Well now…what to make of the Fed’s firing of GM’s CEO?

Some random thoughts…

1. The same people who habitually deliver your mail to your neighbor’s house are now firmly in charge of what is left of our domestic auto industry.
2. Yet the head of the United Auto Workers union remains firmly ensconced in his job…probably into perpetuity.
3. Nothing much will come of the threat of bankruptcy.  A federal bankruptcy judge would have forced the necessary cramdowns to make the companies viable….but that would also remove the power now held by the administration to force the manufacturers to build cars the public refuses to buy.
4. A prominent economist predicted that once the bailout process started…it would burn through 100 to 150 billion dollars, as good money continues to get thrown in after bad.   Sounds about right.
5. The bailout has spread to the auto parts manufacturers as well.  And now the government is stepping up to guarantee the car warranties.   For the failed GM and Chrysler…but not for the successful, go it alone, Ford.
6. Where is Alexander Hamilton when we really need him?  Were the Federalist Papers written in vain?  I must have missed that part of the constitution that gives the President the power to hire and fire private company CEOs.
7. Does this mean that we can fire up the decaying assembly lines and once again manufacture Packards, Studebakers, and Nash Ramblers?
8. We seem to have enshrined need as the overriding policy consideration.  If need is, in fact,  the dominant theme, then the floodgates are open for a massive and never ending redistribution of wealth…which gives rise to the catchy slogan…“from each according to their ability…to each according to their need…”
   (extra points to alert readers who can trace the origin of that phrase)
9. If bailout recipients are defined as legacy firms that have fallen as innovative firms have challenged them,  perhaps we should channel multiple billions to the old dial-up Internet portals who have been hammered by the broad band players….or declining land line telcos who have lost market share to wireless telephony?
10. When I watched the movie “Idiocracy” it did not occur to me at the time that it was a documentary predicting the near future.

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Posted: 04|6|09 at 6:22 am. Filed under: politics, recession.
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