Social Security is Socialism

[vicarz]

Was that a squirrel?

The year was 1979, and Chrysler - the smallest of the big 3 automakers but perhaps 10th largest corp in USia, was facing financial crisis. They begged for help from congress and Carter. Not only had they made cars that people were not buying, SPECIFICALLY MAKING GAS GUZZLERS SHORTLY BEFORE THE OPEC EMBARGO, but they had the lowest quality ratings of ANY car company. It was felt that guaranteed loans were a way of saving this ailing company that was too big a part of the landscape to let die of natural causes. Some in congress cautioned that this would set a dangerous precedent - others chided them that this was a one-time event that could never happen again. Shortly after the oil embargo, GM was venturing into electric cars, which they promptly abandoned when the price of gas stabilized (they gave the idea "to the Japanese")
http://www.npr.org/templates/story/story.php?storyId=96231032&ft=1&f=1001
or
http://en.wikipedia.org/wiki/Chrysler#Government_loan_guarantees.
Honestly I'm not sure what to do in one regard - I think it is healthy for the US to have car companies, but it is clearly not healthy to give them government aid. In 30 years they have had the freedom to wind up making the exact same mistake with the same result. It's not like the writing wasn't on the wall - oil prices have a history of volatility, and at the same time USian companies were making the hummers and monster vehicles, the "foreign" companies (hey isn't GM a German company now, even after the spinnoff?) were making not only fuel efficient vehicles, but hybrids.

There is nothing patriotic about using hard-earned dollars to support the failure of the weak that free market economy is supposed to allow. The allegedly US car companies are asking for an untaxed unlimited profit on the upside with no regulation (blowing money on lobbying congress not to impose fuel and environmental standards) but when their errors and bad business judgments show themselves, the public is asked to "loan" them their dollars to bail them out, again, or in short - not facing the downside of the freedom they were granted.

Fun factoid #1 - misplaced patriotism of rednecks support democrats! Huh? Well, buying the inferior US cars, "buy american" campaigns by the right, propped up absurd Union salaries where manufacturers were able to pay their workers 80k-six figures for HS level work. The unions in turn propped up the democrats.

As an aside discussed last night, Carter had solar panels installed on the white house. Reagan had them removed at taxpayer expense with no stated reason early upon his arrival to the white house.

Comments

[doc-quixote.livejournal.com]

hey isn't GM a German company now, even after the spinnoff?

GM isn't. Chrysler was until fairly recently.

Carter had solar panels installed on the white house. Reagan had them removed

And they're (allegedly... I have no way to verify) back as of a year or so ago, though I'm not sure if the current inhabitant was in any way involved (or even knows).

[vicar.livejournal.com]

Last I heard they were found in a warehouse and picked up by a university...been to long to recall though. I do remember Carter in god-awful sweaters, showing that he was committed to leave exactly the way he preached.

Would be cool if they were up - lead, lead by example.

[djpsyche.livejournal.com]

Hopefully the government will give any money it does attached to the requirement that the car producers ONLY manufacture energy efficient cars. Want to produce more gas guzzlers? Do it on your own dime, the dime you haven't got that is...

[vicar.livejournal.com]

Actually, no? It's private industry - if we start paying them to do things, then it's socialized industry that all the isles are whining about (see UK rail for example). Oh, see US rail - Amtrak, for example. USia is based on the myth that selfish profit motive is the solution to all society's ills.

The only reason I can see to do this is that it is a difficult industry to start. A factory is huge and expensive, car designs are very expensive, and the liability on cars can be huge so you need whole teams of engineers and (ugh) lawyers. So if we lose this industry, we may not get it back - or just have it as we do now, foreign companies with factories in this country.

[eac.livejournal.com]

I don't think we should bail them out.

There should be some sort of incentives or funding for development of fuel efficient cars and a LOT of economic support for the communities which are going to be hit by their failure. Michigan, in particular, is in big trouble economically.

As harsh as this sounds...

[american-arcane.livejournal.com]

I say let them fail and fail big.

Desperate times breed the most severe changes. And what we need right now--especially in the American auto industry--is severe change.

If the existing corps can't manage that change on their own and dissolve or vacate their production facilities, I'm sure some enterprising entrepreneur will be happy to grab that real estate and equipment at bargain basement prices.

Like you pointed out, this is (at least) the industry's second strike in the economic game. I don't think we can afford to support them until they make that third.

(And, yes, I know this would do horrible things to the employees... but I think it's slightly better to end up in a bad situation, employment-wise, when there's more people having the same problem. It builds a certain solidarity and, again, leads to more creative community-based solutions. Or, at least, that's what it seems like looking back at the early 1930's.)

Re: As harsh as this sounds...

[vicar.livejournal.com]

I don't think it sounds harsh! The employees suffer from poor planning too - the news has been talking about the car industry, their problems, oil, mideast instability, alaska-offshore-environment, and the Union benefits forever. Why some twit in detroit would expect that a job that requires a HS education equiv expects to make as much as an attorney while helping robots build cars is beyond me.

Both the workers and the execs made huge mistakes. They gambled and lost, or were incredibly isolated/short-sighed. Fawkem - that's the USian way.

[transentient.livejournal.com]

The big three aren't even as important on the American business scene this time around as they were at the beginning of the 1980s. And since that time, car manufacturing has internationalized to the point where companies like BMW and Honda make cars inside the US, and Ford was up until 2006 so British, that they owned both Jaguar and Aston Martin. This is all so stupid. Damn I hate me some corporate welfare.

[vicar.livejournal.com]

Yeah - I thought Obama was supposed to be a socialist, but not the republican socialist where they fund all companies equally!

[http://users.livejournal.com/_blackjack_/]

As I've mentioned before, using the government's resources to support private industry is symptomatic of fascism, not socialism.

[vicar.livejournal.com]

Really? Sounds fascinating, I'm not sure I understand. If you could point me to a dumb-enough-for-José-to-understand version like wikipedia I'd be grateful.

Rich Country, Strong Military

[sidhebat.livejournal.com]

A very short and crude version of one example of the top of my head: Japan saw what European countries were able to do to China (carve it up into spheres of influence) with their strong military forces (mainly naval) and used state-supported industries to develop/copy and build their own. China made the mistake of buying its ships instead (from Germany iirc). Japan was aided in large part by a silk blight in Europe at the time which game them a huge market share in textiles.

Japan's resistance to colonialism came with a feeling that Asian countries that had succumbed were weak and in need of control. "Asia for Asians" was their rallying cry, but it was just imperialism with a different ethnic group at the helm.

The sacrifice of private industry's decisions about what to manufacture goes hand in hand with the idea that individual goals should be sacrificed for the good of the state, in large part to protect the homeland from the Other.

I can phrase this better and provide sources after my marathon on campus is done tonight.

Re: Rich Country, Strong Military

[vicar.livejournal.com]

I think this is good - just LJ, not a research project :)

[n8-zilla.livejournal.com]

i agree with most of what you've said, but i do have one question. why shouldn't people who do physically demanding, dangerous work be well paid? i hear a lot of blame out there being heaped on the people who do the hard work building things in factories, i don't hear so much about the executives taking home salaries that would cover a whole factory's payroll. a well compensated labor pool is not the source of the car companies' inability to cater to their customers' needs. the only sympathy i have for them in that regard is their healthcare costs, which is something the government should have been involved in taking care of for some time.

[vicar.livejournal.com]

Delay of gratification is worth a fortune. I can walk into a factory and be working full scale in 90 days. An executive needs college plus 20 - 30 years of 60 hour weeks or more. I do sympathize with higher pay for those of us that suffer for ages without reaping the benefits of spending the earnings right away...I have people who work far harder than me and make far more - of them I'm only jealous until I remember the choices they made and the ones I made.

For reference, construction workers have tougher conditions and not nearly the pay. In fact, I think they need more training.

[n8-zilla.livejournal.com]

the way i see it, the auto unions have been more successful in their work on behalf of their members than have the construction unions. labor costs may be an issue, but i doubt very seriously that their importance in this crisis for the auto industry is anywhere close to that of the gross mismanagement of the folks at the top.

people who do hard work should be well paid. the fact that some aren't does not make that point any less valid.