Pat Buchanan and failure

Ray G,

I agree, you got it pegged.

I pretty much feel the same way about Lew Rockwell and most of the people that write for him. I participate on another discussion group and most think Lew is just the best, I think he has some serious screws loose.

The Big 3 defenders on tv I have seen are blaming the credit crunch for their troubles. Their argument is that they were cutting costs and developing cars people would buy until the credit problems caused people to stop buying.

Of course that would apply to most businesses. And the car companies and the UAW seem delusional when they talk about how their costs are competitive with the imports except for the fact they have to pay for their employee's medical insurance.

Chapter 11 is the most sensible path to correcting their cost structures. If they want the taxpayers to bail them out we should be able to do the same thing as a bankruptcy judge and adjust their costs as needed.

I doubt the UAW would be happy with the results.

I for one, am glad that Buchanan has taken this stance.

If he were to suddenly be a free-market advocate, his reputation would only bring discredit to a good idea.

The media would question men like Prof's Roberts and Boudreaux and say silly things to lump them together with the likes of Buchanan.

Pat needs to talk more so the world can see ever more clearly that he's a loon, and not to be tied to any serious thought on the Right.

Note that taxing income instead of consumption necessarily means subsidizing failure.

Stop subsidizing failure. Support a change in tax base.

Thomas W. Hazlett wrote:

On the other hand, Buchanan is patriotic, isolationist, anti-immigrant, and clearly a bellicose defender of "America First." That's called nationalism. So, Buchananism is this odd mix: nationalism and socialism. Gee, that doesn't ring a bell, does it?

My reposting of Hazlett's mot juste should not be interpreted as a claim that a proposition is dubious just because Buchanan is one of its proponents.

Are the car companies claiming they can't sell because people can't get financing? I don't think so. Why should a bank credit crunch affect their ability to raise capital in the capital markets? Doesn't the money have to go somewhere? Have I missed sometihng?

It's odd, looking from the old world to America, that so many of your self-declared capitalists are in fact economic nationalists.

Pat B.

When he's good, he's pretty good, but when he's bad, he's very bad.

Martin Brock, I agree with you. Bankruptcy courts exist for exactly the circumstances which GM and Chrysler currently face.

The entire debate over GM rests on a huge False Choice fallacy that both sides seem to want to assume. Either taxpayers must finance every contractual commitment GM ever made to anyone, or the company must cease to exist altogether along with all of its output, all of its jobs and all of its other resources. Countless organizational alternatives to these extremes obviously exist.

For-profit organizations occasionally make unprofitable commitments. If these commitments are long term, then over time, their cumulative cost makes any profitable organization of the company's resources inconceivable. At this point, the company must break some commitments. It needn't break every commitment, only enough commitments to return to profitability. That's what bankruptcy courts are for.

If a company's factors may simply promise themselves the moon and expect taxpayers always to fulfill the commitments, they'll soon promise themselves the sun as well. I would. It's inevitable.

They'll bail them out for the union's sake, if nothing else. Goodness, if the Detroit unions are powerful enough to get $79 an hour out of the Three, they've certainly got enough clout to get Washington to give them bailout money.

I agree completely with Grant Bosse - nice link.

There's another way to look at this from the micro perspective. The bailout of GM, Ford, and Chrysler will, in part, be financed by the taxes of Americans who work here for Toyota, Honda, etc. I'd like to see an interview with one of those workers - "Why should I be taxed to bail out my company's competition?"

But I'm afraid that the politicians will do something to "help" the Big 3 because they feel they have to be seen as doing something.