Mussolini Would be Proud: Obama Ballyhoos the Auto Industry Bailout
By Jonathan Bean • Sunday August 1, 2010 6:33 AM PDT • 6 Comments
See Obama put the cost of bailing out GM/Chrysler at $60 billion (underestimate)
See Obama claim the “auto industry” created 55,000 jobs after losing 335,000.
Poor Obama. He does not see (say)
*Ford grew the most and received no bailout (some of those 55,000 jobs are Ford’s).
*$1.1 million per job: the cost of every job created (even by Obama’s math).
Give me $1.1 million and I will create TWO jobs!
At the press conference, Mr. Obama took the artificial recovery of Old Detroit as another opportunity to say “we” (government and workers) must “roll up our sleeves and create clean energy jobs.”
This guy is like Al Gore on Red Bull.
His focus on Green jobs — windmills and solar panels — borders on the obsessive. Throughout the whole address he spoke of
1. Green Jobs
2. The Invincibility of the American Worker (paraphrase of speech):
“AMERICAN workers can do ANYTHING!” (applause).
“AMERICAN workers can be the best at everything with ‘targeted investment.’” (Pinch the fingers and point at audience).
“AMERICAN workers deserve all the credit for turning around GM and Chrysler (taxpayers, what taxpayers?)
“American workers can do the same EVERYWHERE.”
(Obama waxes nostalgic about World War II production lines).
“I will put the first AMERICAN worker on the moon!”
(OK, I made that one up, but you get where he is going).
No mention of risk-taking
No mention of private investment
No mention of entrepreneurs
No mention of markets.
Oddly enough, President Obama discussed those things while visiting . . . Africa.
Government and nationalism and workers. Sounds like national socialism to me, although Robert Higgs prefers “participatory fascism.” Fascism is a loaded term. National socialism is simple and accurate on both counts–the state takeover of various sectors is national and is socialism by (or near) the classic definition.
The policy is not working (at this phase of the Reagan recovery, GDP was growing near 10% and the Great American Job Machine was back at work. Does any one feel that 2010 is “Morning in America?”)
Obama’s strategy has been tried before — in Mussolini’s Italy.
It worked so well that Chrysler, that lovable ward of the State, is now creating 200 Fiat dealerships. Furthermore, in an apt twist of fate, Chrysler is using the design of Alfa Romeo, the company bailed out by Mussolini in the 1930s.
I cannot wait: Who can forget that great car built on a Fiat model . . . the Yugo? How I miss that car. This is a Yugo moment in the Obama presidency.
“God bless America!” On that, Mr. President, I agree with you.
God bless all Americans (not just UAW workers).
Tags: Bailouts, Business, Corporatism, Economics, Fascism, Mercantilism, Socialism 
Can you please hire writers who are not using drugs while they write articles? This article is so disjointed it borders on a parody. Let me help:
1.) America has not been making good automobiles for over 40 years and will not suddenly resurge now.
2.) Any federal funds are delaying the inevitable at best, simply wasting more money at worst.
3.) The costs of creating jobs in this sector are vastly overblown, it would be cheaper just to pay the workers money to do nothing.
4.) You need investment, private entrepreneurs, and skilled designers. However, the US dollar is valued higher than other currencies, so the cost of vehicles are cheaper on import than export. Meaning, most countries won’t buy our vehicles, and most of them have trade restrictions against our automobiles anyway.
Further, America makes big, gas-guzzling vehicles, and the price of gas has grown tremendously between 2000 and 2010, and consumers are opting for smaller cars with greater efficiency, the exact thing that American cars don’t specialize in.
Ford won big by changing how it ran the Unions, they used to just keep pumping out vehicles even when there was no demand due to labor costs. Now they match supply and demand.
NoMan | Aug 1, 2010 | Reply
Obama and Bush are two of the best presidents ever nominated by the power elite. So were their so-called opponents. The power elite always win.
richard | Aug 2, 2010 | Reply
It is funny you mention Bush-Obama. Herbert Stein’s Presidential Economics (gone through many editions) starts with chapter 1 on “Hoover-Roosevelt: The Origin of Liberal Economics.” Wouldn’t it be nice if those in power realized that perhaps it is time to write the last chapter of “vulgar Keynesianism” and vulgar monetarism?
Jonathan Bean | Aug 2, 2010 | Reply
NoMan,
The author agrees with your general analysis of the U.S. auto industry but what does that have to do with the Obama response (bailout)? That is what the blog is about. Or perhaps my facetious “it worked so well” threw you off?
The bailout is bad policy — we agree.
The bailout is part of a broader approach to the economy that is fuzzy-headed (the Green aspect) and “delays the inevitable” — we agree.
And it smacks of national socialism.
PS: It is difficult to write about Obama’s economic policy without sliding into parody . . . Heck the whole thing is parody.
Jonathan Bean | Aug 2, 2010 | Reply