U.S. Presidential race - Democrat Discussion

[obdigore]

First off, the money went to the car companies, the cars when to the consumers. Second, just because consumers got something out of it, doesn't mean it was effective. In fact, what really happened is that government encouraged behaviour through giving out taxpayer money, that resulted in cars being produced that no one would've otherwise wanted. They encouraged behaviour that was wasteful for society as a whole, but beneficial for the car companies and the customers.

The tax credit has nothing to do with the R&D. It's a separate issue.

Car Companies learning how to design and produce cars is DEVELOPMENT. Part of that R&D thing. Making something cost effective often (almost always) requires previous generations that are not cost effective.

You still have not shown that people who would not have purchases electric or hybrid cars did because of the consumer tax credit.

[Deleted]

Sure it is. If it is something for the good of its citizens that is not currently economically feasible, then yes, R&D is the governments role to either research it or offer tax breaks to companies who are researching it.

If it's not economically feasible, then it shouldn't be done. End of story.

You're again mixing the concept of being profitable (from a corporations perspective) and being worthwhile from a cost-benefit analysis perspective (government). They're not the same. If it's not even wortwhile from a cost-benefit perspective, then you really shouldn't do it. You need some underlying presumtion of how you will benefit from doing something, and how much it will cost. These ought to be the key issues every time government spends on something.

[belfpala]

Sure it is. If it is something for the good of its citizens that is not currently economically feasible, then yes, R&D is the governments role to either research it or offer tax breaks to companies who are researching it.

Yes. I agree. See my edit.

There are some things that are too big, or too expensive, or the profit is too far away, or whatever, for private industry to tackle. We can argue about which things those are, but they exist. (roads).

---------- Post added 2012-09-21 at 06:28 AM ----------

If it's not economically feasible, then it shouldn't be done. End of story.

We wouldn't be having this conversation if your opinion was reality. End of story.

[obdigore]

If it's not economically feasible, then it shouldn't be done. End of story.

You're again mixing the concept of being profitable (from a corporations perspective) and being worthwhile from a cost-benefit analysis perspective (government). They're not the same. If it's not even wortwhile from a cost-benefit perspective, then you really shouldn't do it. You need some underlying presumtion of how you will benefit from doing something, and how much it will cost. These ought to be the key issues every time government spends on something.

You are the one doing the mixing. The goal was to get more electric cars on the road, and get more companies producing electric cars. Did it fail? I can't see how it did.

[Deleted]

You still have not shown that people who would not have purchases electric or hybrid cars did because of the consumer tax credit.

Supply & Demand.

[obdigore]

Also, Smrund, I found the part of the article I was looking for in regards to price differences:

The CBO said an average plug-in hybrid vehicle with a battery capacity of 16 kilowatt-hours is eligible for the maximum tax credit of $7,500.

"However, that vehicle would require a tax credit of more than $12,000 to have roughly the same lifetime costs as a comparable conventional or traditional hybrid vehicle," the CBO said.

And, the bigger the battery the greater the cost disadvantage for buyers of plug-in vehicles and conventional vehicles, the CBO said.

---------- Post added 2012-09-21 at 02:34 AM ----------

Supply & Demand.

A hypothetical chart with a hypothetical non-answer. Cool.

[Deleted]

We wouldn't be having this conversation if your opinion was reality. End of story.

Huh? Are you crediting internet to economically unfeasible behaviour?

Are you guys seriously arguing that the government should engage in behaviour that doesn't make sense from a cost-benefit analysis perspective? The benefit in this case doesn't have to be revenue or profit. It can be other goals, like lower poverty. Don't be irrational.

A hypothetical chart with a hypothetical non-answer. Cool.

Are you telling me that lowering the price of a car does not increase demand for it? The only way this could be possible is

1) The car's original price is too high and the lowering is too little, so the car remains at 0 demand. This isn't the case because these cars clearly had some demand.

2) It's a luxury car that sells better when the price is high because millionaires do not like to buy cheap cars that the proletariat can afford.

[belfpala]

Huh? Are you crediting internet to economically unfeasible behaviour?

No. The computer you're running it on.

[obdigore]

Are you telling me that lowering the price of a car does not increase demand for it?

Are you telling me that if you charge 100$ for something someone else charges 50$ for, and you then lower the price to 75$, all of a sudden you will start selling more despite that other guy still charging 50$?

[belfpala]

A hypothetical chart with a hypothetical non-answer. Cool.

I actually feel offended.

That doesn't happen often.

[Deleted]

Are you telling me that if you charge 100$ for something someone else charges 50$ for, and you then lower the price to 75$, all of a sudden you will start selling more despite that other guy still charging 50$?

Sure, as the one priced at $50 isn't the same as the one priced at $75. Some people are willing to pay extra for it to be an electric car.

I actually feel offended.

That doesn't happen often.

Offended by what?

Also I edited the post you just responded to as you seem to have misinterpreted what I said.

[obdigore]

Sure, as the one priced at $50 isn't the same as the one priced at $75. Some people are willing to pay extra for it to be an electric car.

Ok, so they were already willing to pay extra? Then I guess lowering the price didn't change anything because they are still paying extra.

[belfpala]

Really, get rid of the Econ 101 lesson. If anyone here needs it, well... they can google up the invisible hand and such.

I was going to comment on one of your earlier posts. I don't feel like going back to quote it. You said that the Volt makes the same profit margin regardless. True. You ignored that the volume of sales might increase.

[Deleted]

I was going to comment on one of your earlier posts. I don't feel like going back to quote it. You said that the Volt makes the same profit margin regardless. True. You ignored that the volume of sales might increase.

I never mentioned anything about volt? I have no idea what you're talking about.

Unless you mean when I said that a consumer tax credit is corporate welfare because it increases demand by artificially lowering the cost for the consumer. The car company still recieves the full price for the product (same profit margin), but now sells more cars than before. Thus, its profits increase.

Really, get rid of the Econ 101 lesson. If anyone here needs it, well... they can google up the invisible hand and such.

Why should I get rid of econ 101 lessons when they fit in perfectly with what Obdigore wants me to show. Quite ridiculous of you really to get offended by knowledge.

Ok, so they were already willing to pay extra? Then I guess lowering the price didn't change anything because they are still paying extra.

You do realize that not everyone is willing to pay the same amount of extra. Some people will pay $50K extra for the car to be electric, others $10K. Some are only willing to pay $500 extra. And even others would pay $1000 for it not to be electric.

[belfpala]

I never mentioned anything about volt? I have no idea what you're talking about.

If it wasn't you, I apologize. I was itching to respond to whomever, but then I saw I had a couple more pages to look at.

Anyway... You haven't responded to my assertion that we wouldn't be having this conversation without the government.

[obdigore]

You do realize that not everyone is willing to pay the same amount of extra. Some people will pay $50K extra for the car to be electric, others $10K. Some are only willing to pay $500 extra. And even others would pay $1000 for it not to be electric.

You clearly want to do nothing but attempt to talk down to people who disagree with you, and then pull random numbers when someone asks for proof that the potential tax credits did anything real for the sale of the cars.

Until you show that, I'm just simply not going to respond.

[Naxere]

Pretty good (and pretty recent) article on the Volt:


http://www.reuters.com/article/2012/...88904J20120910

[Deleted]

You clearly want to do nothing but attempt to talk down to people who disagree with you, and then pull random numbers when someone asks for proof that the potential tax credits did anything real for the sale of the cars.

Until you show that, I'm just simply not going to respond.

I can't believe I have to explain this to you. The only reason it isn't mentioned in the article is because it goes without saying, it's implied.

Part of the governments plan to reach its goals was to increase the sale of these electric cars, and thus they artificially lowered the cost of them for the consumer. Are you arguing that the government failed at this as well?

What you're essentially saying is that there are only two groups of car buyers: One that is willing to pay almost any premium for an electric car, and will thus buy it with or without the tax credits. The second is one will pay no premium at all for the car being electric, and will only buy it when it's as economic (initial price + cost of usage) as normal combustion engine cars.

But this means that between these groups exist no person at all. That there are no people who are willing to pay a premium for the car being electric that is lower than the first group. Which is bullshit. There are people who would pay a little extra for the car being electric and green, and this tax credit affects them mostly. There are other factors as well why people might want to buy a Nissan Leaf instead of a "normal car", like design, comfort, silence. With any other car, if you lower the price, the demand increases. Why would electric cars be any different?

Why are you denying the basic function of supply and demand? Experts can disagree on whether Obama's plan is smart or not etc, but I can assure you that there isn't anyone with economic education that would argue that the tax credits didn't increase demand compared to if there had been no tax credits.

[Wells]

You clearly want to do nothing but attempt to talk down to people who disagree with you

I can't believe I have to explain this to you.

I'm so glad I missed this entire exchange.

[Deleted]

I'm so glad I missed this entire exchange.

Don't tell me you also think is not fucking obvious that a $7,500 tax credit increases the demand for these cars?

Because I'm going to talk down to people when they're arguing that 1+1 isn't 2. Because this isn't even debatable, unlike the other things we discussed like if government should do this or not.