Paul says clunkers program is a clunker

Ron Paul earned a reputation for the contrarian view during his presidential bid.

He's at it again, arguing that the highly popular "cash for clunkers" program is bad for the economy and hurts the poor.

After the first $1 billion for the program was used up, the House last Friday quickly added $2 billion more, and the White House is urging the Senate to go along this week before it goes on recess. Beleaguered automakers have reported huge increases in sales, and boosters of the program say it is stimulating the economy as it replaces gas guzzlers on the roads with more fuel efficient vehicles.

But Paul, a Republican congressman from Texas, asserts that those who voted for the $2 billion, believing they were helping the poor and boosting the economy, acted under a complete fallacy.

"When you stop and think for a minute, it's pretty absurd what's going on here," Paul said in a video posted on YouTube by his grassroots organization, the Campaign for Liberty. "The poor people with poor credit did not come in and buy a car."

Plus, used cars that would otherwise be available for cheap for the poor have to be destroyed under the program.

And borrowing money to replenish the program increases inflation, which hurts poor the most, Paul said.

Paul preached limited government during the campaign and through innovations on the Internet developed a devoted following. "We still obviously have a long way to go," he told his supporters.