Killing Off Capitalism

WASHINGTON -- Congress and the White House inched toward a financial rescue of the Big Three auto makers, negotiating legislation that would give the U.S. government a substantial ownership stake in the industry and a central role in its restructuring.

Nowhere in the constitution does the government have the right to own the means of production, which is the very definition of Socialism. The management and shareholders are willing to sell their capitalist souls in order to avoid the uncertainty of the bankruptcy courts.

In return their companies will be run by politicians, whose interests do not include sound business practices and the taxpayers will yet again pay the price for their incompetence. Even the French finally saw the folly of a sclerotic government attempting to compete in a worldwide competitive market when it privatized Renault.

Socialism is not only immoral, it never works. But their are always power hungry statists who believe they are the gifted enough to do the impossible.

Most of the cars I've owned have been American. If this Anti-American plan goes through, I wont buy another one again.

This is only the beginning. When Democrats take full control of the Government, we will go headlong down the road to economic destruction and the loss of liberty.

Chris Dodd's Brass Balls

Dec. 7 (Bloomberg) -- Senate Banking Committee Chairman Chris Dodd said General Motors Corp. Chief Executive Richard Wagoner should be replaced as a condition for federal aid and Chrysler LLC may have to merge to survive. “You’ve got to consider new leadership,” Dodd said on CBS’s “Face the Nation.” Wagoner, he said, “has to move on.”

This from the guy who along with Barney Frank, oversaw and did nothing about the financial meltdown his party caused by forcing lenders to make loans to people who couldn't pay them back. Not to mention Dodd's own sweetheart loan from Countrywide that was an obvious payoff.

Dodd is not only still a Senator, he's still in charge of the same committee and is lecturing us on how the auto industry should be run. The only place he should be is federal prison.

UAW Guilt Trip Ad

Complete with veiled threats and class warfare, the UAW is begging us to use our tax money to save their uncompetitive and unsustainable contracts. They must think they should be excused from the bankruptcy courts by virtue of their sheer numbers, as if everyone Else's job is less important than theirs.

Another part of the UAW's argument is that since we wasted money on a bailout for Wall Street and Fannie and Freddie, then they deserve it as much, if not more.

Let's be clear. Bankruptcy would mean a temporary loss of jobs since the demand for autos wouldn't stop and other companies would quickly pick up the slack and the pieces of the Big Three in a more efficient manner that would benefit everyone.

The only thing these parasite are offering is to take your money and throw it at an obsolete business model that has no chance for survival in a competitive free market.

H/T to Hot Air

Power Mad Fools

First we had the Government induced Dodd/Frank Mortgage and Banking Meltdown. Now these same incompetent, corrupt boobs are heading up efforts to bring congress' scary business talents to bear on the Auto Industry. Investors Business Daily puts this insanity into perspective:

"...That leaves the latest bright idea from Congress: a broad, federally mandated restructuring of the Big Three in exchange for financial help. Congress would in essence become the Big Three's uber-manager, telling them how to become profitable again.

Excuse us, but are we supposed to believe that the same Congress responsible for next year's estimated $1 trillion deficit can profitably run a market-sensitive company like a car manufacturer?

Or that the same Congress that sat on its hands as the financial meltdown unfolded and helped create the mess will know how to financially restructure America's highly complex auto business?

Or that the people who just last year imposed $85 billion in new "efficiency" standards on a teetering industry will be savvy enough to run them anywhere but further into the ground?

Does Congress have the know-how to do this? We looked up the background of the majority Democrat members on the Senate Banking Committee who grilled Big Three CEOs last Thursday, and who will decide the outlines of any bailout plan. Out of 11 members, just one — Montana's Jon Tester, a farmer and former manager of a butcher shop — had any real business experience.

None of the rest, from committee chairman Chris Dodd on down, has any private-sector experience to speak of, apart from brief stints at law firms. Fact is, Congress isn't equipped to run anything... "

Dear Baltimore Sun: Politicians Aren't Business Experts

Why the hell are we allowing the incompetence of the Big Three to be "fixed" by people who are not only more incompetent, but completely unqualified? Oh, and they're doing it with our money. Insanity? You bet it is.

From BMI


Dear Editor:

You opine that Detroit automakers "need to explain in detail to Congress how they intend to eliminate thousands of uneconomical dealerships, swiftly bring their labor costs closer to what Toyota pays its workers in this country, and quickly produce more energy-efficient cars that Americans will want to buy" ("Selling American cars," Dec. 4).

No. These companies deserve investment funds only if they're able to make cars that will sell AND can demonstrate this ability to private investors. Congress is manned by people who specialize in winning popularity contests called "elections." These are not people expert in judging business models, or at pondering the pros and cons of different retail-distribution methods, or equipped to accurately discern the nuances of consumer demands for automobiles, or even – judging from their track record – aware of the most elementary principles of finance and economics.

If, say, you're looking for someone to manage your 401(k), would you entrust that job to Sen. Mikulski or Rep. Hoyer? Of course not, for that's not what they do. So why entrust them and other politicians with the job of investing on a vastly larger scale?

Sincerely,
Donald J. Boudreaux

Don Boudreaux is the Chairman of the Department of Economics at George Mason University and a Business & Media Institute adviser.

Gov't Run Auto Bailout Likely

WASHINGTON (AP) - The government would order a major restructuring of Detroit's struggling Big Three auto companies in exchange for a multibillion-dollar bailout under a plan circulating in Congress

Great. Political hacks will now do for the Auto Industry what they did to housing and mortgages. And the same corrupt perpetrators, Chris Dodd and Barney Frank, will be in charge again. These two should be in federal prison but Democrats think they're doing a fine job.

The bankruptcy courts are where every other failing company gets restructured, but Democrats can't resist the prospect of taking over a major industry with Soviet style central planning. Besides, the Democrats union buddies would see their fat, uncompetitive contracts disappear in a responsible bankruptcy plan, so taxpayers will now be on the hook for something private investors and lenders wont touch with a ten foot pole.

This will also be an opportunity for the Big Government socialists to micromanage industry and force the big three to produce enviro-friendly crap boxes that no one wants. It looks like the Eco-Marxist's Global Warming hoax may finally pay off. Remember the Yugo?

Bush Backs $25 Billion To Auto Co.'s

Let's face it. Other than tax cuts, GW Bush has been terrible on economic issues, especially spending. Now he advocates throwing good money after bad with a $25 Billion loan to the Big Three. That's Our money folks.

AP- The White House on Friday threw its support behind a plan to speed release of $25 billion in existing loans to the Big Three automakers but rejected a Democratic proposal to use money from a financial bailout to help the troubled industry

The private sector wont put their money behind these losers for good reason. Their antiquated union contracts make them structurally uncompetitive. Unless a top to bottom restructuring of US automakers is included as a requirement of these loans then all we're doing is delaying the inevitable.

Government bailouts by definition are fraught with moral hazards which in this case has to do with purely political considerations rather than good business sense. This insanity is about preserving the status-quo of unsustainable union contracts. It's also about fear of paying the price of failure that must go hand in hand with success in a free market economy.

The unions have bought off the Democrats in this regard but Republicans shouldn't go along. Bankruptcy will force these companies to re-organize in a more efficient and competitive manner or have their assets sold to better run companies.

Let the private market decide what to do with these private companies. We will all be better off and the taxpayers wont pay the bill to prop up those that deserve and need to fail.