The Freedom Factory

Government detention camps cover up deaths-does America have a human rights problem? Congress passes unprecedented $3.6 trillion budget with $1.2 trillion deficit, official unemployment rates his 8.5%-some economists claiming they are really upwards of 20%, government mortgage giants Fannie and Freddie to pay $159 billion in new bonuses, Obama calls end to ‘Pax Americana’, world leaders pledge $1.1 trillion to IMF, Russia refuses to remove troops from Georgia, NY protesters call for government to ‘Bail out the People’, Hugo Chavez declares that ‘Capitalism must end,’ and Treasuries drop with announcement of next week’s $59 billion note issue and Goldman Sachs estimate that government will need to borrow another $3.25 trillion this year… Continue Reading

In January, regarding the American Recovery and Reinvestment Act, President Obama stated that “there is no disagreement that we need action by our government, a recovery plan that will help jumpstart the economy.” Over 300 economists, 3 Nobel Laureates, and many other prominent scholars signed a statement in opposition to the plan.

Political disinformation only goes so far in the digital age.

—–SPECIAL OFFER—–

The Federal Reserve is creating tens of trillions of new dollars, debasing our currency, and silently taxing us all through inflation. With tens of trillions in federal budget deficits on the horizon there is nowhere for the US dollar to go, but down.

Refuse to be a victim of this flawed financial system, buy gold and silver NOW!

One of the biggest advocates against the automotive bailout is the Cato Institute. Since Congress appears to be poised to pass an intial bailout measure, it is worth a final review of some reasons why it might not be a good idea. Here’s a brief video by Cato on the subject:

The main takeaways:

1. Union contracts make Detroit’s long-term prospects untenable, no matter how much money you throw their way
2. Labor costs are meant to be fixed, not variable…union contracts obscure this reality
3. Employee wages are multiples of fair market values that non-unionized competitors face

Finally, we must ask the question:

Where is it written in stone that we need a Big Three?

Ultimately, this bailout enables the Big Three to avoid facing economic reality now, filing bankruptcy, and doing what’s necessary to void untenable labor contracts. The only way the U.S. will have a viable automanufacturing industry in the long run is to conform its business practices to global reality.

Bankruptcy means bad businesses can restructure, organize efficiently, split into parts that make sense and emerge stronger than before. Subsizing bad companies means we’ll never see the good ones.