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Stimulus Program for U.S.

Use Auto bail-out money to give credits for selling 2nd hand autos to Mexico.
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As if there was a need for another dump for tax payers' money.. but I think it is a better alternative to the current automotive stimulus plan. The fact is: there are 200% more cars than drivers in US. So, instead of the government giving money to building more new cars, it could give some kind of credit for exporting old cars to Latin countries. Why, they need cheap cars there, and US needs to manufacture new cars.. This works for everyone, including Joe the plumber.
xkuntay, Feb 17 2009

This policy has a name - it's called "Dumping" http://en.wikipedia...ng_(pricing_policy)
[zen_tom, Feb 17 2009]

Information about Mongolia http://www.ub-mongo...my-of-mongolia.html
[zen_tom, Feb 19 2009]

Nigeria's Automotive Industry already in Decline http://marketreport...ndustry-in-decline/
Shipping vast quantities of second-hand motors to Nigeria is likely to kill off its motor industry for good - and while that might be good for the US, it might annoy those Nigerians who have jobs in that industry. [zen_tom, Feb 19 2009]

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       //This works for everyone, including Joe the plumber.// Everyone except Juan the Fontanero...   

       Wont this just annoy the Mexican auto manufacturers, and be reviewed on the world stage as an act of aggressive protectionism? This in turn would likely trigger similar policies across the world, effectively drying up all cross-border trade and putting any net exporters out of business.
zen_tom, Feb 17 2009
  

       Ahh, the Balance Of Trade. You must protect american workers from foreign competition. Imports are bad. You must subsidise exports to keep american exporters in work. Exports are good.   

       When lots of goods leave America but nothing ever comes back, America will be truly prosperous, thanks to clever trade policy.
Bad Jim, Feb 17 2009
  

       <rant>let's all give people money for incompetently producing stuff nobody wants.</rant>
sninctown, Feb 18 2009
  

       'Juan the Fontanero'? What's that, a vacation spot? Huh! Since when does US care about foreign citizens? What are they gon do, shut their border? Haha sure! It may screw them alright, but Juan is always welcome to enter the country illegally and find a job in manufacturing.   

       I don't see the /rant/ module in my idea. If anything, it is an ammendment to the /rant/ module to clean up the code a bit.
xkuntay, Feb 18 2009
  

       //'Juan the Fontanero'? What's that, a vacation spot? Huh! Since when does US care about foreign citizens?// Nice sentiment, you're evidently a real statesman.   

       Look it up.
zen_tom, Feb 18 2009
  

       //Stimulus Program for U.S.//

Curses! I was hoping that this was going to involve electrodes and an old telephone battery.
DrBob, Feb 18 2009
  

       I'm happy with the idea of equipment that is not required being sold to those who require it, both from an economic and an environmental viewpoint. Economically, although the modern theories which have failed us so well disagree, I believe that making savings and spending frugally is the bedrock of a solid economy. Environmentally, I'm looking at how much you save by not having to build an extra car because someone has the unneeded one now.   

       In terms of the idea and its particular geographic arrangement, there's probably improvement to be made. I don't see why it is better to move the car from the U.S. to Mexico than just to move it to the nearest person who wants to buy a second hand car. If he buys second hand instead of new, he now has a lot more money than he would otherwise have had, and the seller also has money that was previously in a rusting asset. So, although we don't end up putting cash into a bankrupt car manufacturer, we do benefit two people financially with some hefty sums that are likely to end up helping the economy.   

       Perhaps [xkuntay] can explain why moving it to Mexico actually makes a difference here? If anything, it means the person in Mexico will have got a car cheap and hence will not buy a new car, leaving him better off financially and able to spend more in the economy of Mexico.
vincevincevince, Feb 18 2009
  

       [vincevincevince], well put. That's exactly how I was thinking when I posted the idea. And it is also good to sell second hand things within the country, which is equivalent to recycling. Mexico was not really the main idea and perhaps a poor example, since Mexican auto makers may be building enough cars for their locals. My idea was to transport all the unwanted second hand cars (and technologies) to countries that do not have the infrastructure to build new cars and do not have the money to buy new goods from other countries. Examples may be Peru, Columbia, Nigeria, Mongolia etc. The benefit to these third world countries is that their middle class will own operating cars for low rates. The benefit to developed countries will be they will have foreign cash flow and room for new production.   

       Yey. I always wanted to be a real statesman...not.
xkuntay, Feb 18 2009
  

       Sorry, but there are a few things that I'm finding difficult to understand - what exactly are you suggesting? (please indicate those that apply)
1) People in the US sell their second-hand cars overseas, to "Latin" countries
2) In this instance, "Latin" countries refers to countries with no car-building industry of their own, like "Peru, Columbia, Nigeria, Mongolia etc"
3) The US government will subsidise those individuals who choose to export their old cars overseas
4) Presumably these backward "Latin" countries (like Mongolia) while not capable of producing their own cars, will have the kind of infrastructure that is capable of maintaining and fuelling them
5) One benefit to the US is the income generated from the sale of second-hand cars to third-world countries.
6) The other benefit is that now relieved of their old motor, and with a government cheque burning a whole in their pocket, US citizens will now rush out and buy a new car, propping up the beleaguered motor industry.
  

       Is that what the idea is?   

       If this happens, what's to stop other countries importing better quality (subsidized) second-hand cars back into the US?   

       Also, just out of interest, have you ever been outside the United States?
zen_tom, Feb 19 2009
  

       // "Latin" countries (like Mongolia)//   

       Latin??? Look for it on a world map. Its between China and Russia. And it's a terrible place to try exporting to because it's landlocked. And Nigeria is in Africa
Bad Jim, Feb 19 2009
  

       That was my point, hence the "speechmarks" - it might also be appropriate to point out [xkuntay]'s ignorance in suggesting that these "Latin" countries are inherently backward.
zen_tom, Feb 19 2009
  

       [zen-tom] I'll start with your last question: yes, in fact I come from a third-world country.   

       I think that would suffice to say, but I will continue with your other questions: Options 1, 3, 4, 5, 6 apply.   

       I know for a fact that in third-world countries the prices of cars (and electronics) are very high. A new Ford Escort for instance could be $25,000, and a second hand 4-year old Escort may be $11,000 (in US it is $5,000). Clearly the math works. Transportation is not an issue. I once posted my car in Craigslist and someone from Russia asked for it! He told he ships cars all the time, 'cause it's less expensive to do so. (No, I didn't sell it to him, 'cause he wanted to pay by check.) As for Mongolia being Latin, they have actually found evidence that early Christians colonized in Mongolia and brought the Latin lanugage there, and thus Mongolia can be so considered.. ok that was BS. I wasn't looking at the map when I wrote that. Mongolia or Nigeria are not Latin but are in the league. With current oil prices, it is not a trouble to transport cars there, except you need to pass thru some dictas on the way.   

       //If this happens, what's to stop other countries importing better quality (subsidized) second-hand cars back into the US?// Again, by the law of thermeconomics, you can't sell a thing for more than what it is priced for in that particular place. Americans won't buy 2nd hand cars for $15,000.   

       Actually this kind of transactions happen in military industry all day long. US always sells old warships and warplanes to third-world countries in order to 'dump' them off. It works just fine, except you need to start war once a while in order to let the clients enjoy the purchases.
xkuntay, Feb 19 2009
  

       Sorry if I offended you, it just sounded as though you didn't have much knowledge of the 'outside' world - that's just the way you came across, I'm guessing you're not Latin, or you'd have figured out what a fontanero was.   

       On your rebuff of this happening in reverse - why would an imported 2nd-hand car cost $15,000? There's cars here in the UK that are selling for less than £1,000 - if the UK government subsidised their export into the US, I'm sure you'd be able to sell them at a similar price.   

       Free trade across boundaries is fine, and if you want to sell a car to someone in Russia then great - but you're suggesting the US government subsidises those sales - and that's where the whole protectionism thing comes in - which is the main issue.   

       Military sales generally have some government involvement (if you discount the ones you see on eBay) so I'm not sure the idea of subsidy applies.
zen_tom, Feb 19 2009
  

       I think the big problem is that American cars stink and I would be shocked if the majority of American cars were worth more than scrap value in third world countries. How would you get parts? Why would you buy an old Escort when the computer chip is going to die in two years? Why wouldn't you pay less and get a VW bug, bus or hell anything made by VW? Maybe Jeeps or early carburated cars, but it's tough to keep an old US car running in the US when you have the parts store right around the corner.
MisterQED, Feb 23 2009
  

       [UB] Why, I am from Kazakhistan. You know it already. I completed my "Cultural Learnings of the US" so now I can write like this. What what what! Haha. Ok, not quite but close. Anyway, I did get education in US. But I know third world all too good too. In my country Ford Escort is $24k! Still many people buy. The reason is government tax. I see many cars in US that are good condition but people want to donate as scrap. Well, instead of being scarp, they can be useful elsewhere. At least so I thought. But again, as some told, US cars are big and burn dearly, so may not be applicable. Was just an idea. Got fishbones anyway.
xkuntay, Feb 24 2009
  

       [MisterQED] VW is cool, except for Jetta's. They had real wierd electrical probs. I had seen 5 in a row when shopping (2nd hand) and found 2 of them did not start properly, one had lock problem, other had window. Last one was okay, to my knowledge. So they had their issues too, although relatively minor. Maybe now it's better.
xkuntay, Feb 24 2009
  

       //Ford Escort is $24k! Still many people buy. The reason is government tax.// Dude - and that's your problem right there - fighting protectionism with more protectionism isn't going to work. So, by your own admission, if the high price is due to tax (and not some underlying lack of infrastructure) how does this idea address this main problem? Don't you think the government on the receiving end of this so-called policy will tax second-hand imports just as highly?   

       It really doesn't make any sense.
zen_tom, Feb 24 2009
  

       protectionism up, protectionism down! ok, protectionism is bad, doodoo, but I am not the one inventing it. Isn't the stimulus plan protectionism all together? We are trying to choose between the two evils here. Yes, government taxes 2nd hand import cars, and heavily too. But that can be offset. At the end of the day, gov 1 is happy for collected hefty tax, gov 2 is happy for more exports, middlemen are happy for the money they made. Just some smart ones who realize that it is all nonsense are unhappy. It may be nonsense, but isnt that what got the president elected? At least 40% believe so.
xkuntay, Feb 26 2009
  

       Yes, the car-stimulus plan is protectionism, that doesn't make it any better - if it were up to me I'd let it all go to the wall - it's going to have to go at some point because it's unsustainable - if we prop it up now, we're just saving up pain for later - it's Thatcher and the coal mines all over again - except that in this instance, the industry is all privately owned by incredibly wealthy, and politically powerful individuals.   

       And I don't think Obama was elected because he suggested he was going to prop up the overblown American car industry - but I could be wrong.   

       And isn't the potential demise of the American motor kombinat kind of a good thing, at least in the long term?
zen_tom, Feb 27 2009
  
      
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