A 15 mpg clunker that travels 12,000 miles a year uses 800 gallons of gas a year.
A 25 mpg vehicle that travels 12,000 miles a year uses 480 gallons a year.
So, the average Cash for Clunkers transaction will reduce US gasoline consumption by 320 gallons per year.
They claim 700,000 clunkers were turned-in, so that's 224 million gallons saved per year..
That equates to a bit over 5 million barrels of oil.
5 million barrels is about 5 hours worth of US consumption.
More importantly, 5 million barrels of oil at $70 per barrel costs about $350 million dollars
So, the government paid $3 billion of our tax dollars to save $350 million.
We spent $8.57 for every dollar we saved.
I'm pretty sure they will do a great job with our health care, though.
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5 comments:
This is the worst bit of math i have ever seen. I am also pretty sure you didn't even come up with this. Get a life.
The Cash For Clunkers program was a waste of my tax dollar.
But having said that, let's analyze the math in this ditty written like an email chain letter . . .
Up to the "224 million gallons [of gasoline] saved per year" part, the math is OK (assuming you only purchase a new vehicle that gets 25 MPH; there are a lot of vehicles out there to choose from that get much better than that).
The next line (5 million barrels of oil) is way off. A barrel of oil produces approximately 19.5 gallons of regular unleaded gasoline. This means that about 11.5 million barrels of oil is saved. Note also that this is per year, so the benefit is repeated each year for the life of the car; it's not a one-time value as the ditty implies.
The price of a barrel of oil today (noon Eastern time) is $82/bbl. For 11.5 million barrels of oil, we "saved" $943M.
Say the car lasts at least three years. That's $2.8B -- considerably more than the $350M spent on the program.
So, this little "math" ditty was written by someone bad at math.
However, that's not the issue -- What's at issue here is socialism. Why should the money of taxpayers, who work hard to earn their wages and spend their money wisely, be stolen from them by the government and given to others who didn't earn it?
Ignorant arguments for a just cause only help the opposition.
But then again we are talking about saving $350 million a year. so it will take just shy of 9 years to see the return on investment. Not that it was a great plan, but doesn't seem too terrible. Not to mention the help to the environment for newer vehicles with better emissions.
anon 1226, doesnt sound like bad math, sounds like a little lack of knowledge on how much much oil is used to make gas. So why dont you get off his nutt sack and give the guy a break. He was on the right track and we all know what hes talking about. I bet you carry a red pen in your chest pocket to red line everything you see huh?
1:50... You may be putting pure crude oil out of a barrel into your car but the rest of us aren't. There's 42 gallons in a barrel. It is refined down to create between 19-20 gallons of motor vehicle grade gasoline. The leftover is used for any number of other petroleum based products. Get your facts straight.
Rob S
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