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Log In / Register | May 18, 2013

The Wreck of Subsidizing Car Purchases Through Cash for Clunkers

General Motors US market share down 32 percent in North America. Today 72 percent of GM sales are outside of North America. To the extent that the US taxpayer is subsidizing General Motors, are we subsidizing those overseas consumers?

GM is now advertising the Obama administration program to subsidize the purchase of new cars, the program applies even to Americans who want to take their government subsidy to purchase a foreign car.

Newsweek magazine famously said that "we are all socialists now" and giving tax dollars to buy a new car epitomizes the new American socialist consumer society.

Thomas Cooley, a noted nineteenth century jurist, observed:

"When the State once enters upon the business of subsidies, one shall not fail to discover that the strong and powerful interests are those most likely to control legislation, and that the weaker will be taxed to enhance the profits of the stronger." [People v. Salem, 20 Mich. 487 (1870)]

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