American Cars Don’t Fall Apart Any More But Their Makers’ Arguments Still Do
By Johnny Roosh
Rick Wagoner, CEO and G.W. share the same fate as their careers wind down.
They are both on the wrong side of public opinion. Bush is also on the wrong side of the aisle.
Good for GM, Good for America?
The Washington Post reports that its poll finds 55% of Americans oppose the Detroit handout, while only 42% support it. Democrats have become the party of corporate welfare, with 52% supporting the bailout; majorities of Republicans (69%) and independents (57%) are opposed.
Most surprising finding: “Union households are no more apt than those without a union member to favor the plan, 44 percent compared with 42 percent.” The United Auto Workers wants government money so as to protect the work rules and artificially high emoluments that have helped make Detroit uncompetitive.
Wagoner argues that without a bailout, GM will have to go Chapter “Belly Up” and won’t survive it. At the same time Bush is circumventing a Republican filibuster and overwhelming public opinion to open up the TARP checkbook for the Big Three; two of which don’t need the money; one of which has resorted to begging.
We keep hearing the argument, originally put forward last month by Rick Wagoner, GM’s delightfully named CEO, that people won’t buy cars from companies that have filed bankruptcy, for fear that parts and service will become unavailable. Are consumers really so stupid that they would have more confidence in a company that goes on welfare to support an unsustainable business model than in one that is being restructured through bankruptcy court?
It turns out the Unions aren’t as pro-bailout and foreign competitors may be more pro-bailout than one would imagine.
One major problem is that Japanese carmakers in the United States share many of the same parts suppliers. If a Detroit automaker were to collapse, suppliers would likely follow, setting off a chain reaction that could wreak havoc for Japanese production in a vital market.
More broadly, the U.S. crisis could lead to huge job losses and further weaken consumer spending, especially for big-ticket items such as automobiles. Together, the three big American automakers employ 239,000 workers in the United States.
I have teetered back and forth on this issue. Not unlike the unfolding of the financial system crisis, the more time that elapses, urgency fades in favor of clarity, and the more prized clear-headed thinkers become.
Let GM file bankruptcy. Let Cerberus feed their child so we don’t have to. Let Ford Navigate the waters unfettered by bailout dollars and the restrictions they would entail.
Let capitalism do what capitalism does: make stronger companies.
December 17th, 2008 at 10:16 am
Does history rhyme or repeat?
http://www.lil-abner.com/other.html
“Al Capp created General Bullmoose in June 1953 as the epitome of a ruthless capitalist. Bullmoose’s motto “What’s good for General Bullmoose is good for the USA!” was adapted by Capp from a statement made by Charles E. Wilson, the former head of General Motors and Secretary of Defense under President Dwight Eisenhower. In 1952 Wilson told a Senate subcommittee, “What is good for the country is good for General Motors, and what’s good for General Motors is good for the country.” Li’l Abner became embroiled in many implausible but hilarious adventures with the cold-hearted Bullmoose over the years.
December 17th, 2008 at 11:21 am
> Let capitalism do what capitalism does: make stronger companies.
Exactly, do it like they do good ol’ American capitalism in Alabama, where sales-taxpayers subsidize tax incentives for Mercedes Benz.
As long as American patriots like Senator Shelby are defending our free market capitalist way of life, none of them Detroit socialists are getting any redistributions from me!
The invisible hand is faster than the eye!
/jc
December 17th, 2008 at 12:20 pm
Exactly, do it like they do good ol’ American capitalism in Alabama, where sales-taxpayers subsidize tax incentives for Mercedes Benz.
I’m not sure I follow the argument, if the people of Alabama (like unfortunately most States) are taxing themselves to provide subsidies to encourage businesses to relocate there, it seems to me that’s a argument in favor of eliminating State subsidies and not one in favor of a federal subsidy program. Moreover just because the people of Alabama are foolish enough to tax themselves to subsidize business, it doesn’t justify taxing people in the other 49 States to keep jobs in Michigan.
December 17th, 2008 at 12:29 pm
Slash is trying to imitate one of the capitalists that inhait only his imagination.
December 17th, 2008 at 12:29 pm
No skin off my nose.
I structure my income so any profits are realized off-shore, thus reducing my effective tax rate to 1%, like my capitalist friends at Goldman Sachs.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aznONFlyupOI&refer=home#
Free markets ain’t free! Thank a Wall Street vet!
/jc
December 17th, 2008 at 1:24 pm
It’s Bush! Blame Bush!!!
December 17th, 2008 at 1:28 pm
Seems to me like the free-market solution would be for Congress to remove all of those costly regulations they’ve imposed over the years, including the rules regarding labor unions.
December 17th, 2008 at 2:17 pm
nevermind the fact that the President, through ignorance, led us into war about WMD that didn’t exist.
nevermind the fact that the President, through ignorance, didn’t understand the starkly obvious internecene powder-keg, and conflated Wahabism with Shiaa/Sunni resentments…
December 17th, 2008 at 2:26 pm
nevermind the fact that the President, through ignorance, didn’t understand the starkly obvious internecene powder-keg, and conflated Wahabism with Shiaa/Sunni resentments…
nevermind that this post is about the auto industry and that Peev is off-topic again.
nevermind that Peev is on autopilot.
nevermind that Peev’s behavior is the intellectual equivalent of autoeroticism.
December 17th, 2008 at 2:40 pm
I think Maligna’s post was a parody of an earlier Peev comment, Mr. D.
December 17th, 2008 at 2:41 pm
Ah, you’re right Yoss. Gotta stop eating those brandied peaches without the peaches.
December 17th, 2008 at 4:02 pm
bwah ha ha ha ha ha
December 17th, 2008 at 10:42 pm
I read it and thought parody. Then thought maybe not. So hard to tell with the peeve around.