Cash for Refrigerators

Business Week (via Yahoo!) reported today on the government’s rebate program for new energy-efficient appliances. Similar to the “Cash for Clunkers,” the program will give rebates of $50 to $200 on new appliances. It was unclear to me what types of appliances will be covered, but it sounds like at least refrigerators and washing machines will be covered. There was no real specific information about the program since individual states will be determining the exact parameters.

I’ve been trying to get my head around these government programs and the affect they’ll have. I honestly hate the idea of the government encouraging and funding consumer purchases. What’s wrong with people making due with what they have? I assume that a large portion of the people participating in these programs will make their new car and dish washer purchases using debt, thus further increasing overall consumer debt. The article listed above mentions how the appliance market has suffered because people have been choosing to fix their appliances rather than buy new. GREAT! That’s responsible behavior. It’s not a problem to be solved by the government. If industries such as appliance and car makers are suffering, they need to adapt their approach, re-tool their businesses, and look for ways to innovate. They shouldn’t rely on the government to bail them out. The whole thing frankly gets me riled up.

Now I’m no economist and can’t eloquently argue the virtues and vices of Keynesian government spending programs. Maybe they’ll have an overall positive impact. But my gut tells me they are wrong simply because they encourage lazy behavior. They don’t encourage personal accountability which is what got us into this economic mess in the first place. Citizens will eventually have to pay for these government programs in the form of increased taxes, which will be harder to pay with their added debt from appliances and cars.

I guess we’ll find out soon what the details are of this newest program so stay tuned. If you are in the market for a new appliance, by all means try and take advantage of this program. If you’re not, be happy with what you have and please don’t go into debt just to take advantage of a measly little discount.

Am I way off on this? Please leave a comment and let me know what you think. I actually would love to hear some good reasoning as to why the program is a good thing so I can at least feel a little good about it. Will energy-efficient appliances really save the environment that much? Will this really help the economy turn around?

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