"Cash for Clunkers" - Destroying valuable items to stimulate the economy?

What is done with your cash for clunker trade-in, many of which are still usable? It is destroyed.
Well that's helping the environment and the economy then, right? Are you paying cash for the new car or are you getting more in debt? And many of the new purchases are for foreign made cars. So much for really helping the fundamentals of the USA economy. As for the environment, what effect does new car production have on the environment? What effect does scrapping a working car have on the environment?
We have to look at the bigger picture. I like this quote:
“In every deliberation we must consider the impact of our decisions on the next seven generations.” The Iroquois Confederacy

Take a look at this tidbit from history:

During the Great Depression, millions of Americans couldn't afford to buy food. With food prices falling and huge surpluses of food building, the government decided to pass the Agricultural Adjustment Act of 1933 which forced farmers to destroy crops and livestock in an attempt to artificially drive up food prices. The plan backfired and led to millions of Americans starving, prolonging the Great Depression for another six years.
From: http://inflation.us/cashforclunkers.html

Could cash for clunkers be just the beginning of more drastic measures to falsely prop up the failing economy but actually worsening the problem?