Your point on depreciation is fair, but the 'cash for clunkers' program was nothing more than an economic subsidy.
There were no reasonable electric vehicles at the time which would have reduced carbon usage and the newer improved efficiency vehicles available would never offset after accounting for the entire vehicle manufacturing process. The old car getting lower mpg was still less polluting than producing an entire vehicle with mpg better by 30%.
Not only that, but it destroyed the secondary market by destroying all those vehicles, as you mentioned, requiring more production to make up for the short fall. Putting those second-life vehicles in other countries was a net benefit, reducing once again the new full production cost of vehicles there. In particular because less developed nations have historically been less accountable for pollution industrially by necessity.
Not only that, but it destroyed the secondary market by destroying all those vehicles, as you mentioned, requiring more production to make up for the short fall. Putting those second-life vehicles in other countries was a net benefit, reducing once again the new full production cost of vehicles there. In particular because less developed nations have historically been less accountable for pollution industrially by necessity.