GM Govt. Bailout?

[GeneW]

In 1921 there was a recession. The Gross Domestic Product dropped 17 percent. Unemployment reached ten percent. The recession was not "dealt with" by President Harding. It ended in under one year. It sucked to be sure. The "Roaring Twenties" followed this recession. Good times followed for about six years.


In 1929 a recession began. President Hoover tried to keep wages high by encouraging business to raise them. He also tried to keep prices high. He encouraged the Federal Reserve to loosen up credit. Hoover was not a "do nothing" President, he just didn't do quite enough to suit some folks.

By 1932 unemployment reached 25 percent. President Roosevelt created the New Deal. Wage and price controls. Public Works projects. Bad banks were seized. A new agency, the SEC, was created to protect the stock market. It's first Director, Joseph Kennedy, was one of the guys who helped create the crash of 1929. When asked why he picked Joe Kennedy FDR said, "It takes a thief to catch a thief".

Unemployment didn't fall below double digits until 1941. We had to go down to War to end the Great Depression. When guys were being conscripted into the Armed Forces the Doctors noticed that they had evidence of malnutrition.

Some "New Deal", huh?

Moral of the Story - helping failing businesses helps failures. Helping failing businesses also keeps people working in those businesses instead of working elsewhere. Raising taxes and shoveling the money off to failing businesses takes money out of everyone else's mouths.

Letting failing business continue hurts everyone. GM screwed up in so many ways that it must fail. A newer leaner GM will build good cars at good prices.


I voted "no" even though my employer is already seeing the effects of GM's slowdown. I could end up on the street because of a failure of US business. I'm already warming up the getaway car. My skills can be used elsewhere.

Gene