Stimulus

Ex-Obama Econ Guru Sez Cash for Clunkers Was Maybe Not Such a Great Idea After All

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Former Obama economic adviser Austan Goolsbee offered some Tuesday afternoon quarterbacking on various government efforts to goose the economy on the tube yesterday.

Turns out, when the economic crisis hit, the administration had no idea what was going on, how long it was going to be going on, or how to stop it—just like absolutely everyone else. So they decided to try throwing fistfuls of (borrowed) money in several directions, including paying people to scrap perfectly functional cars. Also to make bad investments in housing.

"Because we didn't know if [economic recovery was] going to be short or long," the Obama administration tried measures to address both scenarios, Goolsbee explained on MSNBC's "Morning Joe."

"If you look at Cash for Clunkers or the first home buyer tax credit, they were geared to trying to shift [recovery] from 2010 into 2009. Given it's taken this long [to recover], I don't think you would do that short-run stuff," Goolsbee added.

Reason was all over the Cash for Clunkers fiasco.

Via the inexplicable Lord Humungus.

Related on Reason.tv: Uncle Sugar wants your clunk:

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    1. What do you mean?

    2. We all know you’re not beloved, what with being the terror of the wasteland and all. Perhaps what’s inexplicable is the fashion choices. I mean, leather straps and a colander? Really?

      1. When one is in a post-apocalyptic world, one does as the post-apocalytpic do.

    3. Revel on it while you can.

      1. Your English is excellent, OM, but it’s revel in it.

        1. Wouldn’t one get more soiled if one revelled in it rather than on it?

          http://www.greetingcardunivers….._enlrg.jpg

          (Thanks for the tip!)

        2. I’ve always thought it’s interesting how there’s no distinction between in and on in Spanish. En is a way more hardworking preposition than any of our lazy English ones.

  1. Top. Men.

  2. Inexplicable! Teh AwsumZ!

  3. “If you look at Cash for Clunkers or the first home buyer tax credit, they were geared to trying to shift [recovery] from 2010 into 2009. Given it’s taken this long [to recover], I don’t think you would do that short-run stuff,” Goolsbee added.

    And the idea that it is a really bad idea to destroy wealth and assets in hopes of creating “growth” though the efforts it takes to replace them never occurs to him.

    1. There are days you wonder if anybody in government has ever read Bastiat.

      1. Or even had a single common sense thought in their life. The broken windows fallacy is not exactly rocket science.

        1. One can only come to the conclusion that, since no one can possibly be as stupid as the average politician appears to be, they must be doing these things they do on purpose.

          1. I try to use Hanlon’s Razor, but goddamn if these people don’t make it difficult.

          2. I go back and forth. I know a lot of people in government and I can honestly say none of the are malevolent. I really think they may be this stupid.

            1. I used to think that the current administration was a mix of deviant manipulation for their sharholders campaign donors mixed with some outright ineptitude.

              But after witnessing Holders clueless response to Fast and Furious along with the DOE pissing away money on rainbow farts I’m less convinced the administration is deviant or cunning in the least.

              It’s beginning to become clear that they really are this stupid and have absolutely no idea what they’re doing.

              1. I think you are right. You have to remember liberals live in a bubble. They don’t live around conservatives or libertarians. So they never have to defend their ideas except to other liberals. And they haven’t been in power in a long time.

                So I think these people sat around during the Bush years in a big echo chamber and started to believe some really stupid shit.

                1. Biden has an excuse, as he’s just an idiot and no one really expected much from him. Which, in retrospect makes the harping about Palin’s intellectual capabilities seem rather nuanced but I digress, Although I doubt anyone would’ve expected Palin to say that rapes would go up if you don’t pass their jobs bill, but it’s Joe so whatever.

                  The rest of the brain trust however, they have no excuse. The academic resumes for the cabinet that Obama put together were impressive, if you consider Harvard’s good ole boy/girl network impressive. Based on the results I think Buckley had it right, we would have been better off if we were governed by the first 2000 names in the Boston phone book than by the 2000 members of the faculty of Harvard, which is what we appear to be governed by at this time.

                  I never thought I’d see it proven so clearly, but there you go.

        2. The object of all politics is to kick the can far enough down the road that the majority of voters – who, after all, have lives to live – will not remember where the can came from in the first place.

        3. It’s only a fallacy if you think the goal is to improve overall well being, rather than to benefit glass makers.

      2. I think they read the classic dystopian novels but mistook them for how-to manuals.

      3. “There are days you wonder if anybody in government has ever read Bastiat.” Read a French guy? Are you joking?

    2. How do these guys even put on their pants in the morning?

      Junior economists on a political board called that, yet the Top Men? in the land, the Best and Brightest? America has to offer can’t?

      My thoughts are that they are so convinced in their religion’s truth, that they can bend simple economic reality to their will.

      And these are the guys making the choices that will determine our economic future? We’re fucking doomed.

      1. And worse, they teach at all of the “top schools”. So they can infect future generations with their stupidity. We are doomed. You read this article and you are left with undeniable impression that Goolsbee is just criminally stupid. And yet, he is very much one of those “top men” that a good portion of the country seems to want to run everyone’s lives.

        1. And worse, they teach at all of the “top schools”

          Echo chamber intellectuals.

    3. That he seems to have no insight that maybe the Obama team’s meddling might be prolonging the economic downturn means I can still have faith that I understand their thought processes.

    4. And the idea that it is a really bad idea to destroy wealth and assets in hopes of creating “growth” though the efforts it takes to replace them never occurs to him.

      Of course not.

      He’s a super smart economist.

  4. inexplicable
    As much as I already liked reading H&R, after this week, I like it even more.

  5. No links to yet another attempt by our overlords to re-inflate the housing bubble on the backs of immigrants? Almost as dumb an idea as Cash for Clunkers.

    How did the idiotic equation that “higher housing prices” = “better economy” become so ingrained?

    1. It really is a modern cargo cult.

      1. Right up there with “Clinton-era tax rates.”

      2. +100. Lets fuck everyone who doesn’t own a home and make those who do spend exorbitant amounts of their disposable income. That will fix things for sure.

    2. And the same people have the gall to talk about affordable housing at the same time. It’s a much dumber idea than cash for clunkers (which was fucking dumb). They seem to want to recreate the conditions that led to the financial crisis in the first place.

  6. I think he’s inexplicable because I spent a good part of that movie saying:

    “Why doesn’t he ever take off the mask?”

    And

    “Why not just tell the refinery guys he’ll take 10% of the gas, in exchange for not killing them AND patrolling the area to keep other gangs away?”

    I tell ya, it’s inexplicable.

    1. I don’t think their scriptwriting budget would cover the dialogue needed for a substantial negotiation scene.

      They could only afford to give the protagonist 16 lines, after all.

  7. Next he’ll tell us that petitioning the government to destroy the sun is not such a great idea either.

    1. Maybe declaring leaves as the official currency and then burning down the forests to stop inflation wasn’t so great either.

    2. Next he’ll tell us that petitioning the government to destroy the sun is not such a great idea either.

      But, but, think of how many jobs it’ll create.

  8. “Because we didn’t know if [economic recovery was] going to be short or long,” the Obama administration tried measures to address both scenarios, Goolsbee explained on MSNBC’s “Morning Joe.”

    You got that half-right: You did’t know.

  9. Careful there, Austan… Timmeh might decide your tax returns need a public airing.

  10. Methinks Mr. Goolsby is looking ahead to his likely employment prospects after the next election.

  11. Inexplicable? I’m changing up my style.

  12. Oh, and I sent a hot- hot, I say- lead to jacob sullum the other day, and he politely said, “thanks, but no thanks”. I’m officially in a slump.

    1. Most of the editors have rejection form-emails for me.

  13. Och v?rre l?r de i alla “topp skolorna”. S? de kan infektera framtida generationer med sin dumhet. Vi ?r d?mda. Du l?ser denna artikel och du ?r kvar med obestridliga intrycket att Goolsbee ?r bara brottsligt dumt. Och ?nd? ?r han v?ldigt mycket ett av de “Top m?n” att en stor del av landet verkar vilja k?ra allas liv.

  14. Ainsi, ils peuvent infecter les g?n?rations futures avec leur stupidit?. Nous sommes condamn?s. Vous avez lu cet article et vous ?tes laiss? avec l’impression ind?niable que Goolsbee est juste p?nalement stupide. Et pourtant, il est un beaucoup de ces ?meilleurs hommes? qu’une bonne partie du pays semble vouloir courir la vie de chacun.

  15. From a gearhead point-of-view, some of the ‘clunkers’ I saw on video getting the engine destruction treatment was sad – I mean Corvettes? LT1-powered Caprices and Roadmasters? They had great engines that could have been used in other vehicles, or sold as a used car.

    1. From a gear head perspective, C4c was an unmitigated tragedy.

    2. From the perspective of anyone who ever buys used cars, C4c was an unmitigated tragedy. You could basically tack on a grand to the actual value of any decent car the day it started. Prices still haven’t corrected, and might not for another 5 years.

      1. THIS

        I had an accident at the end of August, had to get a new car. Much more expensive then I thought it would be, and most of the stuff out there is either over 6 years old or is GM shit.

        God I hate those morons in DC. I mean, how does sending used car prices through the roof help anyone but used car salesmen. And damn it, I know those fucks in DC are lawyers but I didn’t think they’d stoop that low.

        1. Even used car salesmen were bitching about it- the price increase basically caused people looking for newer, lightly used vehicles (which few people are selling right now) to bump up to financing a new car. Used car inventory is absolute shit right now, for a grand more, compared to a few years ago.

        2. Britt, the best deals I’ve found lately are on 5-10 year old luxury imports. You can still get a decent deal on a BMW or Mercedes that is old enough to have lost its “prestige” price but will still last you another 150,000 miles without any major issues. Plus they tend to have been better cared-for than entry-level cars and domestics. Stay away from anything Audi made from 2000-2008.

          The best strategy now is to go to a “no haggle” dealership and offer them $1500 less than their asking price, and be prepared to walk away if they say no. You’ll get a follow up call in a day or two, or they might run out and catch you while you’re getting in your car and accept your offer.

      2. exactly – when I went to buy my wife a used car, I was literally floored by some of the prices being asked for high mileage and older cars.

  16. The government never misses an opportunity to punish responsibility and reward irresponsibility, and C4C was a perfect example.

    1. Blame the system. Dumb people’s votes count too, you know.

  17. The first step of Harnentstehung, filtration is the schedule and precondition for subsequent processes. Filtration is the purpose belonging in the direction of kidneys of central importance. In countless renal diseases, the filtration ability belonging in the direction of kidneys is reduced and thus impair the purpose belonging in the direction of kidneys. With various tests (determination of kidney function), the filtration ability belonging in the direction of kidney are examined

  18. Pourquoi ne pas simplement dire aux gars de raffinerie, il va prendre 10% du gaz, en ?change de ne pas les tuer et de patrouiller dans la r?gion pour maintenir l’?cart d’autres gangs.

  19. Turns out, when the economic crisis hit, the administration had no idea what was going on, how long it was going to be going on, or how to stop it

    And nothings changed since.

    1. The saddest part is that, no matter how clearly interventions fail, the politicians decide that if they do it bigger or with other bells and whistles, they can somehow make it work the next time they try.

      And, if they are replaced, their successors simply think it was a matter of how their predecessor handled it, not that there is a fundamental flaw in the notion of intervention itself.

  20. no one can possibly be as stupid as the average politician appears to be

    Your faith in humanity, however misplaced, is rather touching.

    1. I have always subscribed to the “Black Pill” theory:

      Every politician, upon taking office, is required to swallow a black pill which destroys whatever intelligence, good sense, good ideas and analytical ideas they had up to that point.

      (For some, like Joe Biden, the Black Pill was unnecessary.)

      1. I disagree, before his election Joe was just a run of the mill moron. After the pill he went “full-retard”.

        1. I have nothing to add to this except that “full retard” is a term that will never, ever get old.

  21. The wealth destruction record of this administration is so consistent it can only be on purpose. If it were just incompetence, they’d get something right at least once.

    1. Don’t underestimate how big of a loser Obama actually is.

    2. I think you might be over estimating the intelligence of said administration. That said, when something fails as badly as C4C did, it (almost) becomes a thing of beauty.

  22. Who said it? No peaking.

    Austan Goolsbee is a free market economist who Obama would like to put on his Council of Economic Advisers.

    He would be an unabashedly free market voice in Obama’s ear. Let me repeat that: He would be a free market economist, giving Obama advice…

  23. One good thing about Cash for Clunkers:

    For about the cost of two B-1 bombers, it pushed the public to demand cars with good fuel economy, thereby reducing demand for fuel, while also reducing fuel prices and (eventually) reducing the need for more than a few B-1 bombers (and other military kit) to fight wars to secure our supply of oil.

    From this perspective, Cash for Clunkers might be considered a success.

    Of course, as short term stimulus it was always a joke.

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