GM Bailout/ Chapter 11

[iowa boy]

I'm sure he's already tried that.



I know I have

Just wanted to make sure that if his wife does not okay the hummer that he wants, he has her permission to seek out other "dealerships" that offer hummers.

 

[wkmac]

I have to agree, one cannot solely blame the government for GM's demise. Especially when you consider that the elites who run our corporations are the same ones pulling the government's strings.

WHACK! Now that's using your dipstick Jimmy! If that commercial was real life, that guy would be dead! Beaten with his own dipstick.


Your comment above made me think of an article I read over at Front Porch Republic entitled Corporate Capitialism and The Loss of Virtue but it was the following from the article that caught my eye in regards to the American carmakes being the possible origins of their own problems.

But consider what has occurred. Corporations can and do hire lawyers to lobby the federal and state governments on behalf of the corporations that employ them. The voices of those businesses that can afford to retain full-time lobbyists will obviously be heard above the voices of the small farmer in Pennsylvania or the owner of the independent hardware store in Kansas. The result, not surprisingly, is that the bulk of regulations favor the large concern over the small. Even those regulations that appear benign can produce onerous barriers to the small business. If for instance, in the interest of clean meat, USDA regulations require butchering facilities the description of which is well-suited to the corporate meat producer but impossibly expensive for the small rancher, then the small rancher is disadvantaged. Of course, one could say that such regulations are all in the name of public safety. But if a small rancher wants to butcher a handful of steers in his garage or basement and if his neighbors who trust him (know he is a man of virtue) want to buy the meat from him, why should the USDA get in the way? In one instance we have regulations attempting to substitute for virtue (and disadvantaging some) while in the other we have legitimate virtue operating between neighbors. Which alternative serves to create a healthier society?

The regulatory bureaucracy, while ostensibly intended for the protection of the public from corporate abuse, works hand-in-hand with the very organizations they are tasked with policing. They need each other to be what they are. All this can be accomplished under the cover of “public safety.” The need for security (provided by the government) can justify the massive regulatory bureaucracy. The consciences of the regulators can remain clean, for after all, they are serving the public. And if the corporate lobbyists have done their jobs, the regulations will provide the corporations with regulations well-suited to the scale on which they operate and, as a result, the small concern will find itself disadvantaged and less able to compete. Here we come to a surprising possibility. Could it be that many of our economic problems are not the result of insufficient regulations, as many argue, but instead the result of a regulatory structure that creates an unlevel playing field and thereby makes it easier for the large corporation and more difficult for the small concern? Could the internal dynamics of the corporation, itself, lead to this outcome? The implications are, I admit, far-reaching, but at the very least, we should be honest enough to admit that, along with an unprecedented explosion of consumer goods and services, corporate capitalism has nourished powerful forces that may not contribute to the long term health of our society.

Even further taken, with all these mega-corp. interests in Washington it only stands to reason that laws are passed (bought and paid for) intended to benefit certain interests. But as everyone buys and sells their votes, passing these interests for ever more money with little time or thought given to their real impact on society, at somepoint like a nuclear reaction, these regulations create conflict and the negative results are mostly felt by the ordinary person as the "corp. elites" if you will are typically insulated having immediate inside information and can adapt faster to changing conditions.

The real estate meltdown that is a lynchpin in our economic crisis was as much driven by gov't policy as it was by corporate capitalism and let me say this for the record. Corporate capitialism is not IMO a true hallmark of true free market economics just as the whole idea and concept of a corporation is also not in keeping with true free market economic ideals. Corporations come to life via gov't edict and only by gov't permission and with that also comes some level of limited liability to varying degrees. This in itself fosters potential for fraud and abuse with the consumer and taxpayer most often ultimately bearing the burden.

True free markets arise among the actual people themselves as in the above example of the small rancher who butchers his own cattle and the townspeople who trade with him for said beef. As a result, if said rancher commits fraud or wrongs the townfolk, he typically finds himself before a judge charged with a crime and if severe enough, civil actions may even result in judgements that liquidate his assets leaving him penniless. If he incorporates, it's possible to seperate his personal holdings in such a way as they are never at risk and therefore the temptation to stretch the boundaries of what is moral and fraud become a reality more often than not. True free markets don't advantage the seller over the buyer but in fact bring them together as true equals, especially in the eyes of the law. Utopian? Is it any more Utopian to believe that you can create a 3rd party agency (gov't) who is capable of independence, non-bias and free from tempting self interest to do as good a job or better at maintaining this same balance? Looking around our world today, I think it's fair to say that idea has real issues!


Now that between the US and Canadian govt's they hold a near 75% stake in GM, it seems only probable that GM would begin producing the kinds of cars that Obama talked of during the campaign but there is another competing self interest here that has emerged and goes to the heart of how varying public policies can in themselves create potential nightmare scenarios. President Obama talked about the need for super efficent cars and he is correct. Having super efficent cars is something the vast majority of people I've talked with want so this idea has very braod appeal IMO. But super efficent cars have one major negative and that is, using less gas means they also pay less highway taxes. A good picture to foretell the true impact can be seen right now as a result of a down economy where people are driving less along with a fleet of cars nationwide that are getting better and better mileage and now we have a highway trust fund that some say will be broke by August barring a influx of money from the gov't. This was no surprise as some saw this coming back last September. Last year it was September and this year it was August and the keenful eye would notice and point out that in both cases the funding ran out just before the fiscal year ended and therefore the cause in not enough funding on the outset of the fiscal year. True but it still points out the glaring problem IMO that even better mileage vehicles including electric will place a huge strain on the highway fund at a time when many say we need major infrastructure improvements and yet as I linked earlier, our democrat controlled gov't is throwing around money to foreign interests at the same lighting speed as the former foxes guarding the peoples hen house.

"IF" the gov't uses their new found ownership as a means of advancing public policy ie super efficent cars, then watch the nightmare of unintended consequences begin to come into play as well. I'm all for super efficent cars, electric, what have you but using the present construct of society and public policy, consequences will manifest and it will require an ever larger gov't to overcome those consequences only to create new ones and the cycle continues. As I told the republicans in their own zeal for their own brand of big gov't, all things in America are cyclical and some day the rolls will reverse for the democrats and at some point that powers they lay in gov't hands now will be at some point in republican hands. Just keep that in mind going forward!

 

[wkmac]

Just wanted to make sure that if his wife does not okay the hummer that he wants, he has her permission to seek out other "dealerships" that offer hummers.

I took it Over was admitting to trying to give Hoax a hummer! I guess Hoax convinced Over to do a 68 and Hoax would owe him one!




Sorry Over, couldn't lay off that pitch and had to put a shot into the "cheap" seats!

 

[over9five]

I took it Over was admitting to trying to give Hoax a hummer! I guess Hoax convinced Over to do a 68 and Hoax would owe him one!




Sorry Over, couldn't lay off that pitch and had to put a shot into the "cheap" seats!

Ouch!

Hey if I had an extra Hummer to give to Hoax, I would in a minute!

 

[MechanicForBrown]

 

[UpstateNYUPSer(Ret)]

GM has a new commercial that I saw for the first time this evening. Very well done. They basically laid out their objective and game plan for when they exit bankruptcy, keeping the more profitable brands and shedding those less profitable.

 

[Scanthis]

Alas Scanthis, with GM & Chrysler being back by uncle sam's deep pockets just how long will ford be around ?

Uncle Sam does'nt have deep pockets. He has a credit card and the magnetic strip on the back is fading out from too much use.

 

[iowa boy]

GM has a new commercial that I saw for the first time this evening. Very well done. They basically laid out their objective and game plan for when they exit bankruptcy, keeping the more profitable brands and shedding those less profitable.

Haven't seen the commercial yet so i can't comment on it, but where was this objective to keep the more profitable brands and shed those that are less than profitable a year ago or even 6 months ago when they were hemmorraging money? Im not trying to start an argument with upstate (by using his quote),or anyone else about this, but just don't understand why the company had to wait until filing bankruptcy to figure out how to handle this.

 

[JimJimmyJames]

Corporate capitialism is not IMO a true hallmark of true free market economics just as the whole idea and concept of a corporation is also not in keeping with true free market economic ideals. Corporations come to life via gov't edict and only by gov't permission and with that also comes some level of limited liability to varying degrees. This in itself fosters potential for fraud and abuse with the consumer and taxpayer most often ultimately bearing the burden.

Funny that you should mention this as I just came across more info as I was researching information for this thread: http://www.browncafe.com/community/threads/should-union-membership-be-optional.242423/

When one is in a discussion with Pobre Carlos about unionism, you must be on your toes!

For the record, I am inclined to agree with your take on corporations.

Ironically I do have a love/hate relationship with them at the same time.

I have always felt more comfortable buying and using the services of name brand companies. At the same time the power they wield over society truly frightens me.

That is why I am such a strong proponent of unionism, even with all of it's failings. The little guys need to band together to protect themselves from the "benevolent" dictators grasp as best they can!

 

[wkmac]

Ironically I do have a love/hate relationship with them at the same time.

I think in reality that probably best describes for all practical purposes where we all are in some degree.

I noticed your link on capitialism quotes a lot of Ayn Rand. Contary to the myth making of one Obama fan here, I care very little for Rand other than maybe an interesting fiction book or 2. Her cheerleading of 19th century "capitialism" IMO is cheerleading merchantilism which is not true free market. Rand even champions the use of the State's force powers to advocate her economic ideas and I'm opposed to that use. Rand IMO would champion our global expansion for it's economic idealism but this also breaks completely down in that as our State advances our will over a geographic area, this in turn destroys the property and culture rights of the invaded peoples. I find it comical but tragic that people here will scream bloody murder about southern invaders coming here and changing our culture and yet will champion our own nationbuilding which is doing the very same thing abroad. The words of a wise man come to mind who said, "he who lives by the sword, dies by the sword!"

The concept of corporation dates back to the Roman empire and it's use among western civilization has come about as this practice followed the Roman church and the fragmentation of the old empire. In medieval times, corporations were granted special if not monopoly status not unlike the kinds of status and titles of nobility granted under fuedalism. It's history and understanding is well worth study and I'd encourage you or anyone to do.

At the Randian link, I found the following most interesting:

The right to form a corporation is not a "privilege" as socialists allege, but is an inalienable right.

The right to form or in essense become a corporation is an inalienable right. Now I find that very interesting to say the least. The term "inalienable" or the more correct term IMO, "unalienable" is most known from it's use in the Declaration of Independence and refers to a right not granted by an man, group of men or other earthly power but is derrived from God or Nature's God itself. This thinking comes to us in the American tradition from Locke who extolled the right to life, liberty and property and in the Declaration content, read what is said after the words "unalienable rights" where you will find the Locke ideal openly expressed in a broad explaination of "unalienable". In other words, the above statement suggests the right to "incorporate" comes from God as an expression of man's freedom and individual sovernity. But look back at the link and read the very next paragraph.

The definition of a corporation as "An artificial person or legal entity created by or under the authority of the laws of a state" (Blacks Law Dictionary) is only valid when one understands that the laws of any proper state are based on the principle of rights. The point is that the state has no authority to violate rights.

A corporation's creation comes about as an act of the State itself and not a result of a natural occurence among free acting peoples. From it's beginnings in the Roman empire to our western law of today, corporations only come into being by an act of the State itself. If corporations had natural rights as our Randian asserts, then why in 1886' did SCOTUS in COUNTY OF SANTA CLARA v. SOUTHERN PAC. R. CO. 118 US 384 declare that under the 14th amendment a corporation was a person with the same rights as a natural person. Why did it take the 14th amendment to do this if as our Randian states instead of the rights of the organic constitution is what he/she alleges is true? Just a little food for thought. BTW: Some scholars have alleged the 14th amendment was more about securing special status for corporate interests that were a rising tide at the time than about citizenship to freed slaves. Considering where we are today, I'm not so much inclined to disagree as I once was.


I'll leave you with a link to an article written by Professor Roderick Long of Auburn University. Professor Long professes to be a "left-libertarian" and I point this out only because when everyone was taking the infamous political quiz to see where they rank, if I remember correct, you fell also into that general area not far from Jones. As such, consider this article an intro to Professor Long and maybe another intro to his further writing and ideas found here and here.

BTW: I saw that thread on union membership and I to believe it should be voluntary but I also believe that if one chooses to not avail him/herself of union membership, then said union is also under no obligation whatsoever to cover, represent or in any other way benefit said employee who declines union membership. I've found over the years that most union folk I talk with rightly condemn union "freeloaders" but who in turn openly and sometimes with hostile reaction oppose the idea of just cutting these freeloaders completely loose to the whims of their own choices. Of course they rightly fear the company using that person to sweeten a deal that undercuts the union's contract so instead of the worker/employee being able to get the best for themselves, it comes down to a system of force if you will backed by State sanctioned law that either compells employee into the union plan or compells the union to support freeloader if he/she chooses to not take that path. Now this sets up a conflict as both the union or the corporation lobby for more gov't intervention that benefits their own self interests at the sacrifice of the opposing self interest. Also the cost of gov't itself in these actions is past on to the larger collective body who in many cases has no real stake or benefit in the matter. This uses the force of gov't to extract property in the form of taxes from individuals to pay for a form of welfare for others so they can benefit. Corporations complain about unions but in truth, they laid the seed from which unions sprang so there you go!

Another fact IMO that we are a long, long way from true free markets as the State under it's central planning powers directs all outcomes sometimes at the behest of special interests whether they be private or otherwise!

JMO which I'm sure many here will not like.

 

[wkmac]

As an idea as to how much this country has changed with the auto bailouts being an example, a cartoon presentation of Hayek's "Road to Serfdom" was created not long after it was first published in the mid 1940's but look at the opening frame at the bottom and see who was a republishing source!

 

[wkmac]

Property Rights Take A Hit

This doesn't pertain to GM but rather Chrysler however it's IMO still in the general area of discussion of what the thread was started for. Schiff also points out some important facts IMO that go beyond the auto industry as it pertains to banking and thus the need for full sunshine and transparency in the banking industry!

jmo