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Enough With Those Bailout Lines
WITH EACH passing day, the bad news gets more alarming. Sales are shrinking, revenue is declining, and jobs across the nation could be lost.
The industry is in crisis. Time is of the esssence. Delaying support will cause irreparable harm.
President-elect Barack Obama, please rescue the newspaper industry. A thriving, vibrant press is a critical national need. Besides, newspaper writers across the country helped elect you.
In an opinion piece published in USA Today, Michigan Governor Jennifer Granholm and Richard Blouse, president and CEO of the Detroit Regional Chamber, used much of the above language to press their case for a Detroit bailout.
Part of their plea rested on the federal government's previous decision to rescue
No one in government is going to back a newspaper bailout and no one should.
Yet these same arguments are winning bailouts for other industries.
Where will they end? Is there an objective economic formula for deciding who gets one? Or, is it rooted more in politics, even though Obama pledged to reject politics as usual if the country elected him president?
Details of a government rescue of the auto industry are still in the works. From the start, the proposal felt less like a coherent piece of fiscal policy and more like a jobs bill and thank you to labor for supporting Obama and the Democrats during the 2008 campaign. It makes you wonder who else might get a thank you note from the Obama administration.
The Service Employees International Union, the Teamsters, the AFL-CIO all backed Obama at critical moments during the tough primary and general election seasons. According to the Asssociated Press, Obama received 60 percent of the union vote in 14 states where voters were asked if they were union members. Union support was even higher in Pennsylvania, Nevada, Washington, and Michigan. The Michigan AFL-CIO dispatched 85,000 volunteers to knock on 500,000 doors, make 1 million phone calls to union members, and distribute 2 million leaflets at work sites, the AP reported.
Already, it's payback time.
Bankruptcy offers
companies the best chance at a fresh start, some experts say. But jobs
and benefits will be shed during the painful restructuring process. In
contrast, a government bailout for
Beyond the bailout, the labor agenda includes policies that make it easier to form unions, expand the pool of workers who can join them, and extend healthcare benefits. The automakers and the United Auto Workers want half of whatever they get from Washington to help the companies meet healthcare obligations for more than 780,000 retirees and their dependents, under contracts signed in 2007.
Any American worker would be relieved if the government stepped in to preserve health benefits. Today, the opposite is happening, as companies cut benefits to cut costs. A better healthcare plan for everyone was a big part of the Obama campaign agenda, and his ability to deliver on it will be a major measure of his success as president.
In the meantime, he and fellow Democrats should refrain from playing economic savior on a sector-by-sector basis.
Anyone in a struggling industry - and that includes the newspaper business - understands the pain of layoffs and reduced benefits. It's human nature to beg for the life boat as the waters swirl waist-high. But, capitalism doesn't call for survival at any cost or by any means necessary; it's survival of the fittest. Adapt or die, as the corporate fallen know.
If newspapers aren't producing news in a format that people want to purchase, it's the industry's problem. If Detroit isn't producing cars people want to buy, that's Detroit's problem - not the taxpayers'.
18 Comments so far
Show AllAnd, while we're at it... let's bailout Circuit City, Bennigans, Mrs. Fields, Starbucks, The Sharper Image, Linens and Things, Ann Taylor, Zales, Domain, Levitz, Wickes, Fortunoff, Harvey Electronics, Lillian Vernon, Bombay, MPC Corporation, WorldSpace Satellite Radio Company, Mervyn's...
And, while we're at it... me...
Sioux Rose
FRANK: If that sharp wit of yours is ready and able, you should have a talk radio program to compete with those disseminating dis-information on the right.
TOKYO, Nov 17 (Reuters) - Japan's Nikkei share average fell 1.1 percent on Monday
after data showed the world's second-biggest economy was in recession. . . .Et Tu Nippon?
I love the bailouts. I want a bumpersticker that says so.
Americans never read Marx. But they understand very well what it means when all the men & women who bragged about their ability to understand & respond to market demands come to the national Treasury and beg for the spigots to be opened & ask the loaves of bread to be miraculously multiplied.
Kimche is wrong, wrong, wrong, wrong, wrong. Of course the corporations don't deserve a cut, of course the people who ran them were absolutely corrupt & irresponsible -- but this can only be engraved in the American consciousness by being there every day for months on end -- and then they will no longer believe in the free market rhetoric which has made public discourse toxic for so many years.
Corporations are BY DEFINITION 'ineffecient' -- they have to steal labor in order to exist. To ask industries to be "more efficient" is an absolute contradiction. Let them exist -- and let them be devoured by the public financing they require. Of course they'll try to use the money to keep power; but by accepting so eagerly, they stamp their own execution warrants, figuratively speaking at least.
The bailouts are an ugly sight. But they are necessary. Obama is just suggesting what every country in the world is doing right now. If we don't bailout the major industries of America we could collapse the entire global economic system. I know a lot of you just have a knee-jerk anti-Obama attitude, but please do some reading as to why we need the bailouts. For example, if we don't bailout the auto companies tens of thousands of people will lose their jobs overnight. If we didn't bailout Wall Street the DOW would be below 5000.
"In the meantime, he and fellow Democrats should refrain from playing economic savior on a sector-by-sector basis."
If he manages to save those sectors, then why isn't that a good thing?
So...let it collapse! It is a pyramid scheme anyway! Show it as the unsustainable animal that it is. We can rebuild. We can MAKE it a better system. We need to have this ugly system go DOWN in order to bring it back in a more realistic way.
joe: the dow belongs at 5000 or much below..remember the crash of '87 it was like at 1700 and fell to 1200..when j. carter was pres it was like less than a k..also my electric bill was 8 bucks a month..dito phone..my god dito heat..
ken
No bail out. Not in any way that resembles the $700 billion giveaway that just happened. Any money given to the automakers should have such strings and contingencies attached that there will be no way a penny can be spent on compensating the executives who drove these companies into the ground, nor toward continuing to produce the vehicles that no one wants to buy, nor to advertising to ameliorate their public image or promote those archaic vehicles. Every dime of any money given to the automakers must go to the development and production of alternative energy vehicles, or hybrids at the least. Neil Young (of CSNY fame) has proposed an ingenious plan that would keep Detroit factories going. His plan would require no immediate retooling. I saw an article about it and I'm sure anyone could find it on "the Google."
Walmart's profits are down this year. They will be asking for a bailout soon.
Does anyone here on CD believe that the major players in this crisis didn't control the timing to ensure the absolute maximum looting? And now huge immediate bailouts are needed or we'll be in real trouble boy!
Twenty nations hold an economic summit and all of 2 days are devoted to it? And no follow-up meeting until April?
Beefing up International Labor Unions is the best answer to this crisis.Lengthy prison terms for hedge fund managers and some of the other miscreants is an enduring fantasy.Our Supermax prison here in Wisconsin has some available cells.
Wow! The ignorance of the reality on the ground is astounding. Manufacturing is the keystone of National Security. Every one job actually in the auto industry has at least 6 jobs that will be lost when it is made redundant.
I have worked in both the auto and the banking sectors. The auto industry is not asking for money to rescue them from immoral practices - as the banking industry did. No, unlike other industries, they are trying to do right by their retirees. God forbid we reward good behavior! No, you all want to reward predatory behaviors of the bankruptcy vultures who will be the only ones to profit if GM and the like go under in North America. I know of no industry - and I have worked in most - that has less waste than the automakers do.
Oh yes, the only place where GM or Ford is having trouble is North America due to the meddling of Congress for the past 30 years in the industry. Many of the cars that would be competitive are not allowed on the US market because of tariffs and practices protecting other industries - and onerous (and unrealistic) environmental and safety regulations that only increase costs. Reality dictates that only North America will suffer - not Ford Global or GM Global. Both global divisions are healthier than Toyota at the moment.
What other industries are being protected? Oh, oil with artificially low prices. Corn and Beet sugar interests that do not allow cane sugar or hemp fuels into the US. (Hemp fuels are used elsewhere, and Brazil has had a very strong sugar diesel program since the 1970s.)
Anyone who wants to see auto fail is just a treasonous jackass as far as I'm concerned. They care about lining their own rich (banker) pockets rather than protecting the workers.
Really, Congress OWES the auto industry for all the meddling they have done that have done nothing but cost jobs and trade.
But, if you want to fall for the banker's lies, go ahead and let the very backbone (manufacturing) of US real wealth die.
The notion that the taxpayer should bail out private industry, once again, is anathema to the meme from years past that we should "let business do business." The end of the car age is here, and most of you are driving your last car, or stupidly considering buying your last car(Chevy Volt, what a crock of shit!). The sad thing is that the average person working at GM or some other car plant doesn't see the big picture...how could they when their jobs are on the line? We are coming up against nature here folks, unbending, unyielding natural limits to population density, not to mention resource scarcity (especially oil). I could go on and on, but the bailouts will continue, and car plants will fail anyway, and the Amurkan way of life (want, need, buy) will will cease. In fact, I believe the only measures we can take at this point are to decrease the impacts. We WILL return to a slower, agrarian society...whether we like it or not.
While we're waiting for that stimulus package to kick in and save our society, there are three inexpensive things we can do at the agrarian level to decrease the impact of the coming world order:
1. Support your local farmers market.
2. Get your bicycle out of the garage and use it.
3. Learn Chinese.
The biggest factor making GM, Ford and Chrysler non-competitive is the medical insurance millstone hanging on their necks for employee and retiree medical insurance costs.
Unless Obama quickly implements single-payer medical insurance, bailouts will not help the "big three" and an Obama-driven bailout will be nothing more than a political payback to the unions.
I have to agree with the author of this article. Where does the bailout mentality stop?
Yes, manufacturing is the backbone of our economy. I can say this with some authority because that's where I've worked my whole life. This notion that bailouts will save jobs is a scare tactic. It's a lot more threat than reality. A little bit of research shows that, over the years, the big corporations that have gotten the largest government handouts (tax breaks, subsidies, bailouts, etc.) have generally shed the greatest number of jobs, while the top level executives' pay has skyrocketed.
The problem is not Congress meddling for 30 years. Since Reaganomics, big business has gotten just about everything it has wanted--tax loopholes for sending jobs offshore, government regulators who don't believe in real regulation, relaxed environmental requirements, union busting, protectionist trade agreements and so forth. And still they line up at the big corporate welfare office.
The real problem is reduced sales--because the average consumer is nearly broke. More and more people are just squeaking by from paycheck to paycheck. There's not enough money left over after paying the bills to buy, for example, a new car.
A much better use of that 700 billion dollars would be to pay off those "bad" mortgages and set up new payment schedules for homeowners who are facing foreclosure. Or maybe some kind of rent-to-own thing. And universal health insurance would be a major boost for individuals and their employers. But of course, any help for individual people would be considered evil socialism--and we can't have that!
Saint-Just gave me an idea. Perhaps I can supplement my stagnant wages by printing and selling those bumper stickers.
Just something sent to me before the election---About the time our original thirteen states adopted their new constitution in 1787, Alexander Tyler, a Scottish history professor at the University of Edinburgh, had this to say about the fall of the Athenian Republic some 2,000 years earlier: 'A democracy is always temporary in nature; it simply cannot exist as a permanent form of government.' 'A democracy will continue to exist up until the time that voters discover they can vote themselves generous gifts from the public treasury.' 'From that moment on, the majority always vote for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to liberal policies, which is always followed by a dictatorship.' 'The average age of the world's greatest civilizations from the beginning of history, has been about 200 years' 'During those 200 years, those nations always progressed through the following sequence: 1. from bondage to spiritual faith; 2. from spiritual faith to great courage; 3. from courage to liberty; 4. from liberty to abundance; 5. from abundance to complacency; 6. from complacency to apathy; 7. from apathy to dependence; 8. from dependence back into bondage' Professor Joseph Olson of Hemline University School of Law, St. Paul , Minnesota , points out some interesting facts concerning the 2000 Presidential election: Number of States won by: Democrats: 19, Republicans: 29 Square miles of land won by: Democrats: 580,000, Republicans: 2,427,000 Population of counties won by: Democrats: 127 million, Republicans : 143 million Murder rate per 100,000 residents in counties won by: Democrats: 13.2 Republicans: 2.1 Professor Olson adds: 'In aggregate, the map of the territory Republicans won was mostly the land owned by the taxpaying citizens of this great country. Democrat territory mostly encompassed those cities known for citizens living in government-owned tenements and living off various forms of government welfare...' Olson believes the United States is now somewhere between the 'complacency and apathy' phase of Professor Tyler's definition of democracy, with some forty percent of the nation's population already having reached the 'governmental dependency' phase. If Congress grants amnesty and citizenship to twenty+ million criminal invaders called illegal's and they vote, then we can say goodbye to the USA in fewer than five years.
I'm not for any Bailout without a Hell of lot restrictions and pay back.
I predict that there will be no bailouts for the US's faltering manufacturing sector.
The time is near when the corporate elite and the international political community will be abandoning their long time practice of propping up the unsustainably high standard of living that Americans have enjoyed. This standard of living is ONLY sustainable if the US is a manufacturing power-house to back it up, and we are not. The long decline in our manufacturing base, and therefore our power to maintain our standard of living without excessive debt, has been orchestrated by elite planners who have forseen and planned for the coming desertion.
Why are preparations being made for the imposition of martial law? Why is an army brigade newly stationed stateside to engage in domestic peace-keeping/policing/emergency response functions?
It's not to counter domestic terrorism. Such terrorism is a myth, as evidenced by the complete lack of successful domestic terror attacks since 9/11.
No...it's to keep the population under control when we find out that the coming depression is to be a permanent reduction in the standard of living of Americans. The US economy is to be brought into "fiscal soundess" by force if neccessary.
These elites don't hesitate to send our sons and daughters off to war. They don't hesitate to kill millions in the middle-east and around the world. Why would they hesitate to let the American people fall? They don't need us like they did before.
kplukers;
"They don't need us like they did before." Short,sweet and profound.On a day that Citigroup casts aside 52,000 workers-what would seem to be the logical end game to all this?
There's an additional little discussed factor.Seven or 8 years ago I was hearing rumblings of a significant brekthrough in Artificial Intelligence.Any readers cognizant in that field care to weigh in? Aren't entire occupations in danger of being wiped out? Are new capabilities already possible but being held back to prevent civil unrest?