Obama Motor Corporation and Geithner LLC

gm-bailoutHere we go again. We all knew it would come. The first bailout was not enough to save the big three automakers. As I promised back during the first stages of this, here is the second auto bailout from this group of pro state-run industry Democrats. Forget that the government shouldn’t be involved in the workings of the free market in the first place (seems to be a recurring frakking theme doesn’t it?). At what point do these idiots in Washington get the clue that they are simply throwing bad money after good? At what point do the rest of the America taxpayers get to the point where they get disgusted with having to pay for a company’s survival when the company that owns that company refuses to spend the money themselves?

Ali Bama and his forty thieves on Monday will unveil a plan to give General Motors Corporation (which shall now be known as Obama Motor Corporation, or OMC) enough government aid to restructure over the next 60 days, while Chrysler LLC (hereafter known as Geithner LLC) will get up to $6 billion and 30 days to complete an alliance with Italian automaker Fiat SpA. This was leaked to the press on Sunday by two “people familiar with the plan”. 

 

Rick Wagoner

Rick Wagoner

This comes on the heels of the news on Saturday that General Motors Corporation Chairman and CEO Rick Wagoner is stepping down from his position effective immediately, at the request of the White House. Hello, does this bother anyone? I think Wagoner should step down as well. He has done a shitty job at GM, hence why they need a government bailout… again. However, Wagoner has been credited by auto industry analysts with doing more to restructure the giant bureaucratic automaker than any other executive. But to hear that Saturday the White House told him he was stepping down followed up with another bailout on Sunday tells me that the condition for receiving bailout money was that Wagoner step down. And since when does the WHITE HOUSE have the right to force anyone to step down in private industry?

 

I know what you are saying. The newly formed Obama Motor Corporation took government money and therefore the government has the right to tell them what to do. I agree with that. And that is the only reason that I won’t make a big deal about this. But I have to ask… If poor performance is the standard for a forced resignation, when can I expect the White House to force Geithner to resign? How about Barney Franks, cause he has done a bangup job as Chairman of the House Finance Committee for the last several years! I won’t ask for Pelosi’s resignation. As best I can tell her job is to be the Democrat’s biggest partisan bitch, a job that she has done better than anyone could have asked for.

President O’prompter will announce his plan on Monday (with some sort of odd plastic shield with words on it in front of him…Weird). It will demand further sacrifices from the automakers and bankruptcy would still be possible if the automakers failed to restructure. It includes government backing of warranties for GM and Chrysler vehicles to give consumers confidence in the U.S. automakers’ cars and trucks. I am personally hoping that he will make the announcement on a surprise guest appearance at the Hollywood premier of “Fast and Furious” with Vin Diesel, who will be announced as the new CEO of OMC. It would be more appropriate for our talk show President, wouldn’t it?

bailout-steroidsGM has already received $13.4 billion in government loans and Chrysler has survived on $4 billion in federal aid. In progress reports filed with the government in February, GM asked for $16.6 billion more and Chrysler wanted $5 billion more. These figures don’t include the $15-$20 Billion that the Canadian government has also pledged to bailing out the auto industry (they depend on it too). The “anonymous officials” said the administration did not view Chrysler to be viable as a standalone company. Under the plan, the government would provide up to $6 billion to forge the alliance between Chrysler and Fiat, but if the companies failed to reach an agreement or find an alternative plan for viability, Chrysler would not receive additional federal aid.

However, I say screw Chrysler in the first place. As I noted back on December 8th here: Let the Oil Companies Bail out Detroit (UPDATED) « Stand Up For America. Chrysler is owned by Cerebrus Capital Management, one of the largest private equity investment firms in the united States. CCM also owns Bushmaster firearms, Remington Firearms, American Coach Bus Lines, Bayer Pharmaceuticals, National and Alamo Car rental, and a 51% share of General Motors GMAC Finance Group (and this is a VERY partial list of what they own)They should have some cash to put into failing Chrysler, right? Although Cerberus owns 80% of now troubled Chrysler Corporation, it has refused to inject cash into Chrysler. But we are supposed to inject the cash that Chrysler’s owners REFUSE to inject.

General Motors, meanwhile, would have a limited window to work with the United Auto Workers union, bondholders and other stakeholders and would receive an undisclosed amount of “interim financing” over 60 days to restructure the company. If GM failed to reach the concessions needed, some type of bankruptcy could be used at the end of 60 days, the officials said. Good, at least bankruptcy eliminates the need to pay back any creditors, like the silly American Taxpayers for example. 

congressional-motorsThe administration planned to send a team to Detroit to help with the restructuring of Obama Motor Corporation during the next 60 days. With Wagoner’s departure, new management would be decided by General Motors’ board of directors in consultation with the government (Read as: Rahm Emanuel and Timmy Geithner will pick the new CEO). An official said a majority of the GM board was expected to step down.

Under the terms of a loan agreement reached during the Bush administration, GM and Chrysler are pushing the UAW to accept shares of stock in exchange for half of the payments into a union-run trust fund for retiree health care. They also want labor costs from the union to be competitive with Japanese automakers with U.S. operations. Neither GM nor Chrysler have deals with the union on the trust funding or concessions from their debtholders and the administration has been trying to accelerate those efforts.

shitty-carsGM and Chrysler, which employ about 140,000 workers in the U.S., face a Tuesday deadline to submit completed restructuring plans, but neither company is expected to finish its work. The administration’s plan would be designed to accelerate those efforts. GM owes roughly $28 billion to bondholders. Chrysler owes about $7 billion in first- and second-term debt, mainly to banks. GM owes about $20 billion to its retiree health care trust, while Chrysler owes $10.6 billion. In February, GM said it intended to cut 47,000 jobs around the globe, or nearly 20 percent of its work force, close hundreds of dealerships and focus on four core brands: Chevrolet, Cadillac, GMC (now OMC, I can’t wait to see what the new logo will look like on the front of the trucks!) and Buick. Chrysler said in its February report that it would cut 3,000 workers and eliminate three vehicle models, the Dodge Aspen, Dodge Durango and Chrysler PT Cruiser.

I have a better idea for GM and Chrysler. Go ahead and use this money to start re-tooling your manufacturing plants to build Hyundai’s and Toyota’s. The US auto industry is dead for you two. Ford seems to have managed to pull itself out of the fire. The loss of 140,000 jobs will be absorbed quickly (well actually only 90,000 jobs since they already plan on cutting 47,000 and 3,000). For all of you who say the jobs associated with the US auto industry are far greater at 2.4 million jobs, listen up: Those jobs won’t go away, you will just be doing them selling Nissan’s, Honda’s, and Toyota’s. In fact there may be an increase in those jobs because those brands outsell the Big Three anyway. And with no other American choice they will dominate. 

Or here is a more novel idea. Let the free market just do its thing. If there is a place for a US automaker to compete in the market, then the failure of GM and Chrysler will simply open the door for some new entrepreneur who will come forward and start a new American motor company to replace them. That is how the free market works folks. We don’t let government bail out anyone. The free market fills all vacuums on its own. These bailouts do nothing but keep old crooked companies afloat instead of allowing the free market to replace them with fresh new faces.

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Comments

  1. I don’t know how old people who frequent these pages are, but I am dating myself when I say that I have ridden in a 1937 Chord, The FIRST American made automobile that was front wheel drive. Not in 1937, mind you I wasn’t born until 1943. That company went out of business and no government bailout was ever given to them. Nor to the Packard, Kaiser, Hudson, Nash, Studebaker or AMC. I remember that the 1952 Hudson Hornet could outrun any Ford made police cruiser without breaking a sweat. And it got over 20mpg while doing it. Nobody could beat the cornering ability of the Chord, the air ride of the Packard, or the radical styling of the Studebaker.

    Needless to say that all of the above mentioned vehicles were very good cars in their day. That fact didn’t keep them from going under due to lousy management.

    Does anyone remember the VW Bug? It was designed partly by Adolf Hitler and partly by a genius named Porsche. The original design had a 25 – 35 HP air cooled engine. I had a girlfriend that had a 1957 model in the early 1960’s that had a 40hp engine. I drove it on a CA Freeway at speeds up to 65mph between Oceanside and the city of Orange every weekend. Fast, economical and reliable. And cheap. VW’s are still being made in Mexico City. It seems that Germany’s automakers know how to manage their businesses. Perhaps we should take lessons from them.

    • USWeapon says:

      G.A.

      There are lots of lessons that the big three US automakers should be taking from their foreign competition. Lesson #1: Build a better car. And the interesting thing about the failure of all of the companies that you mention is that they didn’t get a bailout, they folded, and the free market replaced them with another automobile company without missing a beat.

      • The truly sad thing is that both Ford and GM have their own forign made cars that fit these descriptions. What has happened here is that the UAW is driving the decisions for what to build instead of the business managers.

    • esomhillgazette says:

      Wasn’t Packard bought or absorbed by Cadillac? LOL The NEW VW Bug isn’t anywhere near as good as the old one was. Also doesn’t get as good gas mileage. And they are WAY more expensive.

  2. GM and Chrysler’s plans are not viable. They never will be to the UAW decides to play ball. Bluegrass Pundit

  3. Studebaker started out producing electric cars,taxis and buses.Way ahead of their time,weren’t they?They eventually were forced to produce gasoline powered vehicles.Today that really seems too bad.They procuced fine automobiles until 1966 when a series of factors drove them out of business.No talk of a government bailout.That didn’t happen until 1979 when we first agreed to foot the bill for loans to Chrysler.They should have been allowed to die off then.The money was repaid that time.This time there isn’t a chance.I don’t believe there’s even a pretense anymore that this money is anything but gifts to a few creditors that should be allowed to go broke along with the ill managed companies they chose to back.

    This charade of GM and Chrysler is going to play out until all players are satisfied that there isn’t any more taxpayer cash available to steal.I don’t know the magic number ,but someone does.Two more months to come up with a restructuring plan while taxpayer funds are injected to pay the bills.I’m assuming both the operating expenses and the debt load will have to be funded.Any bonuses promised will naturally be deferred until after the dust settles.

    Allow GM and Chrysler to disappear now.Today.Tomorrow or the day after is just going to cost the taxpayer more money.

    By the way;the only entity in the U.S.business world that carries Studebaker’s name today is a bank.

    • Kristian says:

      Amen brother,let em fail because there are enough car companies out there to fill the gap should one of the big three go under. The only one of them that I have even a modicum of respect for is Ford, but that is only because they have passed on any bailout from the government, so far. Maybe if these companies see that they are easily replaced by companies that not only make a better product but do it for less, they’ll figure out that they really need to change. The scariest part of all of this though is the involvement of Mr. O’Prompter. He’s already getting OJT for the Office of the President, I think maybe he should concentrate on that.

  4. This is still union payoff for the election. They provided big money and they apparently don’t feel paid off yet, so more money coming their way. I am just so sick of this crap every single day…..

    • Couldn’t have said it better myself. The unions are truly running the show here.

      • RSterback says:

        You want to make the US automakers profitable?
        Ban the U.A.W. Labor unions are a dinosaur that should have died 20 years ago. Watch the cost/price of a US auto drop like a rock!!!

  5. USW – Great graphics again!

  6. It really looks like we are headed towards at least one (OMC) government owned and run auto manufacturer. I’ve typically been a fan of American made automobiles and tried to do my part to support them. My wife and I currently own a Ford and Dodge. The Ford car is a piece of junk, the Dodge truck seems to be pretty good – so far.

    You can bet your last dollar that there is absolutely no way I would buy a car from GM or Chrysler right now with the government handouts they have received. Furthermore, I would never, under any circumstances, buy a vehicle made by a government run company. You think they make crappy cars now, just wait until the government is totally running the companies.

    GM and Chrysler are really shooting themselves in the foot here by selling themselves to the government. Most people, if given the choice between a government made piece of crap and a foreign made car that is pretty good, will choose the better product – basic economic principles WILL win out, no matter how much lipstick the government puts on their product.

  7. esomhillgazette says:

    Until the or unless the UAW decides that they are going to have to turn loose of some of their power over the Big 3 and the workers decide that they can take some pay cuts, the Big 3 are doomed. IMO GM and Chrysler are already dead. I really hate it for GM solely because I really like their trucks. Those they make pretty good even though they cost too much. But Adios Amigos is all I can say! More than quality, I believe the UAW is more responsible than anyone for their demise. They have consistently refused to give up ANYTHING at all. You would think cuts and consessions would be better then no job at all. It’s gonna be awful tough finding a job in this economy when all you know how to do is put 1 part on a vehicle on an assembly line. Guess i’ll just have to buy Japanese cars and used trucks. That really won’t bother me since I have never had a new vehicle anyway. I do have one question for aliBama though. How is he going to save the auto industry while at the same time forcing stricter mileage and emmission standards on them, and forcing them to retool for more “green” vehicles too? On another track,when I was 17,(1980) my daddy bought a new Datsun(Nissan) B210, now called a Sentra. That little gem go 46 miles per gallon, lasted into the 90’s with nearly 300,000 miles on it and the only reason he still doesn’t have it is because he couldn’t find a transmission for it. The other day I heard Nissan bragging about a Sentra getting 30mpg on the frickin’ highway. Why is this? It’s not just Nissan but ALL cars. A Honda Civic used to get 65mpg. It is because they (Japanese) used to make simple cars FOR the gas mileage. That was why we bought them to begin with in the 70’s and 80’s. Then the luxury and power fever hit America. Cars had to be both more luxurious and more powerful thus the (temporary) comeback of the Big 3. If the foreign automakers don’t learn this lesson in a few years it will be their turn to start having problems. Most especially if everyone including the U.S. are turned over to the U.N. Obama and Geithner are already considering this, and the U.N. has an absolutely ridiculous “Green” plan. Even worse than Obama’s. But that particular issue is for another article I reckon.

    • I agree with you on the gas mileage. When I first started driving, we had a 83 Ford Thunderbird that got 30mpg hwy. Our 03 Ford Taurus gets 30 mpg hwy and is 20 years newer. It is also much larger and more comfy than a Nissan Sentra or any other compact car that also gets around 30mpg hwy. What gives?

  8. It is the best way that this ridiculous way of managing money could have been brought to an end

  9. I enjoyed Black Flag’s “Idaho Secedes” Scenario from the other day, so I thought I’d take a stab with my imagination on an “OMC” Scenario from my daughter’s (19) perspective as a customer…It’s silly, but I REALLY, REALLY hope that I’m just having some fun with it!:

    *******
    Richmond, VA – May, 2012 – OMC Dealership

    Jessica to Salesman: Hi, I’ve finally managed to save some money to buy a car; I’m hoping to use it as a down-payment for what I’ve been dreaming for 5 years now. I’ve worked really, really hard to get what I want!

    OMC Salesman: Jessica, that is wonderful. Tell me, do you have any children?

    Jessica: No, just my dog. I can’t wait to be riding in the wind with the top down, putting the metal to the floor and listening to my favorite music!

    OMC Salesman: Hmmm…let’s see what we can do. (looks at OMC Table – Single Person – Land Craft Fulfillment in the OMC Compliancy Guide (version 10.a.1.5:00am – 05/2012)

    OMC Salesman: Well Jessica, the way I’m translating this, it looks like you are able to buy the Squid5000x. That’s the sporty model. Look, it comes in Black, Brown, White and Tan.

    Jessica: I really don’t like that – It’s ugly and it makes me want to puke. Plus, I think I said that I wanted a red convertible. That doesn’t have a convertible top.

    OMC Salesman: Well…it does get great miles, plus it has a very, very low Cap & Trade credits associated with it. Convertible tops add extra credits because it drags on the aerodynamics.

    Jessica: Look, I really want a red convertible that’s sporty!

    OMC Salesman: Jessica, I am really sorry, but OMC’s policy states that you don’t qualify for that. Wait a minute. Do you ever plan on driving a Miss Culture Diversity Beauty Queen in the State-Sponsored, “O” Day Parade…we can possibly get around this if you will agree to do that. That would require you to go to the Courthouse and take out a sworn affidavit and pay the CDBQ Hack Tax.

    Jessica: Uh, no.

    OMC Salesman: I understand. Listen Jessica, at this time I can only get you in the Squid5000x. That is all that you qualify for. Now, if you had some children, then you would qualify for Pop_em_out 9000. That’s a nice car, plenty of room and with a paint job to die for, sky blue with clouds! Plus, it has the most amazing safety features. When you open the door, red lights flash and this really cool arm sweeps out in front of the vehicle.

    Jessica: No, that doesn’t appeal to me either.

    OMC Salesman: hmmmm

    Jessica: How about a truck, that’s my 2nd choice?

    OMC Salesman: What do you do for a living?

    Jessica: Right now, I’m a waitress in a Pizza Joint.

    OMC Salesman: Oh, you don’t qualify for a truck, you must be providing “construction” services to the Republik before you qualify to purchase a truck. Sorry.

    Jessica: Getting really angry, tells the Salesman to “Go to Hell”, leaves and decides to go buy a new horse with the state mandated side-cart for the dog. She thinks, “Heck, the horse is cheap even though it does have Cap and Trade credits on its flatulence that she must buy!”
    *************************

    Sure wish I could continue having fun, but I have to work now! I hope that I’ve brought a smile to your face! Bye…

    • Karyn, I think the White House has “dreams” like this also……

      • Hi Kathy…Yes, well, I agree, but would like to clarify and say that the White House has a particular type of “dream” that involves the word “wet”.

        This an absolute nightmare to me (even though I submitted this with tongue in cheek intent).

    • esomhillgazette says:

      The only thing wrong with you scenario is thay if the Peoples Republik of Kalifornia gets it’s way, you won’t be able to buy a Black car there. It uses too much energy to keep it Kool in the Summer!

      • You got that right Esom!

        Plus, I left out the application tax to have the OMC Salesman to be able to even look to see what Jessica could qualify for because of her demographics!

  10. Not to defend big three miss-management, but I wonder how much government regulation affected them? With OSHA, EPA, IRS and others. I like clean air, but do we really know what it costs? I have vehicles here right now that inject diesel into the exhaust system to burn hot enough to meet environmental standards. Law suits, Ford lost two in the late 80’s. First one, E350’s had exhaust too close to fuel tank, causing it to heat & pressurize, resulting in some fires if the gas cap was opened WHILE ENGINE RUNNING. Second, owners manual called for 50/50 to 60/40 anti-freeze water mix. They had engine fires when owners ignored that guideline and ran 100% anti-freeze.

    I was trying to figure put how many companies have now been nationalized,
    Fannie May
    Freddie Mac
    AIG
    Nasdaq has a listing of TARP companies as QGRI. They assigned them a starting value of 1,000. Today they are at 670. And I wonder, is there ANY government run organization that would not be bankrupt if it were private? The postal system is a good example of what we can expect from these OPR’s.(Obama, Pelosi & Reed.

    • Another example of government run organization that would have been bankrupt if it were private – Amtrak.

      • And Amtrak hasn’t turned a profit in 40 years. They did get $2 Billion from the Economic Spendulus Bill though.

    • Illusion,

      Fannie, Freddie, all port authorities, the MTA here in NY/NJ,most airlines, Housing Authorities, Amtrack etc are all quasi-governmental agencies created because the private entities could not,would not or were not allowed to provide the same service.

      If you follow the current mess in NY where the rise in subway and bus fares is going to be “astronomical” (their words) if they don’t toll the last few free bridges over the East river, you will find one thing all these agencies have in common. They refuse to open their books.

      Being quasi-governmental, they are neither fish nor fowl. Unlike government agencies, there is no government oversight. Not being private, there is no competition and they are exempt from government regulation. As an aside, years ago I was shocked to find out that Federal Section 8 new construction in New York City could ignore zoning and NY construction codes. The State and City housing authorities were allowed to ignore the rent regulation foisted on everyone else.

      So, what you have here, is like Obama’s Czars, people who have tremendous power but absolutely no oversight.

  11. I believe two things when it comes to this issue. 1. The UAW basically priced the employees they represent out of a job. That was to maintain there huge salaries and the leaders of the UAW should be fired. All unions, will always say “we want the best contract for our members”. Thats fine except for the fact that the union bosses don’t know spit about business. 2. GM’s desire to pump out vehicles at the speed of light has produced a poor product. GM’s leadership should be fired for being greedy and agreeing to the outrageous union demands.

    I am against any bailout of any company. If they fail, they fail, tough luck. The very poor business practices being utilized by GM, AIG, and everyother company that is failing or will fail, should be looked at as to why these educated people are making these poor decisions. I used this line once on a boss who made a dumb decision, quote “you should get a lawyer” boss “why”, ” to sue the college you went to for a refund, cuz your didn’t learn anything”.

    After all thats gone on lately, maybe it’s what they are learning that is the problem. Any thoughts?

    • I’m just not sure that it is always poor business practices. GM cars are good. In comparison to the foreigns, even with their “legacy” costs, they are pretty darn efficient.

      AIG had everything to do with greed and the business mantra of the ’80’s and ’90’s “get the money out on the street”. Those who created that mantra knew they would be long gone when the chickens came home to roost.

      The question becomes, how do you compete when the playing field is uneven? Foreign manufacturers are almost arms of the state. We used to joke and say “what’s good for GM is good for the country”.Well, for us it was a joke with a ring of truth in it. For them, it is Gospel.

    • esomhillgazette says:

      I agree with G-man here. The main problem with our auto industry is their unions. As far as unions go, the UAW is one of, if not the most powerful unions in the Nation. The workers have let their unions bosses screw the companies they work for until they can’t be competitive. ALL car companies make lemons. I have owned both good and bad of all kinds from American made to Foreign. So their cars are pretty well made for the most part. But with the Legacy costs, wages, and government regulations, the AMERICAN Auto Industry will not survive. Out of those 3 expenses, the only one they have a prayer of changing is the wages. As much as an auto worker makes, I would think they could afford a pay cut better than a pay cut-off. I’ve seen 100’s of clips of auto plants but never seem to see anyone but the robots working. All the humans are either standing or walking around why is that? My point is, they AIN”T doing $75hr worth of work. I used to have a higher skill job than ANY auto assembler, made $16hr, and worked my frickin’ ass off! I am now crippled up because of it. So pity for them, I ain’t got. I know G.A. decaff, decaff!

  12. Ford Motor Company was the last of the big three to unionize. As I remember the story, Ford was the highest wage payer in the ’20’s before unionization. When asked by the Mott’s of GM and Walter Chrysler why he paid his workers so much, his answer was so that they could afford to buy his vehicles (enlightened self interest?). In the thirties, Ford was forced into unionization and I mean forced.

    I have a totally different take on why the big three are in trouble. While it is very true that there were some bad business decisions, I owned a 70 something Mavrick and a 75 Nova (both dogs) I also owned a Fairlane (sweet ride) and a ’70 Nova. Got 225,000 on that Nova before I sold it. By the mid eighties they had worked it all out. Have had a succession of Dodge Caravans while the kids were growing up (85-now) I have grown to love the things. One even took a head on from a drag racer with wife and kids inside and the damage never even entered the passenger compartment. Shortened the car by 18in. though.

    Unfortunately, what I see is a a fickle American Public, led around by the nose by the media. The big three have produced great cars, unsubsidized, but, if the price of gas goes up, Americans abandon the big three and go to foreign owned, heavily subsidized, vehicles. These foreign companies can continue production of smaller more fuel efficient vehicles because of the subsidies they get even if they are not selling. Our big three cannot have dual product lines.

    The other problem was exemplified in the town next to me which I referred to as “little Sweden”. An upwardly mobile, yuppie town, most residents wouldn’t be caught dead in an American car. It was Volvo’s and Saab’s. The few exceptions seemed to be Mercedes. To this day when I talk to those folks about my Chrysler mini-vans, they go on and on to me about lack of reliability. They won’t even listen to what I have to say being so smug and full of themselves. The reality is that they are, in my opinion, all flash and trash.

    Maybe I’m protectionist, maybe I’m not enough of a free market trader, but I do believe that this country should maintain self sufficiency even at the cost of a subsidy. I know, gadzooks! Horrors! etc. but I caution you all. Remember it was Ford who built that bomber plant at Willow Run during WW 2. Chrysler developed the M-1 Abrams and the big three all out produced Japan and Germany combined back in the day. Do you really want to turn that all over to foreign flagged manufacturers. Do you trust them that much?

    Unions are sometimes good, sometimes bad. Have I had problems with them, personally? Yes, absolutely. However, if you have studied the American labor movement in any depth at all, you will find that Charles Dickens was not that far off the mark with his portrayal of mid 19th century English Capitalists. To kill off unions, one of the primary mechanisms that created our middle class is insane. Do you really think those arbitrage guys give a damn whether you live in a house or a cardboard box?

    Life is a series of lessons, most lessons are of the connect the dots variety. Where have we lost market share and why? Flag said that we were the only one left standing industrially after WW 2. He is right. How did the others challenge us? Well, first of all, we rebuilt their industrial base. Then they got smart and subsidized their industries to bring prices down low enough to grab US market share. After a while, our manufacturers stopped manufacturing. Then prices rose on imported goods but our manufacturers were no longer there to benefit. Today there is no US shipping industry, airlines are in trouble, steel is in trouble and almost gone, autos are in trouble, electronics are gone, aircraft manufacturing is ok but has, like the automakers, been reduced to the big two from the big six. Not much left out there and they all have the same connect the dots matrix. Foreign manufacturers, using subsidies, have driven them to the edge of extinction. Just the other day, surrounded by semi’s on Rte. 80, I thought of that brilliant Bush/NAFTA move, to open the US trucking industry up to Mexicans. More decent, middle class jobs leaving the country.

    I think that I would like to paraphrase Lincoln here, “Free trade and competition were not meant to be a suicide pact”.

    • All good points. There are many different views written here, and all of them ring true. I drive a 1990 GMC pickup, 213000 miles and runs great, so I will miss GM if it goes belly up, their trucks are great. I’m listening to the senate debates on the budget, what a mess we will be in if this thing gets past as is. No matter what the future holds for us, the one thing that the govt can’t break, is the American Spirit. That will carry us through these troubled times.

    • Black Flag says:

      Do you trust them that much?

      Trust is not an issue.

      They seek the dollar, and with that, must provide to the consumer. If they don’t, they don’t get the dollar.

      Thus, who cares about trust?

      Unfortunately, what I see is a a fickle American Public, led around by the nose by the media. The big three have produced great cars, unsubsidized,

      Au contraire – they have been heavily subsidized. You just haven’t looked for it.

      The artificially-low interest rates are a massive subsidy for the auto industry.

      but, if the price of gas goes up, Americans abandon the big three and go to foreign owned, heavily subsidized, vehicles. These foreign companies can continue production of smaller more fuel efficient vehicles because of the subsidies they get even if they are not selling.

      And if the Japanese citizen wants to pay 25% of my car, what is the problem?

      I mean, if I offered to pay 25% of your new car, you’d take my offer without a second thought.

      Someone else subsidizing you is a great thing.

      Our big three cannot have dual product lines.

      Why not?

      They have lots of different models – trucks, vans, car, sports, etc. Big, small….

      Of course they can have as many products as they want to make.

      The other problem wa The reality is that they are, in my opinion, all flash and trash.

      It’s their dollar, not yours or mine. Let them eat cake.

      Maybe I’m protectionist, maybe I’m not enough of a free market trader, but I do believe that this country should maintain self sufficiency even at the cost of a subsidy.

      Why?

      Why should I pay for something that I don’t want?

      Self-sufficiency is a myth – it does not exist.

      Do you really want to turn that all over to foreign flagged manufacturers. Do you trust them that much?

      Why not?

      You want them to buy US military products – you trust them enough to sell our weapons to them – they seem to trust us to buy from us.

      Unions are sometimes good, sometimes bad. Have I had problems with them, personally? Yes, absolutely. However, if you have studied the American labor movement in any depth at all, you will find that Charles Dickens was not that far off the mark with his portrayal of mid 19th century English Capitalists.

      His view was nonsense and biased from the fact his father was in debtors prison for most of his adult life.

      The fact was that industrialized Britain so increased the standard of living for the people, that everyone flooded into the cities for the chance.

      If life was so bad, why did they come?

      To kill off unions, one of the primary mechanisms that created our middle class is insane. Do you really think those arbitrage guys give a damn whether you live in a house or a cardboard box?

      No, I chose my own house earned with my own money.

      Unionization is the death of America industry. It is a form of kidnapping. Because factories cannot move, unions – with the power of government enforcement – can seize the property and prevent the owners from using it, forcing the owners to negotiate a ransom.

      Unions do not exist where the means of business is able to avoid the ransom, such as software companies. A union comes in, and 30 minutes later, the means of business has been transferred somewhere else.

      It is bizarre that an unskilled worker gets paid at the level above $5/hr.

      Then they got smart and subsidized their industries to bring prices down low enough to grab US market share.

      That was great deal for us. They returned all our funds and more doing this. They took their wealth and gave it to us by subsidizing us!

      More of this please!!

      • Ahh, here we go again. It is not so much that we live in alternate universes, it just seems that way. Actually, your ideal world and my real world are the problem.

        Point by point.

        Trust, in this instant refers to their governments agreeing with our government on a course of action. I know you disagree with the action itself, but France’s refusal to allow us to overfly them in the Libyan raid probably cost us that F-111 and crew. Should they disagree with us on the use of military force, will they be willing to continue selling us the hardware we need. (Remember, I’m not talking an ideal, war free world here)

        Their subsidies are one hell of a lot bigger and more direct that ours. Their subsidies have been and are aimed at destroying our industry. This gives them bigger market share as well as less competition. It’s acknowledged that politics or statecraft is “war by other means”. I would postulate that international trade is too.

        I guess if I am guaranteed a subsidy for life by you I would take it but, as you well know, there ain’t no such thing as a free lunch. TANSTAAFL.

        Product lines, you may have me there, however I still see my foreign friends as being willing to subsidize a losing proposition, a lot longer that we are. But then Americans rarely take the long view on anything.

        I guess in a one world government I could say let my neighbors eat cake and buy what the hell they want but in a nation state where one’s decisions have very real effects on others and then come back to haunt you (the town I was talking about is almost all stockbroker types) I reserve the right to complain about their selling their fellow citizens down the chute.

        Self sufficiency may be a myth but you yourself, as an individual, recommend that we become as self sufficient as possible. I merely see it on a larger scale.

        I do not want to have to go to Japan or China to buy a military Jeep, or boots for my troops and have the risk of them saying no in an effort to affect my foreign policy. Maybe it ain’t fair but that’s the way it is.

        Molly McGuires, Pennsylvania coal fields late 19th century. Breaker boys, no health insurance, no chance to buy in other than the company store, black lung. Tennessee Ernie Ford’s “16 Tons” propaganda? Maybe, but. Still think Dickens was right. In an ideal world, or a company run by you or I or Henry Ford, everyone would be treated fairly but we know that’s not the way it is. Oh yeah, they came to get the hell off the farm where they sharecropped for Lord Somebody. Same reasons rural blacks came North in the 40’s and my folks came from Pennsylvania to NY in the ’30’s. Look up Triangle Shirtwaist Company fire. Corporate benevolence at it’s best.

        As previously stated, unions can be good or bad. There is a time and place for them. If you think it bizarre to pay unskilled labor $ 5.00 per hour in deflated dollars, does this mean you are an advocate of price/wage controls? Most important job in the world? Plumber. Why, because we would all be dead of disease without him. Just try to get a Yuppie to believe that.

        Yes, it was a great deal for us, or so we thought, at the time. But, after they increased their market share and our competing unsubsidized businesses went under, was it still such a great deal? If so, why do the balance of trade deficits look the way they do.

        In a global economy, we may never be self sufficient but I do think that, in the current economic meltdown, we have learned something. An exclusively service based economy is no economy. If Mr. rich capitalist goes down the tubes, he won’t buy the yacht I produce, won’t be staying at my hotel, eating in my restaurant, buying my imported designer suits etc. I had damn well better be able to produce something that everyone needs and wants.

        • Its kind of interesting France has asked to re-join NATO. You make some good points I’ll pass on to see flags response.
          Possible side note, like France, most foreign countries are not our “friends”, nor enemy. Self interest driven with an agenda. And I think that’s where most of our leaders have failed us in our foreign dealings, by not applying free market principles to them.

      • Black Flag says:

        Ahh, here we go again. It is not so much that we live in alternate universes, it just seems that way. Actually, your ideal world and my real world are the problem.

        It has nothing to do with “ideal” world’s at all, but much misunderstanding of economics.

        Should they disagree with us on the use of military force, will they be willing to continue selling us the hardware we need. (Remember, I’m not talking an ideal, war free world here)

        Somehow, with a military budget greater than the rest of the world combined, we aren’t about to “run out” of weapons.

        Their subsidies are one hell of a lot bigger and more direct that ours.

        Yahoo! Give me more free money!!

        Can’t have a discount big enough for me!

        If Walmart discounted everything by 50% by forcing their employees to cough up part of their salary, unless you work for Walmart, would you complain?

        So your complaint here is strange! You want the citizens of another country bankrupting themselves to give you money!

        Their subsidies have been and are aimed at destroying our industry. This gives them bigger market share as well as less competition.

        This is an economic fallacy.

        Every action of this type is in you favor. They are giving you money. They want to give you more money. Take it while you can.

        When they stop, you can buy from India instead.

        I guess if I am guaranteed a subsidy for life by you I would take it but, as you well know, there ain’t no such thing as a free lunch. TANSTAAFL.

        Exactly. They are bankrupting their own nation.

        Since their cars cost X, but they can’t sell the car at X, they are subsidizing the cost by X-Y. That “-Y” is coming out of the pockets of their country, to you. You are gaining a product worth “X” at a price much less than “X” – that is extra wealth in your pocket.

        There is no free lunch – they are paying part of your bill – simply for the illusion in their country of employment and industrial growth. But it is an illusion.

        But then Americans rarely take the long view on anything.

        You misunderstand American business. They most certainly see far into the future – far futher than anyone in government.

        That is why they left the USA when they did. They simply cannot compete with the costs of off-shore industry. And we should be very happy with that. That means our workers are in high demand (thus high wages) because they are doing something more productive then turning a bolt.

        I reserve the right to complain about their selling their fellow citizens down the chute.

        They aren’t – they are making you wealthy and you’re fighting them tooth and nail to stop that!

        By your argument, we shouldn’t have left the agricultural age because that would be selling farmers down the chute.

        Self sufficiency may be a myth but you yourself, as an individual, recommend that we become as self sufficient as possible. I merely see it on a larger scale.

        Self-reliant is not the same as self-sufficient.

        You have no idea how to make a gallon of gas out of oil out of the ground.

        You have no idea how to turn iron into steel.

        You have no idea how to put the fizz into soda pop.

        You probably have no idea how crops grow on a farm.

        …etc.etc.

        Self-sufficiency would require you to know all of this, and more.

        Self-reliant, I think, is what you are meaning.

        I do not want to have to go to Japan or China to buy a military Jeep, or boots for my troops and have the risk of them saying no in an effort to affect my foreign policy. Maybe it ain’t fair but that’s the way it is.

        Fair or not, that is how it is and will be.

        Molly McGuires, Pennsylvania coal fields late 19th century. Breaker boys, no health insurance, no chance to buy in other than the company store, black lung

        vs. starving to death in the country-side …..

        You are trying to compare apples with rocks.

        In an ideal world, or a company run by you or I or Henry Ford, everyone would be treated fairly but we know that’s not the way it is.

        If it wasn’t fair, then don’t do it.

        If they said “Yes” then it was fair.

        Corporate benevolence at it’s best.

        It is not the job of a company to be benevolent. Leave that to people who are emotionally attached to you.

        A company’s purpose is to make money by creating a product or service.

        They are not there to be your best friend, a family member, a shoulder to cry on….they are not there as a charity for you.

        You supply a product to them – your labor. They buy that from you. If either of you see no value in that arrangement, either one can terminate that relationship.

        As previously stated, unions can be good or bad. There is a time and place for them.

        Unions are not themselves a problem. Anyone can join into any group as they wish – that is your right.

        The problem is that the law allows the Unions to overrule private property rights. That is the evil occurs.

        If you think it bizarre to pay unskilled labor $ 5.00 per hour in deflated dollars, does this mean you are an advocate of price/wage controls?

        Of course not.

        The fact is, though, that is all unskilled labor is worth (and that is probably still too high).

        Most important job in the world? Plumber. Why, because we would all be dead of disease without him. Just try to get a Yuppie to believe that.

        There is no such thing as the most important job.

        Every job is vital.

        Yes, it was a great deal for us, or so we thought, at the time. But, after they increased their market share and our competing unsubsidized businesses went under, was it still such a great deal

        Absolutely. It allows us to do better jobs that create more wealth than simply building mechanical machines.

        If so, why do the balance of trade deficits look the way they do.

        Because the USA exported its government costs to foreigners.

        I had damn well better be able to produce something that everyone needs and wants.

        We are right now.

        De-evolving is rarely a good idea for any species – including humans.

        • I would define real world as the way things are. I happen to agree with you on economics. However, the world as a whole does not. We are therefore forced to debate based on the what is rather than what should be. Is it right? Of course not, is it necessary? Yes, at least until we change things.

          No we may not run out of weapons but are in danger of losing the ability to manufacture them or their parts. Remember Willow Grove where Ford turned out a complete B-24 on an hourly basis. Rumsfeld gave it all away with his stupid we go to war with the Army we have not the Army we want. In 1943 the US produced in excess of 17,000 M-4 Shermans, and Rumsfeld and his Pentagon couldn’t even produce half that number of up armored Humvees three years into his war.

          Subsidies to steal market share. We manufacture and sell for X, they manufacture and sell for X-Y, we go out of business, They sell for X+Z. We lose. They are smarter than us. They won’t let India manufacture cars. I don’t think that they see this as an illusion. I’ll fall back on international trade is war by another means. Does that make any sense, hell no, but it exists. It’s that innate human competitive thing which we won’t put aside until the space aliens invade and we all have to band together to deal with them. As soon as that’s over we will go right back to planning on how to slit each others throats. Again, not the way it should be or that I’d like it but the way it is.

          Molly McGuires/Henry Ford. I guess that 16 years of Catholic School rubbed off to much on me. I am my brother’s keeper. Note, small k not like Obama’s big K. If I make a little less money and make it easier for people to buy a house, heat it with coal and purchase more of my coal, I think that’s a good bet. Sort of like Ford’s idea on pay scale.

          If I have a gun to their head, (Company store), (locked emergency exits so they won’t steal), even if they say yes it is not fair. Stupid analogy but here goes. Nazi officer says “Jew go to gas chamber” Jew says no. Jew is shot. Next Jew is told “Jew go to gas chamber” Jew goes, Jew buys five minutes more of life. Is fair?

          Pretty much know the theory on manufacturing steel, gasoline and soda pop. Actually doing them would be a bitch but eventually the self reliant would have to become self sufficient.

          Unions have a necessary place at the table. They should, as you point out, not be given special status to hold anyone hostage. As my old pappy used to say, a union has to be good enough to make you want to join it.

          If every job is vital, than certain menial, unskilled jobs may very well be worth the $ 5.00 or more per hour. That is market driven.

          Yes, every job is vital but some are more vital than others. I would postulate that exterminator would have been a more vital job in the time of the plague. None of us would be here without the plumber. Society would have reached a certain size and then died off from disease, over and over again. Maybe important is the wrong word? How about essential?

          Are there enough of those “better jobs” around? If I believe that an individual should be able to do all these diverse things like write the sonnet and butcher the hog, shouldn’t I also believe that the society be able to multi task? Isn’t it better for us, as a constantly expanding (in numbers) society to have all these skill sets?

    • Black Flag says:

      SK. Trynosky Sr.

      No we may not run out of weapons but are in danger of losing the ability to manufacture them or their parts.

      A rough, short search for Humvee manufacturers (whole vehicle and/or parts)

      Mishawaka, Ind
      Butler County, Ohio
      Karmiel, Israel
      Toledo, Ohio
      Fairfield, Ohio
      South Bend, Ind
      Charlotte, North Carolina
      PORTLAND, Ore

      I’m confident that the same would be for nearly every major arms of the USA.

      Subsidies to steal market share.

      Market share is not wealth, nor profit.

      I’d love the Japanese to have even a larger market share – they’d bleed money even faster!

      We manufacture and sell for X, they manufacture and sell for X-Y, we go out of business, They sell for X+Z. We lose. They are smarter than us.

      In the entire history of economics, this has never occurred.

      What happens is, they raise their prices to X+Z, and the Koreans see an opportunity to sell their cars, as does India, Brazil, Sweden, Germany, South Africa, Russia…..

      Japan, finding themselves unable to compete without a subsidy are forced to continue to bleed money, just to keep even.

      They won’t let India manufacture cars.

      Who is “they”?

      Ever hear of “Tata Motors” – they just released the cheapest car in the world – under $1,000.

      If I have a gun to their head, (Company store), (locked emergency exits so they won’t steal), even if they say yes it is not fair. Stupid analogy but here goes. Nazi officer says “Jew go to gas chamber” Jew says no. Jew is shot. Next Jew is told “Jew go to gas chamber” Jew goes, Jew buys five minutes more of life. Is fair?

      But no one has a gun to anyone’s head – so where does your gun come into this??

      Actually doing them would be a bitch but eventually the self reliant would have to become self sufficient.

      You couldn’t do it. You can’t live long enough.

      If every job is vital, than certain menial, unskilled jobs may very well be worth the $ 5.00 or more per hour. That is market driven.

      No, it may be vital, but it may not be valuable.

      Value is based on part on whether someone else could do that job. For me, very very few can do my job, therefore, I am expensive.

      Nearly anyone can turn a bolt – important, but not rare – therefore, very cheap.

      Isn’t it better for us, as a constantly expanding (in numbers) society to have all these skill sets?

      Yes and no.

      No, because it is the specialization of labor that makes us wealthy.

      The lower the specialization, the poorer the country. This is why Africa is poor – they have lots of natural resources, but they are not specialized – thus stuck in the poverty cycle.

      And, yes, it is important for individuals to be diverse – which means maybe two or three other specializations in their labor so to be able to shift depending on economic conditions.

      But the greater the specialization of labor in an economy, the wealthier the people.

      • Humvees are passe, they blow up too easily. Point is manufacturers could not up armor enough Humvees in Iraq. We have lost the capability. can’t do willow run, can’t do decent conventional armor for ships (the Exocet is designed to cut through aluminum. We have lost the capabilities we had.

        If our industry is forced out of business, exactly how does this cost the Japanese? When they are the only game in town and can set the price, how do we benefit? Are they smart enough to have an ownership interest in the next up and coming industrial nation. We weren’t.

        Falling back on my admittedly incomplete knowledge of the American Labor movement and the Pennsylvania RR and the Molly McGuires I nonetheless see a gun pointed at a head. Times may have changed and it is a lot easier to quit a job and move around these days. Actually, your comment about unions being able to hold an industry like Coal or Steel hostage is analogous to what Coal and Steel did to labor in those coalfields. At that time and in that place you were stuck, just as surely as if you were a serf. This is where I like to bring in the pendulum effect. Extreme management begats extreme labor. Then it swings back. Maybe, somewhere in there, is equilibrium.

        Don’t have to live long enough, just have to have the right group of folks with me.

        Vital, valuable? It depends on the job. It depends on how important it is for me to get it done. If I can make $ 100 per hour but need to get something done around the house that costs $ 25 per hour. I still win whether or not you think it is valuable or vital. It is valuable to me because it frees me to do something else. I could clean up my own shop for free losing my $ 100 per hour time or I can give the homeless guy $ 5.00 per hour. He wins, I win. He joins the union, demands $ 10.00, I am held hostage and pay, he wins, I win less. I, personally would not move the shop to Brataslava.

        Turning a bolt, eight hours a day, five days a week, 50 weeks a year. Pal, you would have to pay me a whole lot more than $ 5.00 per hour.

        Again, my Dad used to say to have a completely different skill set available just in case the economy turns south. Not that I think financial whiz kid is a skilled trade (I don’t) but these days, they better know how to paint a house too. If a large number of people have multiple skill sets then the society as a whole has them. the more knowledge you have, the better the society. I actually think that that is one of the bigger problems in this country. Everybody is so specialized and filled with self importance they have no clue of the bigger picture any more.

        • Black Flag says:

          Financial wiz-kids….

          Are incredibly valuable people.

          Financial and money manipulation is the skill of maneuvering production capability to those areas of the economy that produces the greatest return on value.

          It is far better to invest a dollar, that returns two in as short a period of time – than a dollar that languishes for years to barely break even. The increase in wealth of the former is vital to maintaining a steady growing economy.

          It is not generally obvious which particular industry or company best uses production resources. A financial wonder-kid is someone who can study a particular set of indicators, does his homework on the market place, and places funds to those companies that offer the best return per dollar.

          Remember you can only spend a dollar once – so their wisdom, by investing in great returns, multiplies that dollar the most.

          That is incredibly valuable.

      • Black Flag says:

        SK. Trynosky Sr.

        We have lost the capability.

        The point is, we do have plenty of capability.

        If our industry is forced out of business, exactly how does this cost the Japanese? When they are the only game in town and can set the price, how do we benefit?

        The point being, they aren’t the only game in town, and never will be.

        It costs the Japanese because they are subsidizing you.

        If they are giving you value X for less than X, you are getting wealthy from them.

        Are they smart enough to have an ownership interest in the next up and coming industrial nation. We weren’t.

        Yes, we were, and we also found it was not a worthwhile deal. It was a better use of our investment dollar to do other things.

        • You mosty likely have dealt with smarter financial Whiz kids than I have known. Again, if I am of the right income group it may very well pay me to turn over my investment planning to someone else. that will free up valuable time I need to increase my capital. In my own case, I never had enough to make it worthwhile to employ a whiz kid so I was forced to do it myself. By accident or by smarts, I picked right.

          Maybe I’m being thick here, but the loss of my industries does not, in my experience, automatically give me some foreign subsidy. When competition is driven away, the price rises. Competition is eliminated by dumping. We don’t talk about that anymore. One would have thought that Korean Autos would have been a huge threat to the Japanese market share. For some reason they have not been. They have now been around some time and one would have thought that the quality issues would have been resolved.

          Admittedly, our big three had a stake in their companies and to some extent still does (my first Caravan had a Mitsubishi engine) but how powerful was that interest?

          We can do anything we want to. We can even produce 17,000 Sherman Tanks per year if we want to. The problem is that the infrastructure allowing a quick changeover to this type of production by and large no longer exists. The loss of even more manufacturing base (the big three) virtually guarantees us the inability to ramp up if we have to.

      • Black Flag says:

        You mosty likely have dealt with smarter financial Whiz kids than I have known.

        Like in all things, some are better, some are worse.

        By accident or by smarts, I picked right.

        I would doubt by accident.

        Generally, good common sense plays well when investing.

        One would have thought that Korean Autos would have been a huge threat to the Japanese market share. For some reason they have not been.

        Because making a car costs about the same no matter where in the modern world you want to make it.

        Differences in taxation is usually moot as most jurisdictions will simply give tax holidays.

        So, its down to offshore labor costs – but that is usually offset somewhat in shipping costs.

        So, it will go to those that are most desperate and able to climb up the life-style ladder.

        S.Korea and Japan are not that much different in lifestyle, so neither holds any real advantage over the other – compared to, say, India.

        The loss of even more manufacturing base (the big three) virtually guarantees us the inability to ramp up if we have to.

        What world event would require us to ‘ramp up’? We already spend more than the rest of the world combined!?!

        What ramp up are you considering???

        • Well, as an example of ramping up I would point to Rumsfeld’s failure to up armour the Humvees in three years. The basic capability does not exist any more. As a gun collector I was amazed when I originally learned how many different contractors there were for M-1 carbines during WW 2. As much as we all dislike war, if there is one, the answer to making it briefer and less painful may come from Bedford Forrest who said, I believe, “Get their firstist with the mostist”. Firstist we may be able to do. The mostest, I’m not sure about, especially in unconventional warfare where I believe the 15 to 1 ratio still applies.

          Despite our huge military and what we spend on it, there was a September 11th. One can never know what lies around the next corner.

          Regarding the Whiz kids again, I always wondered why, if I had the secrets to guaranteed financial success, I would ever share them with anyone else? So, again, my only reason for using these guys who would, if they knew and believed in what they were selling, not have to bother working for others would be to free up my time to earn even more.

    • A few months ago there was a picture that hit the news of one of the auto manufactures…..so help me when I saw it I laughed so hard…..there were 7 people on an assembly line of the 7, 2 were working 5 were standing around looking…and what were these people making an hour? They want my money? They have lost their minds!!!!
      No offense….but, we entrust teachers with our most valuable assets (kids)and do not pay them 1/3 of what the union labors were making with no education….does anyone see a problem with this picture? Our American vehicles need to go the same route as the UAW….out the door. I bet there are lots of industrious Americans out there who would be willing to make good affordale vehicles.

  13. Black Flag says:

    I think LOI has hit the nail square.

    The automakers have been a government-controlled company for decades.

    It is not surprising that they need government bailouts for them to survive because of government-mandated employment (unions), government-mandated designs, and government-mandated sales.

    Government caused problems seeking government caused solutions.

    Nothing new here.

    • Don’t know how I did that, dropped my hammer reaching for my beer.
      I think we all agree here that the more involved the government is, the worse the problems become.

      You gotta give them credit though, they are not letting a crisis go to waste. I think USW made a comment a few weeks ago about smoke & mirrors.
      The fed. now controls most of the banks. Obama just fired the CEO of a PRIVATE business, which sets a precedent. Big O was well received in Europe saying environmental change would no longer be ignored. We are still not sure how they are going to use the census to make sure they retain power.
      They have set aside 600 BILLION to start our socialized health care system.

      US, I think we need a theme song to play while we are visiting. My first suggestion is Grateful Dead,
      “Hell in a bucket”
      but at least I’m enjoying the ride

      • I think we all agree here that the more involved the government is, the worse the problems become.

        1963-The U.S. Government dictated that Chrysler “develop” a turbine engine that could run in automobiles. 1979 – Then awarded the M! Abrams tank contract to GM after Chrysler had spent all of its reserves in the engine r&d.

        1936 – A small car co. (I can’t find the name)won a design competition for a compact general purpose vehicle for the U.S. military and then our government decided that that company was too small and awarded the contract to Ford and Willys (that is how the Jeep came into being).

        There are many more stories like these. What happened to “Electric Boat Co.” the designer of nuclear submarines?

        • esomhillgazette says:

          G.A., Willys WAS the small co. that invented the jeep. They were allowed to make them, but so were bigger companies so they could be made faster. Willys was a REALLY small car company! After the war, I believe the patent was given back to them though.

  14. esomhillgazette says:

    The main thing is, The government needs to leave business the hell alone! Let them sink or swim on their own. Let the market adjust itself. Let capitalism do it’s job! Not that they will. Just that they need to. Our Nation is being run into the ground by 550 or so idiots.

  15. TexasChem says:

    What company is next in-line for the govt. to assume control of? The gulf coast oil refineries? Chemical plants? RX med producers? Ohhh wait I think it will be your local Hospital…

    • In an ever increasing manner, the government already has at least a measure of control over most every company. Given the current course, it will dramatically strengthen its stranglehold over them in an ever quickening pace.

  16. I am very unfamiliar with the auto industry in general. Were we to allow GM & Chrysler to fail, wouldn’t that (in all likelihood) increase Ford/Toyota/et al.’s market share? In order to fulfill the increased demand for their vehicles, wouldn’t those companies left standing need more employees, factories, etc? I realize that the union employees wouldn’t be making $80/hr, but they would be employed, and at a good rate, certainly a livable wage.
    Additionally, I drive a 1983 Chevy K-10 shortbed. Have had it for years, >200k miles, parts are a dime/dozen and it runs like a top. I pop the hood and know where everything is, unlike the new ones. What I spend in gas, I make up for in parts. Had 2 Fords and a Chevy of the newer vintage crap out on me and won’t ever own a new vehicle again.

  17. Andrew Gabriel says:

    Government is doing what it can to consolidate its power, The government is enforcing the biggest corporate takeover in history. Let the American people build the biggest and most successful money making society in the world, then make them believe that it doesn’t work, so the people can willingly give all the power to the government, and BAM, we got Socialism, then Communism.
    Capitalism is communism at its infancy, when the government has no limitatons imposed on its growth.

    • AMEN AG!Saw it in Cuba. There it was at [literal] gunpoint. Here it has a little more finess, but the end result will be the same.

  18. Great discussion today to all. Good points and counterpoints. Always good for the knowledge locker. While you were away, life has continued in a bad direction, at least in my town. I live in one of the top ten ” most dangerous cities” according to the FBI. Whatever! Anyway, our wordly Mayor announced that 24% of our police force will be laid off because of the City budget deficit. Now, the “new” positions the mayor invented when he took office 8 years ago, and hired his “pals” are all safe and will still be “working” at their whatever jobs they do, while I have to rethink my armorment situation. Sad isn’t it!

    Anyway, while we have to try and save our country from all the idiots that are running it (screwing it seems to apply here), the domino’s that have been put in place for total government control are in place and ready tumble. It all starts in small places, like my hometown, Youngstown, Ohio.

    I only ask that you prepare for bad things and protect your families. The only way for government to get control, is to disarm the citizens, and New Orleans after Katrina was just a test. It worked there, don’t let it work anywhere else.

    G=Man

    • Sounds like a good reason to organize a special little party for your Mayor….a tea party. Invite him as the guest of honor, or rather…dishonor.

  19. Black Flag says:

    SK Trynosky Sr.

    Well, as an example of ramping up I would point to Rumsfeld’s failure to up armour the Humvees in three years.

    I’m certainly not the guy to defend any government mis-decision.

    But, let’s face it.

    If the USA cannot defend itself while spending more then the entire world combined….

    We are f-you-see-kayed

    I mean, come on!! We outspend by a factor of nearly 8x the next highest military budget….

    …and you think we can’t defend ourselves…????

    Bedford Forrest who said, I believe, “Get their firstist with the mostist”.

    Throwing away that he founded the KKK, he was a brilliant guerrilla fighter – set the standard.

    Despite our huge military and what we spend on it, there was a September 11th.

    Do you question how this could happen?

    In every measure, this event was impossible…unless…..????

    If I had the secrets to guaranteed financial success, I would ever share them with anyone else?

    YES!!!

    Because the profit on selling INFORMATION is far greater than reaping from it!!

    That is the power of wisdom!

    If I know how to plant a crop and you don’t … if I sell you the concepts and you do the work… I reap the benefits without the labor!!! If I do this 10, 100, 1000 times!! I’m WEALTHY!!!

    SO, YES~~! Buy selling WISDOM more than makes a profit then me simply planting my own crops!

    • This has been interesting, I thank you.

      While we do spend a huge amount of our wealth on the military and can certainly “bomb back to the stone age” anyone we want to at any time, it is that damn asymmetrical warfare thing.

      I have older friends who were at Chosan in Korea in 1950. The three hundred thousand Chinese who poured over the border really caused some problems. As we know now, Nukes were not an issue. SAC was not an issue. The damned thing was a brutal conventional fight. As well equipped as we were, we almost lost it because, as my Air Force FAC friend said, they had the anthill, we did not.

      In the summer of 1950, when the T-34’s poured over the border into the South, we almost lost the war because of a lack of 3.5in rocket launchers. Simple, cheap weapon but not enough available when and where they were needed.

      So, maybe it’s not the long term strategic thing but the big tactical thing. Had the North Koreans taken Pusan and we not been able to extract our Army, 50,000 or so Americans in No. Korean hands would have been a bargaining chip that might have given them the strategic victory which they would have been incapable of otherwise.

      If you are willing to die for it there can always be a September 11th just like there can always be a Columbine HS.

      I most definitely would not want you to be defending Rumsfeld’s mis-decision. He is far from defend able. I merely pointed out the lack of ability of our very expensive military machine to up armor the Humvees. This was a simple, common sense thing to do after the first roadside bombs went off yet we were unable, even throwing money at them, to increase production of the armor kits to the number necessary. That’s where the M-1 carbine analogy came from. Back in the day, there were enough manufacturing plants available to quickly switch over to essential war time production. Think of it, Singer Sewing Machine, Rock-ola, General Motors, IBM all producing in a short time, something far more complicated than bolt on armor packages. How the mighty have fallen. Precision guided through the mail slot missiles are great but the guy with the bow and arrow can still kill you.

      What you said about selling information makes sense but I’m still doubtful. If I am so damned sure, I think I just might be greedy enough to want all the marbles for myself rather than share that info.

      Again Senor, muchas gracias as we say in the Bronx.

  20. Black Flag says:

    But that’s the rub, isn’t it?

    The armored Humvee is a disaster in Afghanistan – too heavy, and too slow over the rotten roads (if you’d call them that) to actually be any tactical use.

    That’s the thing of war – what works here doesn’t there.

    Kinda makes one think that war shouldn’t be option one.

  21. i like your article very grade and good quality. i will save your link in my favorite page and i will visit your blog again. thanks

  22. It’s all a mess, but as long as you can get parts, guess it really doesn’t matter.

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