Almost REALLY doesn't count…

My modest proposal last year, re: General Motors:

I say the following not as a serious recommendation, as 1) it would be a compromise of principle since it allows for state involvement, though one that would work differently than the current ones thrust on us all the time, 2) I don’t know how it would actually work if done, & 3) I know it has no chance in hell of being done anyway, but consider this scenario: instead of a straight bailout, the company is seized from management and broken up, with the pieces controlled by groups of the employees,  w/ the aid of the suppliers on logistics.  From there, the inevitable state assistance goes to the workers, with the ones that ran the company into the ground deliberately left holding the bag.  Obviously, this would be much more justified than what is going to happen…

Fast forward to today.  All emphasis mine:

Under a restructuring plan put forth this week by GM, the ailing automaker would give majority ownership to the federal government to stave off bankruptcy. That handoff would amount to an extraordinary partial nationalization of the maker of Buicks, Cadillacs and Chevys that has been an independent company since 1908. […]

GM’s proposal would give the government more than 50 percent of the automaker’s stock in exchange for forgiving $10 billion in government loans. The United Auto Workers union would end up with a 39 percent stake.

The plan is far from a sure thing. Holders of GM’s $27 billion in unsecured debt have dismissed it as unfair because they would lose most of their investment. And the White House repeated this week that it doesn’t want to own GM or any other auto company.  But through its broad efforts to rescue the auto industry, the White House is already deeply involved in the operations of GM and Chrysler.

So the government would own half of the company.  The union (not the workers in the union, but the union, note the phrasing) would own 40%.  No breakup.  And this was GM’s idea.  I suspect the UAW workers are in for a rude awakening if this plan goes through…

Edit: in a surprise turn, Brad — whose post you really should read in its entirety — catches not just a Catoite, but Big Chief Catoite himself Ed Crane, admitting that these types of moves make Obama a statist, not a socialist.  Anyone who thinks Obama is a radical is looking at him through whiskey goggles.

About b-psycho

Left-libertarian blogger & occasional musician.
This entry was posted in economics. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s