Vicious Rants of an Angry Yellow Man

I am ambivalent about whether the automakers should get the bailout. I tend to believe that nobody should get a bailout. Look at Chrysler which got a big loan, merged with Mercedes, a foreign company, and now is asking for loan again. Didn't they learn the lesson the first time? I think the so-called concession by the UAW is cosmetic only and will not help much. I don't know enough about the plans put up by the Big 3 in front of Congress. But if the government is a bank, would it think that the automakers' plans would make them a good lending risk? I think not. I think there is a good chance that if one or two of the companies declare bankruptcy, they can start all over, with new salary scales, and be stronger in the future than if we just bail them out.

But I will say that the government has not been as fair to the automakers as to the financial industry. I don't see any concession from the salaries of people in insurance or banking before they got the bailout money. AIG had a big party right afterward. There was no business plans from the banks as to how they will spend the money. It is not clear to anybody what has been done with the money so far. So it is totally unfair that the government is so easy on Wall Street and much harder on Detroit. And I find it absurd for one Congressman after another berating the automakers for their failure to be in the black. The one institution in this country running the biggest deficit is the Federal government. While the UAW has at least made some concessions, I don't see any government unions at any level is willing to renegotiate anything. You see, if anyone is too big to fail, it is the government and that is why it is so difficult to make government better.

So I don't know what is the best. And I don't think anyone else does either. Even the best economists argue about whether government interventions are good. They still argue about whether FDR's New Deal help or hurt the depression. Some argue that only WWII got the economy back, not all the government programs. I don't know whether the bailouts will prove to be the right thing to do. I do think that Obama's idea of stimulating the economy by rebuilding roads and bridges is good. Even if it does nothing for the economy at least we will have new roads and bridges which we sorely need. To show how little anyone really understands the economy, I heard Ben Stein, a conservative economist on CNN, said that unlike people, who must balance their expenses with income, government can go deep into debt without raising taxes because it can print money. That seems like the stupidest thing I ever heard. And he is a CONSERVATIVE ECONOMIST. I mean, if that is the case then no Africa country will be starving. They can print money as well as we can. I also heard another economist said that bailout money is just us loaning money to ourselves. If that is the case, how come we have to owe money to China and Saudi Arabia? If supposedly smart money people can come up with statements like that, you wonder how we are going to recover.