb withdrawal from Kosovo, the "hands off" UN forces were unable to stop the vengeful KLA from brutalizing the Kosovar Serbs. It's quite possible that as many Serbs were killed/raped/displaced in the war as Albanians. But we sided with the Albanians because we didn't like Serbia for causing all those problems in Bosnia some years back, and Milosevic was a grotesque strongman. Serbia was misbehaving and challenging the credibility of the US and NATO in post-Cold War Europe, so we had to respond with violence, even if it upset our wary ally Russia (historically a supporter of Serbs) and destabilized Eastern Europe with a humanitarian crisis. The attached reports from the libertarian Cato Institute (yes I know, consider the source, but at least they had the courage to tackle the subject) give more details.

After the Serb surrender, Clinton said that we "did the right thing in the right way". But now we are indefinitely responsible for Kosovo stability (a gloomy prospect), which gives the people and their leaders little incentive for reconciliation and development for a better, truly autonomous future (the same quandary exists in Iraq). Maybe doing nothing was unacceptable, but war and bombing usually kill all hope of a diplomatic solution and increase hatred, not decrease it. And let's be honest, we bombed because we didn't think the Yugos were worth American blood, but attrition bombing can't stop non-uniformed thugs from killing innocents. If the UN left today, probably nationalistic/ethic violence would resume, so we have really painted ourselves into a corner. So yeah, Clinton was all smiles in Pristina at the statue unveiling, like Bush on the aircraft carrier. Why do they always seem to erect more statues of short-sigted, self-righteous warlords than true peacemakers?

Cash for clunkers

http://www.cars.gov/
http://www.kbb.com/kbb/cash-for-clunkers/list.aspx
http://www.npr.org/templates/story/story.php?storyId=111456626&ft=1&f=1006

I question the necessity and execution of this program. Yes it appears to be a success when the $1B CARS fund has nearly depleted after a week of enrollment, and the House quickly passed another $2B replenishment. Assuming that the average rebate is $4,000, that means 250,000 new car sales were subsidized by CARS (assuming no overhead and clunker junking costs). But what is the purpose of the program? A) to get surplus new vehicles off dealer lots, B) to make America's auto fleet less polluting, and/or C) to help consumers fight the recession with increased spending and enjoy the quality-of-life benefits of a new car? And shouldn't this program accomplish those goals fairly and efficiently?

Well let's look at goal A. If Uncle Sam wanted to incentivize Americans to buy more cars (and more fuel-efficient cars... tie-in to goal B), why not just give a tax rebate for buying high-MPG vehicles? Hybrids already have a tax credit, and under the Bush admin. they even gave polluting mega-trucks and SUVs up to a $12k tax break if the vehicle was used for a small business (an easily abused condition). Efficient vehicles are already cheaper than gas-guzzlers, and it's easier to get a great deal for a new car these days, but maybe another $1-2k off the sticker price would help consumers do the right thing. Because if the Feds are essentially rewarding consumers for making poor decisions in the past, that is no different than the bank and mortgage bailouts to irresponsible lenders/borrowers.

So for goal B - will this program make America's auto fleet a bit less polluting? Hard to say but doubtful. There are over 140M autos in the US (1 car for ever 2.5 people, so even if CARS facilitates 500k trade-ins, that will raise our overall fleet MPG under 0.1%). To qualify for the program, clunkers must achieve 10 MPG (or 4 MPG for "work trucks") according to Kelly Blue Book. And to get a full rebate, you must buy a new car that is 10 MPG more efficient. So if I trade in a guzzler 9 MPG Suburban, that means I can buy another medium-sized SUV that gets 19 MPG, and Uncle Sam takes $4,500 off my bill. Why? We know that SUVs not only consume more fuel, but their emissions are dirtier and some studies suggest they are more accident-prone (maybe more a function of the SUV-driver demographic than the actual vehicle class, but still). SUVs may hurt Americans more than cigarettes, yet we tax the hell out of the latter and subsidize the former? So this program hardly discourages the purchase of low-MPG vehicles, which is why the Senate may re-think the weak MPG rules attached to the addition $2B in funding that the House passed. One may still buy a new car that is only 3-5 MPG better than the trade-in clunker and receive $3,500 credit, which is 78% of the maximum rebate. So I can trade in my old Suburban for a slightly smaller Suburban, and somehow that makes me worthy of $3,500 from the taxpayers?

It doesn't make sense. If anything, you should receive a smaller rebate proportional to how low your trade-in vehicle MPG is. If one trades in an efficient but old Civic for a new Civic, that is the "model consumer" the government should reward, not the person trading in an old truck for a new one. And in order to achieve the maximum effect, the trade-in vehicle should be the person's primary or secondary car. If many of these clunkers are a family's "forgotten" fifth car that sits in the driveway and maybe gets 1,000 miles a year, then by removing it from circulation we haven't really helped fight the CO2 problem, because even badly polluting vehicles don't pollute much if they're not driven. So again, the government is subsidizing a family's poor consumer decision and giving them a free pass to the junkyard. And speaking of junking these clunkers - it's not cheap to safely dispose of a junked car. Parts must be salvaged, toxic components must be safely disposed of, and the bulk metal must be compressed or shredded. Or they'll just end up in a Third World nation with laxed environmental laws, like much of the West's consumer trash.

And lastly for goal C - how will this program stimulate the economy? If anything, it looks like another cash infusion to auto companies. Why not just cut a check to the Big 3 and call it even? Because the administrative costs of running this program are not trivial either. "Cash for appliances" seems just as appropriate to meet goals A-C, if not moreso since appliances are cheaper so we can reach more people. As far as I know, there are no income eligibility requirements for CARS. So Warren Buffet and I are equal in the program's eyes. I know it's too early, but I would like to see some demographic data for those who used the CARS program. I highly doubt many of them are "needy" in this recession. Was there even an effort to spread awareness of this program to lower-income or non-English speaking communities? I know CARS is not a charity (it seems DC is mainly interested in helping the rich and irresponsible during this recession), but still. Why not cap eligibility at $150k household income? Otherwise we are giving people who were going to buy a new car anyway a pointless subsidy. Or you have the "cheapskate rich" who are financially able to buy a new car any time they want, but are just waititng for an opportunity like this for Uncle Sam to save them money. Other Americans who unfortunately must rely on their clunker to get to work and pick up the kids from school every day may not be able to afford a newer, better, more efficient vehicle, even with an extra $4,500.

So is this program fair, effective, green, and edifying for America? Possibly but I have my doubts.