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Posts Tagged ‘government’

Bail Out

I’m not a fan of government bailouts. Unless the government is writing a check directly to me, that is.

But the billions our government is opting to spend in order to keep companies like AIG afloat seem like a monsterous waste of money. I’ve written about why these companies should be allowed to go bankrupt before. Seems as though billions could be used to do a lot of good in the world versus spent on risky bets – bets the masses of humanity will never benefit from at all.

For as long as mankind has walked the earth, those who help themselves tend to rise above the fray. It’s just as true today as it’s always been. It’s also all a matter of perspective. My mom grew up as a child during the depression. She rose above the fray by taking on odd jobs when she was only 10 years old. She cleaned houses, did laundry and cooked meals for the families who could afford it, then she went home and helped her mother do the same for their family of 11. What did she gain from that experience? An unflappable work ethic and the knowledge of the value of a dollar.

Mom was never wealthy. She never had the money to travel lavishly, buy the best clothes, own the nicest furnishings, or even remodel her kitchen in the exact way she wanted. But she was happy, just the same. When she earned her own money and bought her own things (with cash) there was a sense of accomplishment on her face.

Few people today grow up in the same way Mom did. The ethic among us today is watered down and soft. The satisfaction that once came with a day’s wage for a day’s work and paying cash for new shoes or a good used car no longer delivers a sense of self-satisfaction. Cash? What’s that? We buy with credit. Buy now. Pay later.

So our country’s economy stumbles because the rich have gotten greedier while the middle class and the poor have stopped worrying about their ethics. We’ve forgotten how our parents and grandparents did things. We’re the “me too” culture chasing after something we’ll never catch, but willing to risk our retirements on the chase just the same. At all costs.

And now, we have yet another target to point our fingers at and cast off all blame. It’s the AIG’s of the world who did this to our economy. Blame them. Protest them. Picket their office complexes and send death threats to their millionaire employees who got rich off the backs of the rest of us.

My Mom would have clucked her tongue at them, too. But she would have said, “Glad I don’t have to walk in their shoes.” And she would have slept well each night in her own satisfied way.

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America’s storied auto behemoth, General Motors, stands on the edge of a financial cliff. Should it jump? Or should the government throw it yet another rope in an attempt to shore it up and save the giant from bankruptcy?

Truth is GM can’t pull itself out of the tailspin it’s in. GM should file for bankruptcy and remake itself as a much smaller and focused car company if it hopes for a legacy to be part of the future.

Here are five good reasons why GM should file for bankruptcy:

1) GM must realize filing for bankruptcy won’t hurt the company’s already beleaguered image and brand. The cloud of bankruptcy won’t keep people from buying GM cars. Hell, no one is buying them now.

2) In an effort to save itself, GM is reducing research and development spend, which means little or no new, green-friendly hybrids (i.e., the kinds of cars people want to buy). Bankruptcy gives them a chance to refocus on marketable cars of the future.

3) GM can’t compete. Mercedes has a plan to transition its entire lineup of cars to alternative fuels by 2015. GM is cutting R&D by $1.5 billion by 2012, which allows them to stay operative for…one month.

4) The brain cluster at GM continues to lobby California lawmakers to prevent a law requiring car makers to reach an average fuel efficiency standard of 36 mpg. Kinda says it all, doesn’t it? Bankruptcy might help GM understand the landscape has changed since the 1960s.

5) Even with the government’s tens of billions in bail-out money, people at GM will lose their jobs. Bankruptcy will likely save more jobs than the bailout will provide.

Why should we care? Isn’t it more wise to see billions of dollars diverted to things that have a chance of survival vs. burning that cash on the GM fire.

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