This week, President Obama nominated Princeton economist Alan Krueger to replace Austan Goolsbee as his chairman of the president’s Council of Economic Advisers. Prior to this nomination, Krueger’s chief public policy claim to fame was the Obama administration’s “Cash for Clunkers.” That program put the already cash strapped US government on the hook for buying thousands of cars off the hands of Americans, as trade-ins for newer cars. The program was supposed to jump start the US auto industry and stimulate the economy.
It didn’t. And what happened to all those cars the government bought?
As of a few months ago and according to Google Maps to the present, they’re rotting away in historic Bush Stadium in Indianapolis, IN. The historic stadium has been a Negro league stadium, a minor league stadium, and a race track during its lifetime. Placed on the National Register of Historic Places a while back to ensure its survival, the stadium has fallen into disuse. That is, until Krueger’s brainchild, “Cash for Clunkers” came along. The government bought cars, had no place to put them and no system in place to part them out, sell them, destroy them, or otherwise get rid of them.
So the Obama administration rented out Bush Stadium and filled it up with cars. Hundreds of objects, all containing parts that can be used in cars still on the road, recycled, sold, etc, just sit there rotting away. But the government had a dual agenda in C4C: Stimulate the economy and get lower mileage cars off the road while replacing them with newer, higher mileage cars. With that second part of its agenda in place, it couldn’t very well sell the cars despite the value that many of them held at the time of sale.
The point here really isn’t to lament the misuse of Bush Stadium, but to note that once again the federal government leaped into an idea without any planning for the obvious outcome, and with an agenda that determined that the program would end up being wasteful. “Cash for Clunkers” didn’t work, and the taxpayer not only was forced to pay to help someone else buy a new car, we’re all now stuck with these old cars, off the road but also out of the aftermarket industry.
This is the work of the president’s new economic adviser.