This is no way to run the greatest country on earth

Our current President:

"When the American auto industry was on the brink of collapse," Obama told a campaign event audience in Colorado earlier this month, "I said, let's bet on America's workers. And we got management and workers to come together, making cars better than ever, and now GM is No. 1 again and the American auto industry has come roaring back."

 

He did not actually bet on American workers; he bet on GM and Chrysler workers.  He did not actually bet, he took my money and gave it to the unions to stave off collapse of their monopoly on automotive jobs to the free market.  He used my money to pay off one group of taxpayers at the expense of another.  What is more, the workers at Ford and their management were held from profiting by the breakup of GM.  He choose, with my money, to favor one American business over another American business.

Why does the Federal Government feel as if it should do this?  Why would the Federal government allow for a company to be run poorly, make bad decisions and bad labor negotiations and then say; “it’s okay, your failure will get wiped clean and the tax payer will cover the debt.”  He (they) did not save anything in the long term cycle.  Paying labor costs above the market value will never work out long term in the global economy.  If that was the way to generate growth and the middle class they might as well double every salary at GM and away the economy will go! (We do miss Milton Friedman).

Does anyone really think GM, without a bailout, would have collapsed and never continued?  Really?  They would have cut their loses, closed what needed to be closed and kept going with car lines that made a profit.  They would have re-worked union and management contracts and made the company able to continue, perhaps in a much diminished capacity, but continue it would have.  Toyota, Honda, Ford all continued. (?) As these new steps were put into place, if they did what was right in the automotive market, they could have expanded; grown again.  But grown based on a good business practice that delivered product to a consumer willing to buy it at a valuation it was willing to pay.  If a house catches on fire and the fire department manages to put the blaze out; you have to get rid of the structure that has been damaged and rebuild on the what is left; the good parts.  You would not build on the water and fire damaged walls.  This is economic cycle 101.  Why does it seem to confuse even the educated?  Do not get caught up in the moral good feelings of saving jobs now only to lose them later.  Rebuild, strong and true and move forward.

 

Again, he continues:

"So now I want to say that what we did with the auto industry, we can do in manufacturing across America. Let's make sure advanced, high-tech manufacturing jobs take root here, not in China. Let's have them here in Colorado. And that means supporting investment here."

 

[Jobs go to China because the labor force here in the USA demands more than market value for their labor.  This same labor force then scrambles to Wal-Mart to get the least expensive product they can and thus catch themselves in the cycle that says “pay me more than I am worth and sell to me for less than what you can.” ]

News flash: People in China, South Korea, Taiwan will work for less than we will.  Sorry, we cannot close the borders or ask the rest of the world to keep paying for our life styles; that chicken has come home to roost and the world wants our standard of living.  We have priced ourselves out of the world labor market.  We have the additional issues of Federal Government regulations driving business overseas.  There are easier places to start a business than the US of A, sad but true.

Instead, our current President is going to take more of my money, give it to businesses that may or may not be sound (his record does not bode well on that selection) and he, the Federal Government, are going to drive businesses forward.  Based on what?  His good business sense?  Which one of them, he and his council, has this great foundation of knowledge on how to build a business? And no, organizing the local ping pong tournaments does not count.  Why is he using my money to create what he thinks is the ideal business model?  What happened to the free market supplying what the consumer wanted?  It seemed to work rather well in the roaring 50’s we here so much about.  Does anyone know what else was interesting about the roaring 50’s?  How about the level of government regulation and the size of the Federal Government.  Green energy will be viable when the free market deems it.  Manufacturing in America will return in force when the labor market adjusts to the price of their labor, which when valued against labor, freight, shipping and overseas handling charges are included, will still  be higher than the rest of the world.  And this completely ignores the manufacturing growth in the South (read right-to-work states) as car and air plane industries grow.  That is of course when the Labor Department does not step in the way of a business expanding.

How about this Mr. President?  Start working for the citizens regardless of whether or not they will vote for you but rather to help this country move ahead as it has done for over 200 years.  Stop buying and securing the votes of labor unions at the cost of the private worker so that all citizens can grow with the renewed economy.  Work for me for a change.  Represent me by allowing competition to set the direction fed by the demands of the consumer or as I like to call them; the tax paying citizens.  For every vote you buy with a wink and a promise you are personally saying to me; your Life, Liberty and Happiness do not matter as much as this other citizen.

The Federal Government cannot know or design what the consumer will want.  It cannot force or hold jobs here anymore than it can generate GDP by printing money and dropping it out of an airplane.  Short term? Keynesian like?  Maybe, but not long term sustainable growth.  There is no free lunch.  The government does not make money in some private business venture that it then uses to fund the businesses it deems worthy.  You either represent us all or you only pander to those that would vote for you based on their protection of labor or entitlement.

 

That is no way to run the greatest country on earth.

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This blog was built for and funded by myself. Though the road I drove upon to earn the paycheck I receive in exchange for my labor was built by someone else, my tax dollars went towards funding it and the many other functions of our national, state and local government. I am one of the 50% that actually pay for our Federal Government and thus post proudly.