First off, i do believe this is more or less to spur spending in the U.S. considering we are nothing more then a large consumer. We stop consuming, we die off in layman's terms. And the only other thing that will keep us alive, innovation and design is just not near the amount it should as we have to import heads from India, Japan and Germany just to keep engineering staff's full.
Second, look at auto sales a few months ago. Go to the ford dealerships and the Focus's already had more then 4500 dollars off sticker. And the cars being traded in were actually being recycled. So the idea of this being a "great time" to buy a car is very flawed in logic.
So aside from the waste of these parts for semi-older American cars, this program was designed to keep spending going. We stop spending, I.E. too many people owning homes and dumping their usual expendable income into their mortgage, then we fail as a country. As soon as all the upside mortgages get snatched up by the European Union and Chinese investors, who are also partially owned by upper class americans, then the economy will start heading back towards another peak and crash.