The Economic Stupidity of the Carrier Bailout

One particularly tough and indigestible nugget of talk-radio stupidity afflicting the guts of conservatism is the idea that there is some sort of fundamental difference between bribing a business with tax cuts and bribing it with a wheelbarrow full of cash. The Trump-Pence bailout of Carrier’s operations in Indiana provides an illustrative case...

Republicans might have had a little bit of a point in the question of general tax cuts: A tax cut and spending are different things, even if the budgetary effects are exactly the same.

But in the matter of industry-specific or firm-specific tax benefits of the sort extended to Carrier in Indiana, they do not have a leg to stand on. These are straight-up corporate welfare, ethically and fiscally indistinguishable from shipping containers full of $100 bills...

>> NRO sounds just like Levin. They are stuck on crazy stupid.

I foolishly attempted to give Levin another try yesterday a little after 7 PM while driving around town. The point where I tuned in, Levin, citing Aristotle, discussed the value of politics — a complex and pervasive system where no responsible citizen should turn his back to the process. He continued to describe the value of conservatism apart from party politics while emphasizing the Republican Party is not without fault. Among other exceptions, Levin went on to give Trump some latitude intimating he’s not completely at fault — apparently for whatever inadequacies are haunting Levin’s imagination. An interesting subject matter I figured... but nonetheless the target of criticism was the Republic party with the notable reference to Trump.

Eventually Levin turned to a historical essay that describes FDR’s strong-arming of Montgomery Ward and the subsequent battle with its chairman, Sewell Avery. FDR had no intentions of letting strikes and disputes get in the way of the vital production required to support the war. An interesting subject matter I figured... but nonetheless the target of criticism was FDR and the [statist] tactics used to control an otherwise free market.

In his ominous but forbearing voice, Levin methodically transitioned to the prospect of modern tyranny where corporations are forced to suffer the unreasonable whims of a man that has no concept of liberty. Levin proceeded to ask his audience if that’s the type of leadership they expect/hope/want to see in Trump.

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In fairness to Levin, I paraphrased what I recalled hearing about 8 hours ago. And despite my disappointment with Levin’s ultimate message, it’s a worthwhile segment in terms of the Montgomery Ward ordeal.

Obama really screwed up the deal for the bold holders, wonder what happened to the court case?

The judge ignored decades (centuries) of bankruptcy law, and the bondholders only got pennies on the dollar.

I've told people about this, and they try to brush it off as "those Wall Street guys deserved it". Then, I point out that GM's biggest bondholders were public pension plans -- one of them filed the court challenge, but I don't remember which one. It might have been Indiana.

That means that depending on the pension plan, either teachers, firefighters and police officers get a lower pension for the rest of their life, or taxpayers get to make up the difference to maintain the contracted benefits.

Most people get really quiet after that.

A FReeper told me she had about $50,000 in GM bonds in her IRA, and it was effectively wiped out. She wrote that she was sufficiently diversified that she could weather it, but that's still a big hit to your bank balance.

I'm still so pissed off about it, I'll never buy a GM or Chrysler vehicle.

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NO....they should ask, if we were in the same position, would the state come to our aid.
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Ask? What other favors should be ‘requested’ from Big Daddy govt?

I am not so naive to believe the State/govt *should* ‘aid’ anyone to begin. Our Founders were correct to NOT trust govt...just look at the change from Republic to Democracy in the last 100ys. Anyone think *that* is by ‘accident’??

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Exactly. Businesses should shut up and get taxed out of business. Wait that would be stupid. Why don’t all businesses threaten to leave until repressive taxes and regulations are removed. Conservatives should support examples of low taxes being good for jobs and workers.
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And some wonder why biz would setup shop on foreign shores...EXACTLY for those reasons. Still, some (esp. govt) are too blind to see (willfully so).

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