Some people will twist, distort, and lie to get you to believe their opinions. There is now circulating, an e-mail that twists, distorts, and lies on a grand scale. The writer is trying to ridicule the recent phenomenally successful "Cash For Clunkers" program.

The content of the e-mail is below.
The original text is shown in an italic typeface.
The twists, distortions, and lies are lined out.
My responses are displayed in separate blocks of text.

If you traded in a clunker worth $3500, you get $4500 off for an apparent "savings" of $1000.

However, you have to pay taxes on the $4500 come April 15th (something that no auto dealer will tell you). If you are in the 30% tax bracket, you will pay $1350 on that $4500.

The implication is that you will owe federal income taxes on some of the "Cash" part of "Cash For Clunkers." That is not true; the law authorizing the program specifically addressed that issue. I don't know if any states can or do try to tax that. In my state it's not an issue. Note: I checked into this idea first. Too bad that the blowhard who wrote this and the fools who forwarded it didn't check. But who cares about reality, facts, truth, etc.?

So, rather than save $1000, you actually pay an extra $350 to the feds. In addition, you traded in a car that was most likely paid for. Now you have 4 or 5 years of payments on a car that you did not need.

He's talking out of his keister. The writer doesn't know who did and who did not "need" a new car. In my case, my old truck had 200,000 miles on it. My clunker was old enough to drink, and was having a lot of repair issues. So I "needed" a newer truck or car. I decided to keep the old truck - it has plenty of farm use in it - but not many years of commute left.

and your clunker was costing you less to run than the payments that you will now be making.

That's more keister-talk.

• My new car costs the same to license as did my old car.
• My old car had, for quite a while, had the hidden cost of needing an ever-growing fund to provide for replacement and an ever-growing fund for repairs as the old car wears out.
• My new car might outlive me (Toyotas are known for longevity).
• My new car gets more than 3x the gas mileage (53 mpg vs. 17 mpg).
• The interest payments average $25 per month over the life of the loan; I save more than that much in fuel each week!

But wait, there is more: You also got ripped off by the dealer.

For example, every dealer here in LA was selling the Ford Focus with all the goodies including A/C, auto transmission, power windows, etc for $12,500 the month before the "cash for clunkers" program started.

When "cash for clunkers" came along, they stopped discounting them and instead sold them at the list price of $15,500. So, you paid $3000 more than you would have the month before. (Honda, Toyota, and Kia played the same list price game that Ford and Chevy did).

Words wrapped in butt-breath sure do stink. Most cars have an MSRP that is higher than the dealer will settle for in a deal. My new car has a long waiting list, and there is no padded price displayed. All dealers sell for the same price because this car is so popular.

You say all of this with such authority. Should we assume that you learned all of this the hard way? Do you still do business that way?

So lets do the final tally here:

You traded in a car worth: $3500

You got a discount of: $4500

Net so far +$1000

But you have to pay: $1350 in taxes on the $4500 $0

Net so far: -$350 + $1000

And you paid: $3000 more than the car was selling for the month before

Net -$3350 +$1000

Your figures assume a $3500 trade-in value AND that the owner would be selling or trading-in what is already established to be a, um ..... CLUNKER!. I saw a lot of the Clunkers on dealers' lots. Many would be worth little more than scrap value; sold on the open market they would hardly fetch $1000. As for trade-ins .... trade-ins are where the dealer makes money. Trade-ins are a zero-sum game. Every penny the dealer makes is a penny lost by you. If the dealer "gives" you $3500 for your trade-in, he's making up the difference between his real cost and that $3500, somewhere else in the deal.

In other words, "CFC" helped a lot of people get rid of CLUNKERS! for which they would otherwise receive very little. The program made the difference between many people buying new cars - or not buying.

You also neglect to consider the whole point of the program: to get people into vehicles that get better gas mileage than their current , um .... CLUNKER! The last time I checked, better gas mileage means saving money on fuel.

We could also add in the additional taxes (sales tax, state tax, etc.) on the extra $3000 that you paid for the car, along with the 5 years of interest on the car loan but let's just stop here.

Pay attention, BrainFartMan:

• I was going to buy a new car anyway.
• Any new car/truck would have had tax & title fees, and interest on the loan.
• If you don't count depreciation, my new car costs less to operate than the old clunker.
• Depreciation only matters if you sell in the first few years - which I never do.
• And this car - because of its high demand - loses very little money to depreciation.

So who actually made out on the deal? The feds collected taxes on the car along with taxes on the $4500 they "gave" you. The car dealers made an extra $3000 or more on every some car(s) they sold along with the kickbacks from the manufacturers and the loan companies.

I financed my car through the credit union and got an interest rate that is half of what the dealer wanted.

The manufacturers got to dump lots of cars they could not give away the month before. And the poor stupid consumer got saddled with even more debt that they cannot afford.

More anal-blast. I'm neither poor nor not very stupid. I'm brighter than the dimwit who wrote this, and I'm smarter than the morons who believed and forwarded this. Plus, I can afford my new car.

The Obama administration convinced Joe consumer that he was getting $4500 in "free" money from the "government" when in fact Joe was giving away his $3500 car and paying an additional $3350 for the privilege.

I never deluded myself into thinking that I was getting "free" money from the "government." I got an incentive to do this sooner rather than later. I'm tight with my money, but I have no regrets. That is because I went into the deal armed with knowledge and realistic expectations. And I ignored worthless babble like this e-mail spews.

The Figures Don't Lie, But Liars Figure