Americans Love their SUVs

The Cash for Clunkers ended Monday night because it has once again run out of money. It ran out the first time just four days after its July 24 debut, prompting Congress to authorize an extra $2 billion on top of the measly $1 billion it started with. And so we now know how long the car-loving folk of our nation will leave that kind of cash on the table when it comes to new wheels: not very dang long.

That Washington failed to grasp this is a sign of how disconnected the ruling class has become from everyday life, much of which happens in cars. Lawmakers did the right thing in authorizing -- and then re-authorizing -- Cash for Clunkers. But they should have been more aware of the unnaturally depressed state of auto sales -- and the relatively small amount it would take to revive them.

Cash for Clunkers has been a tremendous boost to the two most important components of the economy: the beleaguered manufacturing sector and the formerly sidelined consumer. It may be remembered as the stimulus initiative that finally snapped the country out of its financial coma and set us on the road to recovery. Elaborate financial re-engineering didn't do this, nor ingenious investment in entrepreneurship. It was the recognition that the make-stuff-sell-stuff economy can swiftly restore national confidence.

Americans still have a craving for SUVs. Although the Clunker statistics are not in yet, it is estimated that 30% of all sales were for SUVs. We wonder if those who traded in their Explorer for a Corolla will be happy? Left totally out of the program was Hummer, an all American icon that is assembled and most of the parts made in the United States. Big SUVs are in demand again with prices for gasoline hovering around $2.43 in most areas. It is obvious that Washington doesn't realize that four wheel drive in rugged and snowy areas is now a necessity for many in 2009!