That's right, don't take my word for it. No less than Nobel Laureate Joseph
Stiglitz--hardly my ideological compatriot, but an economist I certainly do
respect--wrote in his latest book Freefall:
The cash-for-clunkers program also exemplifies poorly targeted spending--there were ways of spending the money that would have stimulated the economy more in the short run and helped the economy to restructure in the ways that were needed for the long run (p. 70).Which is what I've been saying since August. Thanks for having my back on this Prof. Stiglitz.
I admire that you read people you don't necessarily agree with from an ideological standpoint. I don't know any wise people who don't examine things from all angles.
I read much of Stiglitz's textbook when Dr. Jones left it out in the hallway last semester. He is clearly an intellectual heavyweight. Much of what he says is old hat, and I disagree with him on the point that the private sector, government, and foreign sectors can all be in a state of surplus. It's just impossible, there must be at least one sector with a deficit if others are to be in surplus. Just like not all countries can have a trade surplus, there must be at least one country with a deficit. Overall though, I tend to agree with the majority of what he says.
I agree with Joe Stiglitz' comment that "the cash-for-clunkers program also exemplified poorly targeted spending--there were ways of spending the money that would have stimulated the economy more in the short run".
The vast majority of the buyers were going to purchase a car within
three to six month anyway.
However, I feel that something needed to be done at the time to reduce the inventory of cars at the dealerships and prevent workers from being laid off. Did they have to spend three billion to accomplish that? Definitely not. They could have done the same or better with half the money.
I also agree with Dr Arsen's comments.