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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: thames_sider who wrote (94517)	11/7/2008 9:10:22 AM
From: Rarebird	Respond to of 541457

<<But without a bailout all three are likely to run out of money next year.>> These companies should be allowed to fail in a true capitalistic economy and their failure would sow the seeds of success for their successors. Instead, these zombie companies are going to continue operating on the largesse of the taxpayer, putting a drag on society for a considerable period of time like Japan in the Nineties. Thus, the recovery stretches out further and further into the future, with very slow growth the top target of the government (avoiding negative growth and lost jobs is priority one). The US is going to be sliding deeper and deeper and will continue to be less and less of a destination for young, vibrant growth companies in the future. Right now, the stronger dollar is a sign of strength, but once the fifth wave rally is complete, it's going to be all over for the US as a destination for investment capital.

To: thames_sider who wrote (94517)	11/7/2008 10:13:49 AM
From: Sam	Read Replies (1) \| Respond to of 541457

So would you favour letting all three US car companies - GM, Ford and Chrysler - go bankrupt? Probably this would also bring down their main suppliers Delphi and Visteon, plus maybe a good few smaller firms. Not to mention the ripple effect in the communities that they are in. Rather than letting them go bankrupt as a lesson to other companies, it would be better to take the top 5 or 10 people in their managements of the past 30 years or so, plus members of their Boards, and throw them all into a high security prison, allowing their families to keep only a token amount of money. That is the way to get the attention of CEOs and Boards everywhere. This isn't an original suggestion. Machiavelli suggested long ago in the Discorsi (Bk 3, chap 1) that a salutary custom would be take a few of the "leading" citizens of any polity every 10 years or so and kill them to serve as an example to the others. That would be the only way to keep them honest.

To: thames_sider who wrote (94517)	11/7/2008 11:44:18 AM
From: TimF	Read Replies (2) \| Respond to of 541457

So would you favour letting all three US car companies - GM, Ford and Chrysler - go bankrupt? I don't favor them going bankrupt, I oppose bailing them out to avoid them going bankrupt. Its is possible that bankuptcy could be good for the companies as it could free them from a lot of the fixed costs that are dragging them down. Still if they can avoid bankruptcy by themselves, I will be glad to see it. Do you reckon that this would be beneficial for the US? At least in the long run yes. Funneling more and more resources to poorly run uncompetitive companies isn't the way to put the economy on better footing going forward.