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Two highly-successful stimulus programs

June 25, 2010

Compare and contrast Cash for Clunkers:

with the First-time Homebuyer Credit:

When you average the buying frenzy of the last month of each program with the crash in the next month, it's apparent that the net stimulative effect of the programs -- which cost the taxpayers around $16 billion together -- was approximately zero. When you consider that they destroyed hundreds of thousands of perfectly good used cars -- the kind that poor people buy -- and raised the price of those remaining, these stimulus programs ended up destroying wealth, not creating it.

Yet the sponsors of each of these boondoggles insist they were successful. Remember that the next time they offer to help you by spending your money.