Editorial: Bailout Watch 431: Bailout Nation Must Die

Robert Farago
by Robert Farago
editorial bailout watch 431 bailout nation must die

The president who did more to expand the federal government than any other in modern history began his first term assuring Americans that the only thing they had to fear was fear itself. Flash forward seventy-six years and FDR’s spiritual successor wants his fellow countrymen to live in fear—so his administration can achieve the same Big Government goal. Lets call it the Fram filter doctrine. Remember the old Fram filter ad? “You can pay me now or you can pay me later.” There’s your philosophical justification for the Detroit bailout. We have to bail out Motown (and everyone else) NOW or the whole economy will go to hell and we’ll WISH we’d made the “investment.” Rubbish.

There’s only one way Bailout Nation makes sense: if you accept the supposedly “inevitable outcome” of failing to prop-up failed enterprise. Oh, hell. You don’t even have to accept it; you just have to be afraid that it’s true. If GM catches a cold, Americans will die of plague. Are we really that stupid?

Cravenly, disgustingly, to their eternal shame, GM and Chrysler Gulfstreamed to Washington to flim-flam the fruits of their epic mismanagement as a threat to all taxpayers. Their CEOs testified that if we didn’t hand them $19.4B worth of taxpayers’ money, the “ripple effect” of a Chrysler and GM Chapter 11 would kill the economy dead.

No! Worse! If we “let” GM and Chrysler slide into bankruptcy, it will destroy America’s entire industrial base. Foreigners—foreigners!—will steal our middle class and, eventually, turn us into their bitch.

So we paid up. And now the zombies are back, using the same tactics that loosened the public purse strings the first time. Pols and press are busy perpetuating the same flawed, fear-based logic which obviously, catastrophically, nearasdammit immediately failed. In fact, we’re post-Fram. The new thinking: we can pay them MORE now and we can pay them MORE later. And… that’s it. Oh yes, we eventually get electric cars.

Here’s another idea. How about we pay Chrysler and GM NOTHING now so we don’t destroy the entire United States economy later? I’m serious. Forget debtor-in-possession financing. If the markets won’t embrace Chrysler and GM’s C11 turnaround plans why should the American taxpayer?

If America wants to clean up the aftermath of a Chrysler and GM C11 by creating a new health care, pension and unemployment safety net, if John Q. Public feels sorry enough for displaced auto workers to spread boondoggle billions over the bankruptcy-blighted landscape, go ahead. But for God’s sake, let these automakers die. It’s gonna be ugly. But over-capacity is over-capacity. There’s no way for GM to avoid the consequences of its inability to make itself indispensable. None. When the bailout music stops, GM still won’t have a chair.

If we continue to bail out Detroit, and extend that largess to automotive suppliers, dealers, etc., we’ll screw-up the economic fundamentals that made this country the world’s greatest economic power: minimal government intervention in fair, free and open markets. We’ll be stealing food from the tables of those companies and workers that didn’t end up in DC. Who didn’t use threats, bribes and extortion to avoid the consequences of their own actions. And we’ll be running-up the price of transportation for the average consumer.

Bankruptcy was designed for this exact situation. Do we really have so little faith in our existing institutions that we want to create some special exemption for a gang of bombastic millionaires that somehow got the idea that they deserve a pass that we, the people, would never receive? What’s wrong with Chapter 11 anyway? GM and Chrysler are afraid of that no one will buy a car from them in bankruptcy. And they want us to “take ownership” of their fear. With our cash.

Someone needs to stare these fear-mongering whiners in the face and tell them to man up. If it’s true that consumers won’t buy your products after you’ve declared bankruptcy, it’s your fault. Not ours. YOU killed your brands, not US. Instead of holding a gun to our head, why don’t use your valuable—make that expensive—time devising a way OUT of bankruptcy. Find some way to come back from the dead that doesn’t steal money from the mouths of productive citizens and taxpayers.

Yes, we’re afraid for our economic survival. Yes, we feel for others who will suffer for their boss’ incompetence, arrogance, short-sightedness and greed. But we must not abandon who we are as Americans and what we believe in.

Faith, hope and charity are wonderful, noble ideals. But they’re not what makes America strong. That would be independence, creativity, hard work, determination and a deep-rooted belief in fair play. Now is not the time to abandon our principles. Now is the time to embrace them, come what may. Yes, we can pay Detroit now. But mark my words: we will pay for it later.

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  • Unleashed Unleashed on Mar 11, 2009
    I would also note that socialism as define by Marx is never really practiced. The guy is just about the most misunderstood theorist ever and that’s a high bar. Isn't it because Marxism as an ideology is unsustainable? It's a theory based on Utopian principles that have little to do with human nature. It's been tried numerous times throuhgout the history leading to the same disastrous results. And yet people like you are still preaching the same old mantra. Enough already.

  • U mad scientist U mad scientist on Mar 12, 2009
    I have the sneaking suspicion that, in your case, the “intellectual” position is the one that agrees with agenthex’s view on the matter in question. You seem awfully long on theory and woefully short on real-world experience. It's pretty funny you're drawing a dichotomy between theory and real-world experience in favor of the latter in reply to a statement about how a political position is not scientific. Because we all know how politics is the correct one. - Henry Ford I didn’t “invent” mass production, interchangeable parts, the assembly line or the automobile. He did, however, put them together to create the first low-cost automobile, and thus became very rich in the process. You will note that my guess was unerring, because the notion of the omnipotent industrialist as a pervasive figure was invented to inspire the rubes. Real industry is compartmentalized between inventors and financiers, and the risk/reward of capital is mainly concerned with the latter. That's fine since it's a workable system, but leave the fairy tales to the kiddies. - You were attempting to equate “corporate” with “conservative,” which I’ve shown is incorrect. No I didn't, you think that because to you there are only the two perspectives, and assumed that I thought "corporate" is within the exclusive domain of "conservative". The two perspectives as used nominally in the US are political conveniences, memes, to control the pleb's thinking process. For example, to counter your prior post, "Republicans" are nominally defined to be "conservatives". The split that you perceived was a result of necessary changes in party direction last couple decades. From that, a small segment of old-time hardliners didn't follow the movement and clung onto the archaic and dead political ideas. There is some temporary coincidental reversion to those "ideals" as a convenient political position now that is no action required on the party's part. --- Isn’t it because Marxism as an ideology is unsustainable? Nobody in practice actually read Kapital, and certainly not its most ardent supporters who used it to rationalize particular types of authoritarian regimes that were useful to them. In any case, it's an archaic oddity in the modern world mostly useful for poking fun at people still fighting their war against it.

  • Gemcitytm Why does it seem every EV seems to have ridiculous amounts of power? Yes, I know they're heavier than ICE models but who on earth needs 708 HP? How about a nice, compact EV with, say, 250 HP and 350-400 mile range? Is that impossible with today's tech? (I currently drive a 148 HP Mazda 3 ICE and it has all the get-up-and-go I need.)
  • CEastwood I could have bought one of these if I had the cash in 76 for $1000 white , red interior , 3 speed stick with whitewalls/ wire hubcaps - it was mint and gone a day after I saw it . But the real catch that got away was an all original 69 green Camaro RS convertible 327 4 speed with 46K on the clock for 1800 that I saw a few months earlier . Young and poor was not a fun place to be !
  • KOKing I'm in an emissions check only state, and I'd trade that away for a safety check all day.
  • Bd2 The hybrid powertrain in the Sportage and Tucson are the ones to get.H/K should discontinue the base NA 2.5L powertrain and just build more of the hybrid.In the future, maybe offer a 2nd, more powerful hybrid (the hybrid 2.5) which will first arrive with the next Telluride/Palisade.Kia also needs to redo the front fascia for the Sportage's refresh.
  • The Oracle I say let the clunkers stay on the roads.