Government Motors

This CNN article gives the facts on GM's bankruptcy. Does anyone else wonder if politicians feed their brains with twinkies and soda? The U.S. government poured $19.4 billion down the GM drain to save the company, and it went bankrupt anyway. None of this comes close to surprising me, but $30 billion more? It's so strange that I feel like I'm missing something. And stating that "the taxpayers" own 60% of the company just makes me laugh. The only taxpayers who will have any control of GM are politician taxpayers (those politicians who pay them, that is, not Obama's cabinet).

My favorite article about the GM bankruptcy came, surprisingly, from public radio. Marketplace aired a report on it. This is the best part:

"...it's difficult to find a public purpose behind this biggest industrial bailout in history. The goal can't be to preserve jobs because the Treasury has been telling GM to slim down; and the company plans to shut 11 factories and lay off 21,000 workers.

If the goal is a much smaller and leaner GM that might be profitable one day, that's something the private sector is better able to do than government -- through workouts or bankruptcies -- and there's no reason for public involvement.

If the goal is to create a prototype for a fuel-efficient car of the future, Congress has already appropriated money for that, and the Treasury says it doesn't want to tell the new GM what to produce anyway.

If the goal is to repay the public, there's no point in putting up the public's money to begin with.

So why exactly are we doing this? Maybe because the sudden dissolution of an American icon like GM would be a blow to the American psyche, further eroding confidence during this deep recession. Yet under normal bankruptcy the GM brand would likely live on, and GM's other valuable pieces would be bought up. Over the next decade or so, GM as we've known it will likely disappear in any event."

How encouraging! The government makes yet another wonderful investment to insure that future generations won't have any economic woes- and will drive Corvettes.