Political thoughts

So, I'm excited about having Barack Obama as our next president. I did vote for him, just to be clear. I have been anti-Bush for eight years, voting for Gore and Kerry, and I feel that my distrust of Bush has been completely justified. That, however, is not the political thoughts I wanted to publish. I have been thinking about the "bailout" plans. Both plans, banking and auto industry.

It seems to me that the overall idea is to rescue businesses that have made poor business decisions, particularliy in the auto industry. If a small business owner makes a poor decision and has to go under because of it, he goes under. Nobody "rescues" him/her, despite people losing their jobs because of it. In the banking industry, we have banks making risky loans to home buyers, and the lending banks' bank making risky loans to the banks making the risky loans, right? If I put my money into stock of a company that I think will do well, and the company tanks, I take the fall. So how is this different? Sure it's on a much larger scale, but if they fold, doesn't that mean that newer companies will buy up the debt left for pennies, creating much less risk for the loan holder? What am I missing here, tat seems like the better way... and as a side not, if the government is going to pay for "troubled mortgages" to refinance, why can't my mortgage be troubled?

As for the auto industry, I have a hard time rescuing companies that continuously make bad choices. For example, when the Toyota Prius arrived on the market, it had such high demand that Toyota couldn't make enough. There were waiting lists at dealers. As the hybrid car entered the market, it grew even more popular. Now we have a "green" trend in the USA where many companies are marketing their "greenness", people are growing concerned about the health safety of plastics, and people are moving away from high fructos corn syrup so much that the corn growers association is paying for commercials promoting high fructos corn syrup. Yet despite these glaring trends toward personal and global health, the American auto industry continues to mass produce, and heavily market, gas guzzling trucks and SUV's. Even with the recent spike in oil prices, the auto dealers continued to rely on trucks and SUV's, and when their sales plummetted, they blame it on the economy and ask for money from the government. I say let them fail like any other business.

I know what you are thinking- "What about all the jobs that will be lost?". Well, again, we have to rely on the free market here. Let the other auto makers surge and pick up those employees. Despite being Japanese, Toyota and Honda have factories in the US, and with the fall of their competitiors, they will see a surge in sales. This in turn helps them grow and have new jobs available. Why wouldn't they hire the people that already know how to build cars? Very little training costs involved. If the government wants to help, they can support those people during the transition of losing their jobs at American auto makers, and being hired by the foriegn companies. The only real downfall is the loss of truly American auto makers, which seems to me is a perfect opportunity for a new auto maker in the US to grow as the economy comes back.

My other problem in this subject is the CEO's. Let's look at this from a small business owner perspective. Let's say I own a small business, and as the economy is strong and I continue to make the right decisions, I begin making a lot of money. As the owner, I decide to pay myself more for my efforts, and soon I am making $100,000 /yr, while the company continues to grow strong. Then the economy takes a downturn and my sales drop. I begin to make sacrifices and cut costs to stay alive. If I beg for money from ANYONE, I'm told to suck it up, most businesses fail, that's the risk I took. So getting a "bailout" is not an option. What's my next move? Cut my own damn pay, that's what. Take my $100,000 down to $60,000 because if I can just survive the economic slow down, I'll be able to take it back up eventually. Shouldn't CEO's be held to the same standard? Why are these businesses failing, but the CEO's are still making MILLIONS! Why aren't they made to cut their own pay- it's the risk of business! So they have to sell their mansions, big freakin' deal! If millions of people, including thier employees, can live on $60,000/yr and less, they can too.

I guess my point is, if we are going to bail out these companies, the people that let them get to this point, should be ousted. If the automaker can't get a sense of the market turning "green", then dump those that missed it. If a company makes risky loans that go bad, toss the people that allowed those loans to be made, then rescue the company. As it stands, we're poised to rescue these companies, and leave the same people in charge that got them there to begin with.