GM Down the Tube

So much for the Big 3. GM filed for bankruptcy today, becoming the country’s second automaker after Chrysler to go under in just over a month. Today was the end of the 60-day period the Obama administration gave GM to come up with a successful viability plan. The administration will give the car maker $30.1 billion in federal assistance to support GM’s restructuring plan. General Motors will enter into bankruptcy protection and is expected to emerge as a new company in 60 to 90 days.

I never thought the automakers had any long term strategy. Where are the smaller and more fuel efficient cars? Where are the cars of the future? They made tons of profits on SUVs and stopped being competitive with smaller cars. That killed GM when the gas crisis hit last year. They did not shift their focus to alternative energy vehicles. Most car makers didn’t care about making cars that would save gas because they were in bed with big oil! Everyone knew GM had too many car models and they couldn’t support it.

Bailing out the auto industry didn’t help solve the basic problems of the industry. Stop throwing good money at a bad problem! Federal money only slowed down the change that the auto industry needed to make. They needed change from top to bottom.

Here’s why I think GM went into bankruptcy and why it’s the best possible scenario for the company. Bankruptcy will allow GM to restructure and get out of some of their contracts. The bankruptcy process is not a bad thing. In fact, it should be embraced. Bankruptcy allows companies to do tough things they could never do in the normal course of business. It has helped many companies turn themselves around and come out even stronger. KMART went bankrupt a while back – they are thriving now. I expect to see GM do the same…

That’s How I Roll…

Gaydos

(Original here)

UAW is a Problem Folks

I went back to the midwest this Christmas break to be with my family. I grew up in Dayton, Ohio, where a GM plant was 15 minutes away. A place where I saw trains carrying cars and/or car parts every time I crossed the train tracks. You would think that with the recent “hardship” of my home town that they would have something to say about the bailout right.

Of course the subject was broached on the first day I was there. I don’t remember the exact subject at hand, but I think the news was showing the somber sad GM workers taking their tools home because their shop was closing it’s doors. Somewhere during this I chirped in and said, “Good. Chapter 11 is exactly what they need so they can get the Union off their back.” I was immediately rebuked with, “No, that isn’t it!” I didn’t get into it at that point but here is a good article here from Michelle Malkin about how the UAW spent money unwisely and lost money for the benefit of the head-hancho UAW people. Anyways, article below…

No! Don’t Do It!!

It’s like watching a horror movie. No! Don’t do it!! Don’t open the door! You cover your eyes because you don’t want to look. You can’t believe they’re going to do it. But you know they are. Even though it makes no sense, and it’s obvious to everybody watching that it’s the absolute worst thing they could possibly do. They’re going to do it anyway. Why? In a horror movie it’s because it’s in the script. And ultimately, it doesn’t really matter, because it’s all make believe.

But this isn’t a horror movie. It’s real. And it affects every one of us, but we’re powerless to stop it. All we can do is write our Congressmen and say No! Don’t do it!! Don’t give them the bailout money! And that does about as much good as shouting at the movie screen Don’t open the door! Because you know they’re going to do it anyway.

First they said they needed $700 billion to bail out troubled financial institutions. Letters to Congressmen ran 20-1 against the bailout and, last September, Congress voted against the bailout bill. But they kept sweetening the pot with a little pork here and a little pork there until everybody in Congress had enough pork in the bill to lure them into voting for the bailout, in massive disregard of the indignant outcries of the people who elected them.

Then Bernanke and Paulson turned around and said, You know what? We’re not going to use this bailout money the way we originally said we would, because that would have been a really stupid thing to do. (Really? When did you figure that out, Mr. Genius? That’s what all the people writing to their Congressmen were screaming all along.) But, even after acknowledging the plan was hopeless, instead of rescinding the bailout, they decided to spend it on something else. After all, they already had the money; you could hardly expect them to just give it back! — Not that they actually do have the money. But that’s never stopped them from spending it before. Why should it stop them now? — So they voted to spend all this money they don’t actually have, and then decided not to spend it for the purpose for which they swore they needed it. So now they’re going to spend it on something else. They haven’t yet told us what, exactly. Why not? Because they don’t know. They don’t have a plan. But spend it they will.

They’ve put out the word that there’s $700 billion of free money on the table, and they’re going to give it all away. To whom are they going to give it? The criterion to qualify seems to be incompetence. But not just any incompetence, only massive incompetence will do. To qualify for some of this free money, a corporation or institution has to prove they’ve mismanaged their finances on such an unprecedented scale that they’re billions of dollars in the hole and have absolutely no way out, short of a federal bailout.

The three automakers deserve to go out of business. GM and Toyota each sold 9.37 million vehicles last year. Toyota made $17.1 billion. GM lost $38.7 billion. What more needs to be said? But, instead of letting economic Darwinism take it’s course, the government wants to compel the taxpayers to throw our hard-earned money at them so they can flush our money down the drain after their own. This is madness. Just say No! Don’t do it!! Don’t open the door!

And, of course, now everybody else is lining up for bailouts as well. Even city and state governments are getting in line. The economy is bad. An awful lot of businesses are losing money or going bankrupt, and local governments are losing tax revenue because their tax base is losing their jobs. So why not just stick a hose directly into the pockets of all the taxpayers in the country, and siphon out more and more money until the well runs dry, to keep businesses afloat that are unable to make a profit on their own merits? Surely, every business deserves to make money, whether or not they provide good value to their customers and investors. Free market be damned! Move over Rover, let Government take over. It seems the government is determined to prove they can waste even more money faster than the failures they’re bailing out.

Which brings us back to the horror movie. Everybody in the audience can see that disaster lurks behind that door. But the protagonist is about to open it. We’re all sitting on the edge of our seats, gripping the handrests, holding our breaths, and whispering through gritted teeth – No! He hesitates with his hand on the knob. Don’t do it!! (But we know he will.) He twists the knob. Don’t open the door! And then he does ———————–

Reblogged. (Original here)