This is going to seem like a ramble, but it is not.  My limber mind has been expertly crafting this post for the better part of twelve hours during varying levels of awareness.  Our minds do some of their best thinking when well fed and then left to quietly and creatively churn while away from the hammering of our will.

Imagine a solitary lifeboat on an expansive sea.  We are all in this boat together, as they say.  The big fat guy up front says he is going to give everybody something to do.  His latest initiative seems a little bit crazy.  He told one group of people to poke little holes in the bottom of the lifeboat so that another group could come along and repair the holes.

Stated as this metaphor, this initiative is completely insane but in a large economic sense it is descriptive of “Cash for Clunkers.”  One of the real forms of wealth that a nation possesses is in what is called “capital equipment.”  In a grand economic sense, and particularly since we are now hurtling toward a collectivist existence, even privately owned equipment, in a sense, is a portion of the wealth of our nation.

In American society, even though we don’t normally think of our cars, trucks, and SUVs as capital equipment, in effect they are just that, but what does that mean?  Capital equipment is the physical stuff that we use to produce goods and services.  It provides leverage to our other efforts and frequently is a basic enabler of production.  Here is a simple test: Among the American middle-class, imagine how productive you would be in your workday, or even in taking care of everyday life chores, if you did not have access to a car?

Personal mobility is one feature of American history that made America into a great nation.  There are many who manage without that mobility, but everyone desires it.

There are a few in America who may be considered as privileged to live without a personally owned automobile, but how many of those people have never ridden in a car for purposes of being productive?  Certainly, the destruction of the mobile way of life is one of the fairy tale dreams of the left.  However, even if that were to come to pass, other capital equipment would be required for our existence.  For instance, the high-rise communes would become a new form of capital equipment to run the enterprise of metro living.

Within its workings, the “Cash for Clunkers” scheme requires the destruction of portions of capital equipment and therefore a destruction of wealth.  Reportedly, the “Clunkers” that are traded in are to be scrapped, not resold.  After all, they embody emotional evil because they are not the cars that Greenpeace (and the other enviro-marxist-nuts) would have us drive.

The vast majority of the trade-ins will be in an operable condition when they are destroyed.  In fact, most may not be clunkers at all, but instead vehicles of great utility.  In a free market economy, useful equipment is rarely scrapped.  Through trading, items that are no longer optimally useful to one entity are sold to others who can make good use of them.  Through these transactions, the usefulness of the equipment is optimized over its lifetime until it is completely spent.  Perhaps more importantly, through these transactions, those on lower rungs of the economic ladder are provided with optimum opportunities to build their own productivity and make their own way in life.

“Cash for Clunkers” is just one more attack on the potential efficiencies of a free market.  This is just a shame and a sham.  Recall that much of the push for this is coming from people who say they want to make the world a better place.  They want to do that through the destruction of things that help us to be productive.  Insane.  However, it might get much worse.

“Cash for Clunkers” is a microscopic parallel to a portion of “Cap and Trade.” (…and what is it with the stupid names they come up with these STUPID ideas?)

Imagine that our lifeboat is equipped with a powerful internal combustion engine and all the associated stuff to allow the boat to navigate under its own power - a really good thing to have in a lifeboat dontcha’ think?  Under “Cap and Trade” we will remove the motor from the bowls of the boat, throw it overboard, and then begin crafting a sail (crafted from the shirts on our backs) to put up in the wind.  I’m sure most of you will catch on to this metaphor.

For just one example, “Cap and Trade” will result in the government-forced abandonment of conventional infrastructure (capital equipment) that is used today to produce energy from coal.  Cap & Trade will effectively destroy that equipment and supposedly put us all back to work building windmills.  This is not progress.  This is economic insanity.

Free market systems optimize the use of equipment and human effort.  Within free market environments innovation flourishes and constantly strives to find efficiencies.  In turn, those efficiencies develop a situation of excess human capabilities that can then be enjoyed as freedom and reinvested into solving yet greater challenges.  As this cycle continues, real wealth is generated and is ultimately, in some fashion, enjoyed by all.

Remember the bossy guy running the lifeboat? He was the Captain who ran the steamship onto the rocks in the first place!  No, he did not go down with the ship.  He is the government, and he is not here to help.  His nature is to enslave us.

UPDATE:

A blog with “Econ” in its name has a parallel analysis at Econbrowser.

Also, the economic model for “Cash for Clunkers” is known as the Broken Window Fallacy, read it!

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