No More Buyouts!!! September 17, 2008
Posted by taoist in Capitalism and Economics, Politics.trackback
Oh look, another government buyout. More of our dollars going to bail out people who made poor financial decisions. Welcome to our new socialist paradise. Government, and a large portion of the public, need to learn that failure is necessary otherwise people will repeat the same mistakes over again. Bankruptcy is not a dirty word, but many people would rather reward failure and punish those who succeed. Don’t expect either presidential candidate to be better, though: both McCain and Obama would bail out our strugglying auto industries.
http://dummidumbwit.wordpress.com/2008/09/17/its-the-deregulation-stupid-among-other-things/
The Republican Party would not be in favor of forbidding SUV’s over 4 cylinder and America at large almost should bail Detroit out to an extent unless you can individually prove you never bought a Big truck, Hummer or SUV, we made them build them by buying them and preferring them, yes it may come to a bailout? Bailout are better than the Great Depression!!!
You are exactly wrong. The types of vehicles being sold are not Detroit’s problem. What is Detroit’s problem is the fact that it has become a bureaucracy who’s primary industry is the employment of unionists, and the guarantee of their pensions.
I never bought a big truck, hummer or SUV: I’m a student, I’ve never owned any vehicle. I don’t think the size of the vehicle should matter to this argument though. Several European and Asian vehicle companies have successful large vehicle product lines, which just proves large vehicles aren’t the problem.
As for the great Depression, in large part it was caused by protectionism, which FDR and liberals of the time were opposed to. Look up the Smoot-Hawley tariff act for more information. Economists now realize that lowering tariffs and subsidies are the key to wealth and good economies. Of course, in modern politics its the Democrats who consistently oppose free trade. Obama’s even claimed he wants to renegotiate NAFTA.
I’d like to let Columbia in, we can protect some industries from unfair competition, Mexico has no unions, so they can make $29.99 DVD players, Canada has Unions and Environmental standards, Obama will select options not just say the low wage wins. Yes Protectionism isn’t good, but I would prefer the Mexicans build what we (with Labor and Management input) don’t want to produce, not be the future home of Cadillac Motor company, let them build the low cost Yugo type vehicles. So we disagree, completely losing heavy industries could be a national security problem as well.
Well it’s no mystery why companies are leaving our country: When you include state taxes, America has the highest corporate taxes in the world. Of course companies are shifting the centers of their business elsewhere. If they want to keep their product competitive, they can’t afford a business expense of all of the business taxes, on top of the cost of producing their product.
As for Colombia, I’m glad you’re willing to let them in. Most liberals don’t realize that Colombia already sells nearly all of their goods with no tariffs here in the U.S. – the main thing that the free trade agreement would do is ensure that U.S. goods are sold in Colombia without any tariffs on their price.
As for Mexico, you have a problem with them because they can make cheap products since they don’t pay unions? Don’t you see the flaws in your thinking? Our own unions are making us less competitive.
We are still the largest market, they can play ball, that’s the leverage, without sales here they lose too, PATCO was the beginning of Reagan’s failure that are now coming to roost, countries need to produce low end goods until they develop unions, we had growing unions all though the 40’s, 50’s 60’s and 70’s till Reagan, Reagan was the deviation from the chosen path, he’s the problem, not the solution. some of your ideas are valid, but Reaganism is excessive, unnecessary and ultimately self destructive. The Free market has never existed, it’s a unicorn?
Mexico is supposed to make $29.99 DVD players, we don’t want to be in that, maybe not even electronics in general (consumer anyway) Protect high wage good jobs like automobiles, Airplanes Industrial machinery, Mexico doesn’t yet produce Cadillacs, Canada does and will continue to, Mexico needs to build Yugo’s until they develop unions and higher environmental standards? I want growth in Mexico, just not shipping GM, Ford and Boeing there?
You don’t seem to understand: wealth is generated not from what you sell, but from what you buy. We should want goods to come in as cheaply as possible: that’s what lets Americans enjoy a higher lifestyle for a cheaper price, freeing up more money to really churn our economy.
Unions slow things down. If you think 70s was the hay day of unions, take a look at the economy of the 70s, it was miserable. Unions had their place in the era of the railroad barons, when monopolistic powers let employers dictate exactly how they wanted to run things, but they’ve been a drag on our economy and the companies that have them ever since. Look at the industries and companies that have succeeded in our modern economy: nearly all of them are non-union. The few that have unionized (such as some of the larger telcos) are quickly falling behind in standards to the rest of the world. Meanwhile, look at the most lucrative places to work: fast, flexible companies inventing state of the art products, oftentimes online. The entire reason they do so well and can offer such fantastic pay and benefits is because they reward success and hard work, not tenure and seniority.
The free market probably hasn’t existed since at least the classical era, I’ll give you that. But look at countries around the world: Ireland, Singapore, Poland, vs France, Germany, us (although we’re better off than France and Germany)…It’s pretty amazingly clear that countries with simple and low taxes, and clear, unprohibitive regulation are kicking the economic butts of the highly regulated countries.
You can try and argue from your philosophy all you want, but look at the data!
Reagan ism is extreme, Singapore is a good model of development, but in conservative circles the idea that France or Germany are somehow lacking is a myth, we used to be Singapore, I would actually say that Europe is ahead of us in many ways, that’s the direction we need to move, being like Singapore is moving backwards, Japan is now more like us in the 70’s and the 70’s certainly aren’t looking bad compared to 4 more years of Reaganomics? Yup, that’s what the election is for, to settle this.
http://en.wikipedia.org/wiki/Image:Gdp_accumulated_change.png
The idea that France or Germany is lacking is a myth? Take a look for yourself. You want us to be more like them? Right now we’re about halfway in between them and the countries that have lowered simplified their tax and regulation structures. It’s startlingly clear what works if you want a successful economy.
Oh, and China’s huge growth is because they were extremely tightly regulated for so long, and now they’re not only low taxes and low regulation (probably too much, since they’ve even reduced safety regulation) but modernizing, as well.
Heck, you can also do the same comparison across states in the U.S.
http://pajamasmedia.com/blog/very-different-economic-times-in-red-vs-blue-states/
Put it another way, conservatism has many merits, I actually admire English and French conservatives, a lot of what Ron Paul says makes sense, except he has yet to sell me on Reagan ism (as he interprets it.) Theodore Roosevelt’s name comes up often, and I have no objection to him. The end result of Barry Goldwater/Ronald Reagan conservatism will result in eventual revolution along French or Russian models, it’s too dated, presumes to much incorrect assumptions about the ideas of Roosevelt and Truman. It’s more a reaction to FDR, than something that will stand on it’s own, it’s irrationally emotive about many things that are viewed in extreme. John McCain cannot be Theodore Roosevelt, he’s spouted Reaganomics too long, hence even Obama would be better.
Did you even look at the data?
I looked at it, the numbers are not as bad as 1929 of course, it’s not the end of the world here, but markets react to emotion and the emotion is scared. Ireland needed to advance quicker than Germany, a Germany advancing at the rate of Ireland would be a huge threat unless everybody else was as well. I don’t believe that the average German wants Reagan ism..It is criminal to watch the gap between the rich and poor in this country widen and widen and just keep spouting Reagan ism, that is the problem, not the raw data, it will yet be a few years before that data causes real political instability (riots and the reappearance of the far left), but I don’t see anything in Reagan ism that even wants to try to change those #’s that’s why McCain get heckled in Town halls, strict adherence to trickle down. I want to get rid of Reaganomics, if conservatives adopt some more flexible progressive attitudes, I’ll definitely look at them. I can’t see a Reagan or a Barry Goldwater appearing in England, France or Germany and getting anywhere, it’s distinctly an American Problem, Hell I liked Ike? The Maverick had to sell out to the right and may have become unelectable in this election cycle.
Once again, you have your numbers backwards, although this is a common misconception.
Here’s how income inequality has progressed under various administrations:
http://engram-backtalk.blogspot.com/2006/10/income-inequality-was-much-greater.html
but you shouldn’t look at the income inequality nearly so much. Here’s how we compare with Europe:
http://engram-backtalk.blogspot.com/2007/03/european-analysis-of-european-economies.html
notice that as soon as you climb out of the poorest bracket here in the U.S., you start doing better than in Europe. Increasing our taxes and regulations to match Europe’s would probably decrease the gap between the rich and the poor, but only because it would make everyone except for the poor worse off. The poor will always be with us.
I was aware of this more beginning in the Clinton era (the first interesting link) but as the Author said, blaming Clinton for the good Stock market performance in that period does nothing really, but the article should raise some eyebrows..The second article on Europe is harder to comment on, obviously since A Reagan and a Goldwater never appeared there we are different.Though I think our Illegals are more akin to the waves of Italians and the Irish than the Islamic immigrants that it seemed to say Europe attracted? For one thing they are Catholic. But I don’t want to get into that.”The poor will always be with us”, but the actual condition can improve All thought the 40’s 50’s 60’s and 70’s it was leveling out, since 1980 as a whole it has increased (the gap).LBJ was the last real “New Dealer’, think about the prosperity of the period that nobody really opposed Vietnam as breaking us while he declared war on Poverty (Great Society), fought the war and funded NASA that’s growth, Clinton was really just as liberal as allowed and set up the Work off welfare programs that are still in effect and paid for the Reagan Era defense spending (admittedly somewhat under protest, but he did), but I knew Clinton was a centrist Democrat, but everybody was worried, just like they are worried that Obama won’t end up more centrist as well?
But why do you care about income inequality? You seem concerned with reducing the inequality between the richest and the poorest, but I don’t think that’s important. Look: Our poor are as well off as Europe’s poor. We need to try and increase how well they’re doing, yes, I agree. But our middle class, and especially our wealthy, are doing considerably better than their counterparts in Europe. As soon as someone in America climbs out of the lowest brackets – and the vast majority of people do, they start doing significantly better than their European peers. Sure, we could flatten things out, but only by making everyone except the poor hurt more. Let the middle class and the rich have more money, and let their businesses grow with less impedance from government.
Your right, but most growth is from smaller business and Obama is really emphasizing Big Oil, and Big Business that seem to be outsourcing as the prefer ed option. His position on Smaller business is not the problem? It’s just assumed if he wants to go after outsource rs and Exxon Mobil that he wants to stick it to the small and medium business as well, this is not actually what he is saying, the larger Business interests are pushing the idea that he want to go after all business, he doesn’t.
There are numerous problems with that view. One, how do you tax a corporation? You can’t: you’re just taxing the corporation’s products, since increase costs mean that the company has to raise the price of their product. The Federal government also makes as much or more off of the price of gas than oil companies do: http://renaissanceguy.wordpress.com/2008/08/05/big-government-and-the-price-of-gas/
When you add the additional state taxes, its no wonder our state taxes are so high. This also relates to why companies are fleeing our shores. Just take a look at the numbers for yourself:
http://www.taxfoundation.org/publications/show/22917.html
It’s simple economics: companies compete to offer a product for a low price. If they’re being taxed more, they have higher operating expenses, they have to charge more. Therefore they leave, or outsource whatever they can.
And do you really think taxes stay confined to just the big companies? If you tax the gas companies, you tax all of the gas company’s customers. That’s not just people, but all of those small companies that are trying to run on a budget. You’re slowing all of them down as well.
I do believe it sounds like “Windfall Profits Tax” aimed at the majors, that will give the minors a competitive advantage, has nothing to do with Corporations as a whole. No tax breaks related to outsourcing behavior, if you need to outsource you will be in the highest possible tax rate period. I’d rather someone tried than just endlessly cited Adam Smith as a global proposition, we aren’t yet ready, we want to be Americans not cogs in Adam Smith’s global vision, that’s as scary as the crazies that believe in Black Helicopters and may even be an offshoot of it No Unions, no Labor standards, no environmental protections then be willing to suffer protectionist sentiment on products we do manufacture here well.
Can you explain to me what windfall profits are? I want to hear your definition.
Taxes are definitely related to outsourcing, and corporate headquarters. NH has a ton of businesses that really operate in Massachusetts, but are located in NH simply for the tax benefits, and with modern IT technology even the smallest company can have portions located overseas. Heck, among my personal friends I know two people, each with their own company, that outsource labor. Their companies are the very definition of small businesses. If the taxes and regulations were lower, a significant portion of the business that has shipped overseas would definitely return.
Are you saying Americans would rather be cogs in some government machine? Frankly, the revolutionary aspect of Adam Smith’s ideas is that economies (and the people who make it up) don’t have to be part of some government machine to be productive. I point back to the previous links to show that reducing the government component of people’s businesses clearly improves the economies.
McCain’s giving up preaching that stuff, so was he the only one listening to you? Seriously Obama has economists Rubin is one of them, they’ll figure this out without my help don’t worry Adan Smith is real cute but at some point someone will just put a bullet between his eyes if his theories don’t connect emotionally to labor.All your reasoning is sound but economics is more emotive at the Stock Market than strictly based on logic and logically I thought Mitt Romney was interesting and the best choice for McCain and emotionally Mitt looks like the guy that laid me off, the market is emotive it needs therapy more than facts as it is? You would have told me how Bubba would blow it out his ass? But odd usages of cigars would have occurred to neither of us.
Wait, you’re going to trust the guy who’s economic advisers include the former CEOs of Freddie Mac and Fannie Mae?
Yup it would appear that Rubin had his hands on Freddie and Fannie, but the option is the guy who until Monday kept saying deregulate five or six time a speech? Sad ain’t it? But since I still feel we need Rubin on the team I gotta go with it.
I’m not talking about Rubin. I’m talking about Franklin Raines and Jim Johnson. Two of Obama’s advisers, who are the former CEOs of Fannie Mae and Freddie Mac, which are at this point failed companies. He is literally taking advice from people who cost taxpayers trillions, that’s TRILLIONS of dollars. Not millions. Not even billions. Trillions.
And you apparently are immune to logic: less regulation would be a good thing for our economy: I’ve shown you the graphs and the data that pretty much prove that, and you still keep on claiming that we need to increase regulation and be more like France and Germany. They are tanking and cheer when they have economic growth above 1%.
I would also point out that Republicans, and the policies McCain is proposing, are not to blame for the current troubles with the Lehman Brothers, Fannie Mae and Freddie Mac, and AIG. If you look at my front page you’ll notice several links pointing out that the issues facing these companies were noted by Bush 5 years ago, and he suggested a fix, but the Democrats blocked it. Then, in 2005, McCain suggested a similar fix, and again the Democrats blocked any change to Freddie and Fannie.
Deregulation is also not the problem, although some editors have been trying to claim that it is, since that has been Republican economic policy, and Republicans have controlled the white house for the past 8 years. Republicans haven’t touched Freddie and Fannie, but for years they have been insisting that Freddie and Fannie are going to fail since they were using government as an excuse not to meet industry standards, and industry to avoid government regulation. The bad loan policies that in fact brought them down were pushed by Clinton and the Democrats during his presidency.
So that comes out and Obama finally uses the Keating 5 thing, I don’t feel like throwing a vote away on Nader, and Ron Paul still needs to sound a little more labor friendly. Thailand has a high growth rate? From my level, there was really no difference between the Reagan years and the Carter years economically, Ronnie helped somebody but not me, the Idea that he ought to have by a graph doesn’t cut it? Economist are like preachers, you can have a million of them and nobody says the same thing? I tend to worry more about the poor dumb son of a bitch that works in a place where the dust levels aren’t monitored enough due to OSHA cutbacks and blows up, been a rash of that lately.