More cash for clunkers? Obama's Cash for Clunkers program ran out of money in just a few weeks, as Americans rushed in record numbers to take advantage of the new public option: free cash if you buy a new car!
What lesson can we learn for ObamaCare from the stunning success of ObamaCar? I am not an economist, but here's some stuff I figured out:
1. People Like Free Stuff!
Americans don't like government running our lives, but we do like getting free stuff. We don't like it when government tells us what to do, but we like it very much when government hands us cash.
We like it so much that if the government will pay us to do something, more of us will rush to do it than any of the experts predicted.
I don't know why the experts continually fail to predict the obvious, but somehow when it comes to government programs, they always do fail.
When government lowers the cost of something, people do it more, use it more, buy it more.
Lesson One: The "public option" is not going to reduce costs; it is going to create a much larger "unexpected" demand for doctors and other medical care than anyone is currently predicting.
2. Government Lies.
Cash for Clunkers is supposed to help both the environment and the economy, but it takes a lot of carbon output to forge steel, ship parts around the country, make new cars and then move those cars around the country. And is anyone worrying about the economic costs of crushing into oblivion perfectly good used car engines that might help poor people get to work and keep their jobs?
But even apart from that, think about the way Cash for Clunkers works:
If I trade in a car that gets 18 mpg for a car that gets 22 mpg, the government will pay me $3,500.
If I trade in a car that gets 19 mpg for a car that gets 23 mpg I get nada. If I trade in a car that gets 20 mpg for one with 35 mpg, I get twice nada.
Speaking greenly, does this make sense? Does this program really have anything to do with "saving the environment"?
Or is it, perhaps, a politically palatable way to pay off the United Auto Workers union for their invaluable political support?
Lesson Two: If it's government run, it's going to be politically motivated.
3. One Man's Free Lunch Is Another Lady's Short Rations
For years I've bought Hyundais. Not, I might add, because I am a green saint. I buy them because the cars are cheap, they get good gas mileage and they don't break down. Therefore, even though I have a perfectly good clunker in my driveway right now (a 9-year-old car with the dents to prove it), I cannot get government cash for my clunker. I've been saving the environment too much carbon all along.
Lesson Three: You can't really offer free stuff to everybody. If it's free, it has to be rationed somehow.
4. A Public Option Costs Three Times As Much As Expected.
They started with a $1 billion price tag for "Cash for Clunkers." In just a few weeks they've upped the price tag to $3 billion. Need I say more?
Lesson Four: When you hear the words "cost estimate" reach for your wallet.
Because (see point one) people like free stuff and (see point two) politicians like to pay off supporters, therefore (see point three), when government steps in some people will get free stuff, and the rest of us will pay their bills.
And (see point four) this health care bill is going to be a doozy.
• Maggie Gallagher is president of the National Organization for Marriage and has been a syndicated columnist for 14 years.