Did Dems "Mis-underestimate" Bush One Last Time?

It's plausible that Democrats "mis-underestimated" Bush one last time giving him an unexpected and even an unwanted victory of sorts as he prepares to leave office. From reading into News articles it appears possible that instead of waiting until next year for the Democrat-controlled Congress to re-structure the auto industry with their more liberal view, Bush may be preempting them, setting Detroit on a course that ultimately makes more sense from a relatively Free Market perspective. If so, they un-thinkingly invited him to do that very thing.

I realize how conservatives will react but Bush isn't running for anything ever again. Hank Paulson is aggressively taking the lead on an auto bailout they hope to have done by December 25th. Look at the scope of detail they're considering and think about what that means adding to it Bush's statement of yesterday - that he agrees the free market is the way to go and regrets he feels certain steps must be taken right now at all.

"I'm a free market guy," Bush said. "But I'm not going to let this economy crater in order to preserve the free market system.

This sentence from today's article is key:

But the official indicated that the administration was inclined to do more than just keep G.M. and Chrysler alive until President-elect Barack Obama takes office, saying, “Giving them enough money to limp along doesn’t solve anything.”

Democrats have all but insisted Bush dip into TARP to help the car makers. But they envisioned only a bridge loan thinking they would get their hands on the auto industry early next year to impose whatever regulations or oversight they saw fit and the car makers would have to take the deal.

Treasury and the car companies are said to be going over everything together in great detail:

G.M. officials said that the company’s chief financial officer, Ray Young, and a team of aides had provided the Treasury with a vast sheaf of documents including supplier contracts and payment schedules, production plans, employee payrolls, debt obligations, interest payments and even utility bills.

While conservatives may still rail against Bush for doing anything for the car makers, depending on how this works out they might actually end up having him to thank in the end. If something is going to be done, it makes more sense from a conservative perspective for the Big 3 to be re-structured along lines more grounded in a business perspective, as opposed to designed to appease whatever special interest groups the Democrats had in mind when they administered the same thing next year. And they asked him to do it!

If true, it might just be that Bush is going out with what he perceives as one more win over the Democrats in the end.

Comments

[jharp]

Pretty hollow win if it does indeed play out this way.

And who knows, maybe it's for the best. Though I don't think so. Either way we're in deep doo doo.

[IslamoLlama]

"-- While conservatives may still rail against Bush for doing anything for the car makers, depending on how this works out they might actually end up having him to thank in the end. If something is going to be done, it makes more sense from a conservative perspective for the Big 3 to be re-structured along lines more grounded in a business perspective, as opposed to designed to appease whatever special interest groups the Democrats had in mind when they administered the same thing next year. --"

The Big 3 are currently staring bankruptcy in the face specifically because they failed to work under an intelligent business perspective. They tried to maintain too many models at once without actually developing newer more elegant vehicles. Quality slipped through most of the 90s and they never managed to recover from that bad image in the following decade. And they made massive land wagons that guzzled gas on the eve of an oil price spike.

The management at the Big 3 sucked.

The Democratic Congress - with input from millions of constituents who have been eternally frustrated at being denied quality American vehicles - have decided to mandate that the Big 3 start building cars that Americans actually want to buy.

The Bush approach sides with Big 3 management. The Democrat approach sides with the actual consumer auto market. While Bush's strategy is definitely "business friendly" in the short term, I don't know if I would call it "more grounded in a business perspective" as this implies a grounded business perspective is one that drives your business into the ground. Meanwhile the "special interests" in the Democratic Party just happen to be the majority of American car buyers.

Capitalism doesn't work if all the businesses are run by idiots who don't have to face the consequences of their actions.

[Anon]

A majority of Americans do not want Detroit to get a bailout. They rightly understand that throwing good money after bad and expecting a different result is foolish.

Detroit should indeed have to face the consequences of their actions and that means that the "big three" will become the 'big two' or the 'big one' and they should go to bankruptcy court just like any other business that made the wrong bets on its market.

I notice you omit any mention of the massive drag down on the auto makers of the UAW pension and healthcare and employment contracts, and the role that having to service these entitlements has had in bringing on the current financial collapse.

[IslamoLlama]

"-- A majority of Americans do not want Detroit to get a bailout. They rightly understand that throwing good money after bad and expecting a different result is foolish. --"

Recheck the polls. They have been fairly soft on this issue.
http://www.fivethirtyeight.com/2008/09/news-accounts-may-overstate-public.html

"-- For instance, Rasmussen asked yesterday:

"Do you favor or oppose the economic rescue plan now being negotiated by Congress and the Bush Administration?"

Among Rasmussen's respondents, 50 percent said they opposed the plan and just 24 percent said they supported it. --"

"-- At the other end of the spectrum is a poll put out by the Pew Research Center that frames the bailout thusly:

"As you may know, the government is potentially investing billions to try and keep financial institutions and markets secure. Do you think this is the right thing or the wrong thing for the government to be doing?"

When the question is framed in this way, 57 percent of people support the bailout, as compared to 30 percent who opposite it. --"

Depending on how Congressional action is phrased, opinion swings significantly. This isn't to say that the auto bailout is a good idea or a better or worse idea than the financial bailout, only that the notion that "people oppose the bailout" doesn't really explain the nuances of how the majority of Americans feel about the government response to the failure of the private sector.

"-- Detroit should indeed have to face the consequences of their actions and that means that the "big three" will become the 'big two' or the 'big one' and they should go to bankruptcy court just like any other business that made the wrong bets on its market. --"

The same thing could be said of AIG, Bear Sterns, Citigroup, WaMu, Merril, or any of the other financial titans that have recently fallen. In a vacuum, I'd agree. Let the bad businesses fail. But these businesses fulfill a very vital roll in the modern economy. Letting them die without providing a replacement would be like letting the Washington Bridge, the Brooklynn Bridge, and the Lincoln Tunnel all cave in. You'd destroy Manhattan. Likewise, letting these massive companies fall without providing the nation with some sort of replacement or alternative creates havok that will trickle down throughout the rest of the country in a very corrosive manner.

Even if you do think these dinosaurs need to go extinct, it's important they hit the ground with a soft landing, or they'll kill a lot of smaller healthy enterprise in the process.