Knight's Pick 11-16-2008
- Thread starter Nathon Detroit
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assuranceagent
New member
That is a great post!
Bravo, Fool! :thumb:
Bravo, Fool! :thumb:
The union isn't our "nose". Instead it's a giant festering boil that destroys the entire face.
elohiym
Well-known member
The taxpayer will have to fork over a lot more than a bailout will cost if we let any of the big three automakers fail. Fool does not seem to understand that crucial point, and he only provides an emotional argument.
Consider a bailout to mitigate damages. Without it, many people will suffer, and the taxpayers will lose far more.
Consider a bailout to mitigate damages. Without it, many people will suffer, and the taxpayers will lose far more.
elohiym
Well-known member
I understand how bad unions are. At this point in the game it's irrelevant. First deal with the crisis, then deal with the unions. We need to mitigate damages at this point.
I don't live my life by making decisions based on things like "suffering less" or "lesser of two evils", I do my best to do what is right regardless of the consequences.
The unions have destroyed the "big 3" and it's time to let companies fail if they cannot be profitable.
Other companies will spring up to fill the void and hopefully they will have learned a valuable lesson in the process.
But don't take my money just so you can give it to some retired union worker that is living off of a ridiculous retirement package. Stealing is wrong, it's immoral to take my money and give it to somebody else just because we don't want "that company" to fail.
It isn't irrelevant. The union is the DIRECT cause that the "big 3" cannot compete with foreign auto manufacturers. I agree... we should "deal with the problem" and I say we should deal with it by not placing a band-aid on a severed torso.
elohiym
Well-known member
Your money will be taken either way. It will be stolen either way, whether we provide a bailout or not. If we provide a bailout, it is possible that we profit, especially if the government buys equity stakes in the automakers. That's dividends and preferred stocks that can later be sold.
If we do not bailout the automakers, we will have our money stolen to deal with the fallout from that. Only in that situation, we can't profit, and we stand to pay a far greater sum to fix things if they fail.
Since you cannot prevent the theft, you are left to decide how much of your money your want stolen. Do you want a little stolen, which will earn you a dividend and be returned to you with profit eventually, or do you want a lot stolen and essentially flushed down a socialist toilet?
Mitigate the damage. It sucks, but that is the reality of the situation.
elohiym
Well-known member
And I say that we send Igor out for the body parts and raise the dead to life so we don't end up as severed torso ourselves.
The Berean
Well-known member
If the Big-3 were to fail tomorrow I suspect what would happen is that new investors may come in and swoop up all the manufacturing facilities and start over. I wouldn't be surprised if they were to hire some of the excellent middle managers and engineering types from the Big-3 to help out. In fact these people would be the first people that the new investors would want to hire.
The guy who started Paypal, Elon Musk, sold Paypal and help found two new companies, SpaceX (rocket company) and Tesla Motors (electric car company). He's challenging the big government backed rocket companies and is positioning himself to take his fair share of the market without any money from the federal government. Tesla Motors recently began production of its hi-performance electric sports car, Tesla Roadster earlier this year. Tesla Motors plans to build a coupe (2010), and sedan (2012). And Elon Musk is just one guy. If the Big-3 failed tomorrow American auto manufacturing will not go away. People like Elon Musk will come in, invest, and make American automotive manufacturing profitable again.
That's what they said right before the last bailout! Now, another bailout... and then another.. .and another... and another....
I will fight against socialism on all fronts.
What you are saying is.... accept socialism now... because you are going to get it one way or another. That's a strategy of failure.
assuranceagent
New member
I agree with the assessment of unions as 'boils,' but I would have put it somewhere other than our collective face. Perhaps somewhere darker and less commonly exposed... :think:
Ewe.... ouch!
Sadly... I am sure you are right.
elohiym
Well-known member
If you are referring to the TARP, we got a better deal than we first bargained for. Instead of the money being used to buy toxic mortgages, the money was used to purchase equity stakes in the banks. Those preferred shares have value and pay dividends. In the end, the taxpayer may profit tremendously from the TARP, getting all the money back plus.
A bailout would be fascism, not socialism. Not supporting the bailout would necessitate socialist interventions to deal with the fallout. So by not supporting the bailout, you unwillingly support socialism. And by supporting the bailout, you willingly support a capitalistic type solution, albeit fascist.
elohiym
Well-known member
Remember, a bailout in this situation, if done similarly to the TARP, would not be corporate welfare. We would be buying an equity stake in the automakers. Technically, that's capitalism, not socialism.
Granted, we need to see what type of bailout is proposed. I favor a program similar to TARP where we get an equity stake in the automakers. I oppose a corporate welfare handout, especially since the bank bailout set a capitalistic precedent we can follow with the automakers.
Granted, we need to see what type of bailout is proposed. I favor a program similar to TARP where we get an equity stake in the automakers. I oppose a corporate welfare handout, especially since the bank bailout set a capitalistic precedent we can follow with the automakers.
elohiym on another thread you gave "kudos" to Peter Schiff for accurately predicting the crash. Do you disagree with him that we should let these companies fail?
| Peter Schiff says we HAVE TO LET THEM FAIL! | |
elohiym
Well-known member
No. I don't agree with Schiff.
Some things you should note about the interview he did with Cavuto: First, the date of the video is in March of this year. It's old news. Second, he is saying that we should not bail out Bear Sterns, or things would get worse. Well, we didn't bail them out. They were aquired by J.P. Morgan Chase. Still, things got much worse. Third, Schiff was claiming gold was a good investment then at $1000.00 per ounce; now gold is $739.00, so Schiff was wrong on that. Fourth, he is basing his reasoning on inflation fears, but we are experiencing deflation and trying to avoid it (think great depression), so inflation is our friend at the moment, if we can get it to happen.
It appears that Schiff does not understand where money comes from. Like so many people, from the masses to so-called experts, he thinks the government just creates money from thin air. Hence his inflation fears. However, according to the Federal Reserve Bank, the majority of money comes into existence through bank lending (business, homes, autos, and credit cards). Since the banks are tightening credit, and have been for a while now, we are facing deflation, not inflation.
Now, in fairness, Schiff does support letting the automakers fail, as you do. Although that is not the point of that "old" video you posted. If you go to his website, you can read his rationale for letting them fail:
The government should let the Big Three fail not because we no longer need an auto industry, but because we desperately do. What we do not need is the bloated, inefficient auto industry that we have today. By allowing the Big Three to fail, their capacity will be turned over to new owners who will be able to acquire the means of production at fire sale prices and hire workers at globally competitive wages. The result will be a more efficient auto industry making cars that people around the world actually want to buy at prices they can afford. Such auto makers could conceivably be profitable and could become the cornerstone of a manufacturing renaissance in the United States. In contrast, Ford, Chrysler and GM are never ending money pits that threaten to swallow a good deal of our economy.
There is much I disagree with on Schiff. His position on the automakers is one of them. He argues that fire sale prices and globally competitive wages will result in a more efficient auto industry, and suggests that people don't want the products that the big three are manufacturing. That's all nonsense!
Globally competitive wages is code for slave labor, because that is what U.S. manufacturers are competing against. To say that people don't want the cars that the big three manufacture, under normal economic conditions, sounds dubious and smacks of global warming, peak oil propaganda. All auto sales are down dramatically at present. Schiff needs a better argument, and he needs to address the consequences of letting the automakers fail. He conveniently ignores the opposing argument.
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