Today President Obama announced that GM will be entering into bankruptcy. 25,000 plus jobs will be cut and numerous plants will either be closed or moth-balled. The Government will own 60% of GM, not much different then the bank plan, while only 10% will be owned by the bondholders that staked GM.
President Obama says he does not want "run GM" but it is necessary that Government intervene. Nothing that I ever read in books about Capitalism or Civic duties of government included national government ownership; temporary or not. Why hasn't President Obama presented a plan to exactly what the Government will do to ensure GM's socialistic regime is short lived?
The lack of the plan indicates that President Obama is looking to socialize all aspects of our economy. Banks were the first and now Automotive. With Chrysler and GM under the thumb of the Federal Government, where does it leave Ford? How can the American Government not play favorites and balance their competing interests? With the taxpayer on the hook for the success of Chrysler and GM, how does President Obama plan to devise incentives to repay to taxpayer while not violating anti-trust laws. The simple answer is he cannot.
So the next move will be to force Ford into the same railroad job and spin it to the American public that its in the best interest of the American economy. A lot of rhetoric coming from President Obama eerily parallels speeches given by Adolf Hitler on the importance of rebuilding Germany. Post WWI left Germany in a deep recession with galloping inflation. Soon we will be experiencing the same inflation as the Federal Reserve Bank prints more and more money to pay off the Trillion of dollar debt that President Obama and Democrats in Congress has saddled us with. All in the name of "It's best for our Economy".
The Free Market and Capitalism are phoenix's. If one company fails, no matter the size, another will spring up to pick up the slack. Now where the Government can assist the Economic models that has given many Americans their wealth is to ensure, through limited regulation, that greed, deception, and corruption is kept in check. The role of government in a free society is not to own business or commerce; ownership of business is only seen in Socialistic societies where liberties and freedoms are restricted.
If Americans do not wake up soon and vote in a more fiscally responsible Congress our free society will be no longer.
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There needs to be more than the rhetoric of the dangers of socialism to wake people up. Even though I don't think full blown socialism would ever be a system that would work in the United States (as it really does not work as a successful means to govern a country, as many countries in Europe discovered)polls have shown that people in this country are not scared by the word, or the connotations of socialism.
ReplyDeleteCalling liberals socialist is like calling conservatives fascists. Neither accusation works in a debate and sounding out these words only shows the shallowness of the position one is making on economic issues. The majority of this decade was governed by republican majorities in congress, a republican executive branch and in this decade this country has seen government grow and spend more than in any other time comparatively in our history. Where was the outcry then? Those of us who did criticize the administration were said that it was disrespectful to do so.
In the last administration under political and peer pressure many people just conceded to most of the arguments for enlarging government spending due to national security threats and political interests. I'm happy to read that in these debates we don't have to worry about such pressure and manipulated sensitivity. Of course, I hope you are wrong in regards to the direction the current administration is taking this country...which will not ultimately lead to socialism, a fear for which you continue to sound the alarm.
My hope is that we need to go through a period of increased regulation and government involvement in the economy while it recovers and strengthens. Many economists are projecting the end of this recession sooner than later. For all of our sakes, let's hope the economy continues to recover, so that those of you who loath government, can go back to the comforts high risk financing and over leveraging of wealth.
I agree that no alarms were going off when the Bush administration spent the final two years growing government and increasing the size of the budget. Will concede that all liberals are no socialist but the current regime is working under the principles of socialism. Taxpayers are on the hook for giving money to the banking industry and automotive industry; in both cases the government has taken stake.
ReplyDeleteThe next step will be if a plan comes out as to when President Obama is no longer CEO of the banks and automotive companies. The need of some regulation oversight is required but ownership is not. Firms need to be allowed to fail or go through bankruptcy without President Obama’s intervention.
Presidents of both parties have been involving themselves in industries and institutions of this country at one time or another. I don't think I need to, or feel like going through the list of government intervention in the market. If this current economic crisis is indeed the 2nd most serious economic crisis this country has ever been through, then I would hope that government is a highly involved player. It's the only institution with the resources to invest in a time when credit is frozen and cash is being saved. I've heard many economist comment that the banks and financial institutions are preparing to commence paying back the TARP funds as they are very motivated to get out of the partnership with the public. The auto industry is another story...we'll see what happens there. I am of the opinion that this country needs a functioning and sucessful auto manufacturing industry. Problem is, no one seems to know how to accomplish that end. I think everyone will agree that a nationalized auto industry is not the answer...even democrats. The current "regime" as you call it would be happy to get out of the business of being CEO as I know the Obama administration would have rather began their work with a functioning economy, no foreign wars and a dismantled and discredited government thanks to the Bush administration.
ReplyDeleteI grow tired of the “Presidents of both parties” argument. The country voted for change, why is it when the current regime does something, like nationalizing GM, the only argument is, “well it’s been done before.” Obama was supposed to change Washington not play the same politics; then again he is bred from the Chicago Machine.
ReplyDeleteThe Bush administration was not alone. For the past two years Democrats had control of Congress and passed legislation that spent and spent. Fortunately for Democrats Bush abandoned his fiscal conservative principles and signed into law bills of a liberal Democrat. The Economy would have been functioning had Barney Frank and his cronies heeded the warnings of Fannie Mae and Freddie Mac back in 2003 and 2004. Instead Barney Frank saw nothing in the report, by Republicans, that hinted at an insolvent Fannie Mae or Freddie Mac. Instead they encouraged the banks to give loans to people that could not afford them.
But what does looking backwards get us now? Nowhere! Regardless of the situations facing Obama’s administration, does that mean the $1.2T budget that will bankrupt America would have been more? Regulations, limited, are needed to keep in check greed in the Free Market. Outside of that, leave the Free Market alone and it will correct itself. Big companies will fail and new ones will be created in their place. That is the beauty of Capitalism. Instead Obama is taking the US down the path of Hugo Chavez and Fidel Castro. Hugo Chavez even joked today that Obama is becoming more leftist then him and Fidel Castro.
First off, I am not looking back to excuse the current administration of anything. Also, in 2003 and 2004 we had a republican majority in congress, so blaming Barney Frank for not doing anything about the impending financial crisis is pretty funny. In 2007 when the democrats became a slim majority in both house and senate congress was known as the do nothing branch because neither party had the political capital to try to pass any legislation and both parties were playing it cool before the 2008 presidential election. So doing nothing was the safe bet until the people voted for a clear majority, which many commentators and citizens found very frustrating. In the meantime the economy collapsed. At the time, leading up to October of 08 many from both sides of the isle were warning of trouble signs, but I think there was a level of denial at high levels of the government...fundamentals of the economy being strong…remember that?
ReplyDeleteI only refer to the past because this nation has turned to government to assist in economic matters since the foundation. If a person is going to understand culture, society, political systems and government one needs to read about and consider historical precedent. Conservatives right now conveniently have short term memory and that is what is so frustrating for someone from another perspective to debate a conservative. It’s very hard to have a discussion with someone about what government’s role should be when the other party does not believe in government.
Conservatives have undermined government’s role in the operation of this country for decades, up to a point when they finally convinced people that government is not good for people, that it’s an institution to be dismantled, under funded and marginalized. The Neo Conservatives of the Bush administration believed these fundamentals of conservatism and convince people to vote for them because he was a compassionate conservative. What people did not realize was that the Bush people on top of undermining government, one government function of government that needs to be utilized, funded, empowered was the armed forces as a political tool to mold and shape the world to the Neo Cons vision. The Neo Con point of view was to the Neo Cons validated and accelerated by September 11th.
Conservatives, having gotten us into foreign adventures, one of them by manipulating Iraq’s role in the before mentioned attack, lost their way. I am sorry, but as you said the country voted for change and that change was not for a new reborn conservative movement. You have a long way to go to convince people that conservatism is a viable way to govern, especially when we are in economic crisis. Let’s see, the best idea the conservatives had to help the economy was to lower taxes and freeze all government spending! I think they had to bribe some economist to endorse that idea and the population of this nation did not agree. My overall point to these posts is that continuing to call Obama, or democrats, or progressives, or liberals, socialist is not the argument people are going to listen to. Referencing Hugo Chavez is not going to help either, no on is going to take what Hugo Chavez says seriously as he’s only motivated to help his own political agenda.
I agree looking at the past will assist the future. Blaming the past is not helping the future. Government has gotten to big; that is a fact. We cannot sustain the size of Government we have without raising the taxes on EVERY American citizen.
ReplyDeleteA topic that is on the table and getting serious consideration is a National Sales Tax. While I agree that a National Sales Tax would be good, it will only be a positive step if we revamp the tax code. As I have stated in a previous blog, it is time for a flat tax that does not begin until one reaches $49K and eliminate all tax credits.
The overhaul of the tax code will make it simple and straight forward. It will, for the most part, remove the ability to cheat on ones taxes while promoting the Capitalistic view of freedom and liberty to pursue the American Dream. For instance, if the new tax code was put in place. No matter what you made or how successful you become, your tax rate will be the same.
Now adding a National Sales Tax to that will mean those with more disposable income will foot more of the tax bill. Those less fortunate, since the flat tax would not kick in until one made $49K, would not see their taxes increase from wages.
I through the Hugo Chavez comment in for good humor. I have little patience for Chavez has he continues his iron grip on his countries freedoms and markets. Liberties are trampled upon. Then again Chavez's policy of nationalization is similar to what Obama did to banking and automotive industry.
Answer me this. How can we as taxpayers recoup our investment in GM if Ford still exists? How can the Government, CEO Obama, turn a profit if Ford continues to produce vehicles that people want and not the smart car? Can you honestly tell me that a 35 mph truck will be used to haul construction equipment or farm equipment? Will that same 35 mph truck be able to pull the boat or recreational vehicle?
The only change voted on was the complexion of the President. It was fashionable vote. No true vetting was done to understand the extent to which his budget would put America at the mercy of the Chinese. The mainstream media ignored it and accused talk radio, and others, of race bating.
9-11 could have been prevented and it wasn't. The reasons for the Iraq War are questionable, I will agree, but the world is a far better place without Saddam. Now our focus is Afghanistan and Pakistan because the surge pushed the enemy out of Iraq. President Obama is not bringing the troops home, he is just re-deploying them.
Government is too big. Our political scene does not allow for all to be heard. We have an oligarchy and perhaps soon a monopoly in our political party system. Jefferson and Adams warned of this potential and resisted as long as they could the creation of political parties.
Our conversation is getting off track for this post. Who is next to be nationalized by the Obama adminstration?
What a suprise, you believe government is too big...and this is the circular logic of the conservative movement in the United States. I don't think this post was ever on track, but I will no longer continue sidetracking it. It just seems that we should cut to the chase and get to the real point of The Hamburg Post which is a plea for conservative values and government...and an opportunity to call all other points of view socialistic. There needs to be a little bit of perspective here.
ReplyDeleteI have made it no secret that Government has grown too big and it is time to reign it in. I am not calling all points of view socialistic, only where the term fits.
ReplyDeleteGovernment ownership is GM and Chrysler are the baby steps to a socialism. I hope Americans will see the steps taken as their true meaning so we Americans do not fall victum to the same fate as the Jews in Nazi Germany.
If you feel my defintion, and others economist (Robert Reich), are using the term nationalization incorrect with GM and Chrysler then please enlighten me and those that believe the term is accurately applied.
Ummm... I think you better re-read your last comment and retract it. Like, right now.
ReplyDeleteDo you honestly think that we are in danger of falling victim to the same fate as the Jews in Nazi Germany?
I'm not Jewish, but I would NEVER minimize the Holocaust in this way... nor would I EVER suggest that America could ever be subject to anything similar. HOW CAN YOU EVEN SUGGEST THIS?
If you honestly think that, then you are impossibly dim. Either way, your arrogance and/or ignorance has led you down a path you do NOT want to travel.
You have diminished a catastrophic event in history in which MILLIONS of innocent lives were lost. Worse yet, you've suggested that America, with all her rights, freedoms, checks and balances could somehow be overtaken and bring about a similar fate.
That one statement is more vile than all of the other arrogant, ignorant, and paranoid statements you've ever made on this blog. Frankly, it disgusts me.
Pat
ReplyDeleteI am not attempting to minimize or trivialize the events that took place during WWII under Hitler’s control. Nor is the statement vile, arrogant, ignorant, or paranoid. I stand by my assessment that moves made by the present Administration will bring about the ruin of our great country. Many a history book points to small changes made by Hitler and his group as they seized power and the private sector.
Are we to allow emotions to cloud our vision and understanding that by nationalizing the auto and banking industry, saddling America with enormous debt, and looking to increase taxes on all an affront to our very freedom and liberties? I say we need to look at it with rational and wide-open eyes.
My analogy is not literal; to say that we Americans will be interned and gassed is not the point of the analogy. It goes beyond the literal interpretation. We will see our liberties and freedom restricted by an increase in government control, i.e. firing of CEO of Chrysler and capping pay of executives, and with less disposable income to make life better for us in the low and middle class. The wealthy and political class of society will see no major change. Their prosperity will be on the backs of the low and middle class and we will be told “it’s a down payment for the future.” Really, when the marker comes due who will be stuck with the bill?
Senator Frank, Senator Dodd, President Obama, Senator McCain; no, it will be you and me that have seen our liberties and freedoms reduced by the tax and spend philosophy of the current regime. So, in the end my analogy is not to trivialize the Holocaust but to echo the warnings, i.e. Ben Bernanke and Robert Reich, so American’s who get their news from limited sources understand the true nature of what is going on.
I know I do not have all the answers which is why I started this blog. At the same time my unique prespective recognizes that events of the day have multiple meaning. And this forum is open for all interpretations. Ultimately, we are the checks and balances of our Government.
It's really funny... you say the end of the world is coming, and then as soon as someone responds calling you out on it, you say we need to be rational.
ReplyDeleteI consider myself extremely rational. Maybe you should check yourself before you wreck yourself, Chicken Little.
And as for the analogy... literal or not, is still inappropriate and disgusting. It's also insensitive, demeaning, and just plain ol' wrong.
I understand you will keep beating your smaller government drum and you will continue your paranoid delusions of the end of days because, heaven forbid, someone try to fix the economy that snapped under Bush with his "tax less, spend more, two war" economic policy over his 8 years -- which, by the way, seems to be working at least short term as the market, housing, and unemployment slowly turn for the better.
If you want CIVIL DISCOURSE, you must give it to receive it. You may encourage replies, but you rarely, if ever actually consider them. I have a feeling it gives you great pleasure in being an immovable object that is deaf to the outside world. Aloof, austere and pious, you rule your own version of the world... or at least you think you do.
I leave you and your black and white world to be... well... whatever you want it to be, I guess. I'm in search of something more technicolor.
Later, skater.
I in no fashion am making a claim of the apacolytic nature. If it were true, then Ben Bernanke and Robert Reich are touting the same philosophy. I will keep beating the drum of smaller government because it is through smaller government that freedom and liberty is fully achieved. Entitlement programs, high taxes, government over-regulation, and nationalization of private sector enslave our freedoms and liberties to the control of the political class.
ReplyDeleteI agree, and have agreed for some time, that Bush, in his final two years, spend more with little regard to the consequences of future generations. I am not her e to be an immovable object. I have conceded points when rational thought prevailed. Prior to posting a blog I read conservative, moderate, and liberal news sources so I will have a greater understanding of what all sides are saying.
Please point out where I have not given civil discourse. There will be subject matter that people will have to agree to disagree. As I will point out in a blog soon to be posted on the two-state solution in the Middle East. It will be unfortunate if you choose to close your mind to the conversations of this blog.