Get ready for Cash for Appliances … sometime

posted at 11:05 am on November 27, 2009 by Ed Morrissey

The long-awaited follow-up to Cash for Clunkers will have to wait even longer.  Despite the controversy over the car program, which did nothing except steal sales from the new model-year by using tax dollars to incentive summer sales, the White House plans to pursue its similar $300 million stimulus program for home appliances.  Unfortunately, the program will not roll out for another several months, thanks to a tangled bureaucracy, and that may already be damaging the economy:

The appliances program may be destined to continue the debate. For when it comes to stimulus, timing can be critical, and the implementation of the effort has dragged on, possibly diminishing its usefulness.

Although the $787 billion stimulus program was signed by Obama in February of 2009, much of the cash-for-appliances money won’t hit the streets until next February, March or April. The rebate program is being run by state governments, which must define and enact their rebate plans with federal government funding and approval. A survey of some of the largest states shows that California is planning to begin its program in March, New York in February, Pennsylvania in the spring, Illinois in January and April.

Under the program, Virginia is expected to receive $7.5 million, Maryland $5.4 million and the District $568,000, but the requirements and rebates have not yet been disclosed.

Now the home appliance manufacturers who celebrated the passage of the program worry that the delay in its implementation might actually depress sales at first, with consumers putting off purchases until the rebates begin.

This is called price signaling, and consumers would be crazy to ignore it.  Appliance purchases are significant decisions, and a subsidy program will seriously reduce the investment needed to replace old equipment.  Would you buy a set of tires for $500 today when you could wait a few months and buy the same set for $375?  Not unless your tires were about to disintegrate now.  The government has signaled that prices will be lower in the coming months, and consumers will react accordingly.

That means that appliance sales will get depressed.  People will put off their purchases until they know they can get a better deal.  After all, most of the appliances getting replaced aren’t non-functional; if they were, Barack Obama and Congress wouldn’t need to subsidize their replacement.  The existing appliances work just fine but use more energy, but not nearly as much as the extra cost for buying ahead of the subsidies for the consumers contemplating the purchase.  While that program remains on the agenda, discretionary purchases of appliances will only occur among the blissfully ignorant.

At least Cash for Clunkers hit immediately.  Whatever its other failures, it didn’t send price signals for over a year to consumers to put off their new-car sales.

This doesn’t even touch on the other reasons that these subsidy programs don’t work, such as displacing rather than creating sales, the use of tax dollars to subsidize private purchases, and so on.  Even before it started, this program has been a screw-up, a self-defeating government program that will do far more harm than  good.  It’s a great argument for keeping government out of market distortions for social and microeconomic engineering.

Update: Don’t miss King Banaian’s take on the issue.


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Black Friday sales:

EasyBake over for kids: $17
Real microwave oven: $18

WashJeff on November 27, 2009 at 11:08 AM

The dumbest people in the world are running this nation right now.

Bishop on November 27, 2009 at 11:11 AM

When does “Cash for Old VHS Tapes” kick in?

Hening on November 27, 2009 at 11:11 AM

I need a new freezer so I can hoard food.

huckleberryfriend on November 27, 2009 at 11:13 AM

Microsoft is the master of this type of manuvering. It’s called “vaporware”. A small company announces plans to release a new SW application. Microsoft then announces it will release a similar application. Nobody invests or intends to purchase the small company product. Small company goes out of business. Micrsoft forgets to develop new application.

In the case of Cash for Appliances, the government is doing the same thing, only worse. Since no one will buy an appliance until the Govt forks out the cash, the appliance manufacturers will see massive reductions in sales and orders. They go out of business.

Who the f**k thought this up?

BobMbx on November 27, 2009 at 11:13 AM

Way OT, sorry.

CMT’s Top 20 Countdown is on right now, coming from the Hooter’s Dream Girl competition on St. John’s.

TXUS on November 27, 2009 at 11:15 AM

I just wish there was a legitimate source for collecting and disposing of old analog CRT televisions. That is anyone except the government.

fourdeucer on November 27, 2009 at 11:15 AM

Cash for 8-track tape players is on deck, I’m told

ya2daup on November 27, 2009 at 11:15 AM

This is called price signaling, and consumers would be crazy to ignore it.

Eh, if only the politically sophisticated get the message, is it really going to produce the nationwide effects you’re discussing?

ernesto on November 27, 2009 at 11:15 AM

Obama is going to nuke the fridge.

Verbal Abuse on November 27, 2009 at 11:21 AM

How politically sophisticated do you have to be to understand “Rebates Coming Soon”?

Pablo on November 27, 2009 at 11:21 AM

I’m really hacked off that the “Cash for Fallen Leaves” program wasn’t established in time for me to turn in our fallen leaves when the supply is greatest.

ya2daup on November 27, 2009 at 11:21 AM

Why not Cash for Clothes or Cash for TVs? Cash for well…anything/everything? These people have never run a business and have no clue.

nazo311 on November 27, 2009 at 11:22 AM

This is called price signaling, and consumers would be crazy to ignore it.

Dithering? Merely a variation on all he does(‘nt do).

Or, if I was a Talibani dude I’d just buy a season pass to netflix, wait for Barry to get bored, and make my move by using key stories in NYT as our DIA.

The guy is as dynamic as long walk to store with grandma.

Shivas Irons on November 27, 2009 at 11:24 AM

The states are required to estimate how many jobs their programs will create. California, which will receive $35 million, preliminarily estimated that it will create 350 jobs. This was based on the assumption that for every $92,000 expended, one job would be created.

Really? So, all 50 (or 57) states will get a boost in appliance manufacturing jobs? Again..really?

I wonder….what company manufactures applicances in Alaska? Uh….umm…can’t say, but I’m sure we’ll be provided with a “jobs created” number anyway.

I think they should amend the bill to require China to declare how many jobs will be created as a result of the Cash for Appliances fiasco.

BobMbx on November 27, 2009 at 11:24 AM

When does “Cash for Old VHS Tapes” kick in?

Hening on November 27, 2009 at 11:11 AM

I’m holding out for “cash for old Betamaxes”.

Puddleglum on November 27, 2009 at 11:25 AM

Cash for 8-track tape players is on deck, I’m told

ya2daup on November 27, 2009 at 11:15 AM

There is a God….

BobMbx on November 27, 2009 at 11:26 AM

Good thing the taxpayers don’t NEED all this money the government is wasting.

[The regulations of the Fauxbama Speech Control panels dictate that a “/sarc “tag be placed here, even though it is totally unnecessary, thank you]

Chainsaw56 on November 27, 2009 at 11:26 AM

As my grandchildren say repeatedly:

“DUHHHHH!”

And, speaking of grandchildren, the idiots who dream up this foolishness have just about as much sense. If it came down to a contest, I’d take my grandchildren in a heartbeat.

GoldenEagle4444 on November 27, 2009 at 11:27 AM

Cash for uppity cats?

katy the mean old lady on November 27, 2009 at 11:27 AM

Why the h@ll are we subsidizing people who can already afford to buy appliances? Same with the cars.

txag92 on November 27, 2009 at 11:27 AM

What an nation of morons. I’m going to assume, since it wasn’t really in the text here that there is something similar to the CARS program that the surface goal is to get rid of old items, to replace them with more energy efficient ones.

In other words, “green,” or “greener” things.

How stupid are we as a people (in general) to be led into this stuff that we have to buy something new to save? Oh, my refrigerator, while working perfectly as designed, uses too much energy, so I’m just going to throw that in the landfill and buy a brand new one! So now we have wasted a good peice of equipment, and used countless resources, and energy, to create a new one.

Just like that dopey Prius; several studies have proven that the manufacture of that car, particularly the battery packs, to have a much larger effect on the environment, energy and “pollution” wise, than a full size, v-8 SUV.

JamesLee on November 27, 2009 at 11:29 AM

Holy “shades of Haliburton” …
Barack Obama’s climate czar Carol Browner was a board member of one of the leading carbon offset trading companies, APX.

J_Crater on November 27, 2009 at 11:29 AM

It is time to do it people. Tell your representatives to STOP SPENDING! Stop, or we will cut off the money supply! We cannot continue to sit around and just call, email, and have tea parties. They are ignoring us! They will not get it until the money stream STOPS! And yes, they will threaten, but the IRS cannot get MILLIONS of us!

They are leaving us few other choices.

patriotparty1 on November 27, 2009 at 11:29 AM

txag92, the guvmint is doing that to entice people who are already in debt up to their eyebrows to take the plunge and buy all new appliances ON CREDIT, thereby creating yet another serious money management debacle. The answer, of course, is bankruptcy….FOR THE GUVMINT!

GoldenEagle4444 on November 27, 2009 at 11:31 AM

I’m waiting for the cash for assault weapons program. Time to upgrade my stash.

TXUS on November 27, 2009 at 11:31 AM

Proper title: “Cash for GE/NBC”

jp on November 27, 2009 at 11:32 AM

I don’t mean to be a crybaby, and I have said this before, but I’m only 38 years old!!! Doesn’t the world you knew go to hell when you are a senior citizen?????? This wasn’t supposed to happen this early!!!!! Arguhhhh!!!

Ghoul aid on November 27, 2009 at 11:36 AM

Cash for guns? :-D

SouthernGent on November 27, 2009 at 11:36 AM

How about cash for bulky, monstrous CRT projectors?? I’ve got a 200 pound Electrohome Marquee 8000 that wouldn’t mind being upgraded to a nice DLP :)

Mike in GB on November 27, 2009 at 11:39 AM

Cash for guns? :-D

SouthernGent on November 27, 2009 at 11:36 AM

The government couldn’t afford a down payment on the least mine.

fourdeucer on November 27, 2009 at 11:40 AM

How about cash for bulky, monstrous CRT projectors?? I’ve got a 200 pound Electrohome Marquee 8000 that wouldn’t mind being upgraded to a nice DLP :)

Mike in GB on November 27, 2009 at 11:39 AM

1080p DLP or LCD at that, got to get rid of those clunker low-resolution CRT’s!

jp on November 27, 2009 at 11:40 AM

Eh, if only the politically sophisticated get the message, is it really going to produce the nationwide effects you’re discussing?

ernesto on November 27, 2009 at 11:15 AM

If it does not delay sales, because people do not know about it, it will still accelerate sales and rob them from future sales.

WashJeff on November 27, 2009 at 11:41 AM

The only way to stop them is an actual tax revolt!

Those that are working….

1. Increase your exemption to keep your money from them
2. April 15th file your taxes but, don’t send owed taxes check
3. If enough people do this, like the entire country then they can’t come after us all.

Those out of work

1. April 15th file taxes don’t send owed taxes check

I really believe this is the ONLY way to cut off the head of the beast!

xler8bmw on November 27, 2009 at 11:41 AM

I think I going to go roving the junk piles and find appliances that are being thrown away and don’t work and keep it until the “Cash for Appliances” kicks in. Get the rebate on the junk and still be able to keep my old one. Which brings up another point how are they going to collect all the old appliances? you cannot drive them to the store.
Gawd these people are idiots!!!

keeptherepublic on November 27, 2009 at 11:43 AM

Cash for guns? :-D
SouthernGent on November 27, 2009 at 11:36 AM

That would require turning in old guns to be smashed. Do you really want that; why do you hate the 2nd amendment? Monster.

Bishop on November 27, 2009 at 11:44 AM

I’m really hacked off that the “Cash for Fallen Leaves” program wasn’t established in time for me to turn in our fallen leaves when the supply is greatest.

ya2daup on November 27, 2009 at 11:21 AM

“Cash for Compost” will that work for ya.

Clyde5445 on November 27, 2009 at 11:46 AM

I wonder how many lawn ornaments will have to be sacrificed.

fourdeucer on November 27, 2009 at 11:46 AM

xler8bmw on November 27, 2009 at 11:41 AM

Won’t work.

Only way is to stop the printing pressing. They will simply print more and more money to make up for the lost revenue.

Nuke the presses.

katy on November 27, 2009 at 11:47 AM

I wondered when GE (government electric) was going to get their payoff.

conservnut on November 27, 2009 at 11:48 AM

I’m waiting for the cash for assault weapons Sport Utility Rifle program. Time to upgrade my stash.
TXUS on November 27, 2009 at 11:31 AM

That’s a great idea, but I like that term better.

Chainsaw56 on November 27, 2009 at 11:48 AM

Why can’t The One do something valuable, like Cash for Old Clothes? My wife has closets full of stuff that dates back to the 1960s. Heck, I’d *pay* the government to make her turn in everything she hasn’t worn in the past ten years.

jt on November 27, 2009 at 11:48 AM

conservnut on November 27, 2009 at 11:48 AM

Good Point

katy on November 27, 2009 at 11:49 AM

I see another cluster**** coming.

becki51758 on November 27, 2009 at 11:49 AM

We need to replace our over and under ovens, guess I will try to time it to the program. Ed will you keep us updated?
Thanks,
Paul

paulsur on November 27, 2009 at 11:49 AM

Proper title: “Cash for GE/NBC”

jp on November 27, 2009 at 11:32 AM

Curses! You beat me to it. Foiled again!

conservnut on November 27, 2009 at 11:50 AM

I don’t need a government incentive to buy more guns.

THIS government IS the incentive.

donh525 on November 27, 2009 at 11:51 AM

Cash for DVD player! I wanna Blue Ray!

creatocon on November 27, 2009 at 11:51 AM

I wondered when GE (government electric) was going to get their payoff.

conservnut on November 27, 2009 at 11:48 AM

Bingo!

yoda on November 27, 2009 at 11:51 AM

Good Point

katy on November 27, 2009 at 11:49 AM

Reckon old Glenn Beck will be all over this come Monday. He has been railing about GE/NBC for some months now.

conservnut on November 27, 2009 at 11:52 AM

ernesto on November 27, 2009 at 11:15 AM

No one wants till Black Friday to start Christmas shopping.

lorien1973 on November 27, 2009 at 11:52 AM

jt on November 27, 2009 at 11:48 AM

That’s what the Goodwill is for and I think it’s tax exempt.

Clyde5445 on November 27, 2009 at 11:53 AM

Cash for DVD player! I wanna Blue Ray!

creatocon on November 27, 2009 at 11:51 AM

Noooooo! I just bought Blu-Ray Wednesday.

FYI: LG Electronic DVD players get good reviews.

WashJeff on November 27, 2009 at 11:53 AM

conservnut on November 27, 2009 at 11:52 AM

Hope so.
We should have protests at the drop off sites. Educate the numb nuts participating.

“Is your childs future worth a new micowave”?

katy on November 27, 2009 at 11:54 AM

I think they are crafting the legislation specifically to exclude most every major applicance maker except GE, or to at least give GE a huge advantage. There has to be some serious number crunching going on like the company must employ at least 358 people per plant and have at least 23 plants in 48 states, etc. I am sure they learned their lesson from the C4C debalce when GM didn’t get the most sales.

Johnnyreb on November 27, 2009 at 11:56 AM

I think I’ll put off buying a new frige and wait for my neighbors to help pay for it. Wealth redistribution at it’s finest. Is this program good for GE?

Kissmygrits on November 27, 2009 at 11:56 AM

That means that appliance sales will get depressed. People will put off their purchases until they know they can get a better deal.

The joys of central planning. It did not work in the USSR and it will not work here, no matter who is in charge.

Johan Klaus on November 27, 2009 at 11:57 AM

How about “Cash for Green Science Projects in my Refrigerator?”

Dr. Carlo Lombardi on November 27, 2009 at 11:57 AM

Way OT, sorry.

CMT’s Top 20 Countdown is on right now, coming from the Hooter’s Dream Girl competition on St. John’s.

TXUS on November 27, 2009 at 11:15 AM

Hrm… maybe I should go set my DVR at lunch time.

hawksruleva on November 27, 2009 at 11:58 AM

katy on November 27, 2009 at 11:47 AM

Actually it would work. But, the american people don’t have the guts to do it. Most don’t understand that the IRS is just the money launderer for the Fed reserve and is a completely illegal enterprise. I agree the printing presses need to stop but, we’re already in deep trouble because what will happen is the vacuum will start eventually to suck up all of the money that has been dispensed to be destroyed which in turn will increase interest rates and cause an inflation.

xler8bmw on November 27, 2009 at 11:59 AM

I am sure they learned their lesson from the C4C debalce when GM didn’t get the most sales.

Johnnyreb on November 27, 2009 at 11:56 AM

Liberals don’t learn. They’ll repeat failure a million times, if you let them. At best, they’ll take away some wrongheaded idea, like “it just wasn’t big enough”.

hawksruleva on November 27, 2009 at 11:59 AM

BobMbx on November 27, 2009 at 11:24 AM

Ed, you’ve been scooped by BobMbx: they’re coupling this with the “jobs created or saved” scam!

I’m in favor of a “Cash for Brain-Dead Congresscritters” program in which our brighter betters are retired in a pair of cement overshoes and dropped in the Potomac River in waist-deep water (gotta boost winter tourism in DC y’know).

ya2daup on November 27, 2009 at 12:02 PM

But, the american people don’t have the guts to do it.

xler8bmw on November 27, 2009 at 11:59 AM

I think with a lot of education on the issue, they will. April 15 2010 will tell..

katy on November 27, 2009 at 12:03 PM

When is “cash for wives” coming? I’m in need of an upgrade.

BPD on November 27, 2009 at 12:04 PM

I still like Cash fir Clunkers. I raise the cash and you formally resign.

MaiDee on November 27, 2009 at 12:07 PM

Holy “shades of Haliburton” …
Barack Obama’s climate czar Carol Browner was a board member of one of the leading carbon offset trading companies, APX.

J_Crater on November 27, 2009 at 11:29 AM

RICO?

Johan Klaus on November 27, 2009 at 12:07 PM

Just what the country needs, more “Obama money”. Eh, what the heck, after all, it’s FREE, isn’t it?

Hahahahahaha!!!!!!

GarandFan on November 27, 2009 at 12:10 PM

We jumped the shark into stupid land when the last admin approved ethanol. Everything since is just an embellishment.

When you start growing food to put in your gas tank you don’t have a energy problem you have a mental problem.

patrick neid on November 27, 2009 at 12:11 PM

If The Unprecedent’s economic brain trust ever stumbles upon “Cash for Videogames” or “Cash for Cellphones” they’ll lock up the 18-to-24 year-old voting block in perpetuity.

ya2daup on November 27, 2009 at 12:11 PM

GarandFan on November 27, 2009 at 12:10 PM

That’s because his face is now on the welfare stamps! He couldn’t get his face on actual money so they put it on the stamps

xler8bmw on November 27, 2009 at 12:14 PM

Cash for toilet tanks, coming soon.

exdeadhead on November 27, 2009 at 12:15 PM

In the real world, if you were a marketing executive and launched a program called “Cash for Clunkers”, once the program was over you would be required to track the results and be accountable for its success/failure. You certainly wouldn’t be allowed to launch another similar program unless you could show the first one reached or surpassed its goals.

Sadly, in this administration, if the goals weren’t reached, they just make up numbers to make it so they were. And then they reach in the money bag (our pockets) and launch another epic failure.

What happened to Mr. President addressing the deficit he claims is a priority? Oh, nevermind.

scalleywag on November 27, 2009 at 12:18 PM

When your Kitchen Fridge
Becomes your Garage Beer Fridge,
Consumption goes up!

Haiku Guy on November 27, 2009 at 12:23 PM

That would require turning in old guns to be smashed. Do you really want that;
why do you hate the 2nd amendment? Monster.
Bishop on November 27, 2009 at 11:44 AM

The original commenter should have expressed himself more sensitively. He was in fact advocating tax credits to support recycling and encourage the progressive press.

Cash For Primers?

sesuncedu on November 27, 2009 at 12:33 PM

When is “cash for wives” coming? I’m in need of an upgrade.

BPD on November 27, 2009 at 12:04 PM

There are quite a few desirable upgrade candidates on CMT’s Top 20 Countdown, which is on right now and coming from the Hooter’s Dream Girl competition from St. John’s.

Do I hear a Hell Yeah?

TXUS on November 27, 2009 at 12:45 PM

The GE Bailout.

I guess this means they are accepting that Cap and Trade is dead, so they have to figure out another way to bail out GE.

Joe Caps on November 27, 2009 at 12:46 PM

Eh, if only the politically sophisticated get the message, is it really going to produce the nationwide effects you’re discussing?

ernesto on November 27, 2009 at 11:15 AM

It won’t just be “the politically sophisticated” who know about it. My power company is already putting notices about it in their bills.

AZCoyote on November 27, 2009 at 12:50 PM

It’s a great argument for keeping government out of market distortions for social and microeconomic engineering.

Like we need another argument for that.

mike_NC9 on November 27, 2009 at 12:51 PM

I still think we would’ve been better off with a $100,000 tax rebate to each tax paying American when all this got started. At least we would know where the money went and would probably have seen better economic stimulus than this crap.

Wyznowski on November 27, 2009 at 1:11 PM

The government bleeds multiple trillions of dollars from American taxpayers each year. You’d think, with all that ill-gotten cash, they could afford to spend just a wee bit to buy a freaking clue.

SKYFOX on November 27, 2009 at 1:14 PM

Can’t do it too soon, these Dem Congresscritters figure they need the stimulus closer to next year’s elections. “Vote for me, I gave you free money”.

PatMac on November 27, 2009 at 1:18 PM

Cash for old AC’s. No more new air conditioners after 2010, and furnaces will come with factory installed governors on their thermostats. Utopia.

petefrt on November 27, 2009 at 1:27 PM

Kissmygrits on November 27, 2009 at 11:56 AM

Only if you buy a GE manufactured product.

chemman on November 27, 2009 at 1:34 PM

I’m a perfect example. I want to get a new refrigerator and had decided to wait for the after Christmas sales. Now, I think I’ll be waiting a little longer.


“Just so we’re clear, you are not allowed to pay us back in clunkers used refrigerators.”

-Hu Jintao

Kafir on November 27, 2009 at 1:37 PM

patrick neid on November 27, 2009 at 12:11 PM

Ethanol mandates began with the Carter Presidency. Bush did us no favors by trying to give us a new and improved version.

chemman on November 27, 2009 at 1:38 PM

“Cash for Compost” will that work for ya.

Clyde5445 on November 27, 2009 at 11:46 AM

Only if the heap is full of democraps..

huckelberry on November 27, 2009 at 1:41 PM

They can push it off till next year like most of the stimulus. What they are really setting up is “cash for votes”. Where do I line up to get my “free” Obama money?

smrtas1 on November 27, 2009 at 1:42 PM

SMART Power!!!!!!!!!!1111111111111111!!!!!!!!eleventy

jukin on November 27, 2009 at 1:51 PM

When does “Cash for Old VHS Tapes” kick in?

Hening on November 27, 2009 at 11:11 AM

They need the metal so the Chi-Coms can make more tanks. They want stuff they can salvage hard metal from.

johnnyU on November 27, 2009 at 2:07 PM

And with appliance inventories already way above normal levels, the distribution centers will be overflowing with slow moving goods. Watch Whirlpool go bankrupt from lack of cash flow because of government interference with the market place. As someone stated, truly the dumbest people in the nation are in charge of the federal government.

ray on November 27, 2009 at 2:17 PM

How about a “Cash for Commies” program? We could buy early retirement for Obama and his cabinet. That would definitely be stimulus.

Mojave Mark on November 27, 2009 at 3:09 PM

Goody, I wonder what we’ll wind up paying for clunker appliances?

$4000 per oven……2500 per washer………$450 per microwave

The “For Clunkers” programs are sort of like ethanol……they alwasy cost more to create than they actually produce.

JoeinTX on November 27, 2009 at 7:16 PM

Cash for Codgers.
Get a nice rebate for pulling the plug on gramps.

justltl on November 27, 2009 at 9:16 PM

This Tea Party poster was a prophet:

“Obama the Ultimate Clunker”…
http://i1019.photobucket.com/albums/af314/usanevada/tp21.jpg

Annie on November 27, 2009 at 10:32 PM

I predict the states will pocket the money, keep union members on their jobs, and give about $20 for a rebate.

PattyJ on November 28, 2009 at 11:00 AM