Consumer Law

Obama Administration To Launch Cash-for-Clunker Appliance Program

By Brian Wolfman

This morning's Washington Post reports in this article that the Obama Administration, building on its cash-for-clunkers car program, will soon unveil a cash-for-clunkers appliance program. The program will enable consumers to get rid of their old appliances for new, more energy efficient models. Presumably, as under the car program, the "old" appliances will have to be destroyed. The article discusses the divide among economists about whether these programs make sense.

Here's the "pro" from the President's Council of Economic Advisors:

[Clunkers] is one of several stimulus programs whose purpose is to shift expenditures by households, businesses, and governments from the future to the present. Such time-shifting is valuable in a recession, when the economy has an abundance of unemployed resources that can be put to work at low net economic cost.

The "con" from UCSD economics professor James D. Hamilton, who, the Post says, has blogged about the clunkers rebate:

The premise seems to be that for Americans to be richer, they need to throw out their old appliances faster -- I don't see it that way. I don't like the idea of just spending money for its own sake.

Full post as published by CL&P Blog on November 27, 2009 (boomark / email).