The law of unintended consequences

I know Sabrina already posted a pretty zealous political post today, but I just read a piece of news that really made me shake my head. The following analysis of the situation is by no means guaranteed to come true, but I consider it an incredibly likely scenario.

The government has announced that it will be giving vouchers for 3500 to 4500 dollars to people who are buying a new car that gets at least X number of miles per gallon better gas mileage than their previous one. The explanation given is that they want to get rid of the number of old cars on the road. Having not thoroughly examined the bill, but finding no language to the contrary, I'm going to assume (until proven otherwise) that there is no limit on how long one must own a car before they can use it to get this credit to buy a new car.

Consequently, people who have no car to trade in, but do want to purchase a new vehicle will go out and find an old junker which gets terrible gas mileage for as cheap as they possibly can (ie <$500). They will then use this to (at the average tax payer's expense) get a net $4000 savings on a new car.

This will have 2 direct effects. First, you'll be paying for people's vehicle's depreciation for the first year. Second, the average price for junker cars will go up. It's a simple case of supply and demand. Poor people's ability to drive vehicles will be decreased. The poor people (this can include college students or anyone else who can't afford to spend a lot on transportation) will have a harder time finding an inexpensive (read <$1000) car. And honestly, it could cause a similar effect among vehicles closer to $2000 in price, because $2500 free still isn't bad.

Well, at least now I'll be able to console myself that I'm not only going to be paying for people's mortgages and health care, now my tax dollars will be subsidizing people's personal cars as well.