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An Ingenious Proposal From One of My Less Favorite People

An Ingenious Proposal From One of My Less Favorite People

by Dr. David Gruder

I confess to not being a big fan of Michael Moore. Yet, in honor of what I hope is truly the dawn of Transpartisanism, I offer below the essence of his proposal for how the U.S. Congress might address the financial mess the Big Three automobile makers (Ford, Chrysler and General Motors) are in. Moore’s proposal is followed by my comments about it.

Here is the three-pronged plan Michael Moore proposed on December 3, 2008:

  1. Reposition the U.S. Auto Industry to Help the Economy Expand: Transporting Americans is and should be one of the most important functions our government must address. And because we are facing a massive economic, energy and environmental crisis, the new president and Congress must do what Franklin Roosevelt did when he was faced with a crisis (and ordered the auto industry to stop building cars and instead build tanks and planes): The Big 3 are, from this point forward, to build only cars that are not primarily dependent on oil and, more importantly to build trains, buses, subways and light rail (a corresponding public works project across the country will build the rail lines and tracks). This will not only save jobs, but create millions of new ones.
  2. Buy Stock Rather Than Provide a Loan So Citizens Can Profit From This Repositioning: You could buy ALL the common shares of stock in General Motors for less than $3 billion. Why should we give GM $18 billion or $25 billion or anything? Take the money and buy the company! (You’re going to demand collateral anyway if you give them the "loan," and because we know they will default on that loan, you’re going to own the company in the end as it is. So why wait? Just buy them out now.)
  3. Don’t Put the Government in Charge of the Companies: None of us want government officials running a car company, but there are some very smart transportation geniuses who could be hired to do this. We need a Marshall Plan to switch us off oil-dependent vehicles and get us into the 21st century.

Here are some of Moore’s comments about his proposal:

"This proposal is not radical or rocket science. It just takes one of the smartest people ever to run for the presidency to pull it off. What I’m proposing has worked before. The national rail system was in shambles in the ’70s. The government took it over. A decade later it was turning a profit, so the government returned it to private/public hands, and got a couple billion dollars put back in the treasury.

"This proposal will save our industrial infrastructure — and millions of jobs. More importantly, it will create millions more. It literally could pull us out of this recession.

"In contrast, yesterday [December 2, 2008] General Motors presented its restructuring proposal to Congress. They promised, if Congress gave them $18 billion now, they would, in turn, eliminate around 20,000 jobs. You read that right. We give them billions so they can throw more Americans out of work. That’s been their Big Idea for the last 30 years — layoff thousands in order to protect profits. But no one ever stopped to ask this question: If you throw everyone out of work, who’s going to have the money to go out and buy a car?

I don’t have sufficient knowledge or wisdom to know that Moore’s proposal is the best one for Congress to adopt. What I do know is that it embodies certain principles that make it worthy of very serious consideration: 

  1. Citizens should not be paying for companies to continue on the same path that has gotten them into the mess they’re in. In return for providing assistance, citizens should require that these companies reposition their capabilities and employees in ways that better serve the common good AND that have a better chance of generating more jobs and higher profits.
  2. There are strong indications that creating a "Green Economy" not only could be better for the environment, but that it has huge potential to help build new prosperity. "Green Collar" jobs, as they are being called, may well be the next boom area in job creation. When what’s good for the environment can also be good for jobs and the economy, why would we wait another moment to start throwing our full weight behind supporting such innovations?
  3. Revitalizing the U.S. public transportation system that the Big Three auto makers deliberately and aggressively succeeded at dismantling in the first part of the 20th century is vital to solving our transportation problems, so why not help the auto makers create far more jobs by turning some of their expertise toward this Green Ecomomy project?
  4. Ending our dependence on foreign oil is a national security issue. While no single strategy can accomplish this by itself, one strategy that would help achieve this objective would be to reposition U.S. auto makers as world leaders in producing cars that consume far less — or no — oil. It is a safe assumption that if the Big Three start building reliable and affordable cars using such technologies, people in the U.S. and around the world will buy them in huge nuimbers. Therefore, the U.S. government investing in the Big Three succeeding with this transition could prove highly profitable for citizens.
  5. The free market is the right sector for businesses, and government can sometimes be helpful in seeding businesses to head in new directions. One of the things that government often does better than the free market is to help fund the creation of new research, technologies, and industries. This has often been done through projects that were initially run by the government and then spun off to the free market to profit from. It has been done through government funding of  free market projects. A few examples of profitable public-private partnerships include the defense industry, NASA, the Manhattan Project, and Amtrak. It’s time to stop trumpeting oversimplified ideological labels such as capitalism and socialism, and instead generate practical solutions that transcend ideologies and may even help birth some new economic system that, heaven forbid, might be even better than capitalism or socialism.

These kinds of plans are examples of integrity-in-action. As I said earlier in this post, I do not have sufficient knowledge or wisdom to know if Michael Moore’s proposal is the best one to implement. But, what I do know is that it is an example of the kind of synergy-oriented proposals we must construct and tweak in order to generate solutions that go far beyond controlling symptoms of a failed system, to building a new system that is more stable, prosperous and serving of the common good than the current one. Whatever form that ultimately takes would truly be change we can believe in.

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Comments

  • Barry
    March 21, 2009

    People are finding ways on how are they going to cope up with the economic crisis that we are facing. More people today are jobless because of the massive layoffs done by companies today. A home business sounds like a great idea for a lot of people.  Home business is how people used to make their living centuries ago – not many people used to work solely at an office – and these days, after suffering a layoff, it may seem like the way to go.  You may even be able to start your business with a payday loan or an installment loan.  No boss to worry about. You can dictate hours, and even better, dress code.  If your interaction with customers takes place by phone or e-mail, customers won’t be able to tell that you aren’t wearing pants.  Not to mention the incentives – in a normal job, if you increase profits, you don’t get any benefits from it.  However, if you start a home business, you will.

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