There are two main purposes. First is for the economy; this is a part of Obama's stimulus package for the economic recovery. The second purpose is for the environment.
Last year's economic crisis was not really hit Indonesia. So this discussion may not sound familiar for my Indonesian friends. But here it is really bad, I am telling you, I even lost my Research Assistantship for 2 quarters due to budget cut for my school (as a result I have to raise my own fund for 2 quarters: bikin proposal lagi, nge-lobby donor lagi, makanya kemaren saya pulang kampung sekalian fund raising). Anyway, Obama' stimulus package is indeed interesting to discuss, but I am not an economist and this blog is not for too serious stuff :-) so I won't discuss it. I admire his administration. He came in a difficult situation after stupid Bush.
Car industry is one of the most hit industries in the US. The government, amidst criticism, had to bail out some US car companies. And you know that American cars suck :-). Discussions here were interesting because many people criticized how bad US cars are (compared to European, I mean, German cars :-)) and how inefficient the companies are (compared to Japanese and Korean cars). Many people blame the industry. But the fact is, many many people were laid off. And the government has to deal with that.
So "cash for clunkers" is done for a month. The deal is, one can get a voucher (up to $4,500) to buy a new and more efficient car for giving out one's old car. There are so many details in it, I am too lazy to write it down :-) but you can read it yourself on www.cars.gov. The program ended last Tuesday. It was only for a month (in Germany it was extended several
times as it was considered successful).
The Government claims that the CARS program will: boost economic growth in the third quarter of 2009 by 0.3-0.4 percentage points at an annual rate thanks to increased auto sales in July and August; sustain the increase in GDP in the fourth quarter because of increased auto production to replace depleted inventories; create or save 42,000 jobs in the second half of 2009. Those jobs are expected to remain well after the program's close. They further stated that Ford and General Motors recently announced production increases for both the third and fourth quarters as a result of the demand generated by the program. Honda also said it will be increasing production at its U.S. plants in East Liberty and Marysville, Ohio and in Lincoln, Alabama. In addition, the program provides good news for the environment. That's because 84 percent of consumers traded in trucks and 59 percent purchased passenger cars. The average fuel economy of the vehicles traded in was 15.8 miles per gallon and the average fuel economy of vehicles purchased is 24.9 mpg. – a 58 percent improvement.
Critics point out the complicated and slow administration for the dealers to cash in their money. In Germany the critics point out the fact that it was misused; there are German cars sold cheap around Europe right after the program ended :-). Hard core republicans here keep on saying bad things about whatever the government is trying to do. They say that because of the slow administration, the program is actually not successful; it failed to boost the economy.
The debate on the media fascinates me. I like the fact that the government is actually trying to do some concrete programs like this. Things I so far cannot see in Indonesia. I mean, of course we had BOS (Bantuan Operasional Sekolah), the system for Kartu Gakin for Health Care system, the change from kerosene into gas, the etc. But there were so many flaws in them; they were not transparent and not publicly well-discussed.
Some Indonesian-politician-friends of mine think I am more and more "american minded" nowadays. I told them, I don't think that everything here is better, not at all! I even "hate" americans (especially the way they talk! :-)) and many things here, but I want to learn as much as I can from whatever is going on here; the good and bad ones. I want to learn from the
US as much as I want to learn from other places, including from England, where I went to school as well and my second "home" (because my child will be half-German), Germany. I even reflected from my short visit to Nairobi. No, I am not crazy about the US, it just so happens that I am here now. And I do want to see Indonesian government able to conduct better politics, run concrete programs such as this one, provide better services, and provide better life for their citizens. Isn't that the reason why I decided to study here in the first place? :-)
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