Job One Bankruptcy

President Bush is evidently directing Secretary of Treasury Paulson to forestall the collapse of the US automotive manufacturers and allow Obama to ultimately solve the problems of the Big Three with a socialistic rescue of the UAW. Our Republican President has embraced the socialist tactics of French or Swedish leadership. At least there are enough capitalist Republicans left in the Senate to have prevented a bailout that would not have solved the structural deficiencies of the companies with their overwhelming legacy costs. There is a widespread misconception that all the jobs would cease to exist if GM or Chrysler took bankruptcy. Under Chapter 11, many of the positions would have been preserved and the corporations could have negotiated new labor contracts that would make their operations more sustainable. Chrysler may have been absorbed by another vehicle manufacturer. The court(s), judge(s), and receiver would not simply have padlocked plants and denied hundreds of thousands their income. As it is now, Obama will, probably in conjunction with a car czar, act by fiat and direct these companies to produce enviro-friendly compacts that few people will want and large families will find impractical. Tariffs and trade barriers will be imposed to prevent the importation of more desirable foreign models. Older vehicles will be legislated off the roads by strict emission/pollution controls that will force drivers to buy the new gas-savers or into mass transit. Fossil fuels will be saved, but freedom will be sacrificed.

Who is Paulson

Our prospective bailout was passed precipitously, without due deliberation by Congress, and was ill-conceived. The plan has not been implemented with Secretary Paulson today changing direction. Just who is this man given unprecedented budgetary authority and the reins over $700 billion in new spending? This is a figure that would make Midas blush, Croesus cry, and even get Bill Gates' and Warren Buffet's attention. Never in history has such power been left in the hands of one man, no matter how carefully vetted. And as today's events illustrated Paulson has an evolving position which only militates towards a greater erosion of confidence in the markets. But for far too long, it appears our economy has been in the hands of confidence men.