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Sunday, November 23, 2008
Paul Jacob :: Townhall.com Columnist
In need of bankruptcy?
by Paul Jacob
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Some of those divisions have been so badly run for so long a time that it would be better to let them die a peaceful death. We don’t weep for Studebaker, today; why weep for just another SUV line?

It would be great if some new owners and managers would take up the promising Volt project from Chevy. There is probably a big future in electric cars. I bet there are investors who would be willing to take it up after receivership.

Or, GM could sell off the line now, staving off bankruptcy.

Or, better yet, GM could sell off other lines, and invest in electric vehicles, where there’s likely a big future.

Unfortunately, before GM, or Ford, or — what’s the third one, again? Iacocca’s once-bailed-out dinosaur? — Chrysler can move forward, they each face a speed bump the size of the Rocky Mountains: the unions.

Representative Flake is right: Getting out from under union contracts is almost a necessity. America’s automobile industry won’t recover as long as it remains weakened by union leechcraft. It’s a wonder that these companies have survived as long as they have, considering how unreasonable union demands have been, and how life-draining union benefits have been to those companies.

And that gets to the heart of why things look so bleak right now. Do we have any reason to believe that president-elect Obama has the insight or the courage to take on the unions? Indeed, he and the congressional Democrats will be sorely tempted to throw billions at Detroit rather than confront one of the more sordid skeletons in their closet: America’s pro-union laws. In fact, our laws may soon be further rigged in favor of unions.

The Democratic Party has played the toady to “organized labor” at least since FDR’s time, and organized labor has played one of the most pernicious political roles, with devastating influence on American policy and culture. The teachers’ unions have consistently held back K-12 schooling in America, and they prevent, at every possible turn, the best attempts to improve education. America’s unions also helped cartelize — and then ruin — the industrial sector. Think steel. Think rust belt. Understand why America is as “post-Industrial” as it is.

Big Three automakers are remnants of the ancien régime, of old school American can-do-it-ness. They’ve been hurting for decades now, struggling to keep up with modern demands.

And now they claim to need government funding.

What to do? Why not fire them all? Fire every CEO, CFO, COO. And fire every worker. And then hire needed workers back at market wages.

Yes, they need bankruptcy . . . because America needs to move on.

But with the party beholden to unions now in control, this is about as likely as . . . financial sanity under the Republicans.

Both parties believe that some enterprises are “too big to fail.” And because of this, they may imperil the biggest enterprise of all: the United States of America itself.

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About The Author
Paul Jacob is President of Citizens in Charge. His daily Common Sense commentary appears on the Web, via e-mail, and on radio stations across America.
 
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America is suffering
America is suffering unlawful deception from the Alinsky group.
Group u$urp$ power on January 20th—the constitution violated.
The United States Supreme Court alone can relieve this outrage.

example: Bogus Selective Service System FOIA Registration?
http://www.debbieschlussel.com/archives/2008/11/exclusive_d id_n.html

Persnickety - On defense production
--
Writes Persnickety Curmudgeon:

"BIG-3 deserve to go under but do have points in their favor like importance to national defense and ridicuolus mandates from DC. Still be careful what you wish for. At $70/per hour as outrageous as that is, each auto job lost is like 3 average jobs in terms of its effect on the economy not mention trickle down."


The production units of the "Big 3" responsible for the manufacture of military vehicles will tend to be the most valuable assets to be picked up by other manufacturers when bankruptcy liquidation ensues, and there should be no strategically significant interruption in the delivery of goods from these units.

As for the aggregate worth of these "$70/per hour" jobs burdening the Big 3 companies, you're falling into the "broken window" fallacy.






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"Special interests request money from the government (in the form of subsidies, grants, etc.), and the government then forces the taxpayer to provide the funds. The recipients certainly do benefit, so the government action is often regarded by the people as benefitting everyone. But the people are failing to consider the hidden costs: the taxpayers are now poorer by exactly that much money. The food, clothing or other items they might have purchased with that money will now not be purchased—but since there is no way to count 'non-purchases,' this is a hidden cost, sometimes called opportunity cost. Bastiat referred to this in his essay as 'what is not seen'. Because the costs are hidden, there is an illusion that the benefits cost nothing. Hazlitt summarized the principle by saying, 'Everything we get, outside the free gifts of nature, must in some way be paid for.' Robert A. Heinlein popularized a summarization/acronym of the concept called 'TANSTAAFL' (There Ain't No Such Thing As A Free Lunch)."

-- Wikipedia article, "The parable of the broken window" (accessed 24 November 2008)
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