Ford has a better idea

One of America’s Big Three automobile manufacturers does NOT need a bailout. Ford has already made changes and, despite a bad year of sales, is not in the meltdown that GM and Chrysler are in. Ford is supporting its two competitors in asking for a bailout because it fears that if they go down, they will drag their suppliers down with them, which Ford also depends on. See George Will’s column on Ford CEO Alan Mulally.

Now higher education wants a federal bailout

Leaders of state colleges and universities have taken out full-page ads in the nation’s newspapers, billed as an “open letter” to the new Obama administration asking for a government bailout. Specifically, they are asking for no less than 5% of all money appropriated for economic recovery.

More than 40 higher-education leaders from across the country asked Congress today to commit 5 percent of any economic stimulus program to the nation’s colleges and universities.

The educators, including University of Virginia President John Casteen III and Chancellor William E. Kirwan of the University System of Maryland, published an open letter in newspapers warning that state budget cuts have harmed the public educational enterprise that is at the heart of the nation’s long-term security.

“For the first time in our history, the cohort of Americans ages 25 to 34 is less well educated than the older cohorts that preceded it,” it says. “We cannot accept such dangerous signs that our future prosperity and security will be weaker than our past.”

Let your mind boggle for awhile. As is so typical of a certain kind of administrator, the request is not for anything specific but for a percentage cut of everything! And the argument for doing so is their own failure!

Why are Americans aged 25 to 34 less well-educated than previous generations? Because the education currently being dealt out is so poor! These college presidents have gutted their own curricula, allowed academic classes to be turned into leftist re-education camps, and allowed academic standards of every kind to be thrown out the window.

Here at Patrick Henry College, where I am an academic administrator (also classroom teacher, I hasten to add), we do not even take government money. But, swimming against the stream, we are giving our students a superb education. We have a 75-credit true core curriculum, rich in the great books and the great ideas, academically rigorous and educationally stimulating. Our students learn to read, write, think, discuss, and create. We are no ivory tower. We give our students opportunities to practice their vocation in an apprenticeship program that offers on-the-job experience. The companies and, yes, government agencies that get our students as interns praise their preparation, analytical ability, work ethic, and personality qualities. And standardized tests are showing that our students are out-performing their peers in regular schools in every category!

We too need money, of course, especially since we refuse the government trough and since we want to keep our tuition low and affordable. We have to make it up from private donors. We have some wonderful supporters, but raising the money we need is always a challenge. We need to build up an endowment to support our work permanently. I cannot see why people of means, especially those who are worried about the bad things happening in higher education, do not just throw money at us! If you would consider throwing some money at us, in big amounts or small, as a Christmas gift and as a pre-New Years tax write-off, click here.

(OK, sorry for the commercial. I don’t do that often. I could never be a college president because I hate to ask for money. We will continue with our regularly-scheduled programming.)

Wall Street fund as Ponzi scam

Bernard Madoff–a major Wall Street money manager, former president of NASDAQ, and a pioneer of online investing–has confessed that his investment company is nothing but a colossal Ponzi scheme and that all of its $50 billion is gone. Many prominent Jewish charities and formerly rich socialites have lost everything. From $50 billion at stake after Wall St broker Bernard Madoff is arrested over ‘world’s biggest swindle’ :

The FBI claims that three senior employees of Mr Madoff’s investment firm turned up at his apartment on Wednesday to ask questions about the company’s solvency. Two of them are believed to be his sons, Andrew and Mark, who have worked for their father for two decades.

Mr Madoff told them that he was “finished”, that he had “absolutely nothing”, and that “it’s all just one big lie”. He said the investment arm of his firm was “basically a giant Ponzi scheme”, and that it had been insolvent for years.

A Ponzi scheme, named after the swindler Charles Ponzi, is a fraudulent investment operation that pays abnormally high returns to investors out of money put into the scheme by subsequent investors, rather than from real profits generated by share trading.

The FBI complaint states that Mr Madoff told his sons that he believed the losses from his scheme could exceed $50 billion. If that is the case, his fraud would be far greater than past Ponzi schemes and easily the greatest swindle blamed on a single individual.

For the fallout see this. For the impact on charities see this.

Unions thwart bailout plan

The automobile industry bailout died in the Senate, as unions once again preferred unemployment to wage cuts:

Republicans, breaking sharply with President George W. Bush as his term draws to a close, refused to back federal aid for Detroit’s beleaguered Big Three without a guarantee that the United Auto Workers would agree by the end of next year to wage cuts to bring their pay into line with Japanese carmakers. The UAW refused to do so before its current contract with the automakers expires in 2011. . . .

Hourly wages for UAW workers at GM factories are about equal to those paid by Toyota Motor Corp. (TM) at its older U.S. factories, according to the companies. GM says the average UAW laborer makes $29.78 per hour, while Toyota says it pays about $30 per hour. But the unionized factories have far higher benefit costs.

GM says its total hourly labor costs are now $69, including wages, pensions and health care for active workers, plus the pension and health care costs of more than 432,000 retirees and spouses. Toyota says its total costs are around $48. The Japanese automaker has far fewer retirees and its pension and health care benefits are not as rich as those paid to UAW workers.

A lament for newspapers going broke

The Tribune Company, which owns the Chicago Tribune, the L.A. Times, and other properties, has filed for bankruptcy protection. Meanwhile, the New York Times has mortgaged its building to raise much-needed cash.

Before we gloat about the end of print journalism, with its liberal bias, and hail its replacement with the internet, consider. . . . When you read news on the internet, notice that it is nearly always linked to a newspaper. What newspapers do is pay people in your town and around the world to dig up news and then write it up. The internet is free, but that means that the internet is not paying anyone to perform that service. That we can now get news free does wreck the newspapers’ business model, but until people pay for internet news–enabling a true migration from print-on-paper to online news organizations–we will not have anything to replace what newspapers, for all of their current faults, do.

We’ll have a Car Czar

As part of their bailout plan for the U.S. auto industry, Congress was going to set up a board of its members and other federal officials to tell the companies what they can and cannot do. That was bad enough. Now Congress is planning to appoint a single individual to oversee the auto industry, a so-called “car czar.” From the Washington Post:

Democratic leaders continued working on details of their proposal this morning, and they made at least one change at the administration’s request. Instead of establishing a board from among six federal agencies to oversee an auto industry restructuring, Democrats agreed to the appointment by President Bush of a single “car czar,” according to a senior Democratic aide, who spoke on condition of anonymity because the measure is not yet final.

Under the proposal, which Democrats hope to bring to a vote this week, the loans would go out on Dec. 15, and the car czar would then develop broad restructuring goals for the auto industry, the aide said. On Feb. 15, after the Bush appointee had been replaced by President-elect Barack Obama, the czar would assess the companies’ progress and could pull back the loans. Long-term restructuring goals would be due from the car companies by March 31.

Friends, is it right for the state to issue fiats to privately-owned companies? Is it good economic policy to run a company according to government commands rather than the private market? I know, this is the price of a government bailout. But this cannot be worth it. This is not just socialism; it’s national socialism.