Automotive News reports that the staggering popularity of the cash for clunkers program has caused a significant drop in donations of automobiles to charities, many of which rely on such donations to help fund their programs to help the needy.
The popular cash-for-clunkers program is boosting U.S. auto sales and manufacturing while slashing donations to charities that rely on gifts of cars to fund social programs, charity officials say.
Volunteers of America and other aid organizations that receive tens of thousands of cars each year said such donations have quickly fallen up to 12 percent — and fear a 25 percent drop eventually, or more than $100 million — as owners rush to trade gas guzzlers for new fuel-efficient models while federal rebates last.
“We started seeing it right away in July” when the program began, said Jim Hartman, vice president of vehicle donations at Volunteers of America. “It varies by market, but there’s been an 11 to 12 percent drop compared with last year.”
The fact is that every public policy comes with tradeoffs; there is, after all, no such thing as a free lunch. There appear to be two main tradeoffs for the success of the cash for clunkers program: Reducing the number of vehicles donated to charity and reducing the availability of low-cost used cars for those who rely on such cars for transportation because they can’t afford a more expensive vehicle.
At the same time, by putting more people back to work the program should also be reducing, though obviously not eliminating, the need for such charity services and the need for such low-cost used cars. But in the end, nothing comes for free. Governing requires weighing and balancing the positive and negative results of every public policy choice.