The New Math

The rules for running a successful business have changed under Barack Obama.

Now it’s been made much simpler. We take GM as an example:

1. Stiff your shareholders. That should save you billions of dollars.
2. Stiff your bondholders. That’s more billions saved.
3. Stiff the taxpayer. That’s a bunch more billions.
4. Close down your big plants.
5. Close down many of your honest, investing dealerships.
6. Get rid of non-union employees that didn’t vote for you.
7. Reduce salaries and bonuses of CEO’s and other non-union personnel
blaming poor performance all the while excusing the cause of the poor performance which was the employee union.
8. Introduce a new line of teeny-weeny cars that won’t sell but can be made
cheaply enough to hopefully keep the unions in business without asking them
to do anything that might get them mad enough to not vote for you.
9. Show a small profit which should be easy since you just stiffed everyone you
borrowed money from.
10. Accept the bows of the faithful with humility but be certain to continue to control the adoring press so they won’t mention (too often) the deaths of the people driving on America’s high speed, long-distance roadways in these adapted golf carts that get GREAT mileage at the expense of weight and safety.

I look for the new USA/GM to sell off those nasty big, beautiful cars getting 30-35 MPG thanks to the long time investment of IRA and 401K retirees who are now broke because of their government’s intercession in a business they know nothing about.

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I feel certain countries in South America and the Middle East will buy the Hummer line and their people will love driving it since they plenty of money and gas thanks to their own drilling. We of course do not drill because we are saving the environment from global cooling – or is it global warming – or is it climate change – or could it be from the new Marxist we just put into office here in the good old USA.

Capitalism made these guys what they are today so now they are using their status to destroy it. How nice.

But Americans don’t care, they LOVE Obama. Would they run their homes this way? Not on your life but they love Obama anyway. Do they see any way we can ever pay this huge debt off? No, but so what? It’s not real money is it? And even if it is, the guy has a nice way about him.

And trust me, this new greatly reduced, government and union-owned People ’s Republic car company if it does turn a small profit, will be hailed as a great accomplishment by the Messiah. And never mind the suckers that were cheated out of their life savings or the taxpayers who were ROBBED of billions because union workers were overpaid and under-disciplined and turned out horribly assembled cars which their American compatriots refused to buy. Actually which THEY even refused to buy (check their parking lots). None of that will matter. The “company” (insert ‘union’ here) will have been “saved”.

By Whom – For What?

Take a look at it like this. You go into a mall and rent two run-down stores. You borrow money from the bank to renovate, over $200,000.00 worth. You borrow more money to set up your equipment. Another hundred grand. You borrow money to buy your inventory, hire an advertising company, and hire employees.

Then you open your doors but before you do you announce you have no intention of every paying back any of the money you borrowed to put yourself into business. And on the first day, your receipts total $14,500.00 and your operating expenses total just $9,750.00 so you proudly announce to the world that you have “made a profit” of $4,750.00. They invite you to address the Chamber of Commerce on “How To Start A Successful Business”.

Don’t laugh, that’s what is happening with GM. They may issue worthless shares of stock to people whose money they stole but so what, they just reneged on billions of debt and equity investments so what makes the new shares worth anything.

Was there another way to do this, to try to save the real GM? I think so. First, they should have filed bankruptcy and let the court restructure the debt as well as the labor contracts and retiree benefit program. Then with that out of the way, they could have scaled back their production lines a little without getting in this political environmental nonsense which is a scam.

Finally they could have instituted quality control checks which would assign controls to every production level and identify those workers who do the assembly at each level. With that type accountability in place, and a willingness to discipline those who fail to meet work standards, they could have turned the company around, saved all those jobs, saved the dealerships and maybe given shareholders a chance to see their company bounce back new and lean and strong.

But they didn’t do that because the UNIONS backed Obama and HE OWED THEM. So he couldn’t come down hard on them. He could and did come down on the CEO’s that earned big contractual bonuses despite poor performances while at the same time allowing Fannie Mae and Freddie Mac – two governmental agencies that also lost BILLIONS of taxpayer dollars – to pay THEIR CEO’s the same type big bonuses.

The difference? Once again Fannie and Freddie along with their CEO’s were supporters of the Obama ticket and contributed mightily to it. Their CEO’s in fact were part of the Obama campaign.

Obama came out of the Southside of Chicago School of crooked politics and he learned his lessons well. Smile when you get in front of the camera and never let ‘em see you sweat’. When the red light goes out, do whatever the hell you want. And always remember Mr. President, there is a sucker born every minute.

Just last week the President after spending TRILLIONS of dollars said ‘we are out of money’. Really? Let’s see, when we started there were 6% unemployed. Now three trillions dollars later, there are 9.5% unemployed and we are being told this can’t turn around for a year or more. How about that? Do a lousy job and tell folks you expect to do a lousy job and everyone nods and says ‘poor Barack, it’s that damn George Bush’s fault”.

The economy collapsed because the Democratic party insisted that Fannie Mae give trillions of dollars worth of mortgages to people that could not hope to pay them back. When they didn’t pay them back, all hell broke out and the reason is Fannie bought those shaky mortgages, repackaged them and sold them to unwary investors around the world without mentioned that the mortgages should never have been given out in the first place. Who was responsible for that? The Democratic Party of Chris Dodd, Chuck Schummer, Harry Reid, Nancy Pelosi and Barney Frank aided and abetted by the likes of Jim Johnson and Franklin Raines.

They weren’t very bright and to show that they still haven’t learned anything, they just introduced this free money to first time homebuyers program.

Now I don’t object to this one-time credit of $8,000.00 to help people at the lower end of the economic ladder to buy a home. But if they can’t KEEP this home, we are doing once again what Fannie did that lead to this current mess.

You know what they say about doing the same thing in the same way and expecting the results to be different? Well we better watch out because we spent trillions to try to solve this mess already, we don’t have trillion more to spend doing it again. And if they give these homes to people that can’t keep them, we are heading down the same dumb path again.

Here’s what they should do. Any applicant for a first time home buyer’s credit should have to meet every other qualification set for the rest of us who want to buy a home!
They have to be employed, they have to have a work history, they have to make enough money to keep this home, they have to have a decent credit history. They need it all. All the checks and balances that are present for ANY mortgage have to apply for THESE mortgages as well. The only difference should be that the taxpayer is kicking in $8,000.00 to help. That’s the way to do it and not make the same mistake we made before.

Giving people homes they can’t afford and can’t keep is a one way ticket to financial ruin for everyone including the folks trying to get that home.

Recently the Chinese has to lecture us on how to act financially responsible. How about that? China. But they were right. You have to act responsibly.

You’d think we would have learned that by now.

Joey

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