waste – Pursuit of Liberty

Money Down the Drain

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A little statement from an article titled “Cash For Clunkers”: Did It Work? got me wondering about the fate of three hundred million dollars.

When the $3 billion is exhausted, roughly 600,000 vehicles will have been swapped for more fuel-efficient models, based on statistics released from the government so far.

Do the math there and we find that if every single “Cash for Clinkers” deal returned the maximum $4500 to the person trading their car in there was still another $500 paid by the government for the deal. For 600,000 cars that makes $300,000,000 that went into someones pocket. (This does not count any other hidden costs of the system which may never be revealed in losses to other businesses or interest paid by people who already had a working vehicle that they owned outright.) I’d like to know how much of it went to dealers, how much went to paying for the destruction of the “clunkers” and how much was government setting up a website and processing paperwork.

One thing is for sure, we have a huge double standard operating when insurance companies are considered greedy when 2% of their gross income is profit while government is considered efficient when only 10% of their cost goes directly to program overhead.

What Is A Billion

I got a forwarded email about putting some perspective on what “a Billion” is and how easily politicians throw around numbers on that order of magnitude. Here’s a summary from the email that attempts to put some perspective on the “one billion” figure:

A billion seconds ago it was 1959.

A billion minutes ago Jesus was alive.

A billion hours ago our ancestors were living in the Stone Age.

A billion days ago no-one walked on the earth on two feet.

A billion dollars ago was only 8 hours and 20 minutes, at the rate our government is spending it.

While this thought is still fresh in our brain, let’s take a look at New Orleans It’s amazing what you can learn with some simple division. Louisiana Senator, Mary Landrieu (D), is presently asking the Congress for $250 BILLION to rebuild New Orleans. Interesting number, what does it mean?

Well, if you are one of 484,674 residents of New Orleans (every man, woman, child), you each get $516,528.

Or, if you have one of the 188,251 homes in New Orleans , your home gets $1,329,787.

Or, if you are a family of four, your family gets $2,066,012.

The first two numbers got me thinking because if it was 1959 a billion seconds ago then it was 1000 B.C. a billion minutes ago. It turns out that a billion seconds is 31.7 years (so 1976) and a billion minutes is 1901 years (107 A.D.). If those numbers were calculated in 1992 then the 1959 number would be correct for a billion seconds and the billion minutes would have been nearly 60 years after Jesus died.

Despite that discrepancy, the value of $250 Billion dollars for New Orleans should open our eyes to the sloppy and generous spending practices of Washington. $250 Billion is nearly $1000 for every man, woman, and child in this country. Our government thinks that it can stimulate the entire national economy for less than it would take to rebuild New Orleans ($165 Billion vs $250 Billion). With numbers like that anyone should start being interested in making our government more fiscally conservative.