Auto makers bailout – Open Forum

Apparently, no one likes my suggestion to sell Obama gear to bail out the (Sorta) Big Three automakers, so Congress is debating giving billions to them.

This week, Congress will consider whether to cough up billions of dollars to bail out the troubled companies.
There are loud advocates with strong arguments on both sides.
Proponents of a bailout say that the industry is a victim of the global financial crisis. Wall Street has been bailed out, so why not Detroit?
They say millions of jobs could be lost and more than $100 billion in wages sliced out of an already-fragile U.S. economy.
“It would be a travesty for the irresponsible, reckless behavior of Wall Street to result in the sweeping away of the American automobile industry,” said Mike Jackson, CEO of Autonation, the nation’s largest auto dealership group. “If indeed it came to bankruptcy, it’s going to make what happened with Lehman Brothers and all the consequences of that a nice day.”
On the other side are those who feel just as strongly that the automakers’ problems are their own doing, born of bad business decisions, uncompetitive labor agreements and vehicles that Americans have decided are second-rate.

In my very small sampling of friends, radio DJs, and Internet blogs, the verdict appears to be running against a bailout. Youngstown, Ohio’s Hot 101 radio station is running their own auto bailout promo, giving away a car, since the Washington DC version doesn’t help anyone except execs (at least that’s what the promo suggests).
What say you?

Obama's new chief of staff Rahm Emanuel on Freddie Mac board during scandal

Well, (some of) the media remembered how to investigate. RE: Rahm Emanuel’s time on the Freddie Mac board, ABC reports:

President-elect Barack Obama’s newly appointed chief of staff, Rahm Emanuel, served on the board of directors of the federal mortgage firm Freddie Mac at a time when scandal was brewing at the troubled agency and the board failed to spot “red flags,” according to government reports reviewed by ABCNews.com.
President-elect Barack Obama’s newly appointed chief of staff, Rahm Emanuel, served on the board of directors of the federal mortgage firm Freddie Mac at a time when scandal was brewing at the troubled agency and the board failed to spot “red flags,” according to government reports reviewed by ABCNews.com. According to a complaint later filed by the Securities and Exchange Commission, Freddie Mac, known formally as the Federal Home Loan Mortgage Corporation, misreported profits by billions of dollars in order to deceive investors between the years 2000 and 2002.
Emanuel was not named in the SEC complaint but the entire board was later accused by the Office of Federal Housing Enterprise Oversight (OFHEO) of having “failed in its duty to follow up on matters brought to its attention.”

When (if) the MSM report this story in depth, it will report that some in the GOP saw the problems early on but were blocked by the Democrats in leadership. I am looking for primary sources on this but a number of bloggers report that Emanuel blocked efforts to reform Freddie and Fannie. In 2006, Dems (who had won control of the Congress) were identified as standing in the way of reform:

Democrats are likely to block a Republican proposal to cut the $1.4 trillion combined mortgage assets of Fannie Mae and Freddie Mac. Republicans have pushed to scale back the investments of the government-chartered mortgage companies, arguing the holdings are so large they threaten to destabilize financial markets.
Frank’s View
Massachusetts Representative Barney Frank, who is in line to chair the House Financial Services Committee, said discussions with Treasury Secretary Hank Paulson may still produce a deal.
Any measure would have to include an increase in the share of profits the two mortgage giants must donate to a fund to help low-income people buy housing, Frank said in an Oct. 31 interview. “I am going to get as much as I can,” he said.
Frank also says he plans to push legislation to give company shareholders more power to review stock options and other bonuses for corporate executives.

The irony is that the recent banking/credit crisis derailed the McCain campaign and played a large role in the election outcome. The roots of the current bailout apparently go back at least to the Congressional transition in 2006 when Barney Frank held off a deal on Freddie and Fannie in order to give money to finance low income housing purchases (read: ACORN Housing, and other ways to finance home purchases, many of which were risky loans). And recall, that the first bailout package offered up by the Frank-Dodd-Paulson group included the same kind of mechanism, funneling money to support risky deals. Barney Frank said, “I’m going to get all I can.” And now the Dems have done a very skillful job of convincing many that the credit crisis was none of their doing.

Debate reactions: Open Forum

I think Joe Wurzelbacher (the Ohio plumber) and Bob Schieffer did well.
The questions were more helpful to voters in making decisions. I think the candidates made the differences a bit clearer. If you want a more centralized federal government and social liberal, vote for Obama. If you want spending discipline and social conservatism, vote for McCain.
Bring it…
NOTE TO READERS: For some reason I cannot figure out, your comments are not being posted. I cannot get to the spam queue either to look for them there. Makes it tough to have an open forum, eh? Try again in a bit, hopefully I can get it worked out…
Let me remind readers about this post about Mr. Wurzelbacher’s interview today with Family Security Matters.

Ohio plumber Joe Wurzelbacher talks about his dialogue with Obama and spreading the wealth

UPDATE: Joe Wurzelbacher held a news conference this morning at his Holland, Ohio home. Holland is about 8 miles from Toledo.
In a prior post, I referenced a conversation between a plumber and Obama on a campaign stop in Toledo Ohio. The questioner’s name was Joe Wurzelbacher and he has gotten a bit of attention surrounding the YouTube video. An advocacy group Family Security Matters secured an interview with Mr. Wurzelbacher and I think it is worth the read. Mr. Wurzelbacher seems thoughtful and expresses many concerns many conservatives and small business owners have about the Obama tax plan. Here are some excerpts:

At a recent campaign appearance in Ohio, Sen. Obama was approached by plumber Joe Wurzelbacher, who has concerns about Obama’s proposed tax policies. FamilySecurityMatters.org’s Pam Meister had a candid conversation with him about his experience.
PAM MEISTER: You recently met Sen. Obama on the campaign trail in Ohio, and you asked him a question about his tax policies. What exactly was your question for him?
JOE WURZELBACHER: Initially, I started off asking him if he believed in the American Dream and he said yes, he does – and then I proceeded to ask him then why he’s penalizing me for trying to fulfill it. He asked, “what do you mean,” and I explained to him that I’m planning on purchasing this company – it’s not something I’m gonna purchase outright, it’s something I’m going to have to make payments on for years – but essentially I’m going to buy this company, and the profits generated by that could possibly put me in that tax bracket he’s talking about and that bothers me. It’s not like I would be rich; I would still just be a working plumber. I work hard for my money, and the fact that he thinks I make a little too much that he just wants to redistribute it to other people. Some of them might need it, but at the same time, it’s not their discretion to do it – it’s mine.

Regarding Obama’s statement that he didn’t want to punish success:

PM: …taxing small businesses making $250,000 and above is going to help the people “behind you.” And yes, “spreading the wealth around.” How did you feel about that?
JW: As soon as he said it, he contradicted himself. He doesn’t want to “punish” me, but – when you use the word “but,” you pretty much negate everything you just said prior to that. So he does want to punish me, he does want to punish me for working harder to – you know, my big thing is the American Dream. I work hard. You know, I was poor; my mom raised me and my brother by herself for a very long time until my dad came along. So I know what it’s like to suffer. It’s not like I was born with a silver spoon. Usually it was a wooden spoon and it was on my butt. It was just a contradiction of terms, what he said: he doesn’t want to punish me but he wants to redistribute my wealth. And what I mean when I say my wealth, I mean the collective. Eventually – I mean, just to sound a little silly here, but you need rich people. I mean, who are you going to work for?
PM: Do you fear this is the possibility of America turning more down the socialist road if Obama does become elected and if he is able to implement these policies?
JW: Very much so. You start giving people stuff, and then they start expecting it – and that scares me. A lot of people expect it now. They get upset when their check’s late, they get upset when they don’t get as many benefits as they used to, or when different government agencies are cut or spending is cut here and there for whatever reason – people get upset at that. And that’s because they’re used to getting it and they want more. I mean, everyone’s always gonna want more. People work the system left and right to get more out of welfare, to get more out of state assistance, federal assistance. And if government’s there for them, they’re gonna keep on trying to manipulate it to get more out of it. You got people that come along and say, “Hey, I wanna help you people,” I mean, they’re all ears! They’re like, “Hey, you can help me more, I don’t have to work as hard, I don’t have to do as much, and you’re gonna give me this? Man, that’s great, you’re a good guy.”

I hope McCain or Bob Schieffer raises again Mr. Wurzelbacher’s questions. Like central planning and wealth re-distribution or not, we need to hear more from Mr. Obama about his economic philosophy.