By Brian Short, CMC, CRMS, GMA
Six months after we were told that giving the auto industries $30 BILLION would save them (in spite of the SCREAMING from nobodies like this author and others! See: https://promortgagematters.com/2008/12/05/are-they-still-clueless-a-time-for-real-ideas-to-move-forward/) GM (now affectionately referred to as “Government” Motors!) has taken our money with them – down the drain!
However, that’s not all! This NEW PLAN to “restructure” GM involves another $50 BILLION from the US Government to this company which is now owned, in part, by the very thugs and shysters (the UAW) who helped bring them to their knees rather than give concessions to keep their employer solvent. Now GM is owned by the US Government and being run by this Administration (headed by the “Community Organizer in Chief”) the Unions put in office with the help of the Black Panther club-toting “poll monitors” and ACORN.
GM stock is now trading at $.70 and has been taken off the Dow 30 but the UAW retirement plan is getting the backing of the US Federal Government. What about all of those other retirement funds which had played by the rules and bought GM stock when it was selling for $90 at it peak? Who is backing and guaranteeing those retirees?
Why does this administration feel the obligation to artificially prop up the union retirees at the expense of the non-union retirees? Would it have anything about securing future votes or rewarding them for past votes? Is this really good for our free market economy? Does this plan to pour another $50-$100 BILLION into GM before the end of 2009 really do anything for 100 MILLION non-union workers who are still fighting every week to make their house payments and keep their jobs?
Just as a reminder, this economic crisis was brought about because of the loss of credit – first in the housing industry, then for business owners, college students, auto dealers, big-box retail chains, etc. We have now all felt the crash of the loss of credit and free-flowing funds on the secondary banking markets.
To continue to throw BILLIONS of dollars at each of these failing industries without fixing the PRIME ROOT of this disaster is like trying to use a “Sham-Wow!” to fix a broken dam. There may be water all over the road but that is not hardly the problem. Some major concrete reconstruction at the source of the cracks is what is required to keep the water from running over the road.
The issue at stake is shoring up the banking credit markets so the other industries dependent on free flowing credit (i.e. housing, autos, retail, college loans, etc.) can begin to normalize. Propping up other industries before the banking and credit markets are stabilized is still “throwing good money after bad.” (My dad always said this. I’m not real sure what it means. However, I think you get my point!)
During Bill Clinton’s successful run for President against an originally assumed unbeatable George H. W. Bush, who had become nearly an overnight national hero for a seemingly bloodless war to remove Saddam Hussein from his occupation of Kuwait, was given its momentum from a phrase coined by campaign adviser James Carville in 1992 when he chimed “It’s the Economy, Stupid.” He turned the debate from Bush’s noble handling of foreign affairs to the faltering economy (which Bush had attempted to fix by caving in on his pledge – “Read My Lips” – for no new taxes during his administration to pacify an uncooperative Democratically controlled Congress).
The Clinton campaign continued to hammer out it focus on the economy -“It’s the Economy, Stupid!” – and they changed public opinion away from the foreign affairs hero in favor of a small-town southern Governor who had never lived or worked in Washington, DC.
Once again, the attention of the public must be turned – “It’s the Credit Market, Stupid!” – to get this currently distracted administration away from simply returning campaign favors and shoring up organized gangsterism and thugery shrouded in “labor protection” movements and “community organizations.” The American public must see through this type of “Chicago Style” politics and demand that our elected representatives quit passing out money they don’t have in order to make promises they can’t keep at the expense of generations they won’t ever meet!