Skip to comments.Bankrupt Bailout
Posted on 12/10/2008 5:34:23 PM PST by Kaslin
font size=4>Auto Bailout: As the Big Three get closer to securing billions in aid from Congress, what was once called a "bailout" has turned into a plan to nationalize the car companies. Bankruptcy is still the better idea.
We could have accepted a "prepackaged bankruptcy" in which the automakers negotiate with both creditors and unions to restructure themselves in exchange for a bailout.
It might have included the closure of marginal auto brands and unprofitable plants. And unions would have opened up their gilt-edged contracts for renegotiation, bringing them in line with manufacturing norms around the globe.
But the Democrat-led $15 billion bailout does none of this. It merely replaces the efficiency of market forces and existing bankruptcy law with extensive government control. It also opens up the possibility of a never-ending stream of subsidies to automakers who have steadily lost market share since the early 1970s.
Here's the broad outline of what we believe will essentially be an in-place nationalization of a major American industry:
(Excerpt) Read more at ibdeditorials.com ...
That's been the plan all along...
The government is basically getting ready to “Conrail/Amtrak” the car companies. Another boondoggle that will bleed tens of millions monthly and will be “too big to fail”.
You should start an IBD ping list.
The articles are always a good read.
“The government will name a “car czar” to rule over the industry with “veto power” over any Big Three expenditure over $25 million.”
That’s basically EVERY expenditure which in turn amounts to total government control.
GM will go from being an HMO that builds cars to a Government-run HMO that builds cars.
Thankfully, President George W. Bush will veto the 15 Billion Dollar Auto Bailout just like he Vetoed that Trillion Dollar Wall Street Bail Out.
How about the Aztek? Only now it will be better because it will be built by the government. What a great idea! Just like government cheese is the best cheese, I’m sure government cars will be the best cars.
I was thinking the new government cars would be more like the Yugo or Trabant.