Bailout thoughts II

Not long ago, I opined that the bailout bill was a bad idea. Recently I found out that some recipients are using their “bailout money” to buy up the competition. Sigh… I’m sick of being right. Looks like the lunatics really have taken over the asylum.

I am not against bailouts, but it seems to me that they are being used incorrectly. If the bailouts are intended to protect a company and a large number of jobs, there need to be tougher safeguards against the abuse that will inevitably follow. Here are some examples:

  • The entire board, must resign. No golden handshakes, no golden parachutes, no golden nuthin’.
  • Senior management (CxOs) must go. If the company is in need of a Government bailout then it is self-evident that the overpaid bozos in charge obviously cannot manage their way out of a paper bag. That being established, why should they be allowed to keep their jobs? Same deal as above (personally I think that they should be charged with criminal negligence, but that’s just me).
  • The government should acquire a 50% stake by issuing extra shares equivalent to the shares currently in circulation (shareholders take a 50% hit).
  • The company must submit a plan to the Government stating why they need the money, what they intend to so with it, and how it will help them stay afloat.

I can’t think of any more off the top of my head, but that’s a start.

Meanwhile, back at the palace… now they’re talking about bailing out the big three US Automakers. Remember them?

  • They were the ones who were trying to sell us big honkin’ SUVs and trucks while Honda, Toyota and the rest were bringing out smaller and more innovative vehicles.
  • They were they ones who have been dragging their feet on electric vehicles, even though they had a workable technology on the streets twelve years ago. Instead, they fought it, buried it, and started selling us on Hybrids, a jack-of-all-trades-and-master-of-none technology that serves to keep their service bays profitable (electric vehicles have practically zero maintenance compared to Internal Combustion Engines), and their buddies in the oil industry fat and happy.
  • They sat on their collective backsides while a tiny startup came out of nowhere and beat them to market with an all-electric supercar.

And we’re supposed to support that?” No. Just… no.

I say let them collapse – “For they sow the wind, and they shall reap the whirlwind”* comes to mind – and give the bailout money to the employees, to be used as venture-capital by the startups that employ them. Startups that will make the kinds of cars that we actually need.

*That’s Hosea 8:7, in case you were wondering.

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