The Cash for Clunkers story is the gift that keeps on giving. In numerous stories in various publications over the last several days, the continued administrative debacle with this program is described in great detail. Just a few of the highlights:
• According to several sources, the government has paid approximately 20% of the claims for the rebates thus far. 20%??? No wonder the dealers have been screaming bloody murder about getting paid. Little did they know they were going to turn out to be a bank for the Federal government. The current commitment is to have all “valid” claims paid by September 30.
• As with most programs, the devil is in the details. The government is apparently being very picky in reviewing the rebate claims and rejecting claims if numbers are transposed, there is any question regarding the registration, etc. So, dealers could still be in cashflow hell after September 30th as they argue with government over the validity of their claims.
• And who will those dealers be talking to? In a recent article in USA Today, the National Highway Traffic Safety Administration says that they will be adding 2000 additional workers by next week to help the 3000 workers already processing claims. Gee… I wonder what kind of extensive training program they will go through to ensure that they are as helpful and efficient as possible? Perhaps the same extensive training program the first 3000 went through. My guess is this story will still have legs in 2010.
So, as we said before, regardless of your political persuasion, the track record on Cash for Clunkers should give anyone pause regarding the government playing a bigger role in healthcare.