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Robert Oak Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Nov-23-08 02:46 PM
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A New Deal with the Big Three
Over on The Economic Populist there is a great post on what terms of big 3 auto companies should have in order to get a bail out. http://www.economicpopulist.org/?q=content/new-deal-big-three"> A New Deal for the Big Three

The post is long, he goes through his plan for the financial sector bail out and why it's now a bad deal because those conditions were not attached to the funds.

Then there's the employment impact. I'm going to repeat it, since it seems like many of the opponents of a bail-out have missed the point, but the Panic of 2008 was the most serious since the Panic of 1929. And now we are sliding into a steep and globalized recession. Even if $25b just pushed the collapse off for a while, turning it into a slow motion process spread over three or four years rather than a sudden jolt, it would be well worth it. Being generically Pro allowing the Big Three to collapse is, in other words, a quite different thing than allowing the Big Three to collapse now.


He has a 4 point plan and if you have additional ideas, you might leave a comment on EP so he will read it. It's a well thought out plan and maybe we can get some Congressional Staffers to pay attention to common sense this time if his post is spread around.


raw link:
http://www.economicpopulist.org/?q=content/new-deal-big-three
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Morpheal Donating Member (145 posts) Send PM | Profile | Ignore Sun Nov-23-08 08:36 PM
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1. BIG THREE PROSPERITY DEPENDED ON WAR NOT PEACE
THE BIG THREE.....

Since the following article was written and published on usenet, some days ago, there has been considerably more discussion of the Big 3 auto makers in America. Note that the Big 3 came out of WWII, having made money on the war. The Korean War further bolsters the situation. They build tanks, armored cars, transports, military trucks, jeeps, and every other kind of rolling stock and vehicle imaginable. Not only civilian vehicles for the civvy street market. They came into the 1950s with all the glitz, glamour and hoopla, new models, luxury cars, and new technology that anyone could imagine. They were the rich makers of dreams, having profited from Daddy Warbucks. In fact they were Daddy Warbucks. Then came the Vietnam war. So many trucks were destroyed in that war that America could not build enough of them. The Ford Oakville plant, among others, worked all the overtime they could handle, keeping the line putting out trucks for war, to be shipped to Nam, night and day, 7 days a week. The historians have not come to grips with the magnitude of that war, and likely will not for a hundred years or more into the future. Similarly there are no real accountings now of all the profits made by the Big 3 from war production. Now, there has been no big enough war, destroying military vehicle after military vehicle. The recent altercations in the Gulf were different. Relatively light attrition to military hardware in comparison to any of the previous engagements. Relatively little profit in it for the Big 3. That and a stockpile, some of it buried in the sand (to prevent rusting) further depleting the gains. Foreign competition on the doorstep giving Detroit increased pressure while it attempts to maintain its military production capabilities for that future war. For that big one to come. Keep your fingers crossed, boys at the Big 3, for that apocalyptic confrontation that will be the salvation of Motor City and the Big 3 of America. Not much luck there.... and now begging for bucks from Uncle Sam in Washington. Partly to keep the idle military capacity viable, in case that big one can be made a reality and the good times can return to the Big 3 in Detroit.

Now you all know that Mr. Ford actually went to Russia and taught the Russians how to build trucks on an assembly line so they could fight the Germans. Well, there is a film about the Fords and Ford Motor Company. A famous documentary, and well made, including each generation and its contributions to motor vehicle production, but guess what ? The war years are never mentionned. War production is never mentionned. The 1930s, 1940s don’t really exist in that documentary, and in Ford Motor Company’s documentary history. Oh,. Henry is there alright. His sons. All the big boys of the Big 3, but no war years and no war production and no mention of war profits. No. That never happened. It never even happened in WWII, much less the war with Japan, much less Korea, much less Vietnam. No it never happened. They wouldn’t talk about Ford and Uncle Sam. They would not talk about Ford and the Pentagon. No. That wasn’t part of Ford’s story in America.

How gullible do they think we really are ?

How gullible do they think Congress, Senate and the President Elect really are ?


Now, something worse..... about over spending on military hardware and is upkeep within a free enterprise, free market, capitalist system. It has other rather nasty implications eventually.

AMERICA’S FUTURE: MILITARY DICTATORSHIP ?

It is my own political theory, somewhat consistent with other theories of socio-economic collapse, that as the costs of improving and maintaining an increasingly complex and costly war machine continue to grow the costs eventually exceed what a democratic, capitalist, and particularly free market system are capable of truly bearing. Deficit spending to maintain that war machine and its infrastructure eventually exceeds fiscal capacity of the
system to bear, and the resulting deficit is indicative of that failure.

Unfortunately in a world where more than half of it is radically and completely hostile to many of your own beliefs, your religion included in that, some of your fundamental values, and inclusive of your own economic system and your own faith in that system as being what is "right", you have no choice but to maintain that war machine. As your competition grows by leaps and bounds, aligning itself increasingly against you and your beliefs, you end up with increased pressure to strengthen that defence, and an increasing pressure to improve military intelligence, which is as expensive as is the actual defence mechanism that intelligence puts into motion. The spiral of costs comes necessarily in response to the growing external systemic, political, economic and ultimately military competition. If you are in the lead, in some ways, you tend to have more others trying to push you off the hill. It's not unlike kick the can games played in childhood. They want their flags on that hill, and your's off of it. Diplomacy notwithstanding because in our essentially Machiavellian world diplomacy is a striving for advantage as to position and time, and not really a way out of the conflict. Not unless you are willing to give up some ground and see the world differently than your own beliefs tend to constrain you to. Right or wrong, its the reality. It's all about power.

So what happens when the costs, deficit spending, to maintain that war machine reach a critical level ?

My theory is military dictatorship.

The free market system and much of capitalist values collapse, and are replaced with a system where the military itself controls the means
of production and profit is no longer the obstacle to continued improvement and maintenance of a growing military capability.

No, the option of knowing the military down in size does not exist.
Then the enemy wins, whomever that enemy is, and the military is likely to be a very sore loser, willing to do anything to avoid that unacceptable scenario, inclusive of taking over control of a government.

I think we have seen the pattern in history in various situations, but as times change and levels of technical sophistication change, along with many other factors, today is not the same as yesterday and "history repeats" is not a very good argument for predicting the future. Nevertheless, unless
something is done to alleviate the "free market" problem, and to alleviate the problems capitalism is bringing into the issue of defence, as well as
to all other areas of human endeavour and interest, in terms of real needs and reasonable wants, we can be assured of system meltdown eventually leading to the demise of democracy, and to the assertion of a military dictatorship aimed at self preservation and the preservation of the core
of a system excessively under increasing siege. Terrorism is only one form attack. We are seeing new variants, inclusive of economic terrorism directed at undermining exactly those institutions and processes that I am specifically talking about.

Ultimately look at it as saying that survival comes first before freedom, and before democracy.
Even in America.
The core tends to choose survival even if some principles considered near to "sacred" are discarded in the process of surviving.

Robert Morpheal
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pissedoffhippie Donating Member (8 posts) Send PM | Profile | Ignore Mon Nov-24-08 11:34 AM
Response to Original message
2. buy 51% of GM

I'm no financial genius, so maybe this is all crazy talk, but looking at the data for GM, I read this:
1) There are 610 million shares of outstanding stock.
2) Shares are currently selling for around $3
3) to buy a 51% controlling interest in the company would therefore cost:

$3 times 310 million = $930 million

So, if this is correct, for less than a billion dollars, anybody out there, including the government, could buy a controlling share of GM and basically run the company.


http://finance.yahoo.com/q/ks?s=GM

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