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Surprise! Cash for Clunkers has unintended consequences, encourages gougers

August 10, 2009

Getting a rebate for a gas guzzler might be good for the vehicle's owner, but it's turning out to be terrible for some charities.
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Animal Services of Thurston County, Wash., depends on up to $20,000 in donations each year from Northwest Charity Donation Service. The service, in turn, relies on donated cars.

But since the Cash for Clunkers program began this summer, the nonprofit's source of funding is drying up, reports King 5 News in Seattle.

This was entirely predictible -- and, in fact, predicted.

Tax Vox reports that some folks are finding the program a great deal:

There is already anecdotal evidence that dealers are adding hundreds of dollars in junk fees to the cost of the new cars they sell as part of the clunker program. One angry customer told me that a dealer tried to charge him more than $1,000 in extra fees for a Toyota Camry--$400 for “processing” , $250 in “prep” and $500 for “delivery.”

But Congress and the President are spending an extra $2 billion to destroy perfectly good cars -- making it harder for low-income folks to get wheels by taking used cars out of the market. That will help those poor folks who have to travel far to get a job in this era of 9%+ unemployment.

Tags: Cash for Clunkers.dumb.Kay Bell.TaxVox.