RUSH: ‘Auto Makers Force Bailout Issue — The auto-industry crisis is forcing a broader debate over how far the government should go to prop up ailing industries, as the Bush administration resists Democrats’ request to use part of the $700 billion financial-rescue fund to aid Detroit’s three struggling car makers. House Speaker Nancy Pelosi of California and Senate Majority Leader Harry Reid of Nevada, in a letter Saturday, formally requested that Treasury Secretary Henry Paulson consider giving ‘temporary assistance to the auto industry’ using money originally appropriated to shore up the banking system. The Democratic lawmakers said federal aid should come,’ get this, ‘with ‘strong conditions,’ such as requirements that car makers build more fuel-efficient vehicles, and equity stakes for the government so taxpayers could profit if the companies recover.’
(snorts) Do I need to translate this? Reid and Pelosi are saying to the Big Three, ‘You let us have financial stake in the companies. You let us design the cars. You have gotta make more fuel-efficient cars!’ This is what, in part — it’s not the sole reason but this is what in part — has led the Big Three to the problems that they have. Do you know that their businesses around the world are thriving, General Motors and Ford? I’m not sure about Chrysler. I think it’s true for them, too. In China… The favorite car in China is a Buick. In Europe, they make all kinds of General Motors and Ford cars, and people buy ’em left and right. One of the reasons is that there aren’t as many restrictions on mileage and CAFE standards and all this other gobbledygook that people who have no idea about building cars and designing them have forced on the domestic production of US automobiles.
It seems like such a long time ago, but remember when the phrase was, ‘As goes GM, so goes the country’? Whatever happened to that? What happened to that is that there’s no more capitalism in the auto industry. Now it’s, ‘As goes the US government, so goes GM,’ and Ford, Chrysler and so forth. These auto manufacturers and CEOs are in dire straits, and here come Pelosi and Obama pressuring Bush. ‘All right, we want stakes. We want ownership! And you better get in gear. You better get in gear making cars we say you ought to make.’ How many of you want to buy a Nancy Pelosi-designed car? How many of you would hire Harry Reid to design a car you wanted to build? Get serious out here, ladies and gentlemen. But here is the thing, besides all that, that is the most offensive.
Reid and Pelosi said they want ‘equity stakes for the government so taxpayers could profit if the companies recover.’ Now, that just insults my intelligence. When they talk about money coming into the government from a situation like this, all of a sudden it’s ours. In the normal ebb and flow of Washington day, no money is ours. It’s all Washington’s, and as I said yesterday, they then start calculating what the government ‘cost’ of every rule in the tax code is. ‘What’s the cost to us, the government, for the mortgage interest deduction? What’s the cost to us of having 401(k)s? What’s the cost to us of allowing people to have their health care benefits not called income and therefore not taxable?’ Government looks at every dollar in this country as its own, and they look at the cost to the government of what your income is, what your taxes are, and so forth and so on.
But now, now all of a sudden if they invest in General Motors and Ford — and if General Motors and Ford show a profit, and are able to pay back some of the loan — why, you and I, folks, we’re going to benefit. Which is a crock! Taxpayers would profit? Let me ask you a question. Let’s say they bail out General Motors and Ford. General Motors and Ford, like Chrysler of Lee Iacocca fame, happen to turn it around and repay the loans all back to the federal government. And then let’s assume that the federal government does relinquish its stake in the auto companies (don’t count on that, but let’s just hypothetically say they do) and all of this profit starts coming back. A great investment the government made in the Big Three!
Is your paycheck going to get any bigger? No! You’re not going to see a dime of it. ‘But, Rush! But, Rush! The Treasury would swell; income would roll in.’ Right, and what’s going to happen to that money? We’re going to be so far in debt, it’s just going to be debt service. There’s not going to be any profit, folks. The government doesn’t know how to create profit. The government only knows debt. The government only knows limitless spending and debt. They do not know profit. All they know is how to tax profit. All they know is how to punish profit. All they know is how to set up obstacles in the way of profit. This notion that we, the taxpayers, might profit if the government bails out the Big Three and that somehow we’re supposed to go along with this on that basis, insults my intelligence.
But, hell, it’s over anyway, because the Big Three auto CEOs are on their hands and knees, and they’re saying, ‘Not only will we build more fuel efficient cars — not only will we do that — we will agree to limit CEO pay.’ The CEOs of the Big Three have agreed. They’ve really, literally bent over, grabbed the ankles, and said, ‘Okay, you give us the bailout and we’ll go along limiting executive pay in the auto industry.’ That’s how desperate they are to get the goods. I remember when the focus in this country used to be on the private sector. In the good old days, what was good for GM was good for America. Now we’re told, ‘What’s good according to the Treasury Secretary is good for America.’ The singular focus on Washington is the problem.
Do you know the market is down 267? The Obama recession continues, and why is this happening? ‘Cause there’s no stability! The markets are frozen waiting for Paulson to say something. The Treasury Secretary has all the power here. The markets are frozen because they really don’t know how fast Obama is gonna embark on his own destruction of the US economy, via his tax increases. There is so much government interference, there is so much government control, there is no incentive to plan for next week if you’re one of these businesses — unless you’re desperately trying to stay alive by asking the government for a bailout, then you’re trying to get it next week. But there is no incentive to plan for much, the next five years out. We have a situation where the federal government is Daddy and all these corporate entities are now Junior, and Daddy is trying to figure out what Junior’s allowance is going to be, or if he is going to be given enough of an allowance to go buy the car.
Meanwhile, Junior has no clue what’s coming his way, so he can’t go buy the car. He can’t go borrow it, can’t rent it, can’t do whatever. So Junior is sitting around waiting for Daddy to make up his mind, and Dad is sitting there getting drunk every night with all the money he’s got, trying to figure out where it’s going to go. And you got Obama calling him every night saying, ‘This is where I want the money to go. This is where I want you to send it, and I want you to do it before I’m inaugurated.’ So think of yourselves as Junior; think of the government as Daddy; and you’re sitting around and you’re begging for an allowance. Your allowance could be to pay your mortgage or to give you a house or to fill your gas tank. We have Veterans Day. Maybe we can find a day to salute those in the private sector who used to be leaders in America’s pursuit of happiness. I’m serious. We need to seriously consider establishing Capitalism Day so that we never forget what it was.