HOW TRUTH WITH SPEEDZZTER "CELEBRATES" MICHAEL MOORE’S 56TH BIRTHDAY
(Get the latest "Truth With Speedzzter" here)
Massive millionaire socialist propaganda film maker Michael Moore is 56 years old today. Moore shot to infame and liberal superstardom through his sophomoric 1989 "mockumentary" "Roger & Me."

"Roger & Me" attacks General Motors plant closings Smith’s hometown of Flint, Michigan, mostly through selectively documenting Moore's ridiculous, self-promoting efforts to interview GM head honcho Roger Smith on camera.

But the film ignores most of the real structural problems at the heart of Detroit’s problems in the 1980s. Detroit was hammered by huge unfunded mandates from Washington, D.C. 1930s labor laws allowed unions to score vastly above-market compensation and benefits in "pattern bargaining" extortion, as well as hugely expensive work rules (none of which the foreign invader "transplant" assembly plants had to bear). Inflation and interest rate problems in the late 1970s and early 1980s demanded Detroit to slash costs, which ultimately hurt product quality. Unfair trade policies allowed Asian automakers to protect their home markets and dump exports in the U.S.A.

In short, Smith’s analytical skills are superficial at best. Yet he used "Roger & Me" as a springboard for a highly lucrative career shilling for extreme leftist "social justice" causes (redistribution of wealth, reductions in personal liberty, abdication of personal responsibility) in slick, sometimes witty propaganda films. He is a slouchy, plus-sized Leni Riefenstahl of the left. Only in America . . . .

So in denigration of Mr. Moore’s 56th birthday, Truth With Speedzzter looked for a video that might be the polar opposite (at least in an automotive sense) of the barren, central-government-controlled World Moore apparently pines for:

"OBAMACA$H FOR CLUNKERS" DESTROYS THE USED CAR MARKET, BALLOONS THE DEFICIT, AND KICKSTARTS VEHICULAR INFLATION

[Get the latest "Truth With Speedzzter" here]

"Cash for Clunkers" is a horrible idea that will inflate the deficit, destroy the used car market, and drive inflation.

1. It will dramatically hurt late model residual values.

In a copyrighted story in the Automotive News, the chief economist of the largest U.S. auto auction said:

'Cash for clunkers' incentives to new-car buyers would have the same impact on prices of late-model used vehicles as new-vehicle cash incentives from the factory, said Tom Webb of Manheim, based in Atlanta.

In general, every $1,000 rebate on a new vehicle reduces the price of the same-make, current-model-year used vehicle by $700 to $800, Webb said. The impact on used-vehicle prices lessens as vehicles get older, he added.

Further compounding this problem is the reduction in frequent vehicle traders

There is evidence that that love affair is fading, and that for more Americans the car is becoming a longevity-driven commodity like the Maytag washing machine. New-vehicle sales fell 38.4% in the first quarter compared with the year-ago period, according to Autodata Corp. A recently released annual survey from R.L. Polk & Co. found that the median age of American vehicles in operation has risen to a record 9.4 years from 9.2 the previous two years.

And perhaps most worrisome for the industry is the recent disappearance of that iconic American character: the new-car enthusiast, otherwise known as the tuner, motor head, speed freak, buff, nut and zealot. [These people have not disappeared, but have simply been priced out of the marketplace**] The percentage of trade-ins newer than two years had hovered for years between 9% and 10%, says J.D. Power and Associates. Last year it slipped to 8.4%, and in the first two months of this year it fell to 6.6%, says J.D. Power.

Thus, as supplies of used vehicles shrink, the long-run outlook for the used vehicle market is poor indeed.

2. Cash for Clunkers will target V8s and other donor vehicles essential for motorsports and grassroots automotive hobbies.

The cash-for-clunkers proposals circulating in Congress vary. But the basic concept is represented by a plan backed by [Mouth-breathing Appliance Motorist Moron] U.S. Rep. Betty Sutton (D., Ohio). Her [pitiful excuse for a] bill would offer bonuses starting at $3,000 [added to the ballooning deficit and borrowed from the Chinese] for someone who scraps a 2001 or older model for a U.S.-made car that gets 27 miles per gallon on the highway. Buyers of a U.S.-made car that gets 30 mpg on the highway could get $5,000.

Dumping a "clunker" to get a new U.S.-made truck that gets at least 24 mpg on the highway would make you eligible for a $4,000 payment under Ms. Sutton's [idiotic] proposal. Businesses that buy a "work truck" that is cleaner than the vehicle replaced based on federal emissions testing could get $5,000 -- so long as the truck is registered in the name of a business.

3. "Cash for Clunkers" will inflate the price for older used American cars.

The reasoning is obvious -- anything older than 2001 that will wheeze to life for 50 feet or so (long enough to cross the "ObamaCrusher" "Cash-for-Clunkers" finish line") and which is categorically deemed a "clunker" by the know-nothing appliance motorists in Congress and the Obama Administration will instantly be worth as much as $5,000.00 in taxpayer cash if forever destroyed. Thus, the minimum "buy-in" for restorable cars and trucks built before 2001 will quickly inflate to more than $5,000.00. If not, then the artificial "ObamaMarket" will eventually suck most of these irreplaceable vehicles into the crusher.

As more and more enthusiast vehicles and more pedestrian donor vehicles are lost, the prices of the "survivors" will skyrocket. While natural attrition tends to increase prices on its own, "aborting" a whole generation of vehicles during the vulnerable time before they become recognized as collectable will spike prices.

This will also dramatically increase the price of used auto parts because of supply restrictions on the most desirable vehicles -- RWD V8s(Presumably, "Cash for Clunkers" won't target hideous four-cylinder imports, which are virtually useless as donor vehicles and have minimal future prospects as historic vehicles or restoration candidates). The loss of affordable used spare parts for RWD American vehicles will lead to fewer restorations and "builds" of vehicles from the 1980s and 1990s.

Fewer restorable "special interest" vehicles from the 1980s and 1990s will hamper development and sales of aftermarket restoration and modification parts. Fewer parts sold will drive up prices for the parts that do make it to market.

All of this, in turn, will price millions of automobile hobbyists out of the market. WHICH IS EXACTLY WHAT OBAMA'S APPLIANCE MOTORISTS AND POWER-HUNGRY GREENS WANT!

4. Cash for Clunkers disproportionately targets seldom driven marginal vehicles.

As the Wall Street Journal's Joseph B. White unwittingly points out, "cash for clunker" incentives will be too low to "hit" the SUVs that Obama's free-spending greens want to junk.

If I owned a 2000 Ford Explorer Eddie Bauer all-wheel-drive model equipped with a 5.0 liter V-8 -- a popular configuration that year [and an excellent donor vehicle for various grassroots sporting vehicles] -- I would be getting about 15 mpg or less in daily driving. This is exactly the kind of vehicle Mr. Obama wants retired to the junkyard. But if Mr. Obama was a car dealer, I'd want him to give me as much as $5,300 for my old Explorer, based on the used vehicle trade-in values at Edmunds.com, an auto-shopping Web site.


[P]rying Americans out of their paid-off SUVs may require more than offering a fraction of the vehicle's trade-in value -- and that means more public money.

Thus, buyers will seek out cheaper trades, which will disproportionately come from the ranks of veteran vehicles that are not really in daily service.

5. Cash for Clunkers is a huge wealth transfer program to the Asian automakers.

Because of World Trade Organization (WTO) concerns, any "Cash For Clunkers" plan cannnot discriminate against imports. Thus, any "Cash for Clunkers" plan will have the unintended consequence of sending billions across the Pacific to the Asian automakers.

6. "Cash For Clunkers" will not screen out historically-significant models for preservation or salvage.

Plenty of marginal collector cars languish in the sub-$5,000.00 price bracket. Most of these are highly worn original vehicles or vehicles long parked in barns, fields, classic car salvages, or backyards. Many of these cars will be "monetized" by greedy opportunists if "Cash for Clunkers" becomes law. There is no mechanism to differentiate between a smoking, rusted-out, common-as-a-belly-button, boring Toyota Camry and a rare Rambler American, a Hudson Hornet, an Edsel, or a restorable 1938 "Spirit of Motion" Graham. Undoubtedly, some milestones such as these will be crushed in the haste to "cash in" on the "'ObamaCash' for Clunkers" windfall.


**A NOTE ON PRICING ENTHUSIASTS OUT OF THE MARKET

In 1967, the median income was $7,143.00. A huge variety of tire-smoking RWD V8 musclecars were available for $5,000.00 or less (Some substantially less. For example, a well-equipped 1967 GTO 400/4-speed stickered for around $3,300.00 -- that's less than 50% of the median income). The average musclecar in 1967 sold for 45-60% of the median income. Thus, an enthusiast who wanted a performance or sports car could often finance one during the boom years of the First Supercar Era for only a few dollars a month. Even clock-punching hourly workers could often afford a factory musclecar.

By 1985, the median income was $23,618. New Mustang GTs sold for only a little more than half of that amount. Even a state-of-the-art turbocharged, intercooled Mustang SVO or Buick Grand National sold for only about 70% of the median income. Thus, while respectable muscle was not as common or affordable as in the 1960s, it was still somewhat affordable for ordinary wage-earners and young college graduates.

As recently as 2003, the median income was $43,318. A 390 (net) h.p. SVT Cobra stickered for around $35,000.00 (right at 80% of the median income).

Now the median income is around $50,000.00. The few traditional musclecars left generally sticker for $35,000 or more, which pushes them above 70% of the median income. A 2010 Shelby GT500, exclusive of dealer gouging, retails for a whopping 92% of the median income! The bare-bones cheapest Mustang GT (which is saddled with glass-jawed hypereutectic pistons, spindly cracked-cap rods, a cast crank, and a pedestrian SOHC valvetrain) stickers in excess of 55% of the median income.

Obviously, if the Detroit automakers had been able to hold to price-income relationship of the 1960s, or even of the 1980s, new high-performance vehicles would still be affordable for hundreds of thousands, if not millions, more enthusiasts. OEM greed, unfunded regulatory mandates, and Corporate Average Fuel Economy standards have artificially cut supplies and driven up prices on high-performance vehicles during the past 30 years.

If Ford could bring in a power-adder-ready (i.e. forged pistons, forged rods, forged crank, good multivalve heads) or even a power-adder-equipped V8 Mustang for around 50% of the median income, sales would be much, much higher (it's basic microeconomics).

Moreover, if Ford could offer a practical, affordable RWD V8-capable sedan (saloon)and crossover (we used to call them "station wagons" or "shooting brakes") with such attributes (i.e. Australian Falcon), it would further expand Ford's market share and high-performance image.

However, the emerging Obama "war" on high-performance and vehicle collecting will extract even more of a hidden "tax" on racers, hot rodders, tuners, and collectors.