Saturday, November 8, 2008

Great. Now GM has its hand out

Well, this was predictable -- the federal government agrees to spend $700 billion bailing out the mortgage industry, and we've got more business lined up with their hands out.

It's enough to make one sick.

One of the latest beggars, of course, is General Motors. Yes, GM is broke and is crying for a handout.

The government should say "hell no" to GM, just like it should have refused to spend a dime bailing out mortgage lenders who were struggling. Blowing $700 billion of borrowed money (a good chunk of it provided through bonds bought by the red Chinese, by the way) was a terrible idea and it appears that move set a precedent.

Apparently, it's now just fine for businesses that can't cut it in the free market to ask for help from the government. And, yes, I know that the mortgage industry can make a bit of a case, seeing how they got in trouble due to some goodie-goodie efforts on the part of the feds to make sure everyone who wanted a mortgage got one regardless of whether they could pay them back or not.

Still, companies that can't compete deserve to perish. And GM officials have proven that they are too stupid to compete in the auto industry.

Let's go back a few years ago when it was obvious that gas prices were on the rise and wouldn't be coming down soon. You'll notice that Honda and Toyota both invested heavily in hybrid vehicles and worked on low gas mileage throughout their fleets.

What did GM do? Spent more on advertising for the blasted Hummer and can kept cranking out SUVs like there was no tomorrow. The only time GM really started thinking about fuel efficiency was when it was too late -- other manufacturers had a leg up in the market as they arrived first and established their brands.

GM is in trouble due to its own lack of foresight. The company deserves absolutely nothing from the feds, and when did it become the government's job to bail out companies that are too stupid to compete? What the hell is going on here? Is Matthew Lesko secretly running the government and handing out cash to anyone who asks for it?

Apparently, it became the government's job to engage in that kind of nonsense as soon as the Republican party got rid of most of its conservative members and started spending money like Democrats.

You want to know the problem with government these days? There are few Republicans left who knows what a conservative is and does. Yes, the Republicans of the past would be raising hell about this. It's a pity that fiscal responsibility has gone out the window.

It would be unfortunate, of course, for the autoworkers who rely on GM for a paycheck if the company went broke and filed for bankruptcy. That's too bad for a couple of reasons. First, they'll be out of a job. Second, they work for a company run by idiots who will, no doubt, be just fine even if they run GM into the ground and the company ceases to exist.

They might not have to worry too much, though. Japanese car manufacturers seem to be building plants in the U.S. and hiring like crazy these days. They're reaping the rewards of keeping an eye on the market and adapting to changing conditions. American auto companies used to do that. What a pity it is, then, that they're reduced to begging for handouts.

Want to read more about fiscal irresponsibility? Make sure to check out my take on why the lottery is a bad idea for Arkansas by clicking right here.


Karen said...

Our neighbor has been layed off from Chrysler for a few years now. He makes 80% of his wages and sits at home!

Matt said...

Awesome post, Hawg! You are so right about G.M. not looking to the future and ignoring warning signs. Hell, they are now running ads left and right for the new Hummer pickup truck, so they obviously didn't learn anything over the last several years. That project probably should have been shelved three or four years ago went gas first got up over three dollars a gallon.

And anyone who didn't think there would be a long line of businesses and industries looking to get a piece of the bailout was just dreaming. And it won't end until they drive us right into a depression. What a joke!

Thanks for the eye-opening post!

Krissi said...

I think I shall write a letter to congress and cry about how broke I am and maybe they will give me and my family $750 million to spend how we see fit! What a bunch of BS!! I don't know about you but I sure as hell am tired of bailing everyone out these days... what happened to the good old days when if you failed... shit you just failed?????? said...

Your pictures of Lesko are hilarious!

Seems to me when Chrysler received the original bailout, Lee Iacocca was smart and turned things around. And didn't Chrysler pay back most of that government loan? Will the current bailout recipients do likewise?

As your post indicates, however, GM seems to think Americans will continue to buy big, huge gas guzzling SUVs and trucks. Yes, some will, but obviously not enough to stay in business.

Uncle Sam, please stop messing with the market. It always fails, long term.

(By the way, we went bike riding today. Along the way, we went on your old stomping grounds, the Hendrix College campus. It is really nice. Dylan, our 15 year-old, yelled out "Obama!" several times while we rode though there.)

The Natural State Hawg said...

Karen -- That actually doesn't sound so bad. Well, unless we're paying for it, of course ;)

Matt -- Thanks for the kind words! This bailout has bothered me since it was announced, and GM's latest bit of begging is one of the reasons why.

Krissi -- I think I'll open a business, run it into the ground through mismanagement and then ask for some help for the government.

Everyone's doing it...

Paul -- Ah, I knew someone would bring up Chrysler. The difference here, I think, is that Chrysler had a plan to turn things around and, in fact, paid the loan back early. I'm still not convinced that bailout was the best idea, but it fortunately worked out very well for the company, its workers and the taxpayers.

Who's to say how this one will work out?

By the way, I'm sure your son won some points by hollering "Obama!" at Hendrix. We Republicans were very much in the minority there. I'm sure that hasn't changed.

Great campus, though, and we were at least encouraged to think for ourselves.