Buy the new Pelosi-Mobile

A Register reader sent us the link to this hilarious car commercial satire. A sign of things to come? Very well-done and very funny. Enjoy.

He who pays the piper . . .

Of course I don't know why General Motors grossly overpaid CEO Rich Wagoner didn't step down long ago, about the time the company went hat-in-hand to the government for a bailout. But the news as of tonight is that the White House -- which has infinite experience running an auto manufacturer -- will pretty much force Wagoner to step down as part of a government- mandated restructuring of the company. We may learn more in the next several days, but at this point it looks as if a condition of getting another tranche of your money and mine -- along with Chrysler they requested $21.6 billion on top of the original $14-some billion already given to the two companies -- was dumping Wagoner.

I don't know why they didn't just allow the two companies to declare bankruptcy. One justification is that some have said nobody would buy cars from a company in bankruptcy. If current sales figures are any indication, people won't buy cars from a company on the government teat either -- although I think the current situation has a lot to do with the recession. When times are tough and you're not sure whether you'll have a job in the next few months, you postpone discretionary purchases. Since most Americans already have a car that more-or-less functions, it's not that tough a decision to put off buying a new one.

I doubt very much if the government plan to save the auto companies will be better than a private-sector plan or better than bankruptcy -- indeed, it's most likely to be worse. But when you're paying the freight you can micromanage, and that seems to be what the Obamaites want to do.

Maybe a "car czar" would be less silly

Obama says he's not going to have a single "car czar," but that Tim Geithner and Larry Summers will take the lead and he'll make the final decisions -- and bureaucrats from other departments will be involved. Great! In today's Register editorial I quoted Don Boudreaux, chairman of the econ department at George Mason U. in Virginia, who put it rather succinctly:

"All are very smart men, but Mr. Geithner is a lobbyist-turned-international-finance-expert-turned-central-banker, Dr. Summers is an academic economist, and Mr. Obama is a lawyer-turned-politician. None of them, as far as the public record shows, has any experience running private, for-profit firms; none has worked in the auto industry; and none (unless you count a lobbying firm as a private enterprise) seems ever to have worked in the private, for-profit sector. The rule of experts would be troubling enough, but here we have the rule of non-experts."

I highly recommend Cafe Hayek, where Don, Russell Roberts, Tyler Cowen and other mostly GMU economists blog regularly. Very lively.

Detroit's early Christmas

The most remarkable and in fact rather alarming aspect of the $17.4 billion bailout the Bush administration decided to give to the auto industry (though not to Ford, at least not now) is the utterly arbitrary way the Bushlet decided to do it. The $700 billion was supposed to be to buy toxic securities, then to inject money into banks (apparently with no accountability) and for no other industry. Then Congress declined to bail out the Three. So Bush just did it on his own. Such power is more than almost any absolute monarch ever had -- and on a far grander scale, since the U.S. was free enough long enough to build a far larger economy than any past monarchy could dream of.

That was the emphasis of the Register's editorial on the subject. George Will made note of the phenomenon also, suggesting that Congress is becoming more or less obsolete in the era of the Imperial Presidency.

No Big Three bailout

Here's the Register's editorial (not written by me) on the latest trip to Capitol Hill by GM, Chrysler and Ford, with corporate hats in hand seeking money (just a loan, of course) to the tune of some $38 billion-with-a-b from the taxpayers. We said Congress should send them away empty-handed to face the music resulting from their own decisions and mismanagement. How many entities will be deemed "too big to fail" before the economy is flat on its back and permanently hogtied by federal command and control?

Let GM (or all three? go bankrupt

Here's a link to the Register's editorial on the pleas from the private-jet-setting Detroit automakers pleading for another gift from Uncle Sam. Let them go bankrupt and reorganize!