Cash For Clunkers: Good for car sales, bad for the environment

The Cash For Clunkers program has been pitched to taxpayers with a dual premise: prop up car sales (because we clearly haven't done enough to help the auto industry) and improve the environment.

The program has been a resounding success as far as car sales go. But Harvard economist Edward L. Glaser says that Cash For Clunkers could actually be bad for the environment. He explains that position in an absolutely incredible op-ed piece for The Boston Globewith a brilliant point: "One side effect of the program is that new car owners will surely find it more appealing to drive in their snazzy new cars. A better way to reduce carbon emissions is to make driving more, not less, expensive. . . The cash-for-clunkers policy seems based on the mistaken view that the number of miles traveled is independent of the price or pleasure of driving. I call this the "lump of travel fallacy,'' which is one of a family of lumpy errors that all assume things will stay fixed when they won't."