The precedent for the disaster of interventionism during a crisis is well documented by many; most recently by Amity Shlaes in her book THE FORGOTTEN MAN.

Except that Shlaes is a wingnut welfare hack who doesn’t even know what a recession is. Apart from that, y’know, whatever.

Here’s the deal-i-o: if GM gets sold off at firesale prices, chances are it gets carved up and the southern senators who already tossed out billions to attract German and Japanese-owned firms have to deal with loss-leader foreign-made Chevys hitting the market. Now, this may be fine to Tim Peck and other neo-Hooverian believers in the Free Market Fairy, but they’ll need to be able to build tall enough walls to keep out the rabble when the US ends up a Third World economy. It’s a good thing that most people infected by Ayn Rand’s nonsense grow out of it when they’re old enough to vote. For the rest, the appropriate response ought to be pity.

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“It’s useful to remind ourselves, then, that our free market system is the result neither of natural law nor of Divine Providence. Rather, it emerged through a painful process of trial and error, a series of difficult choices between efficiency and fairness, stability and change. And although the benefits of our free market system are mostly derived from the individual efforts of generations of men and women pursuing their own vision of happiness, in each and every period of great economic upheaval and transition we depended on government action to open up opportunity, encourage competition, and make the market work better….”

- Barack Obama in “The Audacity of Hope”

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I do agree that something has to be done to make sure so many workers dont slide into poverty. Our nation cant handle the rate of people and famlies falling off the edge as it is. On the other hand, Circut City went bankrupt, and you can still buy a TV from them.

I see the “whats another 14-25 billion after the 700 billion giveaway” arguement, but I think the precident of the government giving money away at the rate it does is one that should never have been set. All around. It’s one thing to give someone unemployment because the plant they worked at closed. It’s another when women have another kid just to get a bigger check. Let’s all be honest about what that kid will probably grow up to be like. Corporations, like people, will not improve unless circumstances forces them too.

I can accept the idea for the big three bailout if it’s in the form of a loan with “improve or die strings” attached. I think the lack of strings attached to the bank bailout is disgusting, but typical of the lack of accountability in what passes for modern conservitism.
Not claiming to have any answers, I think the ills of this nation are systemic and at all levels. While Im a big fan on regulating big business, which isnt done like it should be, consider the hoops someone has to jump through to open a small business here in Asheville.

And dont get me started on what we collectively find important. Keeping up with the jonses has run us ragged. Those who know me know Im somewhat tongue in cheek about being vain, but Im a real cheapskate when it comes to dressing well. The only thing I believe in paying full price on is a good pair of shoes.

Amd MM, I must compliment you on the eloquence of your moroseness.

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But honestly, like many folks, I don’t understand any of it. For most folks out here, who live paycheck to paycheck and don’t even have pensions or 401(k)s or health insurance, much less $30 or $40 an hour jobs, it’s all just abstract rhetoric and incomprehensibly large numbers.

Although we are vaguely aware that somehow we’re being fucked and our futures sold out, most folks are just hanging on in quiet desperation, busying ourselves trying to find some shards of what passes as happiness in our increasingly senseless and difficult lives.

I don’t mean to be so morose. But listening to the news, I feel like a character in Waiting for Godot.

MM

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“Today at noon, Senators Ensign, Shelby, Coburn and DeMint will hold a press conference in the Senate Radio/TV Gallery. They would appreciate our support through messaging and attending the press conference, if possible. The message they want us to deliver is:

1. This is the democrats first opportunity to payoff organized labor after the election. This is a precursor to card check and other items. Republicans should stand firm and take their first shot against organized labor, instead of taking their first blow from it.

2. This rush to judgment is the same thing that happened with the TARP. Members did not have an opportunity to read or digest the legislation and therefore could not understand the consequences of it. We should not rush to pass this because Detroit says the sky is falling.

The sooner you can have press releases and documents like this in the hands of members and the press, the better. Please contact me if you need additional information. Again, the hardest thing for the democrats to do is get 60 votes. If we can hold the Republicans, we can beat this.

Opposing this measure, as Heath Shuler does, plays right into the Republicans’ hand of wanting to use the economic crisis to go after the American worker.

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“Much of the discussion about a possible rescue of the Big Three automakers has been colored by the claim that blue collar workers at those companies earn $70/hour. The original (or, at least, the most prominent) source of this claim seems to have been a recent column in The New York Times by Andrew Ross Sorkin: “At G.M., as of 2007, the average worker was paid about $70 an hour, including health care and pension costs.”

If this claim were true, it would mean that a 40-hour-per-week, 50-week-per-year worker earns $140,000 in annual gross income. In a column in The New Republic, Jonathan Cohn asks rhetorically: “Is it any wonder the Big Three are in trouble? And with auto workers making so much, why should taxpayers–many of whom make far less–finance a plan to bail them out?” Cohn quickly answers his own question: “Well, here’s one reason: The figure is wildly misleading.” He shows that GM’s workers earned $28/hour in wages in 2007, plus about $10 in benefits.”

I don’t think there are any of the folks here “agreeing” with the Republicans. The Republicans who oppose this want to bash the unions. I haven’t heard anyone here say that. What I’m seeing is that people are pissed that if businesses are big enough, then they can be grossly incompetent and get loaned $14 billion dollars. It’s not the same position that the Republicans are pushing.

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And speaking of elephants, the big white union elephant of $75/hour compensation gets no mention here. The auto companies paying more market-oriented wages & bennies are all thriving — in fact, they’re expanding, making money, and adding jobs. No connection?

Methinks the problem is a bit more complex than just corporate shortsightedness and mismanagement.

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Stop gap measures like extending unemployment and stopping foreclosures are paramount to helping the affected workers, then hopefully there will be big infrastructure spending on the federal level to repair bridges and roads as well as get more public transportation off the ground.

What happens when gas prices jump again? We cannot put all of our eggs into the Big Three basket.

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But AP just reported that three million jobs are on the line if Detroit doesn’t get $14 million in loans

Sir: This is a ruse.

What does that mean that “jobs are on the line”? Nonsense. If the auto manufacturers are producing a valuable product, their knowledge, experience and skills will still be needed to produce those products even after the incompetent executives are sent packing.

People need cars. Therefore, people need workers who make cars. For god’s sake, let’s allow this industry to be taken over by someone who knows what they’re doing.

Instead, the government wants to prop up incompetence with corporate welfare.

Sorry. I’m against the whole enchilada. It ain’t dere.

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It’s crunch time, and unless we can stop the bleeding, we’re looking at a long time in the economic wilderness.

The only thing that will push us “a long time in the economic wilderness” is government intervention in the free market. The precedent for the disaster of interventionism during a crisis is well documented by many; most recently by Amity Shlaes in her book THE FORGOTTEN MAN.

But it’s been the Bush years, and if the Obama years are going to be prosperous, we’re going to have to dig out of the hole we’re left with.

We most definitely do NOT need to dig out of the hole “we’re” left with. That is the function of the free market. The free market will reward winners and punish losers. I’m not in a hole; and neither are honest business people who have may good business decisions (like paying market wages). Why should the government take our money and pay it to someone else to whom it does not belong and to those who have squandered their credibility in business matters?

The thing I’m most confused about, to be honest, is why the newly-infused banking industry can’t make the loans to the auto industry…

Because the industry has been mismanaged and over-regulated into the ground. They’re not profitable and their current business model has no future. If they were indeed a going concern, they should have no trouble getting private investors who want a piece of the Big Three’s future success. The problem: there isn’t one.

he said. “I think there have got to be requirements … that will make them wake up to what the current situation is.”

That is the function of the free market. The free market wakes people up to their current situation. The auto company’s must file for bankruptcy and restructure or sell their assets to some one else who can do a better job of providing the consuming public with valuable products they can afford. This is not the job of the government.

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Undercover Blue says:

I read yours, Tim. Just for fun, read David Horowitz’s.

Thanks for reading the articles I posted. And thanks for offering some additional background on one aspect of the government-caused financial crisis.

I read the report from the Federal Reserve that your recommended. I don’t buy it for a minute. Sorry. I don’t buy any reports from the Federal Reserve. The Federal Reserve is the number one perpetrator of fraud in our nation. Their contention that subprime defaults are in line with the others does not absolve the CRA of the damage done. And notice that the Fed offers no alternative explanation. That is because it would implicate their own organization.

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As long as products are being made, dealerships will exist – provided, of course, that there’s a market for them.

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Give every American with a car older than ten years (and none newer) a voucher for say, $10,000 to $15,000 and when they purchase a new fuel efficient car, they must trade in that old gas guzzler and noxious fume generator as well. The cars will then be recycled for materials.

Detroit gets more business than the can handle, we get millions of pollution-causing junkers off the road.

Everybody wins!

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The collapse of even one of the Big Three would be “devastating to this state” and its auto dealers, who are independent business people. They would be left without a product to sell.

Thousands of jobs could be lost at dealerships and at auto assembly and parts plants around the state, Jackson said. The surviving auto makers would be hurt.

“I don’t think anybody in the industry thinks they (automakers) should be given a blank check,” he said. “I think there have got to be requirements … that will make them wake up to what the current situation is.”

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World stock markets plunged Friday as the U.S. Senate’s rejection of a $14 billion deal to rescue Detroit’s ailing automakers stoked concerns that the recession in the world’s largest economy will be even longer and deeper than projected.

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