There’s still time left for the Senate Republicans to stop the insanity. The Detroit bailout plan is a hastily written piece of legislation that gives an open-ended commitment to government support of the domestic auto industry. One that makes a single individual responsible for “determin(ing) appropriate measures for assessing the progress of each eligible automobile manufacturer in transforming the plan submitted by such manufacturer to the Congress on December 2, 2008, into the long-term restructuring plan to be submitted.” And that same individual also will help negotiate a restructuring program “between the interested parties” and will then determine within a date certain whether the plans themselves lead to the expected outcome of financial viability. If not, this same individual can pull the plug by calling the loans and forcing a bankruptcy. If he or she does that, I hope they get Secret Service protection. And a Medal of Honor…
In truth, the car czar idea is patently ridiculous. One player-to-be-named-later will have the power to set the terms, negotiate the deal, and then make a final determination whether he’s done it right. Why not put Stalin in charge? This nonsense destroys the rights and interests of the parties to negotiate themselves-– or under the existing framework of the bankruptcy judicial process. Worse, there’s enormous political pressure to incorporate wacky concepts (from the Pelosi wing of the Democrat party) into the restructuring plans. We’re talking green cars, no jets, limits on exec compensation and other political aims that hamstring prudent allocations of capital.
Bad landing, wrong airport.
Other than CEO Rick Wagoner and the GM Board of Directors, the biggest stumbling block to GM’s root-and-branch restructuring remains the costs of terminating brands and dealers. GM’s latest plan to “rightsize” same is a lame attempt to pull the wool over the eyes of Congress (but not TTAC). It feebly states that GM will sell Saab and HUMMER (to whom? when? for what price?). It places Saturn in “strategic review.” Pontiac becomes a “niche brand” (as if it isn’t already a niche of nothing).
GM’s dancing around the issue: it needs a wholesale slaughter of brands and dealers, including the Buick/Pontiac/GMC “sales channel.” HUMMER, Saab, Saturn? Kill them all. Only GT can’t do it outside of bankruptcy; dealers would bury them in lawsuits from all 50 states’ franchise laws.
If Congress wants to rewrite the rules for its friends in Detroit, they should simply pass legislation that gives a one-time authority for any of The Big 2.8 to terminate brands and dealers with limited liability. The nuclear utility industry has an entire act devoted to limiting its liability in the event of catastrophe (the Price Anderson Act, passed in 1957 and renewed ever since). Why not do the same for Chrysler, Ford and GM? Just cap the amount of corporate liability in the event of franchise terminations during this restructuring period. Problem solved.
If GM really wants meaningful restructuring, it has to eliminate six of its eight brands. STAT. Focus on Chevrolet and Cadillac only. Yes a lot of dealers will disappear; some 3k or more. But it must be done and it can’t be done outside of bankruptcy. The dealers will never cooperate. It’s their livelihoods and personal assets at stake. Screw sacrifice they’ll say, we’ve already given enough.
Other than that…
Yesterday, we proposed a simpler solution. Give The Big 2.8 the bailout money they need to keep the doors open and lights on for 45 days or so. A finite amount of money, fully collateralized by assets. No risk to the taxpayers. Make these companies come up with their own plan, one that makes them viable enterprises: healthy balance sheets, limited debt and an opportunity to make profits and generate cash soon, not never. If they can’t do that outside of bankruptcy in this time period, then they’ll have to file no matter what. Put them under the Sword of Damocles.
But we’re going to add a caveat to this. There will be no additional government money. Any restructuring program must meet the tests of commercial lenders. Let the market determine whether they’ve gone far enough in restructuring, not Congress. And certainly not some “be all, know all” car czar. Let’s be sure to keep the politics out of this where we can. Otherwise it will be an endless circus. The commercial finance market will jump at an opportunity to finance a healthy automaker, perhaps with a “nudge” from Treasury.
We urge Congress to seek a “market-based” approach to solving the problems in Detroit. Any legislated attempt to loan money under conditions will certainly fail. It opens the door to political interference, and places the burden on a single individual to determine the merits of any restructuring. The horror! We say the market can function effectively if Congress lets it do so-– with a little piece of legislative help to limit liability. And a little bit of money just to get there.
Great piece. I would add this to your ‘major stumbling block’ list: the ability to magically restructure $32B of debt into $16B, as suggested in GM’s plans. What power would a car czar have to force creditors to take something like this, particularly if the debt is collateralized??? Would they seriously take equity? If they did, $16B worth of equity is a whole lot considering the market cap…
As stated many times here, Ch. 11 provides an orderly way to do this (restructure debt)…how this will happen without the B word or any legal basis is anybody’s guess…
Uh….no. This solution, while perhaps not politicized, is ignorant of the fact the we live in a political world. Those dealers and their employees vote, too.
Other issues: there IS NO market, that is the basis of the current problem, so market-based solutions are not solutions; commercial banks will not lend anything to anyone right now, so asking them to judge the success of the reorg plans is worthless.
If you want the automakers to fail, just say so. But the few billion you propose is completely wasted, as the mechanisms (the banks and the “market”) you expect to spring to the rescue just don’t exist right now.
This is not a bailout of the big 2.8.
This is a payoff to the UAW.
The big money and bailouts will begin in earnest on Jan. 21/09.
I agree. We should let the whole economy crater. High minded concepts, like whether an organization deserves a bailout or libertarian fairness, are too valuable to violate, even if it results in a long and uncontrolled depression. While waiting in soup lines, we will all feel much better knowing that we stuck to our guns and trusted the free market, which caused the crash in the first place, instead of attempting to limit the damage. At the bottom of the very deep hole, we will rest assured that the society built in the aftermath of horrendous economic turmoil will be a good one. It’s not like economic crisis has ever resulted in regrettable governments or anything.
In truth, the car czar idea is patently ridiculous. One player-to-be-named-later will have the power to set the terms, negotiate the deal, and then make a final determination whether he’s done it right. Why not put Stalin in charge? This nonsense destroys the rights and interests of the parties to negotiate themselves-– or under the existing framework of the bankruptcy judicial process.
The “car czar” isn’t destroying the framework of bankruptcy, it’s copying it.
In a bankruptcy case, this person would be called a “receiver”. The receiver’s job is to serve as a sort of referee who is supposed to make sure that the rules are followed and that creditors can get repaid as much as possible.
The problem with shutting down brands at this point is that the taxpayers would bankroll it. We would spend billions of dollars for a process that does absolutely nothing to improve the revenues of the company and get our money back.
It would have been nice if they had done this themselves on their own dime, but why should I pay for this? As the taxpayer, my desire is to collect what I’m owed from these “loans.” Once they’ve blown all the money on that, I’ll have to loan them even more money that I won’t be getting back.
Now that they have no money, it would be a better idea to starve the brands that are going to be purged. Make Chevy and Cadillac unique, and throw the junk and legacy badge engineered products into the rest. The dealers on the receiving end of this abuse will starve over time and beg to get cut from the system, with little or no cost to us. The Chevy and Cadillac dealers would win (we hope), and the rest would lose, but not at my expense.
Pch101 – You’re right, the car czar is like a receiver. Only problem is that this isn’t bankruptcy and there’s no judicial oversight. Worse, he has no powers to force an outcome. That’s why the idea is ridiculous – no creditor will bend to the extent necessary.
Qwerty :
If the U.S. government wants to help GM survive to protect the U.S. economy, well, fair enough.
As Ken’s stated, they could create a limited special exemption from state franchise laws. They could also provide debtor in possession financing once GM files for C11. There’s lots they can do to help. But this bailout ain’t it.
As we shall see…
Personally, I think the free market WILL work. It’s easy to support it when times are good. It’s important to support it when times are bad.
PS Chrysler needs to go away. Ford needs to keep on keepin’ on (at least for now).
The fervor on this site reminds me of the that TV channel with the televengelists. One note, one message. Where the hell were you on the AIG bailout? But to subsidize 200,000 working families is somehow un-American? Get some perspective. If the spineless cretins we elect have slept through a giant banking bailout, why wouldn’t we prop up the manufacturing backbone of America? I do not understand any opposition.
RetardedSparks, I must say the rest of the public outside of the automotive arena are voters too, and I don’t think I’ll be very happy if my representatives vote for this (even though I’ve communicated my disapproval to them twice in the last 2 months about the bailout.)
I’m socially liberal, but still believe in capitalist ideals. We need to let the market take it’s course, otherwise what are we setting ourselves up for? (… precedence for any large behemoth that’s “too big to fail” to apply for tax payer dollars when times get tough.)
C11 is the only way to get the Big 2 (Chrysler doesn’t count, really) to right-size themselves into something that might actually be profitable for the future.
And to respond to olddavid, your point is well taken, but the point is that the banking industry props EVERYTHING up and actually will start to make money again in the near future. That is virtually guaranteed. The Big 2 are in varying degrees of healthiness, but need C11 to kill brands and expensive labor contracts to fit in the new GLOBAL world order. Honestly I wish them luck… well mostly just to Ford since they seem to actually have a plan *for* the future.
no creditor will bend to the extent necessary.
I agree totally with that. The downside of the bailout is that the major creditors, aside from the UAW, have no incentive to play ball, because it’s now really obvious that the government doesn’t want them to fail.
As Ken’s stated, they could create a limited special exemption from state franchise laws. They could also provide debtor in possession financing once GM files for C11. There’s lots they can do to help. But this bailout ain’t it.
That may be, but it is a fundamental law of the universe that the life is not fair and you don’t often get what you want. You usually have to settle for what you can get. The bailout may be the best we can get.
I have no love for Detroit. I would probably accurately be described as one of the Detroit haters that supposedly don’t exist on this site. I would love to see the Big Three burn and would consider it justice if it happened. But I don’t want it happen if the Big Three take the whole country down the crapper with them.
In January and February how bad things really are will be revealed. The rebudgeting process for large corporation will finally kick in, and the real mass RIFs will hit. Even slimeballs like Senator Shelby will figure out that the economy is in desperate need of stimulation. Money will flow. Some of it will be spent well, most will be spent badly, but it will be spent. Dishing the Big Three a few bucks to keep them afloat will end up being a minor expense compared to the eventual total.
I am not happy with the situation–no one should be–but it is what it is. Pointing to a fantasy of how the free market should work while ignoring the reality of the situation is useless.
Keep in mind that we’re not opposing some degree of support now just to keep these guys out of Chapter 11. It’s just that reality is what it is, and Chrysler has no future of viability, while GM requires a massive restructuring. The point is that there IS a better way to do this without the government trying to manage the process. I fear that this will drag on without resolution.
RetardedSparks: Other issues: there IS NO market, that is the basis of the current problem, so market-based solutions are not solutions; commercial banks will not lend anything to anyone right now, so asking them to judge the success of the reorg plans is worthless.
There is a market…it has returned to normal after years of artificially inflated sales. Please note that the domestics weren’t even profitable when sales were artifically inflated by cheap leases, loans available to anyone with a pulse, and massive sales to rental car companies.
This infusion of federal funds will not make GM and Chrysler viable. It may help Ford, which, ironically enough, doesn’t need it at this point. But, as has been noted numerous times on this site, the business plans of Chrysler and GM basically constitute more of the same. You don’t have to be a rabid free-market enthusiast to question whether this infusion of federal funds will ultimately have any long-term benefit. Even Bob Lutz has admitted that GM will be back begging for more money next year.
And banks are still lending to consumers. They are just making sure that consumers can actually afford to pay back the loan. Which is the way it should be. That’s not a “credit crisis,” that’s a
“return to sanity.”
This is straight out of Atlas Shrugged. The imposition of an overlord on private enterprises is a disaster waiting to happen.
Qwerty, I generally agree with your viewpoint but one of the problems with the current plan is that many of the jobs are gone, no matter what. They can either disappear promptly or, if we follow the current plan, they will be eliminated somewhat more slowly, and public money flushed along with them. It looks like the current shareholders and far too many of the current management will also be protected under the current plan and I don’t see any justification for that.
I’d rather see Detroit rapidly forced into Chapter 11, reasonable financing provided to help them through it with minimum downtime at the factories that will survive the process, revive the companies in forms that allow them to move ahead as viable companies and otherwise spend the public money that we would have wasted on a long, complicated and contentious process on infrastructure improvements that will actually benefit the public.
A little OT, but the xenophobic backlash I feared is starting to happen…
http://www.detroitnews.com/apps/pbcs.dll/article?AID=/20081210/AUTO01/812100330
It’s only going to get uglier, especially if one of the domestics files for C11…
It is like the government is using, “Atlas Shrugged” as a how to manual.
There are two kinds of people who have read “Atlas Shrugged” and other novels and stories penned by Ayn Rand… In one group are those who believe her fictional worlds somehow relate to reality and aren’t afraid to refer to her work as “proof” of something important in the here and now and the other group is composed of people who laughed at her rantings and moved on.
If one reads any of Rand’s critical essays, one often finds her supporting the validity of Objectivism by referring to her own fictional works. Most of us try to demonstrate that things are true or false (right or wrong, effective or ineffective) by referring to things that exist in the real world. Ayn Rand, being the advanced Thinker that she was, didn’t feel quite so constrained. She reminds me of people like David Koresh and Osama bin Laden in that regard.
KixStart: They can either disappear promptly or, if we follow the current plan, they will be eliminated somewhat more slowly, and public money flushed along with them.
My only reason for supporting some kind of bailout is the current state of the economy. I would rather have a controlled descent than a wild tailspin into the ground. Taxpayer money will surely be wasted, but the important question is how it will affect the country as a whole.
Ayn Rand is great if you’re a 20 year old college student who knows that he is badly misunderstood and far more intelligent than the parents who are paying the tuition.
Add a couple of years of life experience to that, and Rand starts looking more like a long-winded hack who uses 800 pages to produce a pile of convoluted schlock in order to make a point that could have been made more interestingly in an essay.
You have to have a lot of suspension of disbelief when reading her novels. The main character always end up on trial, and for some reason that has not been explained, the kangaroo court permits the hero to give 50 page uninterrupted speeches without the prosecutor ever bothering to object.
Then again, the hero always gets laid in the end, so maybe there is something to be said for Objectivism.
Geeber: I agree. The market, for cars and credit, is probably back to where it “should” be. But as so many have surmised, that means C11 for Detroit and probably C7 for GM and Chrysler. All I’m saying is if that is what Ken is advocating then just say it.
The government plan is really just a way to achieve C11 without the stigma of calling it that. Any plan arrived at by Congress in 72 hours will be a mess, but the goal is only to get past Jan 20, not solve the problem. As to what the czar can and can’t do, as many in Congress pointed out last week – they make the laws and can give this guy, or group of guys, the power to do whatever they want. They can invent Chapter 12 or Chapter 99 or whatever….
Ayn Rand is great if you’re a 20 year old college student who knows that he is badly misunderstood and far more intelligent than the parents who are paying the tuition.
I think it is worse than that. It is great for fifteen year olds who think they are an island unto themselves. Her work is inherently childish. It is attractive to those who have not yet matured to the point that they can imagine having a wife and children.
Although there is sleeping around in her novels, there is something disturbing about how free of emotional attachments her characters are. She presents a bleak, sterile picture of human existence. It is embodied in her philosophy.
Remarkably, her capitalists are free from corruption, fraud, and crime, much in the same way Marx’s communists are free from laziness.
I find it amusing that people characterize objectivism and libertarianism as cold and heartless. Those that advocate any form of socialism or redistribution of wealth (including the bailouts for financial firms and automakers) advocate the government seizing by force the rightful property of one for the use of another. Somehow the belief in the sanctity of private property rights is less moral than the belief that the state has the ‘right’ to steal from citizens.
Why on earth should we seize money from (mostly) prudent individuals (and companies) to give to companies which are so poorly run that their only options are bankruptcy or handout? How is it that reallocating capital from the companies and individuals that efficiently use it to those that have demonstrated an inability to do so is supposed to ‘stimulate’ our economy?
The real tragedy is that economics is so (intentionally?) neglected by our public school system that we accept this foolishness.
I find it amusing that people characterize objectivism and libertarianism as cold and heartless. Those that advocate any form of socialism or redistribution of wealth (including the bailouts for financial firms and automakers) advocate the government seizing by force the rightful property of one for the use of another.
So, let me understand this — if you aren’t with Rand, then you must be a pinko?
I had thought that this sort of black-and-white red-baiting fingerpointing was supposed to stop with the end of McCarthyism. I guess that I was wrong.
Aw, come on, Ken!
What’s wrong with a car czar? Haven’t you seen what a fine job Hank Paulson is doing with the financial industry with a mere $700b?
Were’s your faith? Trust the Decider and his team!
This is not a bailout of the big 2.8.
This is a payoff to the UAW.
Your team lost. Lose the chip on your shoulder and move on.
What this is is a do-nothing compromise designed to offend as few people as possible, and it would have been functionally the same regardless of whether or not you wear Elephant or Donkey lapel pins
Then again, the hero always gets laid in the end, so maybe there is something to be said for Objectivism.
Sorry, coffee-through-the-nose moment there. Nicely done.
Truthfully, Rand (in real life) is rather more sexual than is commonly played up. It leaks into the books more or less as a result. You really can’t advocate “rational selfishness” and not be a more than little bit sexually overdriven.
So, let me understand this — if you aren’t with Rand, then you must be a pinko?
I had thought that this sort of black-and-white red-baiting fingerpointing supposed to stop with the end of McCarthyism. I guess that I was wrong.
I’m glad you addressed the substance of my argument. So you’ve played the McCarthyism card, what’s next, the racism card? My money (and yours, and millions of others) is being taken (by force or threat thereof) by the government for use by banks, insurance companies, and apparently automakers. Is any of the above false? If you think that it is you are more than welcome to correct me. If you think that the government has (or should have) the right to do this you may make your argument. Your post does neither.
Incidentally, I’m not a huge fan of Rand at all. I disagree with her on many points.
The Detroit bailout plan is a hastily written piece of legislation that gives an open-ended commitment to government support of the domestic auto industry.
Of course it’s hastily written. The problem has been allowed to fester for eons, the President was elusive about granting the domestic carmaking CEOs an audience, and Congress has been indifferent to dismissive. So now that everyone suddenly has to face that the problems of viability for the domestic automakers are real, with potentially massive amplification of already-extant socio-ecomonic disorder, a hellishly complex problem is not given enough time to assimilate, understand and treat. So there’s a tactical $15B bridge offered to buy more time and put the strategic response in Obama’s and the new Congress’ lap. Big deal. All this caterwauling about insanity, “final appeal” and “final final appeal” has all the credibility of Dean Wormer’s Double-Secret Probation. Enough windbagging. Let it play out and put our energy into influencing the serious initiative that begins in late January.
A car czar isn’t a bad idea, but success is highly dependent on who gets the office. I have no doubt that if a perceptive, decisive individual has the equivalent mastery and personal credibility in the automotive sector that Paul Volcker has in finance, central banking and economics and put to good use taming inflation over a generation ago, we’d all be quite happy with the outcome. The trick is finding and empowering that person.
Phil
I’m glad you addressed the substance of my argument.
The substance of your argument is that if you aren’t with us, then you must be against us.
I addressed that point. It’s a big world out there, and not everyone who disagrees with you is a socialist. You took the easy way out, instead of accepting the fact that not everyone who disagrees with you is a Marxist who prays to Stalin every night before he goes to bed.
I find it amusing that people characterize objectivism and libertarianism as cold and heartless. Those that advocate any form of socialism or redistribution of wealth (including the bailouts for financial firms and automakers) advocate the government seizing by force the rightful property of one for the use of another. Somehow the belief in the sanctity of private property rights is less moral than the belief that the state has the ‘right’ to steal from citizens.
LOL. Half your shit stolen by force! Oh, no.
Some people call that taxes. It is the way society pays for what has been collectively decided is in society’s best interest.
Wouldn’t it be great if we got all the benefits of society and did not have to pay a dime. That would be peachy. The old TANSTAAFL law makes that unlikely, but that does not mean we should not wail about our money being seized by the Evil Socialists.
Ken Elias:
“It’s just that reality is what it is, and Chrysler has no future of viability, while GM requires a massive restructuring.”
Ken, with all due respect;
GM is not viable
GM is not viable
GM is not viable
GM is not viable
GM is not viable
GM is not viable
GM is not viable
Did I mention that GM is not viable? The only difference between GM and Chrysler is that GM is bigger. That’s it. They have no future. If they could go thru a C11 with DIP financing, whether from the taxpayers or private sources, chances are they would probably not make it. Especially if there is no change in mgt. It’s that bad. If we did the viability test, the only recipient of any funds would be Ford. You could argue that Chrysler being smaller would have a better chance of a turnaround with a prepack DIP financed C11.
If GM went bust and split it’s market share with Ford and Chrysler you would have two profitable automakers. If Chrysler went bust and split it’s market share between Ford and GM – guess what? You would have a viable Ford and a GM that was STILL dying.
The substance of your argument is that if you aren’t with us, then you must be against us.
I addressed that point. It’s a big world out there, and not everyone who disagrees with you is a socialist. You took the easy way out, instead of accepting the fact that not everyone who disagrees with you is a Marxist who prays to Stalin every night before he goes to bed.
Boy, you sure are taking it to that straw man. The substance of my point was that those in favor of the bailouts are in favor of the use of force to take money from citizens to give to select companies. Where is this point mistaken? How have I taken the easy way out? I have simply described the essence of the bailouts and socialism in general. If you find the description unflattering, again, you are welcome to correct it. I disagree with the bailout for the same reason I disagree with full blown Marxism: I believe in the sanctity of private property rights. Those in favor of the bailouts are not all Marxists. I simply disagree with them. Incidentally, though I know the remark was facetious, who prays to Stalin? Wasn’t atheism a tenet of Soviet Communism?
Of course it’s hastily written. The problem has been allowed to fester for eons, the President was elusive about granting the domestic carmaking CEOs an audience, and Congress has been indifferent to dismissive. So now that everyone suddenly has to face that the problems of viability for the domestic automakers are real, with potentially massive amplification of already-extant socio-ecomonic disorder, a hellishly complex problem is not given enough time to assimilate, understand and treat. So there’s a tactical $15B bridge offered to buy more time and put the strategic response in Obama’s and the new Congress’ lap. Big deal. All this caterwauling about insanity, “final appeal” and “final final appeal” has all the credibility of Dean Wormer’s Double-Secret Probation. Enough windbagging. Let it play out and put our energy into influencing the serious initiative that begins in late January.
Wow. Some sanity, realism, and practicality. +1 And I thought this place had become a subsidiary of the Free Republic.
The substance of my point was that those in favor of the bailouts are in favor of the use of force to take money from citizens to give to select companies. Where is this point mistaken?
For one, you implied that anyone who disagreed with Rand is a socialist. Bad move.
For another, your verbiage is hyperbolic. Government uses “force” to build nuclear missiles, schools, Interstates, military bases, libraries, government buildings, and the rest. Taxes are collected under threat of punishment, regardless of what uses they have for the money.
Regardless of whether one supports or opposes some form of bailout, you can drop the rhetoric and get to the heart of the matter. You are using the term “force” because you don’t like it. Presumably, the stuff that you do like isn’t described as “force” because you like it.
The taxpayers don’t hold a line item veto. I don’t have the right to stroll up to the local police station and demand that they should not buy Crown Victorias just because I think that they suck.
Hyperbole and black-and-white thinking don’t help the analysis. If you support the bailout, then come up with good reasons to support it. If you oppose the bailout, then come up with good reasons to oppose it.
Saying that people who disagree with you are pinkos just because they disagree with you is not an argument, it’s namecalling. You can do better than that.
LOL. Half your shit stolen by force! Oh, no.
Some people call that taxes. It is the way society pays for what has been collectively decided is in society’s best interest.
Wouldn’t it be great if we got all the benefits of society and did not have to pay a dime. That would be peachy. The old TANSTAAFL law makes that unlikely, but that does not mean we should not wail about our money being seized by the Evil Socialists.
Well, technically it’s roughly 40 percent (government spending as a percentage of GDP), but yes. And it is taken by force (as evidenced by what happens to those that do not pay their taxes). You obviously do not understand my point. I support an extremely limited government (one that does essentially nothing but protect the natural rights of individuals). I don’t want anything for free. I simply wish to choose how I enjoy these ‘benefits of society’. I do not need ‘society’ collectively deciding for me.
For one, you implied that anyone who disagreed with Rand is a socialist. Bad move.
I did? This is what I wrote: “I find it amusing that people characterize objectivism and libertarianism as cold and heartless. Those that advocate any form of socialism or redistribution of wealth (including the bailouts for financial firms and automakers) advocate the government seizing by force the rightful property of one for the use of another. Somehow the belief in the sanctity of private property rights is less moral than the belief that the state has the ‘right’ to steal from citizens.” So let’s see, I didn’t mention Rand at all, and referred to ‘those that advocate socialism’. Evidently you did not read what I wrote.
For another, your verbiage is hyperbolic. Government uses “force” to build nuclear missiles, schools, Interstates, military bases, libraries, government buildings, and the rest. Taxes are collected under threat of punishment, regardless of what uses they have for the money.
Again, government uses force. I agree that in very limited cases government may use force. I stated fact. Fact is not hyperbolic ipso facto.
Regardless of whether one supports or opposes some form of bailout, you can drop the rhetoric and get to the heart of the matter. You are using the term “force” because you don’t like it. Presumably, the stuff that you do like isn’t described as “force” because you like it.
Again, I didn’t use rhetoric. I simply stated what the bailout is. Government can use force for limited purposes in my view, but it is still force.
The taxpayers don’t hold a line item veto. I don’t have the right to stroll up to the local police station and demand that they should not buy Crown Victorias just because I think that they suck.
Hyperbole and black-and-white thinking don’t help the analysis. If you support the bailout, then come up with good reasons to support it. If you oppose the bailout, then come up with good reasons to oppose it.
The first paragraph is true as far as I’m concerned (though some disagree). I didn’t employ hyperbole, nor do I use ‘black and white thinking’ (as evidenced by my belief that government may maintain a military and police force). I explained why I oppose the bailout on principle and in practice. To restate: in principle I oppose the bailout because it is taking money from all to benefit a select few. In practice I oppose it because it is reallocating capital from the (mostly) prudent and productive to those that are demonstrable failures.
Saying that people who disagree with you are pinkos just because they disagree with you is not an argument, it’s namecalling. You can do better than that.
I just reread every comment I’ve posted on this topic. Never once did I call someone a name. You used ‘pinko’, not me. Please read my posts more carefully when replying to them in the future.
Evidently you did not read what I wrote.
I criticized Rand, and I am not a socialist. Qwerty criticized Rand while simultaneously criticizing Marxism in the very same post, which makes it clear that this poster ain’t no Commie.
Yet despite this, you chose to play the socialist card, anyway. Since you’re debating with two of us who aren’t socialists, the only reason for you to bring it up is to use it for namecalling. You can go argue about socialism with the socialists, but you’re barking up the wrong tree here.
I simply stated what the bailout is.
No, you did not. Instead, you played another card in the “socialist” hand, reaching for the rhetoric of “force”. I am pointing out that all taxes are collected under threat of force, regardless of how the dollars are spent. Your pet projects are paid for with the same force as those you oppose.
Instead of being forthright and just saying that you don’t like the bailout, you label the stuff you dislike as being based upon “force.” Again, a form of namecalling — if you don’t like taxes going to that purpose, you’ll need a better argument.
There are plenty of sound reasons to oppose the bailout. At least on this thread, you aren’t offering any. “Force” and “socialism” tells me nothing about why I should oppose it, any more than “capitalism” and a lack of “force” would tell me why that I should support it.
Whatever the Stalinist crowd thinks, “Atlas Shrugged” truly reflects the current situation.
The windbags running the government and the corporations have no idea how to fix this economy.
Give the money to GM or drop it out of a helicopter? The helicopter would be a better choice. GM is a failed company and should be allowed to conclude the swan dive.
Bankruptcy and restructuring are their only chance. (unless the government keeps feeding them billions every couple months)
Yet despite this, you chose to play the socialist card, anyway. Since you’re debating with two of us who aren’t socialists, the only reason for you to bring it up is to use it for namecalling. You can go argue about socialism with the socialists, but you’re barking up the wrong tree here.
Again, I did not call anyone a socialist. The statement you seem to be referring to is: “Those that advocate any form of socialism or redistribution of wealth (including the bailouts for financial firms and automakers) advocate the government seizing by force the rightful property of one for the use of another.” So by saying ‘those that advocate socialism are socialists’ I was engaging in name-calling? I’m confused. At that point I was not addressing the bailout at all. I was simply making a counterpoint to those that were so critical of objectivist/libertarian ideology (much of which I disagree with, incidentally).
No, you did not. Instead, you played another card in the “socialist” hand, reaching for the rhetoric of “force”. I am pointing out that all taxes are collected under threat of force, regardless of how the dollars are spent. Your pet projects are paid for with the same force as those you oppose.
Agreed, all taxes are collected by force AS I PREVIOUSLY STATED:
“Again, government uses force. I agree that in very limited cases government may use force.”
It’s not ‘rhetoric’, it’s fact. I support some use of force. Goodness gracious, please read what I wrote.
Instead of being forthright and just saying that you don’t like the bailout, you label the stuff you dislike as being based upon “force.” Again, a form of namecalling — if you don’t like taxes going to that purpose, you’ll need a better argument.
Wait, saying government uses force is a form of name-calling? What is the implied insult, force-user? I’m increasingly confused. I’ve stated that I support (limited) use of government force; was I calling myself a name?
There are plenty of sound reasons to oppose the bailout. At least on this thread, you aren’t offering any. “Force” and “socialism” tells me nothing about why I should oppose it, any more than “capitalism” and a lack of “force” would tell me why that I should support it.
Wait, reasons like this:
“Why on earth should we seize money from (mostly) prudent individuals (and companies) to give to companies which are so poorly run that their only options are bankruptcy or handout? How is it that reallocating capital from the companies and individuals that efficiently use it to those that have demonstrated an inability to do so is supposed to ’stimulate’ our economy?”
Or, how about this:
“To restate: in principle I oppose the bailout because it is taking money from all to benefit a select few. In practice I oppose it because it is reallocating capital from the (mostly) prudent and productive to those that are demonstrable failures.”
I feel like I am part of some form of psychological study. I write things and they remain posted, yet it is claimed that I wrote things that I didn’t (calling names) and that I didn’t write things that I did (giving reasons why I oppose the bailout). The tenuous grasp I have on my sanity is slipping.
I criticized Rand, and I am not a socialist. Qwerty criticized Rand while simultaneously criticizing Marxism in the very same post, which makes it clear that this poster ain’t no Commie.
Yet despite this, you chose to play the socialist card, anyway. Since you’re debating with two of us who aren’t socialists, the only reason for you to bring it up is to use it for namecalling. You can go argue about socialism with the socialists, but you’re barking up the wrong tree here.
From what I gather, the post in question is:
“I find it amusing that people characterize objectivism and libertarianism as cold and heartless. Those that advocate any form of socialism or redistribution of wealth (including the bailouts for financial firms and automakers) advocate the government seizing by force the rightful property of one for the use of another. Somehow the belief in the sanctity of private property rights is less moral than the belief that the state has the ‘right’ to steal from citizens.”
So, by saying, essentially, that ‘those who advocate socialism are socialists’ I am engaging in name-calling? At that point I was replying in general to anti-libertarian arguments. And in any event, how is ‘socialist’ an insult? People are free to believe in socialism.
No, you did not. Instead, you played another card in the “socialist” hand, reaching for the rhetoric of “force”. I am pointing out that all taxes are collected under threat of force, regardless of how the dollars are spent. Your pet projects are paid for with the same force as those you oppose.
I agree that all taxes are collected by force and I agree that it is sometimes warranted; I ALREADY STATED THIS:
“Again, government uses force. I agree that in very limited cases government may use force.”
Goodness gracious, please read my posts.
Instead of being forthright and just saying that you don’t like the bailout, you label the stuff you dislike as being based upon “force.” Again, a form of namecalling — if you don’t like taxes going to that purpose, you’ll need a better argument.
So saying the government uses force is a form of name-calling? What is the implied insult, force-user? Further, I have said I support some government uses of force; was I insulting myself? I’m so confused.
There are plenty of sound reasons to oppose the bailout. At least on this thread, you aren’t offering any. “Force” and “socialism” tells me nothing about why I should oppose it, any more than “capitalism” and a lack of “force” would tell me why that I should support it.
Wait, reasons like this:
“Why on earth should we seize money from (mostly) prudent individuals (and companies) to give to companies which are so poorly run that their only options are bankruptcy or handout? How is it that reallocating capital from the companies and individuals that efficiently use it to those that have demonstrated an inability to do so is supposed to ’stimulate’ our economy?”
Or, how about this:
“To restate: in principle I oppose the bailout because it is taking money from all to benefit a select few. In practice I oppose it because it is reallocating capital from the (mostly) prudent and productive to those that are demonstrable failures.”
Both of those are from my previous posts. Am I part of some sort of experiment here? I post things (which are still shown above) only to have people claim I wrote things that I did not (name calling) and didn’t write things that I did (reasons I oppose the bailout). My grip on my sanity is tenuous enough without this.
I disagree with part of this article. Killing the Pontiac/Buick/GMC sales channel is a horrible idea. Basically, doing so would cause every Chevy factory to have production instantly cut by 30% or so, due to the fact that most Pontiacs and GMCs are rebadged Chevys. Those sales will mostly disappear and go to Ford or Toyota or Kia or who knows where. 30% is the difference between a plant being profitable and being a bottomless hole where you toss money into. And that’s not even counting the dealer lawsuits from every single one of the bazillion PBG dealers out there.
Saturn has much fewer dealers and less overlap with Chevy, plus they can be phased out in an orderly fashion (since all their product was redesigned at about the same time, the end date can be when it’s all due to be redesigned). Saab and Hummer are mostly seperate from everything else, as well as being very, very small. The only buyers for either are crazy Chinese auto companies, crazy ex-KGB Russian mobsters, or Sweden’s government (in the case of Saab). And all of the above probably will want them for basically free, so straight out shutting them down might make more sense. There will be no buyers for Saturn, other than maybe a Chinese automaker wanting a ready made dealer network (and not any of the existing models or plants).
Please, my eyes can’t stand the glare from all of this best and brightest-ness.
It’s a pity Ayn Rand and L. Ron Hubbard never had the opportunity to mate…
@ Qwerty
Remarkably, her capitalists are free from corruption, fraud, and crime, much in the same way Marx’s communists are free from laziness.
Someone who drank the Ayn Rand Kool-Aid was Alan Greenspan. His mistaken belief that bankers would self-regulate with honor, rather than self-fatten with greed, allowed the credit bubble, which led to excess vehicle sales, and now disaster because credit has dried up (among other reasons).
Wiki: “During the 1950s, Greenspan was one of the members of Ayn Rand’s inner circle, the Ayn Rand Collective, who read Atlas Shrugged while it was being written. Rand nicknamed Greenspan “the undertaker” because of his penchant for dark clothing and reserved demeanor… Greenspan and Rand maintained a close relationship until her death in 1982″
bigmass:
And it is taken by force (as evidenced by what happens to those that do not pay their taxes).
This is hilarious. The mutual contract of society as defined by law is by definition enforced.
You only counter offered thus far is that you don’t desire this level and form of governance as decided on by your peers.
So it’s really too bad for libertarians (and fortunate for the rest of us) this line of idealism isn’t going anywhere anytime soon (just like socialism or communism).