Yes, unfortunately I think we can all agree that there is a massive amount of State corruption in the US right now, which is one of the reasons why the empire is so badly in decline.
Another way that all of this helps to hurt everyone is by basically forcing the destruction of the accumulated wealth of the nation. You might think that those cars were wasteful because they burned a lot of fuel, or because they were too old, but they were highly complicated devices that already existed that people have the option to use if they wanted to. The cash for clunkers program took cars that were perfectly serviceable and destroyed them. It has resulted in vehicle prices in North America overall being on a completely different level than for example Europe where such a program didn't exist.
Really, it would be better to let the car companies fail and then maybe they would come back with something people actually wanted to buy. On the other hand, as part of that failure maybe they need to start pointing their finger directly at the government for forcing companies make cars that nobody likes.