New GM boss: Thanks for the all the cash. Now pardon us while we declare bankruptcy.

I said it was a bad idea to float the Detroit automakers on a pool of public money when it was 1st suggested. When they did what I said they’d do and came back for more when they’d burned through what we handed them the first time, I said it again. Bankruptcy was what was needed there, not more taxpayer cash going to float a busted business model.

Well, among others, I’m finding I’m in the position of getting to say “I told you so” to those people who told me we just had to “loan” them the money. The newly annointed GM CEO apparently thinks bankruptcy might be the best option for GM and he’s saying so on the record:

General Motors’s new chief executive told CNBC that filing for Bankruptcy may be the best option for the struggling automaker.

In a taped interview to be aired tonight on NBC Nightly News, Fritz Henderson said that because of greater demands from the Obama administration to restructure, GM is considering the bankruptcy option. The auto giant previously had ruled out such a move, saying it would discourage people from buying GM cars.

So, here we are now, after having been forced into making a $14 billion dollar investment into a company that I wouldn’t have bought 10 cents’ worth of stock in, and in spite of all of the due diligence telling anyone who had any idea what they were looking at that dumping money into GM was a fool’s errand we’re now looking at a failed investment. You cannot be seriously looking at the state of that company and the intransigence of both the management and the unions who have made it the money-losing monstrosity it is and think we’re ever going to see a dime in repayment.

Bankruptcy is what this company should have been allowed to enter 5 months ago when this was all being bandied about. It would have been better for the company in the longrun, for the economy in the mid- to long-run, and for the taxpayer in the here-and-now.

Loudoun’s budget and the choices we make

Loudoun County’s budget process is in full swing with the Board of Supervisors slated to vote on the adoption of a budget at their next meeting on April 7. In my last post on the matter I wrote about the need to hold the County’s school system (LCPS) to the same budgetary cuts as all of the other critical government functions. Thanks to the yeoman’s work of The Loudoun Scoop on 25 March we are directed to a story that shows the BoS is intending to do just that.

The Loudoun County Board of Supervisors voted Tuesday to slash the proposed schools budget for next fiscal year by almost $27 million over objections from School Board members who said the cuts would severely affect the quality of students’ education.

“Everybody is getting impacted by the circumstances of our moment, and I’m afraid that’s going to have to include the schools,” said Supervisor Stevens Miller (D-Dulles), who voted for the cuts.

The School Board approved a $747 million budget in late January and forwarded it to the Board of Supervisors, cutting cost-of-living and seniority raises for employees to avoid eliminating staff positions or increasing average class size. The spending plan called for $12 million less in county funding than the current schools budget.

The School Board, at the BoS’s direction, came back with budgets representing a 5%, a 10%, and a 15% cut from the full budget originally floated. They provided a set of measures they’d take to find those cuts with each “Tier” which has lead to the “Tier 1, Tier 2…” nomeclature they’ve been using in the press these days. The BoS’s vote as refered to in the story represents the 5% option calling on the LCPS to make those Tier 1 cuts. (I’ll go into this in more detail in another post.)

When Loudoun County – which has seen over a decade of rising school budgets – makes the decision to actually apply cuts to the proposed budget you know we’re facing some serious money issues. That’s hardly a surprise to any of us paying any attention these days. However, it should now be obvious to everyone that if we’re in the process of cutting the budget for things like the Sheriff’s office and the school system, then we certainly don’t have money to be spending on anything new. From my last post:

To the Board of Supervisors, I’d say this: immediately halt any discussion of new services or departments in the Loudoun government until this economy recovers; do not implement new projects to upgrade systems we already have in place without a truly significant, near-term increase of capability or decrease in operating costs; require that all departments that fall within the scope of the core government responsibilities I’ve mentioned above cut their budgets by the same percentage figure. This year’s going to be tough, we all know that. Let’s see our government act like they know that, too.

It would appear the Board is taking the suggestion that all of the critical function areas of government be held to the same percentage of budget cut. I would imagine there’s little support for system upgrades that aren’t providing that significant capability improvement I mentioned. Putting a moratorium on new departments and positions, however…

The current Board of Supervisors is more “bike friendly” than an earlier board was, Turner said. Still, she said, she was worried that during an economic downturn the county would not allocate money for a bike coordinator.

County Supervisor Andrea McGimsey (D-Potomac), who serves on the board’s Transportation/Land Use Committee, was more optimistic.

“I think it’s a critical piece of going forward in Loudoun County,” she said. Noting that there had been two pedestrian fatalities in the same spot on Algonkian Parkway, she said, “We’ve grown quickly, and these are some hot spots that are being addressed.”

I have already said that we could probably use a bike and pedestrian coordinator, although I feel that the planning and zoning folks in the government could probably provide that level of oversight in new construction, too. The issue isn’t whether we could use one or if one is truly needed. We can’t pay for it. We haven’t the funds. This is a fine idea to keep in mind for the future but to even be considering it now, after telling our schools, our police, and our emergency teams that they have to make do with less because times are tight, is just irresponsible.

I’ll also call foul on Supervisor McGimsey’s use of the fatalities on Algonkian Parkway. She’s clearly referring to the 2 deaths at the intersection of Algonkian and Countryside Parkway, incidents I’ve written about before. Tragic though they were, in both of those situations the pedestrian was walking out into the street outside of the existing crosswalk and against the light. Having a pedestrian coordinator in place at the time would have done precisely nothing to avert the accidents because the 2 people in question weren’t following the rules or using the facilities that were already in place. Just because there would have been a guy in an office in Leesburg coordinating pedestrian pathways around the County doesn’t mean anything would have changed. The reference is a moot point and a non-sequitur in this debate.

This decision should be tabled until our economy recovers. We can reconsider it at that time.

Stay focused: The AIG bonuses, while irritating, aren’t the real problem here

Let me start off this post with a personal observation: Any entity with 80% ownership of a company should be able to stop that company from doing anything it chooses to stop, should it so desire. The US Government, thanks to the various bailout resolutions, owns about 80% of AIG. So to say that the government “couldn’t stop” those bonus from being paid is ridiculous. Sure they could have. They chose not to.

Those bonus contracts were explicitly protected by law when the Porkulus bill was signed so any issue arising from the government stopping those bonus payments – meaning, any lawsuit that would have followed – was the direct fault of Congress (specifically Senator Dodd whose staff put the provision into the law) and of the President (who signed it). So the fault, here, lies not with AIG and certainly not with AIG’s CEO Liddy but with the people now screaming at the tops of their lungs to get the money back.

Which means that all of those fellow Americans of mine who are issuing death threats to employees of AIG are woefully misguided both in the effort in the first place and in the target in any case. Shame on you all and knock it the hell off. I fully support law enforcement investigating every one of you and tossing your idiot posteriors in jail.

However, the flash-bang of this whole sordid event is serving to obscure the bigger issue and the White House is making very sure to keep people as focused on AIG’s bonuses as possible. Why? Listen to Bob Owens of Pajamas Media and Confederate Yankee:

But while the ire of Congress and the media focus are on the $165 million that AIG paid out in bonuses to their executives, the president is hoping you won’t notice the $100 billion in taxpayer bailout dollars that AIG paid out to other banks, including $58 billion to foreign banks and $36 billion given to French and German banks alone.

The Obama administration is allowing AIG to bail out the rest of the world with your tax dollars.

So by all means, the president is happy to have you railing at “evil” but relatively small potatoes AIG executive bonuses, as it points your outrage away from his own far more costly executive abuses.

There was, in fact, some media mention of this before the AIG bonus debacle was broken but the media sure seemed happy to switch horses quickly once the bonus story was available. I think the notion that AIG handed out bonuses when the only way they could afford such a move was when taxpayers were on the hook for the money was definitely in the “not good” category. However, most of those people who got those bonuses are Americans living and working here. The money AIG sent to Deutsche Bank and the French banks went to people and companies who definitely aren’t living or working here. That money just flowed right out of the country and is being used to prop up foreign firms and entities.

And American taxpayers had the obligation to do this… why?

There’s a darker undercurrent to all of this that Owens’ story goes into in detail. If you look at the firms who got the bailout cash and cross-reference them with donors to Obama’s campaign last year… well, there’s a surprising amount of overlap. Read the story I linked for the details.

“Too much month at the end of the money.”

Back when my wife and I were a newly married couple now going on (data redacted) years ago, I was working for the commercial airline industry. Now, unless you were a union big-iron pilot you were making a sum of money that wouldn’t even rise to the level of poverty today here in Loudoun County. A co-worker, commiserating with me about the paycheck-to-paycheck state of our finances said he always found he wound up with “too much month at the end of the money.” It’s an old comment but it’s a valid one.

It applies equally well to counties as it does to young ramp rats in the airlines. Loudoun County’s annual budget process is in full swing and, as you’ve no doubt heard, we’ve got a lot of County spending proposals left at the end of the money. Well, that reminds me of another old saying that goes “when you find yourself in a hole, the first thing to do is stop digging.” I don’t mean to pick out any particular Supervisor but I’m going to highlight the proposals of my own representative on the Board to illustrate my point. According to this story in the Loudoun Times-Mirror, Supervisor Andrea McGimsey has taken the opportunity afforded by the implementation of a new tax on hybrid vehicles to propose a new county official: a bicycle and pedestrian coordinator. I’m not entirely sure what said official would really do with their day although I’m sure the person hired could find something to keep themselves at least appearing busy. I’m also not entirely sure we need such an official although I’m also not sure we couldn’t use them.

I am sure we can’t afford them.

We’re in a budgetary hole with virtually every facet of our government yelling about how they don’t have the funds they need and how we all need to pony up more to give them what they want. While the LCPS is certainly the loudest of those voices, the others are also certainly piping up. Folks, we need to remember the first step in dealing with holes we find ourselves in. The BoS is telling us they can’t pay for what they’re already doing. We need to stop digging and put a moratorium on anything new. If we don’t already have a particular department or service, we should absolutely not permit the creation of one at this time. It’s not a matter of the value of having such things. It’s a matter of we haven’t the money for them.

We also need to apply the same restraint to any suggestion that we implement large technology upgrades where those actions don’t produce some significant improvement in service or capability. Mentioned in the latest issues bulletin of the LCRC is a suggestion that’s been made to have the County spend something around $1 Million to swap out existing light fixtures for technology perceived as “greener.” This is another example of something that might be all well and good but it’s something we simply can’t afford right now. Perhaps in a few years when the economy recovers but not today. Any suggestions like this should be tabled immediately.

Government is implemented for actually very few functions. Law enforcement, emergency response, defense, and the fair application of our laws in disputes. We have also accorded it responsibility in matters of education and the creation and maintenance of our transportation systems. Frankly, anything that does not fall directly within these functional areas should be considered on the chopping block. I’m not saying kill any program outside of those I’ve mentioned, but we should seriously consider whether our County’s current income can provide the funds to run the programs that have been allowed to start. Our government owes us that before they turn around and confiscate more of our hard-earned cash at gunpoint.

And when the money gets so tight – as it has now – that the Board is feeling it necessary to instruct our law enforcement and emergency response teams to offer a budget request that reflects a 5% cut it should require that of all of the primary functional areas. We don’t hesitate a second to consider whether or not we can pay for that new road or interchange and to put the project on hold when the answer is “no.” If we’ve reached the point where we’re asking Sheriff Simpson to cut his budget 5%, we need to be handing that same figure to the LCPS and Superintendent Hatrick. I can hear the howls already but if we’re to the point of telling Loudouners that the response time from the Sheriff in the event of a break-in is going to be longer because he can’t hire those extra deputies he wanted then we’re at the point where Mr. Hatrick needs to make the hard choices and cut his budget by the same proportion.

To the Board of Supervisors, I’d say this: immediately halt any discussion of new services or departments in the Loudoun government until this economy recovers; do not implement new projects to upgrade systems we already have in place without a truly significant, near-term increase of capability or decrease in operating costs; require that all departments that fall within the scope of the core government responsibilities I’ve mentioned above cut their budgets by the same percentage figure. This year’s going to be tough, we all know that. Let’s see our government act like they know that, too.

Heritage Foundation: Dumping ‘smart growth’ is wise

The Heritage Foundation has an interesting article up that mentions Maryland’s and Virginia’s propensity for “smart growth” laws.

That kind of thinking fueled the housing bubble, too. But what made housing prices rise so fast in the first place?

One of the biggest culprits has been the fad of trying to control development by placing layers of restrictions on suburban land use. Going far beyond the traditional zoning restrictions, some local governments embraced a host of “smart growth” policies. But these policies also artificially inflated housing costs. So the cost of a home moved steadily beyond the reach of normal families – unless they got a subprime mortgage.

Motivational poster

Heh™.

“Exploding Whale Obamanomics”

Yes, you read that headline right: “Exploding Whale Obamanomics.” Bob Owens of Confederate Yankee and Pajamas Media has the near-perfect metaphor and I simply can’t excerpt it well enough to do it justice. Go have a look and enjoy!

The Market’s vote of no-confidence

These numbers don’t say “we like.” This is the DOW-Jones Industrial Average since the passage of the Stimulus bill:

The longer-term picture is even worse.

Senator Evan Bayh: Obama should veto this spending bill.

The Honorable Senator Evan Bayh (D-IN):

This week, the United States Senate will vote on a spending package to fund the federal government for the remainder of this fiscal year. The Omnibus Appropriations Act of 2009 is a sprawling, $410 billion compilation of nine spending measures that lacks the slightest hint of austerity from the federal government or the recipients of its largess.

The Senate should reject this bill. If we do not, President Barack Obama should veto it.

Read it all.

Power Line on the budget, deficit, and the reporting of them then and now

John Hinderaker over at Power Line addresses the situation – yet again – that our MSM indulges in very different direction of their reporting on the same matters dependent entirely on whether the target of their investigation is left-wing versus right-wing.

Now that his planned deficits are four times larger, does Obama’s budget contain “debt-fattening indulgences?” Has the Times denounced them? Does the Obama administration have a “credible plan to restore budget balance?” Given that Obama’s intended budgets–put aside how optimistic his numbers may be–far exceed the actual deficits during the Bush administration, is the Times still “worried that a structural deficit will push up interest rates and restrain growth as America ceaselessly borrows to steer red ink from imbalanced budgets onto future taxpayers?” If not, why not?

The post is a good one, replete with very specific examples taken from the loudest voice advocating on Obama’s behalf and leading the charge against anything Bush-related: The New York Times. As he says, that was then, this is now.

What I want and what I keep hearing my fellow Americans say they want is news reporting that reports the facts and lets us all weigh the information ourselves. That requires a news organization that provides a consistent coverage of issues and events regardless of who benefits from the information conveyed. As the Power Line article shows, the Times was fervent in their coverage of all of the budget details and in painting the spending of the Bush administration as Very Bad Things™. What I want to know is why they choose to not provide the same coverage now on Obama’s administration given that the budget and deficits are so much worse. Why, that is, except for the concept that the Times cares nothing for reporting the facts, only in making those who share their liberal agenda look good.

Go read the whole article, complete with the quotes from the Times, for the whole story.