When I was in college I had a part time job. Nothing unusual about that, lots of people do that.
Occasionally I would go out for pizza with some buddies. Inevitably someone would be short on cash and ask me to cover their portion of the bill, usually saying "you have a job, you've got money coming in" as he shoved the last piece of pizza into his perfectly able body.
The proposed bailout of the auto companies feels a little like my college days. I have a job, I have money coming in so hand it over. In this case it is not even to help those who have lost jobs, it is to prevent the loss of jobs in companies that can no longer compete. Worse yet, the money will go to support pension and health benefits guaranteed by these companies to their unions. We, the taxpayers, have money coming in, they don't, so hand it over.
I hope Congress says no, but I fear they won't.
What will happen if there is no bailout? There will not suddenly be hundreds of thousands of people on the streets without jobs. The companies may file for bankruptcy. Through bankruptcy they will reorganize and downsize. They will be relieved of some of the more onerous terms of the contracts the signed with the unions.
Yes, jobs will be lost, but that is a fact of life. I am sorry for the people who will lose their jobs, but the American taxpayer should not become the guarantor of job security in failing industries. People can retrain, or relocate. These are people with skills, and there will always be a market for that.
Will they make the same amount of money and have the same benefits? No, but the American taxpayer cannot become the guarantor of employee wage and benefit levels.
The world is changing. We just elected a President on that very theme. If the world is changing, why are we going to spend billions of dollars trying to keep everything the same? The automobile companies have not changed, their unions have not backed down and now, to quote the President elect's former minister totally out of context: their "chickens are coming home to roost".
The only things for sure in life are death, taxes and the Cubs never winning the World Series. Everything else changes and evolves. Why are we spending billions to try and stop evolution?
Under what circumstances might a loan to the auto industry be acceptable? If it came with a strict requirement that none of the money would go to management or union compensation. If the money was used solely for research and development to design and build cars that people want i.e. fuel efficient and environmentally friendly. Before the money would be doled out, the automakers would have to show a business plan, tell us where they want to go before we invest. Under those limited circumstances I might support a loan to the automakers.
But to just keep doing what they have been doing? Sorry, I'm not going out for that pizza.
1 comment:
You're so bitter about college friends attempting to enjoy your hospitality. I bet those guys aren't your friends anymore.
Retrain, relocate, RECESSION. So they're supposed to sell the house they paid to much for to relocate to where, doing what? What industry is hiring?
Some members of Congress argue that it is a national economic problems and the cost of that problem should be borne by the country and not the local communities that house the plant workers. Perhaps aid to those local communities to help retrain and relocate the workforce, rather than to the big dinosaur companies that already made a mess of things, is a better idea. The thing that gauls me is that auto company executives are still getting bonuses. Do they get bonuses just for being executives?
Unbelievable.
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