Cash For Clunkers: What Happens Next

I'd like for us to upgrade my wife's car, which we just finished paying off. But we're not going to do that -- we're going to hold on to the car that we don't need to make any payments on, and probably not replace it until we're done paying off my car, so we only have one car payment at a time. Until then, we'll make do with a not-so-spectacular vehicle and continue to live within our means. That is more important, and worth more money in tough times, than gaining an additional five to ten miles to the gallon. That's a decision that makes sense for individual consumers.

But apparently, that sort of decision doesn't make sense to the economic nincompoops in the Obama Administration, who think that we're so collectively rich as a nation we can just destroy perfectly good cars to buy new ones on credit.We're not doing it to decrease overall oil consumption or protect the environment. As a society, we're not about to run out of oil. We've already demonstrated that even dramatic increases in passenger car mileage is of only minimal benefit to the environment as compared to unspectacular, incremental increases in very-low mileage vehicles.

We're apparently not doing it to benefit American auto manufacturers, because it turns out that 59% of the vehicles purchased in the cash-for-clunkers program are foreign, and eight out of the top ten purchased cars were Japanese or Korean. So what we've done is to temporarily subsidize sales of foreign cars.

That's, um, not what I recall as being the stated policy goal of this program.

Well, what happens next? Let's say you traded in your old "gas-guzzling" car for a newer Japanese one. Got somewhere between $3,000 and $4,500 for it. What does the dealer do with that old thing? Does he turn around and re-sell it, injecting badly-needed cash flow into the automotive market, reducing the overall market price of cars so that more people can buy cars later, or even take it apart to part the thing out or sell it to a parts dealer?

No. Here's what seems to be a perfectly nice 2001 Corvette. The guys pour in some kind of clear gunk liquid into the engine, which eventually gels up and seizes, permanently disabling the motor (engine smokes at 3:00 and seizes at about 4:30):

As if that weren't sin enough, next they destroy the vehicle completely. Here's a perfectly operable Dodge Dakota 4X4 turned into a dense steel oblong in the name of temporarily subsidizing the sale of Hondas, Kias, Toyotas, and Hyundais:

We were sold this program as a way of revitalizing the American auto industry, meaning primarily the Big Three of GM, Ford, and Chrysler, and improving environmental conditions. The result, however, is a billion and a half dollars of national debt we didn't have before and a bunch of junked, formerly-operable cars.

I'm waiting for the part where someone explains to me why I'm better off for our government having done this. I'm not holding my breath. In the meantime, I'm adding a new tag to the blog: "Lighting Our Money On Fire."

The Best-Sounding Bad Idea To Come Along In A Long Time

Reading at Left Coast Rebel about a month ago, I was dismayed to learn last month that the Cash for Clunkers program was gaining political purchase. I can see the logic behind the initiative -- subsidize the ability of people who are driving around old gas guzzlers for newer, more fuel-efficient vehicles -- and I can see that there would be some environmental good done by realizing the objective of updating our fleet of personal vehicles.

But this is definitely a thing to do when times are prosperous, when there is excess money to be spent on this sort of thing. Right now, we're only seeing subtle macroeconomic hints that the recession may be receding, but that doesn't mean times are getting better and it certainly doesn't mean times are good. We're deficit-spending ourselves into fiscal anemia and paying people between $3,000 and $4,000 for what Congressional sponsors hope will be 625,000 vehicles is $2.5 billion that we simply don't have right now.

But even under the best of theoretical circumstances, it is also not clear that the policy would work, or that its benefits would not be swamped by unintended adverse consequences. As I wrote at LCR, if we were in a budget surplus condition, I could call this policy proposal defensible, at least in the abstract; but still a luxury we can't presently afford.

Now, the bill that the House of Representatives just passed has been so compromised that it seems unlikely that it would effect so little advancement towards its policy goal that it seems like a waste of time. In its current form, "cash for clunkers" will benefit almost no one. There are simply not a lot of people who own crappy old cars and who are looking to buy brand-new cars to replace them. So who would be cashing in on this program? As Prof. Steven Levitt writes in today's Gray Lady:

If any vehicles are going to qualify under this program, I suspect it will be because enterprising people who already plan to buy new cars will go out and buy old junkers on the used-car market and then trade them in under the program. But those transactions won’t represent incremental new car sales; it will just be a way for people who were already going to buy a car to rip off the government.

Prof. Levitt points out that, although about ten percent of the total fleet in the United States get low enough mileage to meet the initial threshold for subsidy eligibility status, the bulk of those vehicles are light-duty pickup trucks. Now, light-duty pickup truck owners tend to hang on to those vehicles longer than car owners do because light-duty pickup trucks have utility as cargo carriers in addition to their ability to move passengers around. They therefore become auxiliary rather than primary vehicles, part of the reason why there are more vehicles than drivers registered in nearly every state. The incentive to get rid of a high-utility auxiliary vehicle is much lower than the incentive to upgrade a personal-transportation-only primary vehicle.

Additionally, the person asking for a subsidy on the clunker trade-in will need to prove that the vehicle was registered and insured for the previous year. Well, here's a couple of facts for you coming from a guy who sometimes serves as a traffic judge -- between 20% to 25% of the vehicles on the road are not insured and about one in thirty don't have current registration. They aren't insured and they aren't registered because the people who own and drive them are poor and cannot afford to pay the money to insure and register their vehicles. The vehicles that are uninsured and unregistered tend to be old-model vehicles, the ones that this subsidy is aimed at, because those low-quality vehicles are the only ones that poor people can afford to buy in the first place to meet their transportation needs.

In other words, I would predict that the insurance and registration requirement would substantially narrow the number vehicles that will qualify for the subsidy in the first place. And of those vehicles, the true economic incentives to part with them may be lower than the cash price for such vehicles available on the open market and indeed may be lower than the subsidy offered by this program.

When it's the only car you've got, even if it's a clunker, and you probably can't scrape together enough money to buy a replacement, the utility value of that crappy old car is very high. Higher than the marginal value of $500 to $1,000 in cash that you could get on the open market for it, and probably higher than the $3,500 to $4,500 subsidy you could get for trading it in to be crushed into a small, heavy metal cube. And since you can't scrape together enough cash to replace your junker-with-a-market-value-of-$1,000, you're not in the market for a new car anyway, so the $3,500 to $4,500 subsidy is a non-issue.

In other words, the transactions Congress intends to incentivize are simply never going to happen. Let's consider what would really happen.

If you had maybe $6,000 in available cash, you could buy up a dozen junkers at $500 each, and trade them all in at once, getting a $3,500 subsidy for each trade-in. You'd use that money to get new car worth $42,000. You could then re-sell the new car to a third party without ever putting the key in the ignition, realizing a profit of $36,000.

Given an infinite number of $500 cars eligibile for the subsidy available to purchase, your $36,000 in profit from the first turn-around would buy you 72 more junkers, which for your next cycle of purchases and trade-ins, would be worth $252,000 in new car purchase subsidies. Even after paying sales tax, re-registration fees, and rental on property large enough (and zone appropriately) to store 72 crappy old cars at a time, you could theoretically wind up with something like $200,000 in profit.

What makes this worth doing is the government subsidizing the junkers to seven times their open-market value -- paying $3,500 for a car that would sell for $500 on the open market. In real life, you'd be shelling out cash for more than eighty crappy old cars to make this work. Also in real life, the universe of people who are actually selling $500 vehicles that get mileage below eighteen miles per gallon and who have been able to keep their cars registered and insured for an entire year is not infinite; indeed, it is relatively small.

These owners would respond to your market activities by demanding higher prices for the suddenly-desirable subsidy-eligible cars they had to sell -- I'll go so far as to predict that the supply side portion of this market is small enough that even a single entrepreneur behaving this way would, in short order, move the demand curve of that market and drive up the market cost of these vehicles.

This assumes, moreover, that you're the only person in the area clever enough to have figured this out and exploit it -- which wouldn't be the case; this is a pretty easy business model for pretty much anyone to puzzle out. That would also create upward pressure on the demand curve. So it wouldn't take long before sellers began demanding $1,000 or more for the same cars they had previously willing to sell for $500; eventually, the market price would rise to something very close to the subsidy and now all of these middle-men would be out of business.

What's amazing is not that this happens, but rather how fast it happens. Frankly, I doubt that you'd be able to make it through the first cycle of purchases and re-sales before the market price rose to a point that made the business model unworthwhile. You'd never get to the point that you could pocket $200,000 in after-tax profits because you'd have run out of subsidy-eligible cars to buy at any price.

What's more, all of these owners of subsidy-eligible cars would be out of customers. So they would hang on to, and drive, their old junkers until they were in a position to buy new cars for themselves and exploit their own subsidies. That's what the new equilibrium would look like -- people holding on to old, crappy, inefficient cars for longer, creating an even older, less-efficient fleet of cars than we have now. I don't think this is what Congress intends.

Ah, the pernicious and perverse effects of government intervention in the economy!

The only people who would find practical value to this program, as Prof. Levitt suggests, are entrepreneurial sorts who would look to exploit both the government and the economically-disadvantaged owners of the junkers who are intended to be the beneficiaries of the program. I'll go a step further than him and predict that these entrepreneurial sorts will wind up being the auto dealers themselves. They'll "sell" the junkers to their customers who are buying new cars anyway. Then, their customers will "trade them in" and use the voucher to underwrite new car purchases. The dealers will keep a portion of the subsidy for themselves as an "administrative fee," or build that fee into the ultimate purchase price of the new car.

I don't think this is what Congress intends to happen with this program, either. But I could be wrong about that.

Finally, bear in mind that each and every transaction under this program would be a piece of the $2.5 billion line-item of deficit spending, which will also incur transaction costs, paying for clerks and administrators to make the subsidy happen, and of course the cost of creating a new branch of the Department of Transportation and training the people who will work there to do the job. All of that will also be paid for out of deficit spending.

Could the idea be made better? Yes. Remove the insurance and registration requirement for subsidy eligibility. Expand the scope of the subsidy to allow for the purchase of a previousy-owned vehicle with improved mileage instead of only to brand-new cars. Render vehicles sold to the subsidy claimant in the previous six months ineligible for the subsidy to deter exploitation by middlemen and the economic drag that would produce. These things would steer the subsidy back towards the intent of the bill, which is to help people upgrade crappy old cars to more fuel-efficient ones.

But even then, it's still spending billions of dollars that our government just plain doesn't have in the first place. Cash for clunkers -- a creative idea, to be sure, but not one that I can endorse.

I'm Taking Back Some Of The Things I Said I Liked About California

There are apparently people who are considering, with straight faces and serious, self-righteous attitudes, prohibiting new vehicles sold in California from being painted black. Why? Black cars cause more smog.

No, seriously.

Stop laughing. This is real.

See, black colored cars absorbs more heat than any other color. So that means that they get hotter when parked outside than other cars. (In fact, this is true.) Therefore, the air conditioner must work that much harder, and consume that much more fuel, and generate that much more air pollution.

What a great place to be a lawyer this state is -- there is no end to the half-baked ideas coming out of Sacramento, guaranteeing no end to the work available for us to do. Truly, of the many silly ideas for laws and regulations in California I've heard over the years, this is probably going to make the top ten.

Okay, some serious alternatives to this: How about, instead, we mandate annual tune-ups for heavy commercial vehicles like 18-wheelers and cement trucks and such? Or, I don't know, build another nuclear power plant and shut down a coal-burner? Or if we structure our registration fees so that there is a financial disincentive to driving around that old junker and instead work to replace it with something newer and more ecologically-efficient?

A call to greater environmental responsibility does not require an abandonment of common sense or a risible assault on consumers. The trick to making environmental responsibility work in the long run will be to dovetail environmental concerns with consumer demand. This, however, will polarize the public against, rather than reconcile the public, to the issue of reducing carbon emissions.

If I want a black car, I should be able to get a black car, damnit. You can have my black car painted white when you pry my cold, dead fingers off its steering wheel.

A Downside To Dramatically Higher Mileage Standards

With Federal approval coming from the President himself, California is going to enact new, tougher mileage standards for cars in the state, on the theory that more fuel-efficient cars will produce fewer carbon emissions and therefore benefit the environment. Mostly, I think this is a good thing. But there are prices to be paid for that decision.

Vehicle selection will alter; vehicles will become more expensive. Passenger cars will become smaller and provide less utility in terms of moving people and stuff around. But these issues pale in comparison with the hidden costs of dramatically more efficient passenger cars. For instance, more people are going to die. There will be more traffic. Tax revenues will decrease. Urban sprawl will increase. Why? Because fuel-efficient cars will make driving cheaper unless the increase in efficiency is met with a significant increase in gas prices (think a return to last summer's $4.25 a gallon levels).

Oh, and thanks to increased traffic, while each vehicle on the road will produce less carbon monoxide and other carbon-based pollutants, there will be more cars on the road, and they will be there for longer. So it's questionable whether there will be a net decrease in pollution at all.

A better idea, if you ask me, would be to require upgrades to very low-efficiency vehicles, rather than insist on globally higher efficiency standards. The amount of gas not burned by upgrading a vehicle from 12 MPG to 14 MPG -- only a 16.67% improvement -- is significantly greater than upgrading an already-efficient vehicle to become even more stupendously efficient. If you took a 30 MPG vehicle and made it 40% more efficient, as the new California standard will require, it will get 42 MPG at the end of the process. Assuming a vehicle lifetime of 100,000 miles, the upgrade from the inefficient vehicle to being slightly less inefficient is 238 more gallons of unburned gas than making the already-efficient vehicle really, really efficient. (This was not my idea originally; it came from the sadly-defunct bobvis blog.)

Certainly, adding 40% to the 12 MPG vehicle would be even better than that. But the point is, it's the low-mileage vehicles that we need to be concerned with. They tend to be heavier, they tend to be older, they tend to be owned by people with less economic means to replace or upgrade them, and because of the way California's vehicle registration system works, they cost next to nothing to have their tags renewed (while you pay through the nose for a new car). This is not the right tax incentive to increase efficiency.

What's more, the kinds of vehicles we are talking about are, with the exception of SUV's used as passenger cars, the kinds for which use demand is relatively inflexible because these are mostly utility and working vehicles. If you had to spend less money on gas, you would be more inclined to take recreational trips. But if you're a long-distance cargo hauler, your arrival points and destinations are set for you by your customers, not by your personal desires, and so the savings in fuel cost will become reduced overhead and higher profits. (Which maybe you spend on recreational trips in a less cumbersome vehicle to drive up to the mountains for a picnic, but maybe you buy a big-screen TV instead.)

Which brings me to the subject of big-rig trucks. Moving freight on tractor-trailer rigs is the whole reason we have interstate highways to begin with and trucks are the only way to get cargo from distribution centers to their ultimate destinations. They are horribly inefficient -- maybe five and a half miles to the gallon of diesel. Consider, then, what a 3% improvement in efficiency would do -- over the course of that same 100,000 miles (maybe one year's worth of long-haul trucking) that's 530 gallons of diesel fuel saved. How much carbon not put into the atmosphere is that?

So the point of all this is -- it's easiest for car manufacturers to make small, light cars more fuel-efficient. But that's not where the work needs to get done, and there are hidden costs we have to pay for hyper-efficient small passenger cars. If we really want to have an impact on our collective carbon footprint, mandating, say, a 5% increase in efficiency for heavy- and medium-duty trucks and a 10% increase in efficiency for light-duty trucks and SUV's, and leave passenger cars that get over 20 MPG alone completely, we'd be much better off than a 40% increase in efficiency for all vehicles.

Like I said above, this is better than doing nothing. I don't want to let the perfect become the enemy of the good. But at the same time, it makes a lot of sense to point out how the policy can be improved.

Ricardo Montalban Dies

What a cool cat this guy was. Mr. Roark from Fantasy Island, Khan from Star Trek, and the original salesman for the Chrysler Cordoba, with seats upholstered in "soft Corinthian leather." Although ill with a painful and chronic back problem, he continued to use his rich, distinguished voice of his right up to the end.

Sadly, he died today. The world is a little bit less colorful and interesting because of it.

So Here's What I Want To Know

My automatic lawn sprinkler control device fritzed out this morning. It won't turn off (there must be a power feed from somewhere I can't control) and one of the gates stayed open for four hours, watering one portion of my lawn continuously for at least two hours.

So is Barack Obama going to fix that for me? Whaddya mean, no?

I've got some debt piled up on our credit cards left over from our trip to visit our families in Wisconsin. I haven't paid it off in full in one month and you know, the interest is starting to pile up.

Is Joe Biden going to pay that off on my behalf? Come on, Joe, help a brother out. (And I mean that in an entirely race-neutral way.)

My car needs a new catalytic converter. You know what they make those things out of? Platinum, one of the most expensive metals on the planet. A new one will set me back something like fifteen hundred bucks and of course the car won't pass a smog test and will make a funny rattling noise until it gets fixed. So what's the government going to do to help me out? Nuthin', that's what.

Change, my ass. Change is what I'm hoping I have left over when all this crap gets fixed. Hope? I hope I'll be able to get all this crap resolved and paid for before more comes up. That's what I hope.

Two Bits Of Good Economic News

Yeah, I know the market tanked again today. The bears reign supreme.

But oil fell below $60 a barrel. That’s surely a silver lining to the economic storm clouds we face. I filled up my car today for $50, the first time doing so has been so inexpensive in months. Now, that’s still a way above historical average price. In terms of real dollars, it’s still about twice its historical cost and half again what we were paying with only moderate discomfort in the early 2000’s.

Still, gasoline is getting cheaper. This is a significant counter-inflationary development. As you know, I’ve suggested for a while that the rising price of oil was a big depressor on the economy and a directly inflationary issue that was not being addressed in any meaningful way by anyone (in large part because no one knew what to do about it).

If oil levels off at this point – or continues to fall, as the expert in the linked article suggests it will – will that be enough to get some economic activity going again? We’re not going to get back to where we were a month ago anytime soon, but if there’s growth from here, that would be good enough for the time being.

The tarnish on this silver lining is that oil-rich nations now need their oil income to meet their budgets, and all of them are much more heavily socialized than the U.S. Nations like Venezuela, Saudi Arabia, and Russia rely on high prices to support their less-diversified and economies that are burdened with heavy amounts of government participation in their markets. This will drag global markets and potentially create political instability there.

And, in more good news, we're not as bad off as Iceland, who apparently need to accept a huge loan from Russia that they have no idea how to pay off.

Follow The Hypocrite's Advice, Not His Example

I stumbled across this site today, and because it contains good tips for both increasing your fuel efficiency and for reducing the environmental impact of your car, I pass it along to you.

Of course, I’ve been driving around with my “Check Engine Light” on for about two weeks now without getting the car in for service. It’s come on and off many times over the past several months and every time I did take the car in for servicing, the problem was always a minor issue with the exhaust emissions control system that the mechanic assured me would clear itself up quickly. What exactly this means, I don’t know. But every time, they’ve been right.

So even though tip #14 says to get the car serviced whenever that light comes on, I haven’t done it. And The Wife complains I make jerky stops even though I try to make smooth ones – it’s often because I try and go too smoothly that I get too close to another vehicle and have to stop quickly. You’d think after twenty-two years of driving I’d have figured that one out but my technique seems to still need work.

Not So Impressed As Others

Justin Gardner at Donklephant is impressed with Barack Obama's suggestion that people adequately maintain their cars and keep their tires properly inflated to increase their gas mileage. He is unimpressed with the proposal to increase offshore oil drilling (memo to Justin: Obama's on the offshore drilling bus now. At least, until he throws someone under it.)

I'm not so impressed, myself. I already maintain my vehicles regularly and keep them in good working order. They are not allowed to belch smoke, burn or leak oil, or go more than 3,000 miles without proper fluid maintenance. I'm pretty anal about that 3,000 mile thing and will drive well out of my way to get the oil changed as soon as I pass that 3,000 mile limit.

I already make sure my vehicles' tires are properly inflated. I don't do these things because of fuel efficiency; I do them for safety. It only took one set of photographs of people burnt to death after their tire blew out on I-15 and rolled their vehicle to permanently impress upon me the importance of adequately inflated tires.

So, do you have any other helpful suggestions, Barack?

Problems With The Tesla Strategem

The Wife and I were talking that with our lotto winnings, we might buy his and hers Tesla Roadsters. All-electric, enough range to get to and from Los Angeles on a whim, they go from zero to sixty in 3.9 seconds, and they look sexy like Porsches.

We agreed we'd get them in green and gold but I think The Wife prefers the premium orange and I like the metallic indigo color. Those are the colors of our choice, but people would think we're Broncos fans.

We have two problems with our plan:

1. There seems to be no drink holder in the cockpit. This is a problem, especially if you have a drink.

2. For some reason, we did not actually win the lotto tonight. The liquor store clerk assured me that this was the winning ticket, so I don't know how that could have happened.

Well, maybe the 2009 model will have a drink holder, and we can reserve them now -- just as soon as we actually get that winning ticket. And the car has only about 220 miles of range before it needs a new charge, which takes a couple of hours. So even though the Tesla looks like a lot of fun, I may have to wait for my Volt. Because I'm no hypermiler but I want to be both easy on the environment and easy on the gas consumption.

Local Yokels Pick A Fight

An auto dealership in Rosamond is running this ad on our local airwaves:

Did you know that there are people in this country who want prayer out of schools, "Under God" out of the Pledge, and "In God We Trust" to be taken off our money? But did you know that 86 per cent of Americans say they believe in God? Since we all know that 86 out of every 100 of us are Christians, who believe in God, we at Kieffe & Sons Ford wonder why we don't tell the other 14 percent to sit down and shut up. I guess I just offended 14 per cent of the people who are listening to this message. Well, if that is the case then I say that's tough, this is America folks, it's called free speech. None of us at Kieffe & Sons Ford is afraid to speak out. Kieffe & Sons Ford on Sierra Highway in Mojave and Rosamond, if we don't see you today, by the grace of God, we'll be here tomorrow.

Hey, I'm all for free speech. Which is why I'm not particularly inclined to sit down or shut up:

Did you know that there are people in this country who think that other Americans are somehow not entitled to live as they choose and sort of resent having other peoples' beliefs shoved down their throats all the time? But did you know that our Founding Fathers built in to our Constitution the guarantee that every one of us would have the right to believe, or not, as we choose? Since we all know that at least 86 out of 100 Americans like having freedom, this Antelope Valley Atheist wonders why we don't tell Kieffe & Sons to read the Constitution before opening their fat yaps. I guess I just offended a local car dealership by writing that. Well, if that is the case, then I say that's tough, this is America folks, and this, too, is called free speech. No American should be afraid to speak out for what they think is right, even if they aren't in the majority. When it's time to buy a car, take your business somewhere other than Kieffe & Sons.

Besides, we all know God drives a Plymouth: "He drove Adam And Eve from the Garden of Eden in His Fury" Genesis 3:23.

By the way, did you notice how Keiffe & Sons' math allows that 86% of Americans are Christians, 14% are secular, and 0% are Jewish, Muslim, Hindu, Buddhist, or anything else? Good math there, fellas.

A Party Like Toyota: A Marketing Analysis Of John McCain's Ascendancy

Looking at the election returns this morning, I note that most of my sources have not distributed many delegates from California yet. But a look at the Fish Wrapper's graphic illustration of county-by-county returns tells a couple of interesting stories -- on the Democratic side, a rather close-seeming race, but on the Republican side, because of the district-by-district winner-take-all rules here, a powerful victory for McCain. Congressional districts are not the same as counties, but comparing the district maps to the county maps, it still seems to me that McCain has a plurality in every district in the state. Romney has very small pluralities in only three counties. Romney took Shasta County by about 650 votes. Shasta County is part of the second district, which also includes seven other counties and portions of two more. Looking in those other seven counties, McCain's net margin of victory is far greater than Romney's in Shasta. Romney got the plurality in Sierra County by a mere 14 votes. McCain's margin of victory in the other six-and-a-fraction counties in the fourth district are substantially more than 14 votes (although El Dorado county is not yet reporting all of its precincts). And Romney was, as I thought he would be, relatively successful in the Central Valley, taking a plurality of relatively populous Fresno County, by about 500 votes. Fresno County, however, is split between the 18th, 19th, 20th, and 21st districts, and the neighboring counties within those districts were all for McCain with numbers big enough to swamp Romney's win. It would take a more detailed analysis, precinct-by-precinct, to see if the exact permutations of where Romney was able to squeak by McCain to determine if he will carry even a single district here. For that, I will await official results from the Secretary of State, since that data is both hard to find and more tedious to compile than I care to look at.

The upshot, however, is that McCain looks likely to walk away with all 170 of California's delegates that were up for grabs yesterday. Right now, my favored delegate tracker on CNN is indicating that McCain won here, but has not allocated any delegates to him. I have awarded McCain those delegates in my delegate counter. I do not have as much knowledge about other states, so I'm relying on CNN, Fox, the Green Pages, the NYT, the Fish Wrapper, and MSNBC to supplement the other delegate counts.

Adding the 170 delegates to McCain puts McCain near 800 delegates right now. That is very close to the margin of delegate distribution that would appear to make a McCain candidacy inevitable. And as we have seen, this will produce no shortage of caterwauling on the part of the "conservatives," whose invective has become more heated rather than less. I've seen plenty of Sour-Grape Republicans musing on the Internets about sitting out the general election rather than voting for McCain -- almost as though they want Hillary Clinton to be elected our forty-fourth President. Hugh Hewitt seems to have reached "acceptance" stage of his process of mourning the imminent loss of the Romney campaign, but he's relatively advanced in that regard.

If our next President must be a Democrat, as I am no longer so certain must inevitably be the case, I would prefer to see Obama than Clinton. I discern few meaningful policy differences between the two, but Obama seems to have both more honesty and character and he brings a different attitude than Clinton does. Clinton is very Establishment, and it's Establishment Democrats who really turn me off. Don't get me wrong, I'd prefer to see a Republican, which now means McCain, but in a forced choice between Clinton and Obama, I'd pick Obama.

Still, I continue to be confused about all the right-wing angst about McCain, as I have been for more than a year. I'm not alone in that regard. He’s flawed, to be sure, but he’s also pretty darned conservative on a bunch of important issues. He’s been the most pro-war candidate out there for a long time. He’s made waves and not been afraid to throw stones around within the party – but then again, that can be said of just about all of the Republican candidates for President still in the race. Romney never had a problem attacking McCain, Giuliani, Huckabee, or Thompson. Huckabee’s been laying into Romney for a while now, too – especially using Christian code words to rally evangelicals to his camp, a tactic that I note with some pleasure has not been entirely successful. (This, by the way, speaks well of the majority of evangelical voters, who have proven themselves well able to look beyond a candidate’s religion and support someone like Romney, despite what they surely feel are significant religious differences.) He's in favor of immigration reforms that do not involve hunting illegal aliens for sport, but the fact is that guest worker immigration reforms have a strong conservative pedigree. So in terms of the kind of product he represents being given the Republican brand, objectively, he ought to be a perfectly acceptable choice.

One thought by Rick Moran at Right Wing Nuthouse is that McCain’s ascendancy means that the Republicans are reinventing themselves, and I think that if he’s right, that’s probably a net improvement for the GOP. But even he is getting lots of generally unarticulated whining about McCain being “liberal,” which means the people who have been getting their way for the past, oh, ten years or so find themselves forced to either accept half a loaf or cede power to people who are willing to bargain for half a loaf. This, it seems to me, is simple denial that the Democrats have managed to take the majority in Congress and they did it for a reason – the public doesn’t like what George W. Bush has been selling since 1999. Not a surprise that people who have some power are reluctant to part with it.

But when your product isn’t selling and the competitors are taking your market share from you, the solution is not to put more of the same product that people aren’t buying on the shelves. You may really like it, and it may have sold well in the past. But if that’s not where the market is, you need to move to that place rather than making the market come to you. Remember New Coke? Pepsi Crystal? Inflatable hightops? The market got over all of those things pretty quickly – and the manufacturers of those products did not respond by putting more of those products on the shelves, as if to tell customers, “No, you really do want clear cola, here buy more of it.” Instead, they stopped selling something the public obviously didn’t want, and either tried something else (Slice) or went back to something that had worked (Coca-Cola Classic). They recovered from their missteps and have only used their past mistakes as learning exercises.

Now, consider what Ford did when gas prices started to go up about five years ago. Ford increased its production of sport-utility vehicles and pickup trucks, even as demand for them decreased. GM followed suit. But foreign manufacturers (who aren’t really foreign anymore, any more than GM or Ford are “American”) like Toyota and Volkswagen put smaller vehicles on the market instead, and their market share increased at the expense of Ford and GM. Ford responded by making still more SUV’s and trucks. To move these vehicles, they had to slash their prices and minimize their profits. Ford found that demand for SUV’s pickup trucks had hit the floor; it would not go any lower than where it was – although once that happened, Ford’s market share increased so that now more trucks than ever are Fords – but there are still fewer trucks and SUV’s being sold than there were before.

In political terms, Ford achieved greater ideological purity in a diminished voter pool. This is not to say that money can’t be made there, but not nearly as much money as in other segments of the market. Ford is no longer the #2 auto manufacturer in the world – it’s #4 or #5 now. But if you want a truck, you’ll think Ford first. But if you want a regular passenger car, chances are you think Toyota first. Toyota has won because it build and sells cars with broad appeal, has acquired a reputation for quality, and manages to get those cars to market at competitive prices. Toytoa and Nissan figured out that there was a market for station wagons, and had the good sense to not call them that. It doesn’t dominate any particular segment of the market, but it does dominate the market as a whole by having big shares of every segment of the market.

The Republican Party should not become a party like Ford. It should become a party like Toyota. It should not become the distilled source of ideological purity and uniformity, at the expense of having broad electoral appeal. The point of a political party is that it present a sufficiently broad amalgamation of different interests that most voters be able to get behind it. Of necessity, it will involve making some compromises and deals between its interest groups, and as such, it can also reach out to interest groups not within its core coalition – particularly when it is in the minority, as it is today. And of course, the other party will be doing the same thing since it is subject to the same pressures. That is, when you think about it, Madisonian pluralism at work -- exactly as contemplated in Federalist #43. For the life of me, I can't see that as a bad thing, even if it means that my side doesn't always win.


But in the meantime, all those people who really, really like the political equivalent of those Ford trucks are doing a tremendous amount of wailing and gnashing of teeth. There is, so far as I can tell, absolutely no profit in it. That is to say, the right wing gains no more profit from disavowing McCain than a spoiled child gains by throwing a temper tantrum when denied a piece of candy or a toy -- which is what the right-wing punditocracy is starting to resemble more and more each day.

An Inconvenient Sunday

The Ninja is in the shop, because the "service engine" light is on and the car keeps on stalling out for no apparent reason. So we're down to one car until at least some time tomorrow.

This means The Wife has to drive me around everywhere in the Blue Bullet. That included the sports bar to see the game while she went back to work on the home improvement project, although I accompanied her to Wal-Mart after breakfast to help out with the shopping and dealing with all of the agonies that are inherent in a trip to Wal-Mart first.

After the Packers game was pulled from broadcast for lack of competitiveness (not that I'm complaining) I had to go to the office to meet with another attorney here and brief him on a case he's going to take to trial for me on Tuesday. My hands are full with other imminent deadlines, so it's a big relief to not have to try the case.

So The Wife dropped me off here and went away to do her own thing. After my colleague got here, we found the office's computer network down, which handicapped our ability to assess any of the preparation that I'd previously done when I first readied the case for trial in June. We talked for about an hour and a half, and then lacking any ability to access any other information, he went home to pore over the exhibits, and I wrote a little bit and called The Wife to fetch me.

I suppose there could be worse problems to have than these.

New Name For A Used Car

By the way, since it turns out that we've picked a really lame name for the new car, there seems to be a need to come up with a new one. Suggestions from the Loyal Readers are welcome. A reminder, the car looks like this:

Bye Bye Beater

We're going car shopping today.

Both The Wife and I are sick of the junker. Yes, it's paid for, but it's got close to 110,000 miles on it, no power steering, a seat that makes both of our backs ache when we drive it, the little three-banger engine doesn't have the pickup of a two-hamster exercise wheel, and The Wife knocked the left-side rear window off of it and the deductible on the repair is more than the repair itself. Leave aside cosmetic issues like the dings and dents on the door and the peeling paint on the rear fender -- the car is just not up to snuff any more and we can do better. When the summer really comes here in the desert, the air conditioner is almost certain to drain out any remaining power in the motor.

So we're going to go look for a reasonable used car. We'll see what we can get; when we're back this evening I'll finish up my trial preparations and get ready for my class Monday night. Until then, I'm wondering what we should get. Maybe a nice Toyota. I've never owned a Japanese car. I liked my BMW when I had that, but we're still a few steps away from getting back into a Beamer -- getting a house is more important than getting a BMW. That's the only non-American car I've ever owned; my experience was great and my impression of the mid-range car market is that Toyotas are the highest-quality and most-reliable cars we could get in the range we're at. But I'm open to anything that will be reliable and safe and be of reasonable quality. It doesn't have to be a status symbol. After all, B.B. the Saturn is not a great car but it's quite sufficient for our needs. All I'm really looking for is "good enough." "Good enough" means safe, reliable, and functional.

UPDATE: Six hours later, we are now the proud new owners (well, after the loan is paid off we will be) of the replacement to the junker. I was going to hold off on the naming process, but The Wife was impatient and gave the 2004 Nissan Altima a new sobriquet on the way home. So meet.... The Green Ninja!


A little more than I wanted to spend, and the payments are a little higher than I would have preferred, but the money involved is within our range of ability. The mileage is what you would expect for a car of its age and history (a former rental). The color is nice -- a kind of gray-green that I haven't seen on any other cars out there. We can get a key fob for remote entry from Nissan, and we'll have to order a replacement owner's manual, too. Tomorrow or the day after I'll research how often I have to change the oil and so on. But for now, the Green Ninja is ready for action. And we had no idea of the Urban Dictionary's meaning to the phrase "Green Ninja" when The Wife adopted it for the car.

Looking for a second vehicle

The time has come to acquire a second vehicle. The Wife and I have been getting by with just one for some time now and while that is not a huge burden, it is inconvenient. So I'm looking around. The big question is what kind of a vehicle do we want? A small, fuel-efficient car? Good on gas, but when you live out in the sticks, like we do, you need to haul stuff around. A pickup truck? Perhaps a good choice, but a smaller SUV might be a better option than that. Nothing extravagant either way, as we will certainly want to get it paid off quickly. But we also want something safe. I want something that will be low-maintenance since it drives me apeshit when things don't work right. What will be best from an insurance perspective? Oh, so many issues.