Observing our congressional leaders approach to the auto industry bailout is like watching bad reruns on Nickelodeon. The case they are making to bailout the auto industry is exactly the same as they made for the Bear Stearns, AIG and TARP fiascos… further damage to the economy during a fragile time, incredible hardships for “Main Street” and the urgency to make it happen in a period of weeks before the economy comes crumbling down.
These efforts don’t work to help Main Street one iota and are serving only to temporarily prop up these failed business models into an unknown future. They need to be cleansed from the system. They are all playing a dangerous political game by trying to give the appearance of fiscal propriety through hearings and a show of toughness, when the end result is obvious for all to see. The auto industry will get their money and they will be back at the trough in very short order as already seen on our TV pilot show AIG.
Please spare us the theatrics Congress.
The solution I would propose is one that would help Main Street, auto dealerships, suppliers and the failed auto companies, if we are to use tax payer dollars to fall another rung into socialism:
Let’s take the $35 BILLION and put a $12,000 car credit directly into tax payer hands. It would work like this; create a lottery for people under a certain earnings level, at least $15,000/year with a maximum of $65,000/year (they still have to have the ability to pay car insurance, title, registration etc.). The winning lottery winners would receive a $12,000 dollar American Car Purchase Certificate that may be used to purchase an automobile from any American car maker dealership.
People would get cars, dealers would make sales, auto industry suppliers would sell products and the not so BIG 3 would have revenue to continue operations. The auto makers are going to fail. Their business models are not sustainable and will not be “turned around” for at least 4-5 years, even if they began immediately. They will likely need an additional $20-$30 BILLION along the way. It took AIG just two short months to go from $85 BILLION to $150 BILLION in taxpayer money.
Since $34 BILLION is the initial installment (already up from the $24 BILLION request a few short weeks ago), let’s go ahead and round up to $50 BILLION (this will be viewed as a pittance to give them when we look back 12 months from now). At that level, the lottery would put $12,000 American Car Purchase Certificates directly into the hands of 4,166,667 consumers.
That’s what I’d call a stimulus package that helps those in need (the tax payers). Why continue to inch our way into socialism in order to save bad business models, when we could just go for broke as innovative, proud, former capitalist and try a new twist on the formula… start at the bottom and let it trickle up.
