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Santa Claus comes early for General Motors and Chrysler

It’s been a rough few months for General Motors and Chrysler. Both Detroit auto giants have been struggling with a sharp decline in sales and dwindling cash reserves. Cross-town rival Ford has seen similar drops in sales, but it is not nearly in the same cash-strapped position as GM and Chrysler.

The Senate couldn't come to an agreement on a $14 billion USD loan package to bailout GM and Chrysler earlier this month, so the matter was kicked back to President Bush who at first was reluctant to meddle with the free markets. However, President Bush today announced a plan to provide low-interest loans to GM and Chrysler.

The federal government will make available $13.4 billion USD in loans to GM and Chrysler over the next two months -- an additional $4 billion USD will be brought to the table with the second half of the $700 billion USD bailout package is opened up in February.

"The terms and conditions of the financing provided by the Treasury Department will facilitate restructuring of our domestic auto industry, prevent disorderly bankruptcies during a time of economic difficulty, and protect the taxpayer by ensuring that only financially viable firms receive financing," added the White House in a statement to the press. "If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury."

Other conditions in the loan include a limit on executive compensation and perks, and provisions that the Detroit automakers work out more favorable terms with its labor unions and creditors.

Chrysler Chairman and CEO Bob Nardelli understandably was excited about the news and thanked the Bush administration for its vote of confidence.

Nardelli said in a statement, "A letter of intent was signed which outlines the specific requirements that must be achieved. These requirements will require consideration from all constituents, requiring commitment first in principal, leading to implementation this coming year. Chrysler is committed to meeting these requirements."

For its part, General Motors had this to say about the government loans:

We appreciate the President extending a financial bridge at this most critical time for the U.S. auto industry and our nation's economy.  This action helps to preserve many jobs, and supports the continued operation of GM and the many suppliers, dealers and small businesses across the country that depend on us.

This will allow us to accelerate the completion of our aggressive restructuring plan for long-term, sustainable success.  It will lead to a leaner, stronger General Motors, a GM that is:
  • Dedicated to great products, exciting design, and world-class quality
  • Fully committed to leading in energy-saving vehicles and technologies,
  • Responsive to the needs of our customers, our stakeholders and the communities we live in and serve.
We know we have much work in front of us to accomplish our plan.  It is our intention to continue to be transparent as we execute our plan, and we will provide regular updates on our progress.  We again thank the Administration for this important support of our industry at this challenging time, and we look forward to proving what American ingenuity can achieve.

Although GM stated earlier this week that it planned to go ahead with its Chevrolet Volt development with or without help in the form of a bailout, the company is no doubt pleased to have funds set aside to help complete the program. The Volt program is GM’s most high-profile and likely riskiest ventures in decades.

Likewise, Chrysler will have to find its way in the changing automotive landscape. The company’s truck and SUV sales have tanked along with the rest of the industry, but even some its mainstream offerings like the Dodge Avenger/Chrysler Sebring and Dodge Nitro have failed to leave a lasting impression on American consumers. The company also is noticeably lacking when it comes to highly fuel-efficient vehicles.



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Ridiculous
By mdogs444 on 12/19/2008 9:50:48 AM , Rating: 4
I can't even begin to show how ridiculous this is getting. They had already started working out organized bankruptcy and merger plans. But no....here we go, let the middle class workers who make $50k/yr pay for union workers to sit on their asses for $90k/yr.

Yup, makes sense to me. Not only does the UAW have GM by the balls, they now have the American taxpayer by the balls.




RE: Ridiculous
By Funksultan on 12/19/2008 9:57:47 AM , Rating: 2
This wasn't the gift that the big 3 were hoping for, but a low interest loan (which historically, the US government has given to any industry with a pulse).

This isn't money out of your pocket, and it's a step toward big gov actually taking control of our badly structured, union-fanatic auto industry.

All things considered, this is right about in the middle of the road where I think it needed to be. Not letting them rot, and not giving them a golden goose. They're gonna have to fight to succeed. If they don't, this will just delay the inevitable.


RE: Ridiculous
By Zandros on 12/19/2008 10:06:13 AM , Rating: 5
All loans and grants are taken out of his pocket, whether indirectly or directly.


RE: Ridiculous
By omnicronx on 12/19/08, Rating: -1
RE: Ridiculous
By Ringold on 12/19/2008 1:24:49 PM , Rating: 5
I know economics is a little flimsy on the left, but.. Treasuries will have to be issued to pay for this in the short term. That is however many billions of dollars not available to fund private market bonds for actually functional businesses that may want to expand. The "crowding out" effect of government spending.

And if any of them fail to repay these loans or the future ones we'll be giving them, absolutely the tax payer has to pay more taxes than they would otherwise to pay for it. We could continue to roll the debt over until hell freezes over, but the world will get tired of that sooner or later. (Forex markets have already expressed their displeasure with 0% interest rates)

There will also, eventually, be an interest rate cost we may endure if we pump large amounts of money in to failing industries. With more treasuries out there, we may pay higher interest rates to fund all the other government deficit spending we run. Again, higher taxes in the long run, as that higher interest has to be paid by somebody.


RE: Ridiculous
By eye smite on 12/19/2008 2:27:23 PM , Rating: 4
I'm not opposed to the loans, but it really seems they should have required the resignations of the current ceo's and board memhers over the next few months for managing the companies so badly for how long now? It will be interesting to see what they do with yet another chance to shape up or ship out.


RE: Ridiculous
By foolsgambit11 on 12/19/2008 8:38:48 PM , Rating: 2
And who exactly is buying corporate bonds these days?

Corporate debt, municipal debt, federal debt, they are all bonded and generally given interest rates that reflect their riskiness and availability. So yes, a greater amount of federal debt can result in higher interest rates - they need to be higher to entice people to buy all the debt. And that would increase the rates that would need to be paid on riskier assets like corporate bonds, which would have an impact on businesses bottom lines. But currently, corporate bonds are at ridiculous rates not because they are being crowded out of the low-interest market by federal bonds. It's a lack of trust in the companies.

We don't have to stick to 0% interest rates to ensure that the debt is 'payed down'. We just have to keep interest rates below inflation. Also, we can grow our way out of our debt - that's how we've done it in the past. Debt as a percent of GDP was over 90% after WWII. It was down in the 35% range or so in the late 70's. Wise investment of public money, coupled with wise monetary policy, can ensure that we get more purchasing power out of the money we borrow than the amount it costs us. Especially with loans, where we plan on getting the principle back eventually, and only have to pay the difference between the interest we offer the recipient and the interest we get from those who carry our debt.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 9:10:47 PM , Rating: 3
> "And who exactly is buying corporate bonds these days?"

Someone is -- several hundred billion dollars worth are changing hands. Take a look at the DOW Corporate Bond Index sometime.


RE: Ridiculous
By adiposity on 12/19/2008 2:35:36 PM , Rating: 3
In that case, could you issue me an interest-free million dollar loan for 50 years? I promise nothing will come out of your pocket, directly or indirectly.

-Dan


RE: Ridiculous
By adiposity on 12/19/08, Rating: 0
RE: Ridiculous
By adiposity on 12/19/2008 2:36:56 PM , Rating: 2
Nope, this was the good one...


RE: Ridiculous
By omnicronx on 12/20/2008 5:28:54 PM , Rating: 2
Ok who were the two losers that wasted their vote on this post. Makes me shake me head in disgust.


RE: Ridiculous
By callmeroy on 12/19/2008 1:05:42 PM , Rating: 3
Agreed...seriously folks -- if its a loan or not its still tax payer dollars, and it still will be paid by "we the people" however you want to rationalize that or not. It's so ridiculous reading comment after comment "its a loan! its a loan!" SO WHAT if it's a loan what's your point? A) we are in a recession, major unemployment rates and these companies are on the brink of collapse -- not exactly normal circumstances -- so tell me what guarantee do we have this "loan" will be fully re-paid? B) Pretending the loan is 100% paid back eventually, its still money spent NOW -- more money taken out of government budgets, more money that between the time the check is written until the x number of years the big 3 pay it back we be supplemented by higher taxes.

When the government gets low on funds -- how do they get money.......higher taxes. 'nuff said.


RE: Ridiculous
By TomZ on 12/19/08, Rating: 0
RE: Ridiculous
By whiskerwill on 12/19/2008 2:01:19 PM , Rating: 3
quote:
The automakers pay back the loans, plus interest.
How does an automaker "pay back" a loan when they're losing money constantly? They're just going to blow it all then come back for more.

And even if they do pay the loan back, the cost still isn't zero. They're not paying interest on the loans, which means the government is losing the interest they could have otherwise earned.


RE: Ridiculous
By TomZ on 12/19/2008 2:07:13 PM , Rating: 1
The automakers would pay back the loans after they get through the current recession. As Chrysler did in the 1980s.

I don't know the exact terms of today's loans, but up until now, the automakers had been asking for loans at the same interest rate that the government is able to borrow money at.

In fact, if the government prints money for the loans (as it has been doing like crazy lately), loans that money, and gets paid back with interest, it could even make money on the loan.


RE: Ridiculous
By callmeroy on 12/19/2008 2:22:31 PM , Rating: 3
Well printing money has to greatly watched and controlled -- the more money printed and in circulation means the less value the dollar has.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 2:30:23 PM , Rating: 4
> "In fact, if the government prints money for the loans (as it has been doing like crazy lately), loans that money..."

Tom, surely you realize that "printing money" is the root of all inflation, and a hidden tax upon us all.


RE: Ridiculous
By TomZ on 12/19/2008 5:35:58 PM , Rating: 5
Of course, but there are also valid economic reasons to increase the money supply, which is why they are doing it now.


RE: Ridiculous
By TSS on 12/20/2008 1:41:20 PM , Rating: 3
go name a valid economic reason why the dollar's worth now about 10% of what it was worth in 1950.

nothing in life comes free. not even printing new money. dont belive me? take a gander at this:

http://www.mikecalabrese.com/users/mikec/picture_g...

"The best way to destroy the capitalist system is to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens.- John Maynard Keynes"

there will come a point where all the presses running all the time cannot print the amount of money needed. and at that point, america will come crashing down. with interest.


RE: Ridiculous
By TomZ on 12/20/2008 6:22:07 PM , Rating: 2
quote:
go name a valid economic reason why the dollar's worth now about 10% of what it was worth in 1950.

As long as my salary is now 10X what it would have been in 1950, that is perfectly fine with me. After all, the bottom line is the standard of living, and everything else is academic.

The printing presses are running now to expand the money supply in order to help avoid a recessionary cycle.


RE: Ridiculous
By TSS on 12/20/2008 9:40:59 PM , Rating: 3
while comming up with an awnser to your very good point, i came across this site:

http://www.fashion-era.com/1950s/1950s_9_timeline_...

don't mind the pink. it's only 1 line of text i'm interested in:

1950
"USA average annual salary $2992 - when dollars were $4 to £1"

that's exactly what's wrong with your statement. i did some digging and actually, the average median personal income has increased more then 10 times, more like 15 times now. but nothing in life is free, and that line captures exactly what it has cost you.

in 1950, if you where to buy an english product that cost 4 pounds, you'd only have to pay 1 dollar. right now, for that same product, you'd have to pay a staggering 6 dollars.

so in 1950, if america wanted to lend 100 dollars from brittain, they'd give you 400 pounds, collect a say, 1% interest, and get 404 pounds back (or 101 dollars).

so in 2008, if america wants to lend 100 dollars from brittain, they give you 50 pounds, collect a say, 1% interest, and get 50.5 pounds back (or, 101 dollars). now, that's not much of an investment.

same with china and every other country in the world. it wouldn't be so bad if you'd be running an budget surplus (like us dutch are, yay us), noo your running an budget deficit. so each time you borrow more money you print more money and thus america becomes less attractive to invest in. 10% of the federal budget is already planned in for interest on the national debt (thats not paying off, that's interest) and because of the deficit that will increase yearly. and thus, the deficit will increase yearly.

compare it to somebody going to his favorite pub, each time adding 1 beer to the tab. the barkeep doesn't mind, it's in good faith that the guy pays his debt. this continues untill the barkeep looks and sees 11 trillion beer on the tab. there will come a time where he's going to ask to pay the bill first before drinking another beer. the only problem with america beeing, once that time comes it will kill more then just your buzz.

right now, your spending a ludicrous amount of money to avoid a crisis that came around because you've spend a ludicrous amount of money. so if it at all works next time will be worse.

the printing presses are running simply because everyone in charge doesn't want the system to fail *on their watch*. the printing presses are simply running because if they stop the system crashes overnight.

meh, in my oppinion though, don't worry about it. as i see it there's still enough stretch left to have your kids pay the bills so you'll be high and dry. heck they might have to sleep on the streets to pay for your social security but who cares, right?

quote:
After all, the bottom line is my standard of living, and everything else is academic.


it's a bit harsh i know, but it's the truth none the less. if you accepted a lower standard of living, you could start paying off your national debt and avoid the real crisis. interest on debt would decrease every year, allowing more money to be spend on americans instead of funneling it to the rest of the world. just ask yourself 2 questions: how hard would it be for america to actually pay off 11 trillion in debt.... and how hard would it be for america to pay off 20 trillion dollars in debt.

right now that moment is dictated by whenever china cuts their losses and refuses to lend more money to the US. ill say it again:

"The best way to destroy the capitalist system is to debauch the currency."

actually made an error there (that's what you get from looking up quotes too quick). that was Vladimir Lenin who said that, keynes said this:

"Lenin was right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose."


RE: Ridiculous
By masher2 (blog) on 12/21/2008 3:36:34 AM , Rating: 2
quote:
As long as my salary is now 10X what it would have been in 1950, that is perfectly fine with me.
There's a fallacy inherent in that. Inflation still hurts you, even if your salary rises in lock-step with it. You earn a dollar today-- tomorrow, that dollar is worth less, even if you earn a $1.01 that day. The $100K you save for retirement is, by the time you actually get there, essentially worthless.

Invest your money and earn a tidy 8% return...but at 5% inflation, the government is taking over half your profits through deflated currency. Then, they turn around and tax you on what's left!

No, rising salary or not, inflation still hurts us all.

quote:
The printing presses are running now to expand the money supply in order to help avoid a recessionary cycle.
It won't work, of course. Why? Because tightened credit markets are a symptom, not the cause. Bernanke is starting to figure that out...the Fed issued a statement just last week that lending wasn't happening not because of money supply, but due to lack of "credit-worthy borrowers".


RE: Ridiculous
By BansheeX on 12/19/2008 4:25:39 PM , Rating: 4
quote:
The automakers would pay back the loans after they get through the current recession. As Chrysler did in the 1980s.


You're assuming that bankruptcy wouldn't have given us a better future. We can't know what would have happened, but here they are again, staring at bankruptcy and asking for another bailout. Had Chrysler been allowed to go bankrupt back then, someone probably would have bought up their good assets and restructured the company without the defunct baggage that remained after the bailout. There's a good chance they would have come out of it leaner and meaner, forcing Ford and GM to do the same, thereby resulting in a far more vibrant industry today.

So your supposition that the socialist bailout "worked" assumes that proven free market solutions would have been worse. It's not likely, everything from the free market approach makes sense from a human behavior standpoint. It allows the fear of consequence from imprudent policies to remain at its highest, and it puts the good assets in the hands of a private buyer with money of their own to lose rather than a politician with none of their own money to lose. This incentive models works best, your fairy-tale one doesn't.


RE: Ridiculous
By TomZ on 12/19/2008 5:44:28 PM , Rating: 4
quote:
So your supposition that the socialist bailout "worked" assumes that proven free market solutions would have been worse.

Your assumption is that the automotive industry is a free, open market, which it isn't and hasn't been for many years.

It would be nice if we could all wave our hands and make the UAW disappear, make the huge import tariffs imposed by most European and Asian companies disappear, and make the cost of labor and benefits consistent in all countries. That would make for a more free, fair, and open market - but alas, those changes are never going to happen.

I'm against protectionism in general, but I'm also in favor of the Big Three having something close to a level playing field, which does not exist today - not even close.


RE: Ridiculous
By BansheeX on 12/20/2008 4:01:49 PM , Rating: 3
quote:
It would be nice if we could all wave our hands and make the UAW disappear


You don't seem to understand chapter 11 or the role bankruptcy plays in the free market. The Big 3 made idiotic projections based on false economic growth and agreed to insane benefits packages for its employees that it simply couldn't pay. They failed of their own accord, and if they were allowed to fail, the UAW contracts could be renegotiated or dissolved entirely in bankruptcy proceedings.

quote:
I'm against protectionism in general, but I'm also in favor of the Big Three having something close to a level playing field, which does not exist today - not even close.


American cars can be more price competitive if we eliminate personal/corporate income taxes with a corresponding reduction in government spending. We can also let companies file chapter 11 after making deals with collusive labor unions trying to fix the price of labor, which artificially increases the prices of those cars for consumers. The utterly wrong solution is to raise tariffs on imports and fight increased socialism abroad with increased socialism domestically. Unfortunately, this is the road we've been taking since 1970 and the debts and programs that have been building up since then are very, very scary. SS and Medicare are just now maturing as ponzi schemes, they can't be papered over anymore with CPI adjustments, tax hikes, and retirement age increases. What we've mortaged to our children is inexcusable.

Protectionists don't understand that other countries' subsidies do nothing but increase prosperity here. If a foreign government steals from its people to undercut prices for our consumers, why shouldn't we take it? Sure, our wages will go down, but by the same amount as our cost of living. All people determine their government by being complicit with it, and we can compete just fine with less government, which has to be matched by foreigners with even more redistribution. And the bigger the foreign redistribution model becomes to match our legitimate prices, the greater a chance foreign socialism will be purged by an unhappy populace. Which is precisely the kind of world we want to bring about.


RE: Ridiculous
By sinful on 12/21/2008 2:24:45 PM , Rating: 1
quote:
They failed of their own accord, and if they were allowed to fail, the UAW contracts could be renegotiated or dissolved entirely in bankruptcy proceedings.


So, basically you want the government to step in, abolish the contracts the companies and workers negiotiated in a free market, and impose a government decided salary for all the employees?
Sounds pretty socialist to me....

quote:
Protectionists don't understand that other countries' subsidies do nothing but increase prosperity here. If a foreign government steals from its people to undercut prices for our consumers, why shouldn't we take it? Sure, our wages will go down, but by the same amount as our cost of living.


You fail at economics.

Consider this:
1) If the subsidies affect economies of scale, that company now has a competitive advantage on top of the subsidy advantage
2) If the subsidy advantage and economy of scale advantage is enough to bankrupt/destroy local industry, the subsidized company ends up with full control of the market
3) Government subsidy ends - competitors aren't around anymore, so now prices skyrocket, and that dominant company can now use its market position to keep out new competitors.

What's to stop that company from gouging US customers now?
Nothing.

Sorry, now you've got lower wages AND a higher cost of living.

Oh, and because that local industry was paying a healthy amount of taxes (right up until they went bankrupt) - well sorry, now your taxes go up too.

quote:
And the bigger the foreign redistribution model becomes to match our legitimate prices, the greater a chance foreign socialism will be purged by an unhappy populace. Which is precisely the kind of world we want to bring about.


I think you have it backwards.
As the "protected" foreign companies bankrupt "unprotected" US companies, the only unhappy populace will be here in the US.

quote:
SS and Medicare are just now maturing as ponzi schemes, they can't be papered over anymore with CPI adjustments, tax hikes, and retirement age increases. What we've mortaged to our children is inexcusable.

SS is failing because we spent the money --that was there-- on other things, such as wars -- without increasing taxes.
Sound familiar?
And people wonder how we can maintain one of the most expensive wars in history and LOWER taxes at the same time.
Really?


RE: Ridiculous
By grenableu on 12/21/2008 4:19:38 PM , Rating: 2
quote:
SS is failing because we spent the money --that was there-- on other things, such as wars [] people wonder how we can maintain one of the most expensive wars in history
Why can't you people ever learn basic facts? We spend 15 times a year on Social Security what we do on the Iraq War, and the money comes out of different buckets anyway. SS is going bankrupt because we give too much to people who don't pay enough into the system. Redistribution of wealth.

quote:
basically you want the government to step in, abolish the contracts the companies and workers negiotiated in a free market, and impose a government decided salary for all the employees?
You're 0 for 2! Basically we want the government to stay OUT. A bankruptcy abolishes all those contracts automatically, and if the UAW wants to continue demanding unrealistic new salaries from bankrupt companies, well more power to them.


RE: Ridiculous
By sinful on 12/21/2008 8:36:56 PM , Rating: 2
quote:
Why can't you people ever learn basic facts? We spend 15 times a year on Social Security what we do on the Iraq War, and the money comes out of different buckets anyway. SS is going bankrupt because we give too much to people who don't pay enough into the system. Redistribution of wealth.


Why can't you people ever learn basic facts?

Cost of Iraq War: $123 Billion/Year.
Cost of Iraq War+Afghanistan: $147 Billion/year
Cost of Standard Defense Spending+War on Terror: $660 Billion/year
Cost of Iraq, Afghanistan, Defense, War on Terror: $807 Billion/year
Cost of Social Security: $608 Billion/Year.

I don't know what country you're living in, but it's not the US. Maybe in your country 608 is 15x as much as 123, but here in the real world it isn't.

And what does "the money comes out of different buckets anyway" even mean? Maybe we should take SS money out of that magical "other bucket"?
In any case, you're wrong (again):
"...thus the Social Security Trust Fund indirectly finances the federal government's general purpose deficit spending" - http://en.wikipedia.org/wiki/Social_Security_(Unit...

Secondly, the money for SS has been spent over a long period of time - not just the current war.

quote:
SS is going bankrupt because we give too much to people who don't pay enough into the system. Redistribution of wealth.


Your understanding of how SS works is fundamentally flawed.
If anything, SS has the opposite problem:
"Critics, such as libertarian Nobel Laureate economist Milton Friedman, say that Social Security redistributes wealth from the poor to the wealthy."
http://en.wikipedia.org/wiki/Social_Security_(Unit...

Of course, I doubt this "education" will change anything - I'm sure you'll just continue to spout off ignorance, claiming you know "the facts".


RE: Ridiculous
By masher2 (blog) on 12/21/2008 11:40:10 PM , Rating: 2
quote:
If anything, SS has the opposite problem:
"Critics, such as libertarian Nobel Laureate economist Milton Friedman, say that Social Security redistributes wealth from the poor to the wealthy."
http://en.wikipedia.org/wiki/Social_Security_(Unit...
Using Wikipedia as a source is dangerous business. In this case it has bit you-- Friedman simply argued that the tax which funds social security (rather than the program itself) is regressive. Due to the income cap and the fact that the rich generate a much smaller share of their income from wages (the only income taxed by SS), they pay a much smaller percentage of total income.

However, to move from that to the claim that the program transfers money from poor to rich is utter silliness. A low-income payor will receive much more from SS than they pay into the program, much more than they would have received even investing those contributions. For those paying at or near the cap, that isn't true. Their benefits are less than what they'd receive from investing their payments.


RE: Ridiculous
By sinful on 12/22/2008 1:53:12 AM , Rating: 2
quote:

However, to move from that to the claim that the program transfers money from poor to rich is utter silliness.


Are you reading the same thing I am?

"Critics, such as libertarian Nobel Laureate economist Milton Friedman, say that Social Security redistributes wealth from the poor to the wealthy.
Sorry, I guess I missed the memo where that means the opposite of what it says.

quote:
A low-income payor will receive much more from SS than they pay into the program, much more than they would have received even investing those contributions. For those paying at or near the cap, that isn't true. Their benefits are less than what they'd receive from investing their payments.

Again, are you reading the same thing I am?
"Furthermore, wealthier individuals generally have higher life expectancies and thus may expect to receive larger benefits for a longer period than poorer taxpayers. [106] A single individual who dies before age 62, who is more likely to be poor, receives no retirement benefits despite his years of paying Social Security tax. On the other hand, an individual who lives to age 100, who is more likely to be wealthy, is guaranteed payments that are more than he paid into the system.[107]"

Now, maybe my reading comprehension isn't the greatest, but to me that sounds like an argument that despite the higher amount the wealthy put in, they withdraw more, thus benefitting more from it than a poor person would.

Now, the wealthy might lose a greater theoretical opportunity cost due to their money being tied up in SS, but that's neither here nor there - it's outside the scope of SS.
In other words, in terms of benefits:
Poor with SS< Poor without SS <Rich with SS < Rich without SS.
i.e. yes, the rich would benefit more without SS to begin with, but even with it in place, they're benefitting more than the poor. If that's the case, the SS is transferring wealth from the poor to the rich.


RE: Ridiculous
By masher2 (blog) on 12/22/2008 10:44:19 AM , Rating: 2
> "Are you reading the same thing I am?"

Yes. You, however, are taking a Wikipedia entry as gospel. Go to the underlying source, and you'll see how some Wiki editor took it out of context to feed their particular point of view.

For an extra credit assignment, then explain how someone contributing the minimum to social security, then withdrawing twice as much annually for the next 25+ years, has had their wealth "redistributed" to the rich.

> "maybe my reading comprehension isn't the greatest, but to me that sounds like an argument that despite the higher amount the wealthy put in, they withdraw more"

Your reading comprehension has indeed failed you. First, that wasn't a quote from Friedman, just simply a continuation of some Wiki editor's comments. But second and more seriously, you've misunderstood the statement itself. Yes, a rich person-- by virtue of their slightly lower chance of dying early-- has a slightly lower chance of not retrieving benefits. However, that most emphatically does *not* mean that rich people, on the average, retrieve a larger share of their contributions than do the poor. Quite the opposite, in fact.

But the argument is even more flawed. It fails to consider survivor benefits. The family size of the poor is much larger on the average. Meaning if they die early, their survivors will get many times their total contributions. Not only do wealthy have smaller familes on average, but they are much more likely to have alternate income sources which would reduce or eliminate those benefits entirely.


RE: Ridiculous
By masher2 (blog) on 12/21/2008 3:38:39 AM , Rating: 2
quote:
I'm against protectionism in general, but I'm also in favor of the Big Three having something close to a level playing field, which does not exist today - not even close
Tom, GM and Ford are quite profitable on their overseas operations -- its only their US operations that are hemorrhaging cash. Blaming their problems on "European protectionism and low Asian salaries" doesn't add up.


RE: Ridiculous
By lagomorpha on 12/22/2008 9:47:59 PM , Rating: 2
"make the huge import tariffs imposed by most European and Asian companies disappear,"

Commodore Perry figured out how to convince the Japanese to trade freely with us in 1852! Maybe they just need a little reminder.

http://en.wikipedia.org/wiki/Matthew_C._Perry#The_...


RE: Ridiculous
By callmeroy on 12/19/2008 2:19:50 PM , Rating: 2
Huh? right back to you, if your reply is all you got out of my post -- you clearly skipped over it all except for the lines you quoted.

Your whole assumption 100% is just focused on the loan being paid back -- you completely ignore realities that -- there is no guarantee the loan will be fully repaid back, there is no assurance WHEN it will be paid back....and I don't get your understanding of the government with money if you don't feel they won't raise taxes to make up for money that has been drained from its coffers -- be it a "gift" or a "loan" expected to be paid back. Hugely simple example: I have $10 - I "loan" you $8...I'm now left with 2 -- oh crap I need more money a $10 bill has to be paid that just came in....how does your repaying my $8 back in x time period change the fact that I'm still w/o that $8 *NOW* to pay that bill?

I agree its incredibly simple to understand.....understand how it doesn't matter that its a loan or not in between the time its lent and the time its repaid during a rather significant recession period.


RE: Ridiculous
By TomZ on 12/19/2008 10:18:05 PM , Rating: 2
quote:
I have $10 - I "loan" you $8...I'm now left with 2
Goverment money supply doesn't work that way - not even close. Besides raising taxes, the government can also borrow more money, or it can print money. The government doesn't have a fixed amount of money available as your analogy suggests.


RE: Ridiculous
By grenableu on 12/19/2008 10:26:06 PM , Rating: 3
If the government borrows money to lend to GM, taxpayers pay extra interest. If the government prints money it costs us more in inflation. Any way you look at it this is going to cost us a bundle.


RE: Ridiculous
By Ammohunt on 12/19/2008 2:49:03 PM , Rating: 1
Where do you think the 700B came from for the governemnet to loan 14B to the automakers? lat time i checked the 700B wasn't a loan from the taxpayers.


RE: Ridiculous
By Suntan on 12/19/2008 1:29:28 PM , Rating: 2
quote:
When the government gets low on funds -- how do they get money.......higher taxes. 'nuff said.


Google "U.S. Treasury Bonds" for starters, then move on to “Federal Mint”. You seem to be missing a few options.

-Suntan


RE: Ridiculous
By Hiawa23 on 12/19/2008 4:49:59 PM , Rating: 2
I understand about not letting the auto companies fail, but I am not sure, given the current economic conditions, that these comanies will even be able to pay back these loans, or even sell enough cars to even break even. They already can't pay the debt they have now.


RE: Ridiculous
By adiposity on 12/19/2008 2:34:28 PM , Rating: 5
In that case, could you issue me an interest-free million dollar loan for 50 years? I promise nothing will come out of your pocket, directly or indirectly.

-Dan


RE: Ridiculous
By adiposity on 12/19/2008 2:37:25 PM , Rating: 1
IGNORE PARENT, WRONG LOCATION FOR POST


RE: Ridiculous
By FITCamaro on 12/19/08, Rating: 0
RE: Ridiculous
By FITCamaro on 12/19/2008 10:11:38 AM , Rating: 1
Let me add that the government won't be able to take the money back because it'll have been spent.


RE: Ridiculous
By Lord 666 on 12/19/2008 10:20:59 AM , Rating: 3
Hey Fit, found this old post of yours. It was a reply to mine back in September. Just today, I wanted to say.. "I told you so!" ;) The US has sold us all, Commrade Fitcamaro.

GM Bailout inevitable now after horrible design
By Lord 666 on 9/8/08, Rating: 0
By Lord 666 on 9/8/2008 2:29:43 PM , Rating: 0

Holy sh1t... this is a horrible design. Like a puffy aveo.

If GM is banking their entire future on this vehicle, they might as well throw in the towel now and have their hand out.

Reply

(2 Hidden) RE: GM Bailout inevitable now after horrible design
By FITCamaro on 9/8/08, Rating: 2
By FITCamaro on 9/8/2008 2:35:40 PM , Rating: 2

GM isn't a New Orleans "victim".


RE: Ridiculous
By Funksultan on 12/19/08, Rating: 0
RE: Ridiculous
By FITCamaro on 12/19/2008 10:58:51 AM , Rating: 4
quote:
As always, if you don't like it, there are lots of other countries with space. Don't feel as though we're all begging you to stay.


I would say the same thing to those who seek to change this country into Europe.


RE: Ridiculous
By TomZ on 12/19/2008 10:27:46 AM , Rating: 4
Making loans is not socialism. The government is not taking any stake. The only control they have is to help ensure that taxpayer money is used responsibly and is not at a high risk of not being paid back.

And frankly, I'm glad Bush stepped in. It is the right thing to do. Our idiotic do-nothing Congress is so dysfunctional that all they do is sit around in committe conferences and mock the auto industry execs. How does that help solve any problems?

Another poster pointed this out - and I agree - I think the terms of these loans will continue to pressure the UAW to give up more when it comes to negiotiating labor contracts. Eventually this should lead to better labor cost parity across the industry which should help foster more competition.

I also would like to see the federal government get involved to help lower car interest rates, to get consumers movitivated again. While there are some select low-interest promos, most car loans are priced in the 7-9% range right now. It would be nice to see that figure go below 5% again to make new cars more affordable again.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 11:14:43 AM , Rating: 4
> "Making loans is not socialism. The government is not taking any stake"

Incorrect. If (or when) these companies go bankrupt, the federal government will now be one of its debtors, and own a substantial share of any assets remaining.

The loan may be unsecured -- but its still a loan, which implies ownership of those assets. Just as my bank owns a share of my house, the federal government now owns a stake in both GM and Chrysler.

> "It is the right thing to do"

How so? Do you really think delaying the inevitable for a few months is helpful to anyone? Until GM and Chrysler are allowed to repudiate their UAW contracts, they'll never be competitive with Japanese automakers.

What's next, higher tariffs on Honda and Toyota, to help make domestic cars more palatable?

> "I also would like to see the federal government get involved to help lower car interest rates, to get consumers movitivated again"

Quite frankly, this would simply worsen the current crisis. To function properly, interest rates must reflect the actual risk involved in making the loan. When risk is high, interest rates should be also, lest you throw good money after bad and worsen the cycle further.


RE: Ridiculous
By TomZ on 12/19/2008 11:25:48 AM , Rating: 4
quote:
The loan may be unsecured -- but its still a loan, which implies ownership of those assets. Just as my bank owns a share of my house, the federal government now owns a stake in both GM and Chrysler.
But these are arm's-length loans - they are not secured by ownership interest, and more importantly for the current debate, they convery little or no control of the companies by the government.
quote:
How so? Do you really think delaying the inevitable for a few months is helpful to anyone?
I think stretching out the problem is a good way to help solve it. If you look at the industry over the past 10-20 years, they have made a lot of progress in terms of being able to overcome the systematic competitive disadvantages forced upon them by their history and by government actions. For example, the influence of the UAW - and associated labor costs - have been steadily decreasing. I'd prefer to let this transition continue to naturally run its course rather than to have a tsunami of bankruptcies ripple through the industries causing further global economic instability - especially in the middle of a recession.
quote:
Quite frankly, this would simply worsen the current crisis. To function properly, interest rates must reflect the actual risk involved in making the loan. When risk is high, interest rates should be also, lest you throw good money after bad and worsen the cycle further.
What's good for the banking industry (expensive loans) is not necessarily good for the automotive industry. There is not sufficient risk in car loans IMO to justify such high interest rates. After all, these are secured loans against assests whose depreciation characteristics are well known. And there are no significant external risks such as a "bubble" in the car pricing market.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 11:34:03 AM , Rating: 2
> "they are not secured by ownership interest"

I repeat -- a loan implies repayment. If GM or Chrysler falls, the government will demand its ownership share of assets.

Government choosing to grant low-interest financing to some companies and not to others is the very essence of socialism.

> "...and more importantly for the current debate, they convery little or no control of the companies by the government."

But you yourself have admitted these current loans are just a stop-gap, awaiting a "more comprehensive plan" by Obama. That plan most certainly will include requirements and measures by the government, to exert a level of control over the recipient's actions.

> "If you look at the industry over the past 10-20 years, they have made a lot of progress in terms of being able to overcome the systematic competitive disadvantages forced upon them by their history and by government actions"

Really? 20 years ago, GM wasn't losing billions year after year, and they weren't teetering on the verge of bankrupcty. 20 years ago, Toyota didn't have a comparable market share. For GM, the situation has gotten more grim year after year.

Chrysler, admittedly, is in pretty much the situation they were then. But GM is worse.


RE: Ridiculous
By foolsgambit11 on 12/19/2008 8:57:19 PM , Rating: 3
But an ownership share of assets is not the same as ownership of the living company. A socialist model would have the government actively directing the company based on its ownership stake. This loan has preconditions that must be met, which direct the companies to some extent, but that's not the same as active control. Besides, the government gets to control the auto industry en masse anyway through legislation on safety equipment, emissions control, &c, &c. So arguing this is a particularly socialist action isn't convincing.

Government choosing to grant low-interest loans to specific companies is certainly meddling in the market, but that's not the 'essence of socialism.' Socialism is control of the means of production. Capitalism allows varying degrees of government intervention in the market. This isn't laissez-faire capitalism, to be sure. But where has that gotten us? We tried it in the 1910's and 1920's. Great Depression. We tried it in the late-80's-to-present. Serious recession, at least. American hands-on capitalism has a better track record than laissez-faire capitalism, if you ask me.

Admittedly, there are more basic, structural market reforms that should be a priority. But you have to go to (economic) war with the army you've got....


RE: Ridiculous
By masher2 (blog) on 12/19/2008 9:09:32 PM , Rating: 2
> "A socialist model would have the government actively directing the company "

As condition for the loan, the government is "actively directing" GM to seek concessions from creditors, set compensation caps, and to convert certain debts to equity. The "full" plan is expected to have many more conditions.

What else could the government possibly do, except tell it what products to make? Turns out its doing that also, between the tens of thousands of regulations and favorable tax treatment for various vehicle types.

I don't see how the government could possible be any more "engaged" in running GM's business right now, without actually having a few politicians on the board of directors.

> "We tried it in the 1910's and 1920's. Great Depression."

Err, no. The Great Depression was caused by the then-recently created Federal Reserve, which was in effect the nationalization of the banking system and utter control over interests rates. Smoot-Hawley certainly precipitated it, but the root cause was the foolhardy idea that, if we just kept interest rates low enough, we could shortcircuit normal business cycles and ensure a permanent upswing.

In essence, its the same problem that caused this recession. As the housing market overheated, a true free-market economy would have seen interest rates rise in lock-step with the rising risk. Instead, we did the exact opposite, and lowered rates to force lending to continue, despite the increased risk. Eventually, it all blows up.


RE: Ridiculous
By foolsgambit11 on 12/20/2008 9:09:45 PM , Rating: 2
Michael, why don't you just concede this point. If the government doesn't make day-to-day decisions, it isn't actively directing GM. Preconditions that must be met to get a loan is different, and you know it.

Government regulations and the tax code do direct how the companies operate, but they direct all companies, and it's not direct decision-making, either. The government doesn't make manufacturers meet the tax exemptions.

You hit the nail on the head in your third paragraph. If the government had board members, or was a major shareholder of voting stock - that would be a bit socialist. That's how the government could be more engaged in running GM.

As for the Great Depression, I didn't mean that laissez-faire policy directly caused the Great Depression. But it certainly set an environment which allowed the economy to get out of control. I find it unsurprising that, when economists still can't agree on exactly what policies caused or could have prevented the Great Depression, you will, ideologically as always, chock it up to the one major regulatory move the government made. I've heard economists say the Federal Reserve could have done more to fight the recession that became the Great Depression, but I don't usually hear them say the formation of the Fed caused the Depression.

You're explanation of what should happen in a free-market system is great. But it leaves out the fact that investors, indeed all economic actors, do not always act rationally - indeed, they tend to act irrational exactly when it is most needed for them to act with a level head.


RE: Ridiculous
By masher2 (blog) on 12/21/2008 3:44:03 AM , Rating: 2
quote:
If the government doesn't make day-to-day decisions, it isn't actively directing GM.
Nonsense. Even in the day's of Hitler's National Socialist Germany, with full state ownership and control, the government didn't "make day-to-day decisions" for each firm. They simply set broad policy directives...much as the US government is trying to do now.

quote:
I've heard economists say the Federal Reserve could have done more to fight the recession that became the Great Depression, but I don't usually hear them say the formation of the Fed caused the Depression.
Then you haven't been listening. Any good Austrian economist will tell you just how FRB interest rate manipulation turned a dozen trivial business cycles into a single massively-amplified one.


RE: Ridiculous
By foolsgambit11 on 12/21/2008 8:35:15 PM , Rating: 2
Sure. Just keep on telling yourself that the current U.S. actions are just like Nazi Germany, or Socialism, or whatever you want. There is obviously a qualitative and quantitative difference between them.

Fine, maybe I didn't make my point perfectly clear. If the government has full discretionary hiring and firing power over the people who make day-to-day decisions, that counts, too. That's socialism, as well. And it's not what we have here. It's possible the U.S. government may ask a CEO to step down as a term of a loan or grant, but the company always has the choice to comply or not.

Every government sets 'broad policy directives' in the sense of creating laws to control the economy. Whether we're talking about regulations protecting investors from dishonesty, or regulations protecting consumers from dangerous substances, or prohibitions on specific substances, or minimum wage law, or immigration law. Or the entirety of criminal law, really.

Look, obviously there is a difference between Castro nationalizing all major industry in Cuba and the U.S. government offering cheap loans with preconditions to U.S. auto makers. The difference is clear. Rather than just try to equate U.S. action with socialism, why don't you tell me why the difference between the two is not significant. Or even better, cut out the middle man, and just explain why current U.S. action is bad for America and/or bad for Americans. (Then you won't also have to prove that socialism is bad for America - a logical step I would let you take, but there might be people who wouldn't.)

I like the free market in general, but economics is not a place for ideology, it is a place for pragmatics. If it works, do it. If it stops working, try something different. That's why, in certain sectors, I support a non-free market approach - utilities, public sanitation, and preventative medicine, for instance.

None the less, I look at the free market system as an RBMK reactor - it produces lots of power, but it's inherently unstable. It requires constant vigilance and proper safeguards to keep it safe. Could a slightly different design produce similar output, but without being unstable?


RE: Ridiculous
By masher2 (blog) on 12/22/2008 12:02:54 AM , Rating: 3
quote:
Or even better, cut out the middle man, and just explain why current U.S. action is bad for America
Glad you asked! First, let us underline why corporations that lose money are bad for America, rather than simply their own stockholders. Business takes labor and resources and converts them into other resources: products and services. A business running a continual deficit is therefore one that is destroying resources. That's a bad thing. It doesn't add to our GDP, it subtracts from it.

Let's look at the banking system. Over the past decade, many banks made risky decisions. Many did not. Now, the best thing for America is for those banks which took unacceptable risks to be eliminated. That rewards and strengthens those banks with good management. It reinforces good behavior -- behavior that helps all Americans -- and removes the bad.

Propping up bad banks hurts us all. Rather than eliminating the management which made those decisions, we reward them. Strong banks continue to have to compete with bad ones, ones which receive hundreds of billions to help them unfairly compete. Instead of a smaller number of well-managed banks, we have many poorly-run ones.

Worse, such bailouts reward bad behavior, which encourages it. Generations of future institutions are now more likely to take unacceptable risks, hoping that future administrations will again shoulder the burden if their bets fail. Whether or not that actually happens, it's still bad for us.

Now let's turn to the auto industry, and "protecting jobs". Many people are under the misguided conception that "jobs" themselves are good for the economy. They are not. Productive jobs are what's good for the economy. If job creation in itself was a good thing, the government could simply hire half of America to bury stones, and the other half to dig them up. 300 million new jobs, and 0% unemployment!

Each and every job at a Big 3 automaker is, at present, a job that's bad for America. A job that's destroying resources. Preserving those jobs in the status quo is the absolute worst thing for us.

Should GM and Chrysler file bankruptcy, they would be forced to become smaller automakers, and to make drastic changes to their management structure and employee compensation. All good things. They would produce less cars -- meaning Ford, Honda, Toyota, etc would gain market share, thereby being rewarded for their better management decisions -- meaning they (and all other future automakers) are more likely to make those same wise choices in the future, and less likely to make the ones which ran GM and Chrysler into the ground.

All in all, a very good thing for America. Over the past century, dozens of large industries (many larger than the automakers are today) have vanished. With each one, America has grown stronger, not weaker.


RE: Ridiculous
By ICE1966 on 12/20/2008 2:18:03 AM , Rating: 2
Wages and benefits affect the bottom line operating cost of a business, and one of the biggest expenses to the big 3 is the UAW. I work for a non-union company{thank God}, and I do not make $40-$50 an hour, I make half of that. The company I work for is profitable, even now, we are more profitable in the current economic situation. the people where I work at take pride in what we make and it is a world class product. We have jobs and not contracts with the company, and we have great benefits. the union model is far outdated and needs to be done away with. union workers have long been paid way to much for the work they do and now it is coming back to get them.


RE: Ridiculous
By reader1 on 12/19/08, Rating: -1
RE: Ridiculous
By masher2 (blog) on 12/19/2008 11:18:31 AM , Rating: 5
> "Government regulation of private organizations is AGAINST the free market."

No one asked for laws regulating unions. They simply asked the UAW to lower their rates to a level which would allow their employers to survive without government assistance. . . a request the UAW refused point-blank.



RE: Ridiculous
By HinderedHindsight on 12/19/2008 11:30:40 AM , Rating: 1
quote:
No one asked for laws regulating unions. They simply asked the UAW to lower their rates to a level which would allow their employers to survive without government assistance. . . a request the UAW refused point-blank.


The actual hourly wages paid to workers is about on par with competitors, it is widely known that the added cost of additional benefits is what drives the cost up for the manufacturers- and the UAW already agreed to concessions on benefits and the jobs bank programs. I think these are reasonable ways to lower the costs/rates on the manufacturers.


RE: Ridiculous
By Spuke on 12/19/2008 12:06:47 PM , Rating: 2
quote:
and the UAW already agreed to concessions on benefits and the jobs bank programs
Sure, they agreed to concessions, in 2011.


RE: Ridiculous
By HinderedHindsight on 12/19/2008 5:26:49 PM , Rating: 2
Reread the news, they signed 4 year contracts in 2007, they're agreeing to modify them prior to their expiry in 2011. Unless I'm mistaken, they've already suspended the jobs bank program.


RE: Ridiculous
By RoberTx on 12/20/2008 12:32:31 AM , Rating: 2
The president of the UAW, Ron Gettelfinger disagrees with you. He admitted that UAW workers do make more than the non-union employees. His quote was "about $25-30 an hour more". Only entry level pay is the same as the non-union workers.


RE: Ridiculous
By FITCamaro on 12/19/2008 11:55:36 AM , Rating: 2
I was for them not getting anything. However I also knew it was going to happen because the Democrats have the majority, there's too many liberal Republicans, and Bush is backing it and is able to bypass Congress. So if it was, at least have the stipulation on it that actually fixes the problem. That being immediately lower the cost of wages. The UAW agreed to lower wages already, but not until 2011. Now without them declaring bankruptcy (for now) and without these Republican stipulations, UAW workers at the big 3 will continue to rake in massive pay and benefits that is now government funded.

And no. Without government involvement the free market would thrive(you're always going to have some basic controls). GM and Chrysler would declare bankruptcy, free themselves of the UAW's tyranny, and be able to become competitive. Just as people who's credit wasn't worthy of a home loan would never have gotten one because things like the Fannie Mae, Freddie Mac, and the Community Reinvestment Act wouldn't exist. Not to mention car makers could make the cars people want without the government telling them how to build it. And oil companies could make the best gas possible without having a bunch of inept lawyers with no background in chemical engineering telling them how to mix it. We also wouldn't have wasted BILLIONS of dollars on ethanol.

The problem is we haven't really had a free market in the past 40-70 years.


RE: Ridiculous
By Reclaimer77 on 12/19/2008 12:08:52 PM , Rating: 1
Man you said it !


RE: Ridiculous
By MrBungle123 on 12/19/2008 1:25:19 PM , Rating: 2
Give that a 6!


RE: Ridiculous
By Xenoterranos on 12/19/2008 2:53:13 PM , Rating: 1
"I was for them not getting anything. However I also knew it was going to happen because the Democrats have the majority, there's too many liberal Republicans, and Bush is backing it and is able to bypass Congress."

Wait, I'm confused here. Didn't congress vote a big fat no to bailing them out? Didn't Bush then turn around and give it to them anyway...despite the will of the democratically controlled congress?


RE: Ridiculous
By whiskerwill on 12/19/2008 3:09:56 PM , Rating: 2
If you're trying to imply the Democrats didn't want this, you're living in fantasy land. Nearly all Democrats voted for the bailout. Almost no Republicans did, except those from automaker states.


RE: Ridiculous
By FITCamaro on 12/19/08, Rating: -1
RE: Ridiculous
By maven81 on 12/19/2008 4:08:54 PM , Rating: 1
There's only one problem... your "brilliant" ideas have been tried, and they failed, miserably.
Look at what happens to the financial sector if you just say the government should not be involved at all. Financial institutions start cooking the books because no one is paying attention. They get into deep trouble because they make bad decisions that no one was able to prevent. They go under.
Now in your Utopian view you say who cares, it was a bad business, they deserve to go under. There's only one problem... they aren't playing with their money, they are playing with YOUR money. Suddenly you have no savings, because someone decided it was ok to gamble with them, and no one stepped in to stop them.
What are you going to do then?
The fallout from such misguided thinking is right in front of your eyes and you're STILL pushing for this?
What has to happen before you get it?


RE: Ridiculous
By masher2 (blog) on 12/19/2008 4:31:45 PM , Rating: 1
Stuff and nonsense. There's nothing in the free-market system that prevents the government from enforcing laws against fraud.

In any case, your assumption that fraudulent accounting led to this crisis couldn't be further from the truth. We're on the downward end of a typical business cycle, one that was greatly exaggerated by a real estate market overheated to red-hot status by poor subprime lending policies set by the US government itself.

Things like credit derivatives amplified the effects further, but even those aren't financial fraud -- they're simply a risky business that any member of the public who was invested in had full knowledge of.


RE: Ridiculous
By maven81 on 12/19/2008 5:05:27 PM , Rating: 4
You have to make sense before calling others thoughts nonsense.

Government enforcing laws against fraud is regulation. What Fit is arguing for is no regulation of any kind. Therefore you already missed the point.

quote:
In any case, your assumption that fraudulent accounting led to this crisis couldn't be further from the truth.


You say that with a straight face while just during the past week we find fraudulent accounting to the tune of 50 billion dollars?! seriously?!


RE: Ridiculous
By BansheeX on 12/19/2008 5:26:55 PM , Rating: 3
quote:
Government enforcing laws against fraud is regulation. What Fit is arguing for is no regulation of any kind. Therefore you already missed the point.


And yet, the Federal Reserve is empowered by government to create fraudulent notes representative of no new labor or product and loan them out at interest. This is called fractional reserve banking, it's the only industry allowed to do it without going to jail. And it was even allowed before we had a Fed, the Fed was actually created to backstop it, as it would often created bank panics when depositor demands exceeded reserves of heavily fractionalized banks.

http://en.wikipedia.org/wiki/Fractional_reserve_ba...

That's not all, our Federal government runs a multi-trillion dollar ponzi scheme itself called Social Security. But unlike traditional schemes like Maddoffs, it forces participation, so there's no way to avoid it even when you educate yourself, because the "regulators" themselves are running it.

http://www.youtube.com/watch?v=oh-NqdmEDq4

The SEC doesn't do it's job anymore, there's too many people in their pockets and they don't want to rock investor confidence by exposing most wall street hedge funds as ponzi schemes. Maddoff's was only uncovered when he admitted it to some people. And SOX regulations have been proven to impose greater cost and burdens on the market than the ones it solves. Fraud is a strange crime in that it requires greedy, unskeptical victims to succeed. Enron and Maddoff would have never happened had people simply educated themselves and questioned returns that were simply too good to be true. 8% returns every year without fail? Those people got what was coming to them, the government can't protect people from their own stupidity.


RE: Ridiculous
By maven81 on 12/19/2008 5:48:17 PM , Rating: 2
I agree with you, scams don't happen without willing participants, and the government has it's own schemes. However it shouldn't be that hard to make the SEC do it's job. Everyone's eyes are now firmly glued to them.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 5:29:43 PM , Rating: 3
> "What Fit is arguing for is no regulation of any kind. "

Actually, he said the exact opposite. I suggest you reread his post.

> "while just during the past week we find fraudulent accounting to the tune of 50 billion dollars?! "

If you think the failure of one hedge fund -- which didn't even occur until long after the crisis came to light -- led to this situation, you are sadly misinformed. Some investors are going to lose their shirts, but compared to the subprime meltdown, this isn't a flea on the back of a mammoth.


RE: Ridiculous
By maven81 on 12/19/2008 5:55:30 PM , Rating: 1
Which part of "Without government involvement the free market would thrive" says the exact opposite? He said that if we have to have regulation then we need to meet certain conditions, but he clearly thinks it's a bad idea no matter what.

quote:
If you think the failure of one hedge fund -- which didn't even occur until long after the crisis came to light -- led to this situation, you are sadly misinformed.

I see you clearly need some reading comprehension. Where did I say that this 1 thing was the cause of the entire meltdown?
I say it was just the latest example. There have been plenty of others, some we may not even know about yet.
That was a response to your laughable assumption that financial fraud is no big deal.


RE: Ridiculous
By masher2 (blog) on 12/21/2008 3:46:02 AM , Rating: 3
> "Where did I say that this 1 thing was the cause of the entire meltdown?"

If you were speaking English, you certainly implied it.

> "it was just the latest example. There have been plenty of others..."

Name one.

> "...some we may not even know about yet."

Translation: I don't have any data, but I'm willing to hypothesise like mad.


RE: Ridiculous
By FITCamaro on 12/19/2008 10:30:04 PM , Rating: 1
I have no problem with some government regulation. But interference in the market through mandating that loans be given to those who can't afford them, forcing oil companies to mix in substandard alternative fuels which decreases fuel economy in gasoline and makes car companies have to spend money to upgrade fuel systems, forcing mileage standards on automakers to further an environmental agenda, etc is a hell of a lot different than regulation.

And last I checked the Democrats were the ones who fought against increased regulation in 2005.


RE: Ridiculous
By KamiXkaze on 12/19/2008 9:27:01 PM , Rating: 2
Yes freddie, fannie and ethanol are bad idea from the start.

KxK


RE: Ridiculous
By Yawgm0th on 12/19/2008 11:58:57 AM , Rating: 2
quote:
Then he decided he didn't like everyone disliking him so he decided to work with Democrats thus becoming one in everything but name.
I don't think even Bush is stupid enough to think people will start liking him, regardless of what actions he takes as his term ends. If anything, he's alienating the few Republicans that still had some support for him.

When the term ends, even if he did something that helped stabilize the economy, he will still be remembered as the worst president since Nixon, if not Harding. For all my disagreements with him and for all the corruption that has surfaced in his administration, I do believe he is doing what he thinks (or has been told) is best for the country. I seriously doubt this is a last-minute ploy for popularity or a restoration of his legacy.

quote:
It's amazing the levels of socialism the American people have just supported. People say they're against these bailouts yet they vote in the very congressmen who propose it.

Although we do have a representative government, it is inaccurate to say that the "American people" just supported the bailout or to imply that they knowingly voted in the people who supported it. The current Congress was elected in 2006, 2004, and 2002, and the Detroit bailout was not an issue on November 4th. You'll have to wait until 2010 to find someone who was elected despite their support for the bailout.

Perhaps more significantly, the bailout did not survive the Senate. This is an executive decision. I'd bet money Bush wouldn't have won in 2004 if voters had known what would happen this month.


RE: Ridiculous
By Reclaimer77 on 12/19/2008 12:05:43 PM , Rating: 1
quote:
When the term ends, even if he did something that helped stabilize the economy, he will still be remembered as the worst president since Nixon


Oh pffft ! Thats only anti war pascifists hippies saying that. His economic policies aren't half as bad as Clinton. And his personal life and maturity level is light years beyond.

I have lost tons of respect for him. But worst president since Nixon ??? In fact, why did you use Nixon when Carter is the CLEAR choice for worst president of all time.


RE: Ridiculous
By Kenenniah on 12/19/2008 12:16:21 PM , Rating: 3
Agreed. I too have lost some respect for Bush, but it's ridiculous how much he gets blamed for everything. I'd be much more inclined to say we have had the worst Congress since well...as long as I can remember.


RE: Ridiculous
By MrBungle123 on 12/19/2008 1:30:13 PM , Rating: 2
Which is likely because we have the most complacent, apathetic, uninformed electorate since... well, ever?


RE: Ridiculous
By foolsgambit11 on 12/19/2008 9:08:50 PM , Rating: 2
The electorate was anything but complacent and apathetic in this past election. Uninformed is a judgment call. They probably weren't that well informed on their congressional races, for the most part, I'd guess. But most had plenty of information to make a decision on the presidential race.

2006 was also a large turnout for a mid-term election.

So why is the Democratic-controlled Congress so ineffective? Well, first, it's not as ineffective as many think. The 'do nothing congress' epithet is thrown at them by Republicans and activist Democrats. The Republicans are frequently the ones that block Congress from enacting legislation. As for the activist Democrats, they're mad we're not out of Iraq. But the Dems can't get legislation passed on major issues because they only hold the Senate by one vote. It makes it hard to pass the 'big' legislation. I predict they will be much more effective in the coming term, thanks to a larger majority, and clear direction being provided by the President.

Now, whether you like what they do is another question.


RE: Ridiculous
By whiskerwill on 12/19/2008 9:30:38 PM , Rating: 2
quote:
most had plenty of information to make a decision on the presidential race.
Not the ones who voted for Obama. A Zogby Poll after the election found that only TWO PERCENT of Obama voters could answer 12 simple questions about his policies.

It was even funnier when Howard Stern's show interviewed Obama supporters, saying things like "you think Sarah Palin was a good pick for Obama" or "Do you agree with his ban on stem cell research". Most of them agreed that these were great moves on Obama's part!

Truth is the average Obama voter doesn't have the slightest idea about his voting record in the Senate, or what he was actually proposing besides the word "change".


RE: Ridiculous
By foolsgambit11 on 12/20/2008 9:19:23 PM , Rating: 2
quote:
Truth is the average Obama voter doesn't have the slightest idea about his voting record in the Senate, or what he was actually proposing besides the word "change".
More accurate would be, 'Truth is the average voter doesn't have the slightest idea what any candidate is actually proposing.' I don't deny that Obama is a great example of the 'Cult of Personality'. (<singing>Like Joseph Stalin, and Kennedy</singing>) But that's only because he was better at it than McCain, not because McCain's supporters were any better. At least Obama's supporters mostly knew he was neither a Muslim nor a Communist.

Besides, at the end of the day, I'd much rather have Obama's supporters be idiots than deal with McCain's VP choice in the White House being an idiot.


RE: Ridiculous
By Reclaimer77 on 12/22/2008 10:02:48 AM , Rating: 2
quote:
Besides, at the end of the day, I'd much rather have Obama's supporters be idiots than deal with McCain's VP choice in the White House being an idiot.


And Joe Bidden isn't a huge idiot who has been on the wrong side of every issue since he was born and offends this country every time he opens his mouth ??

Hmmm.. strange. I thought I woke up on planet Earth today.

http://www.youtube.com/watch?v=ZXrsOe2spDE

My favorite is his stereotypical comments about Indians working at 7-11. I mean, wow, thats class !!!

Republicans would be tarred and feathered in public for making half the statements that the left gets away with. Thank god they have the hardest working propaganda machine, the media, to continuously clean up their messes for them.

Palin is a class act all the way. To even compare her to Bidden insults this country.


RE: Ridiculous
By foolsgambit11 on 12/21/2008 9:27:25 PM , Rating: 2
As for the poll, it was only .5% that could answer all 12 (+/- 4.4% error). While it was conducted by Zogby, it was commissioned by, and the questions were provided by, a right-wing organization. Likewise, only one question was about Obama's policies (the question that asked which candidate had said his policies would be bad for the coal industry and would increase the cost of electricity). The rest were about 'scandals'.

There are several problems with drawing major conclusions from this survey, for instance, that it didn't survey McCain supporters on these topics. Of course, a survey of all voters should ask questions like, 'which candidate first made national news as part of the Keating 5 scandal', and 'which candidate gave aid to the enemy during a time of war' (McCain gave a confession while a POW). A good survey would also look at those who voted for Bush in 2004 and Obama in 2008, and how they did at answering these questions. That would help show who was voting by party and who was convinced by message (although it would still be possible they didn't care about the message and just wanted to vote for a black man, or they didn't want to vote for McCain, or whatever).

The idea of a message that is more an idea than specific policy proposals is a classic Republican marketing tactic - one that has served them well. (Although Obama put out a lot about the policies he would enact, as have Republicans who relied on ideas and vision - you still need to pay lip-service to substance.) Republican ideas are 'freedom' and 'strength'. Obama's ideas were 'change' - but specifically, he talked about change for 'fairness' and 'respect'. That is the kind of change people knew he was talking about.


RE: Ridiculous
By RoberTx on 12/20/2008 12:37:02 AM , Rating: 2
You're one of 'em.


RE: Ridiculous
By Yawgm0th on 12/19/2008 4:07:56 PM , Rating: 3
quote:
Oh pffft ! Thats only anti war pascifists hippies saying that.
No, anyone with a reasonable viewpoint of his administration will admit it is one of the worst ever, and possibly worse than Nixon. It's not just a left-wing response to the controversial, extreme nature of his policies. Reagan and FDR had similarly extreme policies, but Reagan wasn't that bad and FDR was one of the best. Even his failed foreign policy is only a small part. Rather, Bush has mishandled the executive brand to a level that could accurately be described as criminal. Many, maybe most Republicans will admit this.

quote:
His economic policies aren't half as bad as Clinton.
Any reputable economist would dispute that, as would anyone with a clear memory of the last 16 to 20 years. Bush's handling of economic matters was suspect well before it was clear we were in a recession. Any ideologue can point out his huge tax cut and say that makes his economic policies good. That doesn't, however, make it true.
quote:
And his personal life and maturity level is light years beyond.

Aside from all the phony Texas cowboy nonsense he plays on, which is hardly mature, his past is questionable. But aside outside of clear corruption or otherwise criminal behavior, a president's personal life is of limited interest. His terrible grades and demonstrated lack of intellectual curiosity are certainly more concerning than an oval office blow job or two.

quote:
I have lost tons of respect for him. But worst president since Nixon ??? In fact, why did you use Nixon when Carter is the CLEAR choice for worst president of all time.
Unlike you, I have some grasp of American history. I'd be hard-pressed to find an intelligent person who has sat through a college-level American history course that would consider Carter to be the worst president of even the twentieth century, much less all time. Buchanan, Johnson, Pierce, and Grant come to mind for worst of all time, probably in that order. Harding and Coolige are easily the worst of the Twentieth century by all accounts.

Carter actually was only slightly better than Nixon during his presidency. However, Carter has led an extraordinary post-career as diplomat and negotiator. Nixon, conversely, was shamed from office and has been exposed as being a president of character far more questionable than Bill Clinton or George W. Bush. Generally only historians who double over as extreme free-market ideologues consider Nixon to have been better than Carter, and even then only barely.

Whether Nixon mismanaged the country as much as George W. Bush is up for debate, which is why I used him as the point of reference.


RE: Ridiculous
By whiskerwill on 12/19/2008 4:20:30 PM , Rating: 1
quote:
Carter actually was only slightly better than Nixon during his presidency
Carter's policies are what led us to 15% unemployment and 20% interest rates, the worst of the entire 20th Century.

quote:
Nixon has been exposed as being a president of character far more questionable than Bill Clinton
Nixon ordered one coverup to help his party. Clinton ordered dozens, most to help him personally. I don't recall Nixon forcing women to have sex with him either, or getting campaign funds from foreign nations, then selling them top military secrets. But you go on believing your Democratic view of history.

quote:
Bush's terrible grades and demonstrated lack of intellectual curiosity are certainly more concerning
You mean the "terrible grades" that were BETTER than Kerry's, his opponent in the 2004 election, and someone I'll bet anything you yourself voted for.

Nothing worse than a hypocrite.


RE: Ridiculous
By Yawgm0th on 12/19/2008 7:13:50 PM , Rating: 3
quote:
Nothing worse than a hypocrite.

quote:
Carter's policies are what led us to 15% unemployment and 20% interest rates, the worst of the entire 20th Century.

The unemployment rate at its highest was 10% in 1983, not 15%, and that pales in comparison to the estimated 25% unemployment rate during the Great Depression. I am not disputing the Carter was a mediocre president nor that he failed to prevent the economic recession in the late 70s and 80s, but please try to keep your hyperbole factual.

Are there any more blind ideologues here who need lessons on contemporary American history?

quote:
Nixon ordered one coverup to help his party. Clinton ordered dozens, most to help him personally. I don't recall Nixon forcing women to have sex with him either, or getting campaign funds from foreign nations, then selling them top military secrets. But you go on believing your Democratic view of history.
You can believe what you want, but Clinton was convicted of no such thing. Nothing he was accused of even compares to Nixon. Nixon openly admitted he thought he was above the law. Nixon also led a relatively bad and ineffective presidency. Ask an actual historian if Nixon was a good president. Then ask about Clinton.

There's really not much room for debate on the subject. Clinton is widely regarded as one of the better presidents of the 20th century outside of far-right ideology. His approval rating was high for most of his tenure and when he left office. Nixon was forced to resign from office to prevent impeachment, whereas Congress failed to impeach Clinton.

quote:
You mean the "terrible grades" that were BETTER than Kerry's, his opponent in the 2004 election, and someone I'll bet anything you yourself voted for.

I did not vote for Kerry in 2004. Grades aside, I accused Bush of lacking intellectual curiosity, which is a euphemistic way of calling him stupid. Kerry is by no means stupid, regardless of his positions. Kerry is also a genuine war hero whose record was attacked by Bush supporters, whilst Bush was AWOL from the Coast Guard which he was only in to avoid Vietnam. But again, I didn't vote for Kerry or Bush in 2004.

The fact that I don't see everything as black or white and right or left doesn't make me a card carrying member of the far left.


RE: Ridiculous
By whiskerwill on 12/19/2008 9:25:36 PM , Rating: 2
quote:
Nothing he was accused of even compares to Nixon
WTF? Violent rape doesn't compare? Selling government secrets to foreign agents doesn't? Using police forces (state troopers) to intimidate women into sex?

If you think that doesn't compare to Nixon's hiding a tape recording or two, you're a sick individual.

quote:
The unemployment rate at its highest was 10% in 1983
11%, November 1982, 18 months after Reagan took office. Once his policies kicked in, it went down continually for the next 10 years.

quote:
Kerry is also a genuine war hero
Rofl, right. If shooting a teenager in the back while spending only 3 months "in country", then before getting a purple heart for a splinter wound treated with a band-aid, then requesting an early release makes one a war hero, then I'm Rambo. I won't even go into the "baby killer" crap he spewed when he got home, it's already been proven he made it all up.


RE: Ridiculous
By Yawgm0th on 12/19/2008 11:41:49 PM , Rating: 3
quote:
WTF? Violent rape doesn't compare? Selling government secrets to foreign agents doesn't? Using police forces (state troopers) to intimidate women into sex? If you think that doesn't compare to Nixon's hiding a tape recording or two, you're a sick individual.

Sorry, I was referring to the more reasonable accusations. You can believe all of the left-field allegations you want. Obama is a Muslim Marxist, you know, so at least Dick and Bill were Christians. Bad Christians are better than terrorists like Obama, right?

Of course, we're innocent before proven guilty in this country. Clinton wasn't convicted of most of what the Republicans tried so hard to accuse him of and wasn't even tried or investigated for much of it. I remember the Clinton era well, and the lengths that were gone to to try to discredit what proved to be an excellent administration.

And again, the more important difference is that Clinton was a good president; Nixon was an awful president. The fact that we have to compare him to Carter to find a recent President almost as bad says something. Would you really say you liked Carter better than Clinton, taking personal lives out of the picture?

quote:
11%, November 1982, 18 months after Reagan took office. Once his policies kicked in, it went down continually for the next 10 years.

It was 10.8%. I rounded poorly. 11% and 15% are very different though, and both are a far cry from the 25% of the 30s.

Also, I'm not necessarily disputing the economic policies of Reagan, although there were downsides to them. But Reagan's effect on the economy was better than most 20th century presidents, and history has treated him kindly for that. Don't mistake me for a socialist or radical left-winger.

quote:
Rofl, right. If shooting a teenager in the back while spending only 3 months "in country", then before getting a purple heart for a splinter wound treated with a band-aid, then requesting an early release makes one a war hero, then I'm Rambo. I won't even go into the "baby killer" crap he spewed when he got home, it's already been proven he made it all up.
Obviously you took the discredited Swift Boat Veterans for Truth too seriously, which even Bush wouldn't claim association with, despite how much their lies helped his campaign. Every reputable news source and fact checker discredited them, but obviously if they're saying things that help your side, you'll believe it.

Again, I didn't vote for Kerry but attempts to downplay his war record are disgusting. John McCain has a far more exaggerated military history and if someone from the Obama camp had touched that subject, regardless of how accurately, McCain would have won in a landslide.


RE: Ridiculous
By whiskerwill on 12/20/2008 12:00:15 AM , Rating: 2
quote:
Sorry, I was referring to the more reasonable accusations.
Clinton having women taken to his hotel room by State Troopers is more than "reasonable", its proven. Clinton settled the case rather than fight it. Or did your wonderful knowledge of US history skip that chapter also?

Did Clinton sell secrets to the Chinese? They wound up with them, and he wound up with the money. Maybe it was just an accident, but I can't see that it matters much.

quote:
Obviously you took the discredited Swift Boat Veterans for Truth too seriously
Everything I said about Kerry is well documented, except for the part about shooting a teenager in the back. We only have one witness who says that. Maybe he was lying.

The rest though there's no doubt. Kerry only spent 3 months in Vietnam, he got an early release (and a purple heart) for a shrapnel wound that was treated with a bandaid. And when he got home, he began making up stories about "baby killers" to gain fame and get an in with the anti-war crowd.

All fact:

http://www.nationalreview.com/york/york20040504162...

quote:
John McCain has a far more exaggerated military history
You're right, he made up being held prisoner for years and tortured so badly he can't use his arms properly.

God, what nuthouse do you people come out of?


RE: Ridiculous
By Reclaimer77 on 12/22/2008 10:25:07 AM , Rating: 2
quote:
Did Clinton sell secrets to the Chinese? They wound up with them, and he wound up with the money. Maybe it was just an accident, but I can't see that it matters much.


Clinton finally released financial information on who donated to his Clinton Foundation and library. Guess who's at the top of the list ? Saudi Arabia.

Remember, at this time, it was believed his wife would be the one running for president. Not Obama.

Follow the white rabbit down the hole. Theres really no end to the Clinton's greed and corruption.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 11:16:03 PM , Rating: 2
quote:
Unlike you, I have some grasp of American history...whereas Congress failed to impeach Clinton.
Your first statement is rather ironic, given that Congress did in fact impeach Clinton.


RE: Ridiculous
By Yawgm0th on 12/19/2008 11:43:27 PM , Rating: 2
Touche. Congress failed to pass all articles of impeachment, and measures to remove him from office failed. Still, my statement was flat out wrong as phrased and I should have been clearer.


RE: Ridiculous
By Reclaimer77 on 12/22/2008 10:21:45 AM , Rating: 2
quote:
Touche. Congress failed to pass all articles of impeachment, and measures to remove him from office failed.


Oh so all is forgiven ?

You are a wacko. I can't even be bothered to argue with you on a point by point basis. The sum bulk of your statements and arguments, no matter how much you claim to be educated, reek of Liberal brainwashing.

Your comment about LBJ tells it all. I'm sure your college professors would be proud. LBJ's "Great Society" is a monument to the failure of liberal doctrine in this country. NOT something to uphold. The man who rammed through Congress the Tolkin Gulf Resolution to give him war powers in Vietnam ? While at the same time socially engineering this once great nation into a wellfare state ?

That LBJ ?


RE: Ridiculous
By maverick85wd on 12/19/2008 1:23:56 PM , Rating: 2
quote:
The Republicans requirements for an organized bankruptcy and steep cuts in union pay totally went out the window. Sure the auto makers might be able to get that out of the UAW on their own, but I doubt it.

Did you miss this part of the article?
quote:
Other conditions in the loan include a limit on executive compensation and perks, and provisions that the Detroit automakers work out more favorable terms with its labor unions and creditors.

To be fair, it doesn't say how or to what degree, but I'd certainly hope it would significantly loosen the ball-hold the UAW has on the Big 3.

While I don't think government intervention is usually appropriate, sometimes something simply must be done. My sentiments in this case are completely torn. On the one side I'd hate to see three (or, more likely, two) companies that have done so much for American industry go bankrupt. I have an 87 Ford Ranger, a 98 Lincoln Mark VIII, and used to have a 94 Pontiac Grand Am and I love(d) them all. I recognize foreign cars have their benefits, but I like having the option to buy from a domestic company that's been around for ages.

At the same time I'm not at all in favor of government intervention in the free market system. On this we completely agree. I'm American and will resists socialism until I die.

But to say the American people would be out 13.4B seems pretty heavy. Are you implying all their assets would instantly be worth literally nothing should they go bankrupt?

I guess all I can do is pray like hell this thing is handled correctly and they can get their collective acts together and start producing some bang-up vehicles at competitive prices. But I have faith in the system, because if I didn't I'd probably go insane.


RE: Ridiculous
By maven81 on 12/19/2008 2:16:07 PM , Rating: 2
Hilarious. The republican administration royally screws up, and with some people it STILL manages to be the democrats fault.
I'm sorry... but you voted for this phoney. If we're f*cked, it's only because of you. You supported his braindead policies while letting every scan artist on wallstreet steal as much money as they wanted because regulation is such a horrible thing.
Even when you see that deregulation failed miserably you call for more deregulation!
And see, even if your silly theory about Bush suddenly changing was true... you seem to ignore the rest of his cabinet. Did they suddenly also transform?
If you want to blame someone, blame yourself, end of story.


RE: Ridiculous
By whiskerwill on 12/19/2008 2:41:34 PM , Rating: 2
You've conveniently forgotten the source of this entire mess was the meltdown in subprime mortgages, a problem caused by the Democrats rolling back regulations on Fanny Mae and Freddie Mac, and forcing them to make high-risk loans to those who couldn't afford them.


RE: Ridiculous
By Xenoterranos on 12/19/2008 3:09:03 PM , Rating: 2
Nothing other than rampant, uncontrolled greed caused this current mess. The question of who unfettered that greed hardly has any relevance today, considering that the current administration has had 8 years to fix the "problem". And even that argument is tired by now. We have too much mess lying around to keep looking back 16, 8 , or even 4 years.


RE: Ridiculous
By Spuke on 12/19/2008 3:11:47 PM , Rating: 2
The problem was created by mostly everyone. Dem's, Rep's and private citizens alike. There's no one person or one group to blame for this mess. The only people not responsible are those that didn't buy a home they couldn't afford, didn't buy a car they couldn't afford, and didn't elect an official that had a hand in creating or continuing any of this mess. If you are in ANY of those categories, YOU ARE PARTLY RESPONSIBLE and are hypocritical to place blame anywhere else.

quote:
"And why do you look at the speck in your brother’s eye, but do not consider the plank in your own eye? Or how can you say to your brother, ‘Let me remove the speck from your eye’; and look, a plank is in your own eye? Hypocrite! First remove the plank from your own eye, and then you will see clearly to remove the speck from your brother’s eye."


RE: Ridiculous
By mdogs444 on 12/19/08, Rating: 0
RE: Ridiculous
By reader1 on 12/19/2008 10:53:59 AM , Rating: 2
quote:
Aren't both of these against free market systems


No, they aren't.

A free market means there's no involvement from the government at all. All monopolies and any form of cooperation between companies or workers is acceptable. It's only with government regulation that monopolies and organizations are kept in check.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 11:28:01 AM , Rating: 3
> "It's only with government regulation that monopolies and organizations are kept in check"

And yet, before government began anti-trust efforts, it's impossible to find even one historical example of a monopoly needing to be "kept in check".

Even the largest monopoly to ever exist -- Standard oil, which controlled 90% of the world market -- only survived by offering much lower prices than its competitors ever could. And when Standard Oil was broken up, prices rose and remained high for decades, hurting consumers immeasurably in the process.


RE: Ridiculous
By reader1 on 12/19/2008 1:04:25 PM , Rating: 2
We wouldn't have needed anti-trust laws if monopolies weren't abusing their power and harming consumers. The fact that they continue to need to be enforced proves their value (LCD and DRAM price fixing come to mind).

Somebody told me that you have filed patents? Is this true? You do realize patents are federal involvement in the free market? They're designed to encourage innovation. Under a true free market the government wouldn't have any control over the use of ideas.


RE: Ridiculous
By FITCamaro on 12/19/2008 1:38:06 PM , Rating: 2
quote:
We wouldn't have needed anti-trust laws if monopolies weren't abusing their power and harming consumers.


What monopolies exist today? Except those created by the government (which ARE hurting consumers) there aren't any.

Price fixing has nothing to do with monopolies. If there's a monopoly on something, you don't have to do price fixing because you can charge whatever you want since there's no one else to compete with you.


RE: Ridiculous
By juserbogus on 12/19/2008 2:16:39 PM , Rating: 2
not all monopolies are bad... government "created" or natural.


RE: Ridiculous
By FITCamaro on 12/19/2008 10:32:55 PM , Rating: 2
Didn't say they were necessarily bad. He did.

I said there weren't really any except those forced by the government in areas. About the only one I can think of is Sirius/XM or whatever the company is called now. It's one company now and is the only provider of satellite radio in the country. But it needs to be since there isn't a big enough market for more than one company.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 2:05:59 PM , Rating: 3
> "We wouldn't have needed anti-trust laws if monopolies weren't abusing their power and harming consumers"

I repeat my challenge. Prior to those laws being enacted, name one historical case of this actually happening.

> "You do realize patents are federal involvement in the free market?"

Eh? A patent is simply government enforcement of property rights -- no different in theory than the police preventing squatters from taking over a home you built, or the FCC preventing someone from broadcasting on radio spectrum you've purchased. Intellectual property is still property.


RE: Ridiculous
By juserbogus on 12/19/2008 2:19:34 PM , Rating: 2
quote:
Intellectual property is still property.


Eh? it is only because we, the government, defined it as such.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 2:29:03 PM , Rating: 1
> "Eh? it is only because we, the government, defined it as such. "

A statement that is true for all property. What's your point? If government didn't define and protect property rights, private property as such wouldn't exist.

The second factor you miss is that, in the absence of patent protection, nearly all those great new ideas wouldn't exist. Why spend millions to develop a better widget, if your competitors can instantly get it for free? R&D would be counterproductive. We'd revert to the Middle-Ages scenario of guild secrets, tightly controlled and passed on only in very limited situations.


RE: Ridiculous
By juserbogus on 12/19/2008 2:56:55 PM , Rating: 2
I understand that.... I'm all for limited IP rights for the reasons you outlined. There is a big fundamental difference between physical items and intellectual property.

if you build or buy something tangible it's clear who should be able to exploit that item. this is not the case with IP since the item is abstract. why should you get the sole right to exploit it when I might have very well come up with same idea?

My point is, a patent is a state created/enforced monopoly. which in my opinion is perfectly justified but is certainly not free market.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 3:07:57 PM , Rating: 3
> "a patent is a state created/enforced monopoly [and] is certainly not free market"

With respect, you're confused on both terms here. In a free-market, government involvement is limited to enforcing property rights. IP laws are the very essence of free market society.

Neither are patents monopolies. You can only monopolize a particular market. A patent, though, is the particular method of fulfilling a market need, not the need itself.

You can patent a better way to move people from A to B, but you can't patent transportation itself. In cases where a patent seemingly seems to create an entire industry, one has to remember that industry didn't even exist before the patent. A whole new market was therefore created...but should someone else have a different idea on how to fulfill that market, patent law does not prevent them from competing.

> "why should you get the sole right to exploit it when I might have very well come up with same idea?"

Firstly, you don't receive "sole" rights, you receive first rights-- because you were the first to originate the idea. When you're the first to sit on a swing at a public playground, you get to use it first. Getting the first crack at developing an idea you originated is no different.


RE: Ridiculous
By juserbogus on 12/19/2008 4:06:30 PM , Rating: 1
again, I disagree but we are going round and round here. "property rights" are the essence of a free market society, not IP (I could argue an exception for copyrights based on the contractual obligation not to duplicate the work).

with a patent, any subsequent inventors, no matter how unaware they were of the first inventor’s effort are barred from exploitation of the invention.

sure, you get first rights. In other words sole rights for a limited period. it's not the same as the swing though. If I didn't get to that swing, I or some enterprising person could build another. if you patented that swing, the government would be impose a non natural restriction, prohibiting me from duplicating it with my own property and work.

a patent forbids the natural right of one to enjoy the product of his own exertion.

Again, we have them for a reason but there have been many "Free Market" authors that argue patents are government intervention.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 4:26:14 PM , Rating: 2
> "if you patented that swing, the government would be impose a non natural restriction, prohibiting me from duplicating it with my own property and work."

No. You're free to duplicate it all you wish. You're simply not free to sell it.

Furthermore, you are free to build and sell other types of swings. You just can't sell this particular implementation. That's the critical point.

> ""property rights" are the essence of a free market society, not IP"

Again, the point you're mising is that all property, intellectual or not, is created by government enforcement of a right. Without the government, everything from real estate to the clothes in your closet aren't "property"; they're simply items you may happen to be near at the moment.

You're arguing that the concept of physical property makes sense even without government protection. That's a fallacy. Property rights exist on a legal basis only.


RE: Ridiculous
By maven81 on 12/19/2008 4:59:26 PM , Rating: 2
Even after these laws we still had monopolies that tried hard to be anti competitive and had to be broken. AT&T ring a bell? (sorry for the really bad pun heh)


RE: Ridiculous
By masher2 (blog) on 12/19/2008 5:45:38 PM , Rating: 2
> "Even after these laws we still had monopolies that tried hard to be anti competitive and had to be broken. AT&T ring a bell?"

Again, AT&T was a government-sponsored monopoly. It only existed due to government intervention in the market, banning competitors. Even as late as the 1960s, it was illegal for anyone else to manufacture telephones, much less offer telephone service.

Even today, state and, to a lesser extend, federal restrictions on "last-mile" service are what engender the existence of the RBOCs (Baby Bells) and stifle competition.


RE: Ridiculous
By reader1 on 12/19/2008 5:07:37 PM , Rating: 2
quote:
...name one historical case of this actually happening.


All of them. There are no significant advantages to having a single, monopolistic company over multiple competing companies.

quote:
A patent is simply government enforcement of property rights


Patents control what businesses can sell. It's government interfering with private business. In a true free market, if two companies used the same idea, the consumers would decide which companies thrive without federal involvement.


RE: Ridiculous
By juserbogus on 12/19/2008 2:14:21 PM , Rating: 2
Patents and copyright are usually overlooked by "free market" people. in reality, most "free market rules all" people are generally not total free market advocates, unbeknown to them.... they tend to have all kinds of exceptions, just nowhere near as many as other people do.

you can certainly call yourself a capitalist and have government regulation. Even Adam Smith didn't believe capitalism should be completely self-regulating and unfettered.


RE: Ridiculous
By juserbogus on 12/19/2008 1:50:21 PM , Rating: 2
your characterization is either ill informed or dishonest.

that "monopoly", standard oil was not created by low prices alone. while the consumer may have generally seen lower prices from the trust there were competitors which indeed did offer competing and even lower prices at times, but they were unable to sell because of the trust's illegal actions.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 2:22:38 PM , Rating: 2
> "there were competitors which indeed did offer competing and even lower prices at times..."

If that were true, how do you explain the fact that, after the breakup of Standard Oil, the world price for oil rose sharply, and remained higher for nearly two full decades? It wasn't until better technology made producing and refining oil cheaper that the loss of Standard Oil was compensated.

Standard Oil put its competitors out of business by continually offering lower prices. The "illegal action" that prompted the most outcry was Standard's practice of demanding shipping rebates from the railroads due to the volume Standard shipped. That certainly gave Standard an edge. . . but it was a net benefit to the consumers, as it allowed the delivery of lower prices.


RE: Ridiculous
By juserbogus on 12/19/2008 2:59:38 PM , Rating: 2
quote:
due to the volume Standard shipped.

<sarcasm>ah, right.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 3:11:58 PM , Rating: 2
Instead of the sarcasm, why not read the actual history of Standard Oil? Historian Burton Fulsom has studied the company more than any other comtempory. Read his account, and judge for yourself:

http://www.amazon.com/Myth-Robber-Barons-Burton-Fo...


RE: Ridiculous
By juserbogus on 12/19/2008 4:38:24 PM , Rating: 2
quote:
Historian Burton Fulsom has studied the company more than any other comtempory
that seems hard to believe since he should then know to what extent Rockefeller went to stop others from shipping any of their oil or kerosene at all.


RE: Ridiculous
By Spuke on 12/19/2008 3:20:03 PM , Rating: 2
quote:
<sarcasm>ah, right.
Didn't expect him to know about this subject, huh? Masher moves in mysterious ways. :)


RE: Ridiculous
By maven81 on 12/19/2008 4:47:54 PM , Rating: 1
Google doesn't make one smart.


RE: Ridiculous
By Spuke on 12/19/2008 7:16:16 PM , Rating: 2
quote:
Google doesn't make one smart.
This comment doesn't either.


RE: Ridiculous
By Xenoterranos on 12/19/08, Rating: 0
RE: Ridiculous
By masher2 (blog) on 12/19/2008 3:48:29 PM , Rating: 4
quote:
I don't know, there was this tea company that did some pretty messed up things a while back.
Did you seriously use the Boston Tea Party -- a free-market rebellion against a government-created monopoly -- as a justification for government control of monopolies?


RE: Ridiculous
By Xenoterranos on 12/19/2008 5:19:21 PM , Rating: 2
No, I was referring to the company that caused it...the East India Trading Company.


RE: Ridiculous
By Xenoterranos on 12/19/2008 5:24:31 PM , Rating: 2
Sorry, cut off my own post. You asked for a historic Monopoly that required government intervention. Here you go. They lasted for centuries, caused many problems, and had to eventually be dissolved via government intervention. Sure, it may be a cheap shot, but it meets your criteria. :)


RE: Ridiculous
By HinderedHindsight on 12/19/2008 11:08:05 AM , Rating: 2
quote:
who's "unions" purposely defy the free market system?


I don't know if you're aware, but there are many industries that defy the free market system in the same way you describe. You can start with utility companies, and move on to several others. I would complain about the fact that the cost of producing energy has dropped significantly in the last four months, yet electricity companies income are protected by local governments.

While, I do agree some provisions that the UAW won are a bit absurd, their actual wages are not that much more than Japanese competitors, and no one should complain about the health care benefits- if you work in an auto plant (or any other job) you should be entitled to them. It's items like extended severance pay that really should be reexamined.

quote:
I don't know whats worse - being held by the balls from the UAW, or being held by the balls from liberals like Obama , Pelosi, and Reid.


I'm curious, what do you think that the "liberals" are going to do to the auto industry that's so bad? Is there something worse than allowing them to fail? Based on this (so far) unsubstantiated line of reasoning, the industry should just close shop now because it will not be worth it to produce cars in an Obama administration.

I might also point out to you that the industry got to the point of failure during a conservative administration, with a conservative congress for six out of the eight years. So please, help me understand what Obama might do to them that's worse than complete failure?


RE: Ridiculous
By FITCamaro on 12/19/2008 11:58:22 AM , Rating: 2
quote:
I don't know if you're aware, but there are many industries that defy the free market system in the same way you describe.


quote:
yet electricity companies income are protected by local governments.


So how is that a free market? Utilities, phones, and cable are all industries HEAVILY regulated by the government. There is no free market in them. You have who the government says is allowed to offer you service. A new cable company can't start up in an area even if it wants to. Otherwise Verizon would be rolling out FiOS nationwide.


RE: Ridiculous
By HinderedHindsight on 12/19/2008 4:47:35 PM , Rating: 2
quote:
So how is that a free market?


That was kind of my point...it's not.


RE: Ridiculous
By Ringold on 12/19/2008 1:15:28 PM , Rating: 2
quote:
I'm curious, what do you think that the "liberals" are going to do to the auto industry that's so bad? Is there something worse than allowing them to fail?


Yes, there is something worse than allowing them to fail. Go forth and look up what unemployment has been in socialist France over the last 30 years or so, as well as their debt to GDP ratio. That's only one example, but a decent one as the French government will bail out any kind of firm almost any time, right down to taking ownership stakes. Constant coddling of industry in the long run doesn't get you anywhere.

Asides from what the "liberals" will do, it's pretty clear. Unions gave record amounts to Democrats this year, so they'll be calling in their favors. The UAW will walk away in relatively good shape, they'll give them however much money they need (50b? 100b?), and original private market lenders to the Big Three? They'll get bent over a barrel and will be lucky to see 30 cents on the dollar. It'll almost be like bankruptcy, but it'll have all the worst aspects of bankruptcy with none of the positive, rejuvenating aspects. Just what one would expect from government intervention.


RE: Ridiculous
By TomZ on 12/19/2008 1:47:59 PM , Rating: 2
I agree with you - I don't want to see America go down the same road as Europe in terms of socialst leanings. But we are in an economic crisis at the moment, and certain actions need to be taken now in order to prevent a downward spiral. That is why I think it is okay to deviate from what we might agree is the "ideal" economic policy, so long as it is thoughtful and short-term.

I also think that a negiotiated bankruptcy coupled with goverment loans - like Chrysler had in the 80's - probably is a good path for GM and Chrysler. A plan like that, or something similar, will take a while to put into place, and more specifically, will require that Obama be in office first. So I think that short-term bridge loans like the ones announced today by Bush are helpful and justified.

Eventually, we need the Big Three to achieve labor cost parity relative to their competitors, but strong political forces exist that will oppose this. So it will take time, but it will happen in the long term, one way or the other. The current labor cost diffential is not sustainable.


RE: Ridiculous
By Ringold on 12/19/2008 2:24:37 PM , Rating: 2
I could agree with this:

quote:
I also think that a negiotiated bankruptcy coupled with goverment loans - like Chrysler had in the 80's - probably is a good path for GM and Chrysler.


Particularly if Obama stands up to the UAW so that everyone really does share in the pain. If government money had to be involved at all, thats the way. Obama is on TV right now, and I can't help but laugh in disbelief; Barrack "I'm going to renegotiate NAFTA" Obama is appointing an ardent free trader as trade rep. Anything is possible.. but we'll see what happens when the best laid plans meet Congress.

We agree I think that even if it is good for the economy right now that it's not a path to make well trod. That's different than others, who seem to think low interest government loans is normal, is no big deal, etc. Some even have their heads in the sand and repeat propaganda from Michigans governor suggesting there really is no significant difference in labor costs, rules, etc. You've got a much more pragmatic view.


RE: Ridiculous
By whiskerwill on 12/19/2008 3:14:13 PM , Rating: 2
quote:
Particularly if Obama stands up to the UAW so that everyone really does share in the pain.
Sorry, I couldn't stop laughing after I read this.


RE: Ridiculous
By HinderedHindsight on 12/19/2008 5:14:51 PM , Rating: 1
He's already defied the terrible homosexual activists.


RE: Ridiculous
By HinderedHindsight on 12/19/2008 5:13:03 PM , Rating: 1
quote:
That's only one example, but a decent one as the French government will bail out any kind of firm almost any time, right down to taking ownership stakes. Constant coddling of industry in the long run doesn't get you anywhere.


First of all, you're comparing a systemic issue in France to an industry issue in the United States- not exactly an apples to apples comparison, is it? Nor does it really draw any kinds of conclusions as to what will happen to the industry itself. No one is advocating bailing out every failing industry/business in the United States, it would never happen in the United States. Bear in mind that business is already coddled in this country, just not when they are failing.

This does, however, demonstrate your bias against liberals; your primary argument in this paragraph seems to be against "coddling business." Yet a republican just handed bailout money to the industry, and instead of complaining about that, you're arguing what a set of liberals MIGHT do after the conservatives leave the executive branch.

quote:
sides from what the "liberals" will do, it's pretty clear. Unions gave record amounts to Democrats this year, so they'll be calling in their favors.


The problem with this idea is manifold. First of all, Ford is not immediately affected, so at the moment, there's not many favors the UAW can pull in to affect existing contracts. Ford is safe for now. Secondly, the UAW is already in good shape (better shape than they should be, I agree that many provisions of existing contracts are absurd).

The third problem is that you're assuming a lot of things that have very little to do with reality. Congress is already controlled by liberals, and the incoming administration is a "liberal" one. Yet, the UAW has announced its willingness to make concessions to mitigate the crisis. They're not making more demands, they're trying to help the situation. Meanwhile everyone is trying to cut back on corporate excess- it would be a pretty blatant double standard for Obama to limit big 3 spending while supporting increased UAW benefits- how fast do you think his popularity and reelection prospects will disappear?

Further, Obama is already upsetting groups that provided substantial support through his campaign. If he's willing to upset the homosexual and transgendered communities, do you seriously think the UAW is going to be able to sway him? Where will the Unions go if the liberal's "abandon" them- to the conservatives???

The worst the liberals will do is have the Big 3 invest in R&D on the vehicles they have resisted developing. Raising efficiency is in everyone's best interests, and that's not such a bad thing if the government intervenes. Your supposition is unsubstantiated.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 5:37:16 PM , Rating: 2
> "you're comparing a systemic issue in France to an industry issue in the United States- not exactly an apples to apples comparison, is it?"

It's as close as any possible comparison can be. Historically, protecting weak industries doesn't strengthen them-- it simply further weakens them.

> "Yet, the UAW has announced its willingness to make concessions to mitigate the crisis."

They haven't agreed to competitive wage rates nor the repudiation of the massive debt the Big 3 owes retired workers. "Announcing willingnes" sounds good on paper, but its results that count.

> "If he's willing to upset the homosexual and transgendered communities, do you seriously think the UAW is going to be able to sway him? "

Are you seriously comparing the triviality of an inaugural minister pick to a concerted union-busting effort?


RE: Ridiculous
By MrBungle123 on 12/19/2008 1:50:03 PM , Rating: 2
quote:
I might also point out to you that the industry got to the point of failure during a conservative administration, with a conservative congress for six out of the eight years.


Republican != Conservative

A conservative would want smaller government; this administration has expanded it.

A conservative would want our country protected; this administration claims to fight terror while at the same time leaving our borders open to the invasion by a million unidentified foreign nationals every year.

A conservative would attempt to shorten this recession by letting the free market correct itself; this administration has made 700 Billion dollars the country doesn't have available for medaling in the financial system to allow bad fiscal policy to continue for a few more months.

The failures and mistakes this administration has made are there because it has not governed conservatively, not because it is conservative.


RE: Ridiculous
By Ringold on 12/19/2008 2:30:26 PM , Rating: 2
quote:
The failures and mistakes this administration has made are there because it has not governed conservatively, not because it is conservative.


George Bush is the worst Democrat we've ever had. :P


RE: Ridiculous
By porkpie on 12/19/2008 10:36:44 AM , Rating: 4
quote:
This isn't money out of your pocket
If you live in the US and pay taxes, it is.

quote:
They're gonna have to fight to succeed.
In less than six months, both companies will be back asking for more money. Want to bet on it?


RE: Ridiculous
By TomZ on 12/19/2008 11:00:44 AM , Rating: 2
quote:
In less than six months, both companies will be back asking for more money. Want to bet on it?
That's a false argument, since it is already known that they will need to borrow a lot more money than $13B. That is only enough to sustain them until Obama takes office and can craft a more comprehensive plan.


RE: Ridiculous
By straycat74 on 12/19/2008 11:23:05 AM , Rating: 3
You should listen to Obama. He has no plan in the short term, everything will be solved far into the future, and he said it will get worse before it gets better. I can only listen to so much, "I have a plan" or "we are working on a plan". I thought he had all these great ideas BEFORE the election. Where did they go?

Obama is not the savior, just a good salesman who could've picked a lot better time to become President.


RE: Ridiculous
By TomZ on 12/19/2008 12:20:50 PM , Rating: 2
Obama says the economy is his #1 priority, and keeping the automakers from collapsing will almost certainly be part of the plan. He's said time and time again that he believes that the government needs to keep the automakers from failing.


RE: Ridiculous
By MrBungle123 on 12/19/2008 2:09:17 PM , Rating: 2
The government cannot "keep the automakers from failing". The reason they are in this mess is because they are operating a business in a manner that is unsustainable and they have finally run out of cash reserves. Obama's plans which will undoubtedly revolve around giving them massive quantities of money in exchange for lower CEO (and other executive salaries) and the mandated development of smaller more fuel efficent cars will do nothing to get at the root of the problem:

The unions whos benefits have proped up the wages of the average worker to $20 an hour more (after benefits are calculated) than the cost per hour of a non union worker at a Toyota or Honda plant. 100,000 people making $20 per hour more than they are worth costs the company $4,000,000,000 per year... the CEO only makes $10 million which is comparatively a drop in the bucket, so cutting his salary is symbolic at best but will make the class envy dems happy.

Add to that the CAFE standards which will require the automakers to produce the cars the GOVERNMENT wants to be sold and NOT the cars the PUBLIC is demanding and the liberal tree huggers have set the whole system up for failure.

The Dems are interested in preserving the status quo and helping their union buddies, not helping the automakers don't let them fool you into thinking differently.


RE: Ridiculous
By nycromes on 12/19/2008 1:40:20 PM , Rating: 3
If anyone were paying attention during the debates and such, Obama never said anything concrete regarding any of his plans. "We will look into" & "We will explore" were two of his favorite sentence starters to almost any question. I don't believe I ever heard him say one thing he was surely going to do besides perhaps taxing the rich more because they "don't pay enough".


RE: Ridiculous
By skirvmi on 12/19/2008 10:00:01 AM , Rating: 2
The auto makers have to get loans every time the economy takes a dive. The only difference now is the credit markets are too tight and they can not get the loans. Don't get me wrong, there are a lot of problems in Detroit, unions being one of them. But I guarantee a 14B loan will be cheaper than paying unemployment for all of the people that will lose their jobs. We are going to pay for this in one way or another. I think Bush made the best decision with the options he had.


RE: Ridiculous
By mdogs444 on 12/19/2008 10:10:06 AM , Rating: 2
quote:
But I guarantee a 14B loan will be cheaper than paying unemployment for all of the people that will lose their jobs.

They won't lose their jobs and have to file for unemployment. The company would reorganize, get rid of the union, and turn into a shop like Toyota/Honda paying competitive wages.

The former union workers would have to settle for something less than their current "golden parachute" benefits. Its quite humorous how all these people start bashing the executives and CEO's for their ridiculous salaries and benefits when a company goes down....but no one does that to the unions who are responsible for the same thing. Hypocritical all the way.


RE: Ridiculous
By Funksultan on 12/19/2008 10:32:58 AM , Rating: 2
quote:
They won't lose their jobs and have to file for unemployment. The company would reorganize, get rid of the union, and turn into a shop like Toyota/Honda paying competitive wages.


I see your point mdogs, but that's an incredibly narrow point of view. Many people see big 3 going down and just assume there will be companies available to step in.

Bankruptcy by big 3 will cause a spiral. Their existing product lines will take a dramatic nosedive (who wants to buy a car from a company in trouble?). People having those cars will be more likely to jump ship as well (gotta have parts available).

In an industry this large, this is going to cause a major upheaval. I can't even fathom all the touchpoints that would be effected, but if they can reform and save themselves, good. If they can't, that's fine too, but we'll ALL pay the price one way or another.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 11:21:39 AM , Rating: 5
> "Their existing product lines will take a dramatic nosedive (who wants to buy a car from a company in trouble?)"

The continual begging trips to Congress and subsequent widespread publicity have done far more to convince the American public that the Big 3 are in trouble than any Chapter 11 filing could ever have.


RE: Ridiculous
By HinderedHindsight on 12/19/2008 11:20:19 AM , Rating: 2
quote:
The former union workers would have to settle for something less than their current "golden parachute" benefits. Its quite humorous how all these people start bashing the executives and CEO's for their ridiculous salaries and benefits when a company goes down....but no one does that to the unions who are responsible for the same thing. Hypocritical all the way.


While I agree that some provisions of the agreements made with the UAW are a bit extreme, I think a good majority of them are deserved by any worker, such as retirement plans and medical care if you work in a factory.

But I think even you can agree that there is a difference between what the UAW is getting and the executives who received golden parachutes.

The difference is that you have millions of dollars going to one person (or a very small select group of people) in spite of success or failure, who do not need the money in the first place, and are directly responsible for the success or failure of the business. Basically, all they have to do is breathe at work, and they get the money even if they fail.

With the concessions to union workers, the group is larger, the degree of compensation is not in the millions, more like in the thousands, their need is demonstrably higher, and here's the best part- they're not directly responsible for the companies failure.

I think given the choice of complaining over the welfare of a small group of people who don't need it, and a larger group of people who need it, it is perfectly reasonable to complain about executive parachutes. The ridiculousness of protecting failed executives is several orders of magnitude higher than the reasoning of protecting everyday workers without trust funds.


RE: Ridiculous
By Smilin on 12/19/2008 12:27:07 PM , Rating: 2
quote:
They won't lose their jobs and have to file for unemployment. The company would reorganize, get rid of the union, and turn into a shop like Toyota/Honda paying competitive wages.


In normal economic times I might agree.

Unfortunately we already have over half a million people unemployed as of just last month. There are no jobs to go to. Toyota and Honda are NOT hiring right now. The almost 1/2 million unemployment figure just released has little to do with the auto industry. So you aren't going to find a job in some other industry either.

The fact is if say GM goes out of business there will be hundreds of thousands of people going unemployed. Those unemployed people are going to stay that way too. There simply aren't enough jobs available to absorb that influx of workers. The economy is in the sh1tter right now even without the auto industry collapsing.


RE: Ridiculous
By Spuke on 12/19/2008 3:31:55 PM , Rating: 3
quote:
So you aren't going to find a job in some other industry either.
Bzzt! Half million people out of work pales in comparison to the amount of people that ARE working. And "high" unemployment doesn't mean no one is hiring. I just got a call from a perspective employer the other day and I'm not even actively looking for another job. Anecdotal? Sure, but look on Monster and other job websites. There's STILL plenty of employers looking to fill positions.

In summary, just because 500,000 people lost their jobs doesn't mean no one is hiring. Just because people that make $30k a year and lost their $500k house and can't get more credit doesn't mean no one can get credit.


RE: Ridiculous
By tastyratz on 12/19/2008 10:10:22 AM , Rating: 2
I highly doubt the unemployement payout was anywhere close - and besides the only thing this does is delay the unemployment payout and crisis to the next president. Banruptcy, consolidation, and restructuring would have saved them. This just delays the inevitable.

G dub is trying to go out with a bang lately and its leaving a mess for Obama which will shine negatively on him whether or not he actually does anything wrong.


RE: Ridiculous
By FITCamaro on 12/19/2008 10:13:56 AM , Rating: 4
Please. Regardless of what happens now, Obama will blame every bad thing in his 4 years on Bush. When taxes go up, and universal health care drains us of all our money, and carbon taxing closes businesses, etc it will all be Bush's fault.


RE: Ridiculous
By mdogs444 on 12/19/2008 10:22:46 AM , Rating: 4
Of course Obama will blame it all on Bush. The liberals out there in the world today still refuse to acknowledge that Jimmy Carter was the most awful president ever. They refuse to hold him accountable for 20% interest rates on new homes, the inflation and unemployment rates of that time, etc.

Its typical liberal posturing. When at fault blame someone else.....then try it again in 10 years.


RE: Ridiculous
By Yawgm0th on 12/19/2008 11:42:15 AM , Rating: 1
Did the right-wing not try to blame many of the problems over the last eight years on Clinton?

Some problems will be Bush's fault, some won't be. Most blame, however, won't be that easy to place for the non-ideologues among us. Either way, it is fallacious to attribute blaming current problems on previous administrations to "liberals," left-wingers, or Democrats. It happens every time a different party takes power, and oftentimes even when a party retains power.


RE: Ridiculous
By Fireshade on 12/19/2008 10:25:36 AM , Rating: 2
Well, we do get these promises from them:
# Great products, exciting design, and world-class quality.
# Fully committed to leading in energy-saving vehicles and technologies.

Too bad it takes a near-bankruptcy to get them this far ;)


RE: Ridiculous
By reader1 on 12/19/2008 11:20:30 AM , Rating: 2
If the unions were a factor then it was the big 3 that failed to handle them. They should have taken a stand against them. It's just another sign of poor management.


RE: Ridiculous
By masher2 (blog) on 12/19/2008 11:39:16 AM , Rating: 2
Absolutely. Generations of CEOs voted for short-term benefit of appeasing the UAW, rather than face the crisis we all knew was coming.

How does that change anything, though? The UAW needs to accept competitive rates, else we'll be continually bailing out these companies year after year -- hundreds of billions of tax dollars, going right into the pockets of UAW workes.


RE: Ridiculous
By TomZ on 12/19/2008 12:54:20 PM , Rating: 2
quote:
Absolutely. Generations of CEOs voted for short-term benefit of appeasing the UAW, rather than face the crisis we all knew was coming.
That's not true, and you know it. The car companies have fought hard against the UAW many times and has been pretty successful especially in the past 5-10 years. Remember, UAW strikes happen pretty often and are devistating to the auto companies. Not much a CEO can do about that other than to try to balance both sides.


RE: Ridiculous
By Meinolf on 12/19/2008 11:51:46 AM , Rating: 2
I wish I made $50,000 a year


RE: Ridiculous
By callmeroy on 12/19/2008 12:57:43 PM , Rating: 2
Actually the legitimate business news sources are saying $17.4 billion was approved but $4b will be held back until after the new year.

My mind swims in disbelief since I discovered how FANTASTIC the union autoworkers have it....from avg pay of $44/hr to the incredible benefit package they get, and they have the arrogance to say "NO!" to consessions on the first bailout plan...what friggin nerve -- replace them with one of the unemployed, ungrateful SOB's.

And most of those workers are just laborers -- its physical work but not "thinking" work. Unless you are an engineer -- the bulk of the union workers are on the assembly line though...its not like the level of skill is worthy of $44/hr...its all stereotypical union for you...charging 2-3 times the cost as the true value of the job would normally warrant.

BUT I have to tell you something I think if they fail to live up to the March 31 terms and the big three are really gonna go under -- I think the Government is gonna force the unions to conceed to HARSH terms or disband or no money...period.

Unions aren't inherently evil across the board -- but in the case of UAW they really need a dose of reality.


RE: Ridiculous
By lawrencelam2000 on 12/20/2008 5:22:55 PM , Rating: 2
The solution seems simple to me: all the retirees that are living off the Big Three pension funds need to come off. The biggest favor the U.S. Government can do the U.S. Auto Industry is to take all those retirees into a big taxpayer-funded charity "camp", give them room/board/medical services for life, and let the Big Three get on with meeting the newly-created criteria to get competitive with international automakers again. If they don't fix it without the handicap of supporting legions of retirees, then they really should be allowed to fail.

Until the retirees come off the Big Three charity rolls, it will never be a level playing field. Besides, I bet it won't cost $17B to feed all those folks for life.


RE: Ridiculous
By fibreoptik on 12/22/2008 8:28:43 AM , Rating: 2
What about the CEOs making more money than anyone for doing practically nothing?...


RE: Ridiculous
By wajone on 12/23/2008 3:24:00 AM , Rating: 2
Only in America can a company make a product that goes down the toilet because of fuel costs, go cry about their mistake and the government takes MY money to help them out when I about to loose my house. Who the @#*%$ is going to feed my daughter? I can't because all the companies smell that bail out money and now claim they may have to do bankruptcy if they don't get that bail out package.

Ya know what..... How come the American people are not SCREAMING about this? I mean really scream? Think about it. 700BILLION.... Hrm... Take 700BILLION and divide that be the number of LEGAL 18 year old and up Americans.... Put that money in the pockets of PEOPLE.... Somehow, I think that will stimulate the economy much better than giving MY money to companies that make bad decisions. Let ME make the bad decision of purchasing new homes, food, cars, etc. with that money.
This country is going down the toilet and taking everyone with it. And the people running this place only care about their own pockets. 100 years ago, there were no taxes. This county was the TOP and best country to live in. It was a time where people were PROUD to be called an American. These days, I don't know. Still proud maybe, but no longer happy to be an American. we're no longer the home of the free. We're all slaves to the government now and it just keeps getting worse. Our say no longer has teeth. The dreams of our kids are no longer happy. Their about survival now. No wonder the whole freaking world hates us. The leaders now and of the past all focus on one thing. MONEY. With money comes greed. When there is greet, the care for people disappear.
We have thousands of men and women who fought for the freedoms of this country that don't even have houses to live in. Many are completely homeless. The special people still don't get the health care they deserve. They are treated like trash now because their usefulness is done.
Only in American do we have these problems, but the important thing is that we have cars to drive. The important thing is that business owners who make WRONG decisions can still have their nice cooshie offices and bring home more than they deserve. There was a time where top execs would loose their job for running the company to the ground. BUT NO LONGER! Just ask your government to take the taxpayers dollars to bail you out!
GUESS WHAT.... ALL MY AMERICAN BASED CARS ARE FOR SALE. I'm driving NISAN and TOYOTA now! I will NOT support the American Auto industry NO MORE. You have just taken my tax dollars that should have gone to something more worthy that your sorry asses. It's a shame I have to say moving to Russia is sounding better every day.


Cars people want?
By therealnickdanger on 12/19/2008 9:52:01 AM , Rating: 2
If I recall, the "Big 3" still outsell all other car companies combined on a monthly and annual basis.

http://www.autonews.com/section/DATACENTER

They are building cars people want. Their problem is making/investing profits properly.




RE: Cars people want?
By mdogs444 on 12/19/2008 9:59:20 AM , Rating: 2
I believe GM in itself is somewhat tied with Toyota in sales figures. So all the Big 3 vs the rest of the world may be close.


RE: Cars people want?
By theapparition on 12/19/2008 10:21:58 AM , Rating: 2
quote:
I believe GM in itself is somewhat tied with Toyota in sales figures.

Why do you "belive" Toyota is tied with sales? Did you not see the OP's link?

You don't have to guess that GM sells more than any other manufacturer, just look at the facts. When you make assumptions like that, we all have to wonder what other assumptions you've made to come to your conclusion.


RE: Cars people want?
By mdogs444 on 12/19/2008 10:26:22 AM , Rating: 2
I read his link alright. Did you not notice that the link only specified sales for the US, not global? My comments were based purely by what I recall reading some time ago regarding global auto sales.

So please stop attempting to parse everyone's words....it sounds like you are the one "assuming".


RE: Cars people want?
By Finnkc on 12/19/2008 11:05:11 AM , Rating: 1
lol ... put whatever spin you want on it ... the "Big 3" (how ironic of a name) have been making crap for the last 30 years. You will see them back in 8 months asking for more, that or they are going to shut down lines and models anyway so they can make it another year. The next 2 years are going to be interesting for the US (and the World too I guess).

Brace for impact America, the sh*t hasn't even hit the fan yet and people are already falling overboard.


RE: Cars people want?
By TomZ on 12/19/2008 12:28:25 PM , Rating: 2
quote:
the "Big 3" (how ironic of a name) have been making crap for the last 30 years
Please study automotive quality and customer satisfaction statistics before you continue to make your argument (hint: JD Power). The fact is that the Big Three already have world-class quality today, which is why GM sells approximately the same number of cars as Toyota and Ford sells more cars than Honda.
quote:
You will see them back in 8 months asking for more
No, you'll see them back in 1-2 months asking for more money. $14B is just the amount needed now to bridge until the Obama administration gets in place and can deliver a more comprehensive support package.
quote:
Brace for impact America, the sh*t hasn't even hit the fan yet and people are already falling overboard.
The impact of letting the automakers fail would be more than you can imagine, my friend. Bush knows this, and so does Obama. Fortune for us this is the case, since our Congress is impotent.


RE: Cars people want?
By masher2 (blog) on 12/19/2008 3:36:26 PM , Rating: 2
> "Please study automotive quality and customer satisfaction statistics before you continue to make your argument (hint: JD Power)."

According to JD Power, The Big 3 are still behind Japanese automakers in initial quality, though the gap is small (and indeed exceeded on certain models). US automakers exceed European brands like Saab, Audi, and Volkwagon by a large margin.

However, JD Power doesn't track long-term reliability. Most anecdotal reports say the gap between Japanese and US automakers at about the 8-10 year mark is much larger. I don't know of any hard data to support that claim, but no one can deny that, if there's no fire, there's certainly a lot of smoke.

> "The impact of letting the automakers fail would be more than you can imagine"

You do realize, don't you, that the same thing was said about the US textile industry and several other large industries that have failed in the past 50 years?

In any case, I think the salient point here is that the government cannot prevent failure. A forced bankruptcy would do more to ensure GM and Chrysler remain viable entities than any amount of government funding.


RE: Cars people want?
By Spuke on 12/19/2008 5:00:53 PM , Rating: 2
Just looking at their site quickly, I found a 3 year study (Vehicle Dependability Study). Out of the top 10, 5 are American brands. Amazingly, Jaguar is one of the top 10 brands.

http://www.jdpower.com/corporate/news/releases/pdf...


RE: Cars people want?
By Smilin on 12/19/2008 12:30:23 PM , Rating: 2
That's fine. Let them come back in 8 months and ask for more. Hopefully the bottom of all this economic turmoil will be past us and we can affor the auto industry to collapse. We can then say NO and buh-bye!

For now..we gotta do this. I'm for the bailout but not because I give two craps about our incompetent auto industry. The bailout will be cheaper than the alternative.


RE: Cars people want?
By Spuke on 12/19/2008 12:56:22 PM , Rating: 2
quote:
You will see them back in 8 months asking for more
Why do people keep saying this? This loan is NOT nor was it ever intended to be the final, be all, end all loan to the automakers. It's only enough to keep them going until Obama takes office. That's all. There's no back for more later because nothing's been finalized.


RE: Cars people want?
By Reclaimer77 on 12/20/2008 9:52:11 AM , Rating: 2
Last year GM and Toyota pretty much tied for total vehicles sold in 2007.

Toyota made 17.4 billion. GM lost 32 billion.

Hmmmm, whats wrong with that figure ? Makes you wonder where all the profits went..


RE: Cars people want?
By RamarC on 12/19/2008 9:59:59 AM , Rating: 3
they're building too dang many cars! that's why there's always a glut at year's end and why they struggle to make a profit.


RE: Cars people want?
By Lord 666 on 12/19/2008 10:06:57 AM , Rating: 3
Chrysler's claim why there were slow sales and the need to shut down for one month was due to banks refusing credit to buyers.


RE: Cars people want?
By Smilin on 12/19/2008 1:35:07 PM , Rating: 2
No. They are building the cars they can make. People don't want them. They sell so many because they discount the crap out of them until people do want them. Combine that with poor cost management and they are left with no profit margin.

How else do you see more product than anyone yet still go out of business?


RE: Cars people want?
By masher2 (blog) on 12/19/2008 2:39:25 PM , Rating: 4
> "How else do you see more product than anyone yet still go out of business? "

You do by paying retirement and healthcare benefits for four times as many people as you actually have working. GM does this -- truth is indeed stranger than fiction.

You also do it by paying thousands more "job bank" members a salary and wages, even though they don't work, and may have never worked at all.

Finally, you do it by paying those few who *do* work a rate that is substantially higher than your competitors, even discounting all the previously mentioned overhead.


Support the bailout
By Smilin on 12/19/2008 12:18:55 PM , Rating: 1
Just some really quick and loose math here. There are some 3.5 million jobs related to the auto industry as a whole but I'm going to go insanely conservative to avoid overstating the point I'm going to make.

Lets go with 125,000 production line jobs. See this WSJ article for some additional numbers: http://online.wsj.com/article/SB122670818143330019...

So 125,000 at lets just say $40,000/year. Benefits would take the actual number much higher but those don't count towards unemployment.

Now lets say when these jobs are lost everyone magically finds a new job in 6months even though there are 124,999 people competing for that new job you are looking for.

60% rate of pay for unemployment.

That works out to $1.5 Billion in just the first six months that GM is out of business . I'll go ahead and say this is the best case scenario. Best case to the point of being unrealistic.

What if Chrysler goes under? Ford?
There are another 1.1 million people employed by dealers.
3 million employed for everything including parts, repair, wholesale, dealers, line jobs. That doesn't count the state jobs in Michigan, it doesn't count the retail industry that surrounds the auto. etc etc.

Try 3 million x 40k x 60% x 1 year. That's 72 billion or roughly FOUR BAILOUTS in the first year alone.

My point?
Screw GM, Screw Ford, Screw Chrysler. They deserve to go under. Screw the UAW.
But!! As soon as the sh1t hits the fan, Michigan goes bankrupt due to unemployment and the nation starts reeling the question is going to arise: What do we do to get all these people working again?

I say support the bailout simply because it is the most immediate and cost effective work program that the taxpayers can buy. Better to have a work program where people are doing *something* instead of an unemployment (essentially welfare) system that pays them for doing nothing. I'm not a socialist and I don't give a crap about the big 3 (or you for that matter). I just don't want to see MY economy tank because of some crap over in another industry.




RE: Support the bailout
By masher2 (blog) on 12/19/2008 12:38:07 PM , Rating: 2
> " I'll go ahead and say this is the best case scenario. Best case to the point of being unrealistic."

Sorry, but your figures aren't even close to the most likely scenario, much less a "best case". Bankruptcy wouldn't mean a loss of 100% of all production line jobs -- 25-50% is a much more likely scenario. Furthermore, at least some of those workers would find new employment.

Third of all, unemployment benefits don't last forever. I believe the limit is 33 weeks? And fourthly, workers pay taxes on those benefits, meaning the actual government cost is slightly lower.

Add it all up, and it works out to an expected cost of maybe $700M in unemployment benefits -- a tiny trickle compared to giving billions every month to these companies.


RE: Support the bailout
By TomZ on 12/19/2008 12:47:16 PM , Rating: 2
quote:
Sorry, but your figures aren't even close to the most likely scenario...
Your analysis, and that of the OP, fails because it doesn't take into account the job loss in the supplier chain, which will probably be 5-10X the number of jobs lost, I would guess.
quote:
Add it all up, and it works out to an expected cost of maybe $700M in unemployment benefits -- a tiny trickle compared to giving billions every month to these companies.
But you're comparing the cost of unemployment benefits (real money, not to mention the loss of tax revenue) to the cost of the loans (opportunity cost). Since the automakers will be paying the same interest rate as the government is borrowing the money (assuming they borrow and don't print), the cost to the government is roughly zero.


RE: Support the bailout
By Smilin on 12/19/2008 1:39:20 PM , Rating: 2
The supplier chain is included in my 3million estimate. Checkout that article I linked. There is a table of it on the left side.

I *think* you're right though. My guess is that things will be far worse but it requires way to much estimation to back up my assumption.

Just figure the coffee shop across the street from the Michigan state capitol right? No auto factory within sight yet they will be in deep sh1t.

No auto industry = high unemployment = high cost to the state = state budget cuts = state worker layoffs = no coffee shop customers.


RE: Support the bailout
By Smilin on 12/19/2008 1:28:52 PM , Rating: 2
The ultimate result of the current auto industry situation is leading towards chapter 7, not chapter 11. This results in a 100% loss of ALL jobs.

Gov't, Financial, and auto industry experts all agree chapter 11 is not viable. They may try it, but it will best delay chapter 7 for some months.

The best case scenario I mentioned is frankly retarded. Things will never turn out that well. I posted it that way to stop any possibility of some retard debating it...which obviously didn't pan out.


RE: Support the bailout
By masher2 (blog) on 12/19/2008 2:35:07 PM , Rating: 2
> "This results in a 100% loss of ALL jobs..."

Again, this is wildly unrealistic. People still need cars, and, excluding temporary dips like we're seeing now, people are still going to buy roughly the same number of them.

Long-term, if Chrysler stops selling cars, some other company will sell that many more. And they'll have to hire people to assemble those extra cars.

> "Gov't, Financial, and auto industry experts all agree chapter 11 is not viable"

On the contrary, thousands of financial pundits -- the people who know best -- have been saying for years bankruptcy is the best option here. As for the "auto industry", do you expect them to cut their own throat? $50 billion in free government money is a gold bonanza, that will trickle down through their fingers.


RE: Support the bailout
By Xenoterranos on 12/19/2008 4:59:25 PM , Rating: 2
"$50 billion in free government money is a gold bonanza, that will trickle down through their fingers."

This wins the "Best imagery in the thread" award. :)


RE: Support the bailout
By Ringold on 12/19/2008 2:45:17 PM , Rating: 2
quote:
Gov't, Financial, and auto industry experts all agree chapter 11 is not viable. They may try it, but it will best delay chapter 7 for some months.


A government supported chapter 11 is, however, viable, as stated by all the above "experts." Even chapter 7, somebody presumably buys those assembly plants, the brands, etc. Unless they convert their new assets to scrap metal, they'll need some original workers, no?

Plus, unemployment benefits are taken out of our paychecks. That shouldn't even be a calculated cost of failing to bail them out, because in theory we have all paid to insure ourselves for that benefit. If Michigan has not prepared to be able to pay the benefits it has taken money to provide, then that is Michigans fault. I for one would not take welfare on moral grounds, but unemployment? Social Security? I'm paying for it, so I'd eat it right up.

In case you hadn't noticed, hundreds of suppliers and a lot of assembly plants are still getting shuttered even with the bailout. There is no way to avoid much higher unemployment in the rust belt. Michigan might as well get ready for it.


Rewarding the Incompetent
By choadenstein on 12/19/2008 10:29:11 AM , Rating: 5
Man, I really should have stopped paying my bills, bought an expensive house I can't afford and take out a HELOC and run it up through the wazoo, run up my credit cards anad just watch the money come in from the government.

Instead, I did everything right and within my means... And now I will be paying more taxes and have a government that will inevitably run itself into the ground and be bankrupt.

Ugh.

Can those of us who did all the right things at least get a stipulation in each of these bailout bills and stimulus packages that we don't have to pay back any of this crap?

Like, if you take the bailout money, got bailed out of your ARM mortgage, take the stimulus money etc... etc.. You have to pay back the debt... and then have a DIFFERENT tax structure for those of us who did everything the way we were supposed to.

Sorry, not exactly on topic, but... Whatever.




RE: Rewarding the Incompetent
By Spivonious on 12/19/2008 10:38:27 AM , Rating: 2
I think when you have over $10 trillion in debt, you're already bankrupt.


RE: Rewarding the Incompetent
By Xenoterranos on 12/19/2008 5:01:37 PM , Rating: 2
When you think about it, that's such an absurd number, but there it is. Sheesh, we're in a giant ball of crap, aren't we?


RE: Rewarding the Incompetent
By Spuke on 12/19/2008 5:04:01 PM , Rating: 2
quote:
I think when you have over $10 trillion in debt, you're already bankrupt.
Better move out of the country now before the sky starts falling.


RE: Rewarding the Incompetent
By FITCamaro on 12/19/2008 11:02:11 AM , Rating: 3
I'd go for that. Those who get government help, get taxed at a socialist like 60-70% income tax. Those of us who were more responsible, get to continue under current tax rates. Too bad the vast majority of those who would be paying the 60-70% rate don't make any money (of consequence) to begin with.


are they loaning money or not?
By the goat on 12/19/2008 9:51:36 AM , Rating: 5
quote:
". . . protect the taxpayer by ensuring that only financially viable firms receive financing."


So they are not giving loans after all?




RE: are they loaning money or not?
By Nakecat on 12/19/2008 10:27:43 AM , Rating: 2
That's what they want you to believe.


UHO need bail out too !!!
By Nakecat on 12/19/2008 9:56:44 AM , Rating: 2
We should start an union like United Home Owner and have government bail us out too for the mortgage..... lol




RE: UHO need bail out too !!!
By FITCamaro on 12/19/2008 10:09:09 AM , Rating: 3
They already supposedly bailed out homeowners in July. Of course that was bullsh*t that retarded home owners in default bought hook, line, and sinker. Don't know about you but I haven't seen a dime go to home owners to help them keep their homes. Or any mortgages get renegotiated.


RE: UHO need bail out too !!!
By Spuke on 12/19/2008 1:12:23 PM , Rating: 2
quote:
Or any mortgages get renegotiated.
These types of deals were already in place from the mortgage companies themselves, you just have to go ask for them. No government interference needed.


Unusual
By TomCorelis on 12/19/2008 1:39:02 PM , Rating: 2
Is it me or does Bush actually look charismatic in that photo?