Clunker Math

[FiletAndRelease]

[FONT=Verdana][COLOR=#000000]Got this the other day, Thought it was interesting.


Think of it this way,



A clunker that travels 12,000 miles a year at 15 mpg uses 800 gallons of gas a year.
A vehicle that travels 12,000 miles a year at 25 mpg uses 480 gallons a year.

So, the average Cash for Clunkers transaction will reduce US gasoline consumption by 320 gallons per year.
They claim 700,000 vehicles so that's 224 million gallons saved per year.

That equates to a bit over 5 million barrels of oil.

5 million barrels is about 5 hours worth of US consumption.
More importantly, 5 million barrels of oil at $70 per barrel costs about $350 million dollars

So, the government paid $3 billion of our tax dollars to save $350 million.

We spent $8.57 to for every dollar saved.
How good a deal was that ???

They'll probably do a great job with health care though!!

[/COLOR][/FONT]

[Devils Horse]

Love that government math.

2 + 2 = 900 Billion

[jcb]

http://www.snopes.com/politics/gasoline/clunkers.asp

[Tom523]

What a deal!
>
> If you traded in a clunker worth $3500, you get $4500 off for an apparent
> "savings" of $1000.
>
> However, you have to pay taxes on the $4500 come April 15th (something
> that no auto dealer will tell you). If you are in the 30% tax bracket, you
> will pay $1350 on that $4500.
>
> So, rather than save $1000, you actually pay an extra $350 to the feds.
> In addition, you traded in a car that was most likely paid for. Now you have
> 4 or 5 years of payments on a car that you did not need, that was costing
> you less to run than the payments that you will now be making.
>
> But wait, it gets even better: you also got ripped off by the dealer.
>
> For example, every dealer here in LA was selling the Ford Focus with all
> the goodies including A/C, auto transmission, power windows, etc for $12,500
> the month before the "cash for clunkers" program started.
>
> When "cash for clunkers" came along, they stopped discounting them and
> instead sold them at the list price of $15,500. So, you paid $3000 more than
> you would have the month before. (Honda, Toyota, and Kia played the same
> list price game that Ford and
> Chevy did).
>
> So lets do the final tally here:
>
> You traded in a car worth: $3500
>
> You got a discount of: $4500
>
> ---------
>
> Net so far +$1000
>
> But you have to pay: $1350 in taxes on the $4500
>
> --------
>
> Net so far: -$350
>
> And you paid: $3000 more than the car was selling for
> the month before
>
> ----------
>
> Net -$3350
>
> We could also add in the additional taxes (sales tax, state tax, etc.) on
> the extra $3000 that you paid for the car, along with the 5 years of
> interest on the car loan but lets just stop here.
>
> So who actually made out on the deal? The feds collected taxes on the car
> along with taxes on the $4500 they "gave" you. The car dealers made an
> extra $3000 or more on every car they sold along with the kickbacks from the
> manufacturers and the loan companies. The manufacturers got to dump lots
> of cars they could not give away the month before. And the poor stupid
> consumer got saddled with even more debt that they cannot afford.
>
> Obama and his band of merry men convinced Joe consumer that he was getting
> $4500 in "free" money from the "government" when in fact Joe was giving
> away his $3500 car and paying an additional $3350 for the privilege.

[HURRICANEBOB]

[QUOTE=FiletAndRelease;383461]

So, the government paid $3 billion of our tax dollars to save $350 million.


Ahhhhh, ya say per year right? Times 10 years of savings equals what? Hey make that the next 20 years, say what now?

Some costs do amortize.......given a little time and a longer horizon.

And, don't older cars continue to get worse mileage as they age? Some wierid scientific thing about worn rings and scratched cylinder sleeves, and deposites on the values and seats and stuff like that. And we all know transmissions don't get any less efficient. Clutch pressure plate spings never get weak and slip a little, and automatic transmissions never wear.

[HURRICANEBOB]

[QUOTE=Tom523;383481]What a deal!
>
> If you traded in a clunker worth $3500, you get $4500 off for an apparent
> "savings" of $1000.
>
> What if the clunker was only worth $500? What "street wise consumer was negotiating this deal?" "Ish" starts at invoice, and works up ever so slowly, and sometimes below invoice. "Ish" gets the absolute last set of numbers not from the sales manager, but the last set of numbers from the "finance guy", then lays down the pen and goes home to do more research for a couple days. If the numbers look good, "Ish" goes back. And if the sales guy suddenly forgets what he signed up for a couple days ago, "ISH" departs. You'd be surprised how many of those sale managers will chase you across the lot as you head for your car, and all of sudden remember what those last numbers were.

[Chubminnow]

[QUOTE=HURRICANEBOB;383546]

And, don't older cars continue to get worse mileage as they age? Some wierid scientific thing about worn rings and scratched cylinder sleeves, and deposites on the values and seats and stuff like that. And we all know transmissions don't get any less efficient. Clutch pressure plate spings never get weak and slip a little, and automatic transmissions never wear.

Common sense tells us this Clunker thing was a waste of money to begin...I'm glad someone finally did the math though.

HurricaneBob - Not sure where you're going with your post about vehicles getting worse mileage as they get older, transmissions wearing out, etc...I'm the proud owner of two 4-wheel drive Chevrolet gas hawgs...both of which are ten years old or older. I expect things to go wrong...but that's why they make replacement parts...It's been my experience that it's always cheaper to keep her (accept for in the case of my ex-wife, she HAD TO GO!). I guess for me it's a love between a man and his trucks, or a bonding or something, lol...Kind of like my old dog, all he does is lays around, but I ain't gettin' rid of him.

[RoadToad]

http://www.snopes.com/politics/gasoline/clunkers.asp

No point in injecting reality into this feeding frenzy.

[know1]

Here was the simple, personal math I used to decide it wasn't worth it.

I have a "clunker" that is paid for and worth about $3500.

The government was going to "give" me $4500.

So I'm $1000 ahead.

My new car would depreciate by how much the minute I drove it off the lot? $3000 or so?

Why bother?

[DJD]

Here was the simple, personal math I used to decide it wasn't worth it.

I have a "clunker" that is paid for and worth about $3500.

The government was going to "give" me $4500.

So I'm $1000 ahead.

My new car would depreciate by how much the minute I drove it off the lot? $3000 or so?

Why bother?

Too bad more people don't use your math. Some people feel a new car is their right even when they can't afford one. Same goes for houses....

[CMorg]

What about lessening our dependancy on foreign oil ?? Thats a good enough reason to trade in that Clunker.

But on the other side of that coin...alot of state governments are run on gasoline taxes. The departement of transportations mostly. And with all the cars getting better gas milage , thats alot more money taken away from those road projects.

[GeoFisher]

What about lessening our dependancy on foreign oil ?? Thats a good enough reason to trade in that Clunker.

Now THAT is a FUNNY JOKE.........While we ARE dependent on foreign OIL, it is an artificial dependence....THE USGS found BILLIONS of barrels of proven reserves from those leases that were CANCELLED by Obama. IMAGINE THAT.

http://www.usgs.gov/newsroom/article.asp?ID=1911

You left wing LIBS always talk about the NUTS in washington being in the pockets of the big oil. How about Obama being in the pockets of the greenies.

Had we started DRILLING those BILLIONS of barrels of PROVEN RESERVES, the cost of gas would drop about 1 buck. IMAGINE THAT.

Well the REASON the drilling has not started is because DRILLING would give us supplies for 40 years....and the GREEN push for vehicles goes out the door.

Unfortunately, I cannot find the LINK this stuff below came from so, I'm quoting it inline......it is long.....Sorry.

The U. S. Geological Service issued a report in April ('08) that only
scientists and oil men knew was coming, but man was it big. It was a
revised report (hadn't been updated since '95) on how much oil was in this
area of the western 2/3 of North Dakota ; western South Dakota ; and extreme
eastern Montana ..... check THIS out:

The Bakken is the largest domestic oil discovery since Alaska 's Prudhoe Bay
, and has the potential to eliminate all American dependence on foreign oil
The Energy Information Administration (EIA) estimates it at 503 billion
barrels.. Even if just 10% of the oil is recoverable... at $107 a barrel, we
re looki ng at a resource base worth more than $5.3 trillion.

'When I first briefed legislators on this, you could practically see their
jaws hit the floor. They had no idea.' says Terry Johnson, the Montana
Legislature's financial analyst.

'This sizable find is now the highest-producing onshore oil field found in
the past 56 years.' reports, The Pittsburgh Post Gazette. It's a formation
known as the Williston Basin , but is more commonly referred to as the
Bakken.' And it stretches from Northern Montana, through North Dakota and
into Canada . For years, U. S. oil exploration has been considered a dead
end. Even the 'Big Oil' companies gave up searching for major oil wells
decades ago. However, a recent technological breakthrough has opened up the
Bakken's massive reserves.... and we now have access of up to 500 billion
barrels. And because this is light, sweet oil, those billions of barrels
will cost Americans just $16 PER BARREL!
That's enough crude to fully fuel the American economy for 41 years straight


2. And if THAT didn't throw you on the floor, then this next one should -
because it's from TWO YEARS AGO!

U. S. Oil Discovery- Largest Reserve in the World!
Stansberry Report Online - 4/20/2006


Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the
largest untapped oil reserve in the world. It is more than 2 TRILLION
barrels. On August 8, 2005 President Bush mandated its extraction. In three
and a half years of high oil prices none has been extracted. With this
motherload of oil why are we still fighting over off-shore drilling?

They reported this stunning news: We have more oil inside our borders, than
all the other proven reserves on earth.. Here are the official estimates:

- 8-times as much oil as Saudi Arabia
- 18-times as much oil as Iraq
- 21-times as much oil as Kuwait
- 22-times as much oil as Iran
- 500 - times as much oil as Yemen
- and it's all right here in the Western United States .

HOW can this BE? HOW can we NOT BE extracting this? Because the
environmentalists and others have blocked all efforts to help America become
independent of foreign oil! Again, we are letting a small group of people
dictate our lives and our economy....WHY?

James Bartis, lead researcher with the study says we've got more oil in this
very comp act area than the entire Middle East -more than 2 TRILLION barrels
untapped. That's more than all the proven oil reserves of crude oil in the
world today, reports The Denver Post.

Don't think 'OPEC' will drop its price - even with this find? Think again!
It's all about the competitive marketplace, - it has to. Think OPEC just
might be funding the environmentalists?
Got your attention/ire up yet? Hope so! Now, while you're thinking about
it .... and hopefully P.O'd, do this:


Now I just wonder what would happen in this country if every one of you sent
this to every one in your address book.
By the way...this is all true. Check it out at the link below!!!
GOOGLE it or follow this link. It will blow your mind.

http://www.usgs.gov/newsroom/article.asp?ID=1911
gov/newsroom/article.asp?ID=1911

http://pubs.usgs.gov/fs/2008/3021/pdf/FS08-3021_508.pdf