Thursday, June 18, 2009

Cabela's Obama Bailout: Right Cause, Wrong Reason

The nice-guy president is off his rocker and he’s hoping you’re off yours, too. Just about everyone has awakened now to the blitzkrieg spending strategy which has bailed out everyone from Cabela’s Guns, Hunting and Fishing credit card lines to banks to insurance companies. I’m for the Cabela’s bailout, incidentally, not that I believe it’s the right thing to do. It’s just that Cabela’s believes in 2nd Amendment rights and so do I. It was just chump change, but anything that promotes the gun rights of law-abiding citizens is a positive step with me.

Not so with the rest of it. The trillion dollar deficits have already caused mortgage and credit interest rates to rise, further delaying any kind of recovery. What really kills the American spirit (and the economy) is the “too big to fail” mentality which pervades the Obama White House.

American companies are lined up everywhere to get on President Obama’s “Too Big to Fail List” of government enterprises. Being on the “Too Big to Fail List” has lots of advantages in the form of taxpayer guarantees. Look at the differences between Lehman (not too big to fail) and Bear Stearns and Merrill, both bailed out with government guarantees.

GM and Chrysler should have failed too and, considering the high level of government involvement in U.S. auto manufacturing, are still bound to fail. We’ll be paying for a long time, at least, an installment debt with unending terms where the “buyer” never gets the car keys.

The bailed out car companies have already laid off thousands of workers and more will be laid off as manufacturing advantages go to Ford and the non-U.S makers. Actually, we should now classify Ford as a “foreign” car company as the term, as applied to car companies, comes to mean any car company not owned by the government. Indeed, the U.S. government is now competing against Ford, with fat subsidies and deep pockets, hoping to drive Ford into bankruptcy so it can gain control.

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