Saturday, December 13, 2008

Real solutions to the big three auto maker crisis

Obviously I'm not an economic expert, but it seems there would be a better solution to the financial crisis than to bail out the auto industry. I thought I would weigh in on some more proven and Constitutional methods.

Governor Granholm of Michican said she is frustrated and upset that the bailout did not get approved by the Senate, as though there was proof this would have worked. It was politics that made politicians feel like they did something good. It was all smoke and mirrors with no substance. It was a quintessential example of feel good politics.

If Washington wanted to really help the economy they would remove obstacles that are obstructing economic grown, like taxes and regulation. But, since those things won't show immediate results, a liberal Washington has chosen to do something that might look good and sound good but is very risky and highly unconstitutional.

It doesn't make any sense to bail out Detroit, when there are auto makers in Alabama too. A car czar would decide who gets the money, so if the czar likes one person and hates another, its not fair if he lets one company fail and helps the other. Can you see how this can be unconstitutional.
If Michigan got this bail out, California might be next in line.

Since the government created this problem by raising taxes on those who pay taxes (I have to word it this way because democrats like to give tax cuts to people who don't pay taxes) in order to help people who are poor. The result is the person who pays taxes and does the hiring has no choice but to quit spending in order to pay the tax.

The result: not only are the poor poor but the middle class becomes poor too. Likewise, not only is the poor person unemployed, so to are many other Americans. That's how recessions are started.

So, to solve the current economic crisis, I have a better solution than bailing out only the banks and car dealerships one person in government likes. How about cutting taxes by $15 billion. Better yet, how about cutting corporate taxes by $15 billion. This way at least there is a guarantee someone will benefit.

Since one person in the gov decided to make expensive regulations that auto makers can obviously not afford, how about cutting $15 billion worth of regulations. The auto bailout would have actually added more regulations for automakers to flip the bill for.

Since U.S. auto laborers are making $68 an hour when you add in benefits and Toyota automakers are making only $48 an hour selling the same product at the same price. And since Toyota and GM both sold the same # of cars and Toyota made a profit and GM went into debt, how about auto laborers taking a $15 billion pay cut. It certainly would be better than not having a job at all.

Still, you have people chanting, "The gov has to do something. We have to bail out the auto industry. We have to bail out the the banks. We have to bail out...(fill in blank.)

So what happens in two months when that $15 billion is gone and nothing has changed. We are out an auto industry, $15 billion, and the economy has 15 million fewer people working.

My suggestions make sense. My suggestions have worked in the past. But, Mr. Bush in the White House, and Granholm in Michigan, and the U.S. Senate and Congress have their minds set on expanding government to the disadvantage of all of us.

My suggestions would allow the economy to fix itself, and is fair to everyone and not just a select few.

No comments: