Tuesday, December 9, 2008

More-on Bailout

So I've heard the argument from several sources saying that while the bank bailout was a terrible thing for the government to do, the auto bailout is a good thing. Why? Because auto companies employ people and provide jobs.

Point 1: So do banks.
Point 2: Actually, banks employ a lot of people and probably pay them more too.
Point 3: A bailout is a bailout is a stinking bailout.

A recent Fox editorial summed it up pretty good, and even used facts. Something I should probably do more often.

http://foxforum.blogs.foxnews.com/2008/12/09/bolling_automakers/

I just heard that Pres. Obama has proposed an "economic stimulus" package that will cost upwards of 1 trillion dollars. Only his will be building roads and stuff. If we need the roads, great. If it's just smoke and mirrors, I'm not impressed. He said his plan is more than just throwing money at the problems. I don't know, but 1 trillion sounds like throwing a lot of money. I'm truly baffelled by all of this. We rail on Washington for spending like a drunken sailor and then turn around and spend like a drunken sailor. And then we get mad at GM for spending too much money flying their personal planes to DC. We respond by blowing more money.

Look, if you can't afford it, you can't afford it. Even if it is a good or desirable thing. If you want something, earn the stinking money first. Then buy it. I'd be all for the auto bailout, if we were running a government revenue surplus. But we're not. We need to cut spending even if it means losing some good programs. We need to payoff debt and institute wealth generating programs. Then we will have the money to buy the other things we want or need or whatever.

When I was younger, if I wanted to buy something my parents would give me a job. I'd mow the lawn or wash the car or dig ditches. Then I'd get a dollar. Then I'd spend it. It wouldn't have made a lot of sense for my parents to buy the thing and give it to me and then tell me to pay it off. Oh, but only if it doesn't cause a hardship.

LIFE IS HARD. Deal with it. If it means buying Hondas because GM goes out of business, then great. We'll all be cruising around in eco-friendly, affordable, reliable cars in no time. And for those who lose their jobs in the meantime. I'm truly sorry. Really. I've been unemployed before. But you still have skills, so use it as an opportunity to get into something else and expand your horizons. There's a line from a song I love. It goes something like this:

Thank you God, for giving me this insight
So I might make these wrongs right
If and when there ever is a next time
Because failure is a blessing in disguise


(Relient K, "Devestation and Reform")

We slam big corporations again and again for being greedy and evil. Well, now they're eating the consquences of their greed. And we're saving them from it?? Isn't this what we wanted?? Would we bailout Walmart or Big Oil if they were the ones going out of buisness?? (Probably we would. I mean, what's another trillion?) I say let them fail. It's a blessing really. They'll come back more competitive and stronger than before.

SM

Saturday, December 6, 2008

The New Cabinet

Just for fun, I thought I'd toss out my opinion on the new cabinet members. They are ranked on a scale of "up" (=good or interesting choice), "down" (=bad, stupid, or strange choice), "whatever" (=vanilla choice or whether it's good waits to be seen) and "not sure" (=I really don't know much about this person at all and wikipedia wasn't very informative either). These are only positions that have been announced, and I may do another post after the next batch of appointments are named. (There are still some interesting positions that have not been decided in the areas of energy, transportation, etc.)
  • Secretary of Treasury - Timothy Geithner. Down. He has a strong resume, but if you've read my other posts, you might realize that anyone who supported the bailout to the extent that Mr. Geithner did is not going to have a lot of my support. (As if that matters coming from someone of my political clout, but still.) Mr. Geithner not only supported the bailout, the whole AIG thing may have been his idea.

  • Secretary of Commerce - Bill Richardson. Down. The other types of choices that are hard for me to get behind are ones that seem to be based on political moves, rather than actual qualifications. Gov. Richardson has a lot of experience, yes, but not a track record I'm very fond of.

  • Chairperson, Council of Economic Advisors - Christina Romer. Whatever. This seem to me to be a "sexy" choice, if you will. Dr. Romer is a prominent economist in academic circles, and has done a tremendous amount of work in areas relevant to our current economic crisis. She's smart, but I worry that research (recently presented at Ohio State) such as this takes interesting results and tacks politically motivated interpretations on them. That is, she may turn out to be someone who says "yes" to everything Pres. Obama proposes, and use her research to support this, even when the evidence is weak.

  • Director, National Economic Counci - Lawrence Summers. Up, I think. The guy is way smart and has tons of experience. He might have the best resume in the entire cabinet. He was probably a contributor to the some of economic success we experienced during the Clinton administration. The only reason I'm not a solid "up" is that I haven't taken the time yet to really examine where he stood on a few policies of recent concern.

  • Chairman, Economic Recovery Advisory Board - Paul Volcker. Up. I'm a Volcker fan, what can I say? What he did in the 1980's as Fed Chairman was gutsy, not popular, but in retrospect was the right decision. He saved huge future problems at the expense of current discomfort. That's what we need now. Bring on the Volcker Recession Round 2! (Oh wait, we're already in a recession. Perhaps this time it will be the Volcker Depression. Whatever.)

  • Director, Office of Management and Budget - Peter Orszag. Down, but maybe up. Any student of Alan Blinder is going to make me a little nervous. Dr. Blinder does good work, in a rigorous sense, but he sticks too close to the economist way and doesn't consider the real world often. If that rubbed off on Dr. Orszag, that's not good. BUT, he's been somewhat vocal about our debt and it's potential long term problems. If he seizes on this point and keeps the Budget under control, I may be a supporter after all. Although he was in the budget office during the recent uncontrolled spending fiasco.

  • Secretary of State - Hillary Clinton. Down. The is clearly a political choice. I really don't see the qualifications. She needs more solid experience in direct foreign affairs before taking these rains. Up to now, she's really just been sort of next to a lot of things, but not directly involved, other than making speeches and stuff. Maybe she'll prove me wrong and usher in a new area of world peace, but I just see her as bring a lot of politics to the White House and not many real solution. We'll see.

  • Secretary of Defense - Robert Gates. Up. And not because of my personal feelings on the war, either. I'm extremely impressed at Pres. Obama's guts in putting someone in the cabinet who disagrees with him, and to do it in a critical position. This gives me a lot of hope that Pres. Obama really might be more middle ground than I've worried. Now if this was a political choice, then I'm not as thrilled, but I'll take it at face value for now and assume that Pres. Obama really wants a variety of opinions. Again, we'll see.

  • Secretary of Homeland Security - Janet Napolitano. Whatever. Good resume, political track record. Who knows? Not me.

  • National Security Advisor - James Jones. Up, probably. All sorts of experience, strong record, and frankly, I'm interested to see how a military guy will fit into this role.

  • UN Ambassador - Susan Rice. Not sure. I know she's been around a lot, but I haven't paid too much attention to her. I guess I will have to now.

  • Attorney General - Eric Holder. Not sure. See Susan Rice.

  • Secretary of Health and Human Services - Tom Daschle. Down-ish. He's over a department with a huge budget and doesn't have a super record suggesting he's not going to blow a lot of cash. That makes me nervous.

  • US Trade Representative - Xavier Becerra. Down. This one is really puzzling, maybe I don't know something about his track record that I should, but I don't see that he's had much experience in trade matters. He's a lawyer. That's weird. Maybe he's a specialist in international law? Personally, I would prefer to see someone who's more versed in trade economics. Maybe Mr. Becerra is and it just isn't that transparent in my readings of what he's done.