While trying to resuscitate the hemorrhaging economy, the federal government has spent the better part of the last year tossing dollars in every direction it could think of, with the great majority going to big banks and financial institutions whose health was deemed so vital that to ignore their crisis would be to send the country further into distress.
Billions here and billions there, flowing through convoluted corporate channels, always behind the scenes and with little direct impact on the lives of the regular Americans suffering through this recession.
At points in the process, we saw a few gestures of relief arrive right on our doorstep, like the stimulus checks last year, but I’d guess that in many cases that money was either squirreled away in a savings account or used to pay the electric bill.
If you were prudent, it wasn’t used to buy a Playstation 3 and reinject money into the economy in an attempt to help get the gears of spending and consuming grinding again.
Even some of the efforts to boost the housing market seemed narrow and difficult, with many hurdles for borrowers to clear and little or no relief for those in the worst of the bad situations.
Watching all of this, it was hard to feel a personal impact, to identify ways recovery efforts were really helping individual people, or beyond that, helping communities and creating long-term improvements across different and often-competing segments of our society.
That is, until a clever little program took off like wildfire last week.
I’m referring to the so-called “cash for clunkers” program, which if you stop to think about it, might be the simplest stroke of economic genius to come out of all the stimulus efforts of the last year.
Why? Because of the win-win-win-win-win-win nature of the program in affecting immediate positive results across a range of interests.
Who wins?
- The guy who gets a $4,500 rebate to trade in his 20-year-old truck that got 10 mpg for a safer, smaller model that gets 20 mpg.
- The local car dealer whose sales have been languishing.
- The employees of the car dealer, whose livelihoods have been threatened.
- The company that made the car and all its workers, who’ve been hammered this year as bad as any industry in the nation.
- The financial institutions making the loans.
- The environment, which benefits from having so many fewer gallons of gasoline burned to move the same people about their daily lives.
- And ultimately the economy itself, as other complementary industries ride the rising tide.
At the end of the day, the greatest power in this program may be its ability to stimulate a sudden wave of positive consumer energy, which has been so noticeably lacking over the last 12 months and beyond.
That’s good economic karma. It’s momentum, and it needs to be harnessed now while the swell still has potential.
On that note, Senate Republicans need to quit being part of the problem and move quickly to approve the additional $2 billion needed to keep the program going.
Frankly, it’s rather mind-boggling to even be hassling about such a small amount. Compared to other stimulus efforts, this is hardly but a fleck in the massive sack of gold that’s been handed out.
But it’s a shiny fleck, an exciting fleck that some of us might actually imagine a benefit from.
I’m not buying a new car, but I like the idea. Even more so, I like the idea of “liking an idea,” which, taken in the context of the last year, has become something of a foreign state of mind.
We’ve got something good working here. Let’s not screw it up.
