August 07, 2008

Breaking: Detroit mayor jailed

For violating the terms of his bail.
No link yet, heard on the Frank Beckman show.

Update: Detroit Free Press. H/T IreneFingIrene in AoSHQ comments.

Cackling is encouraged by all the staff here at ASM (i.e. me).

Update, the sequel:  I forgot to mention that Mr. Kilpatrick is a Democrat Party Superdelegate, who supports Obama.

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August 03, 2008

$300 M "investment fund"

Jenny swoops in to encourage local business by pledging to risk the state employees retirement funds on it. So somewhere, a bureaucrat will decide whether to invest money from the state employees pension fund into your "high growth" business, or not. Because it's important for the State to be able to pick winners and losers, play favorites, and facilitate quid pro quo. Hey Jenny, I can think a half-dozen ways to jump-start business in this state while decreasing -- or at least not increasing -- opportunities for graft and corruption among state officials.

Let's start with the easy one. You're term-limited anyhow, you've got nothing to lose, so why not announce that you're willing to sign legislation making MI a right-to-work state. I'm guessing the state legislature can have that law on your desk in a matter of days. MI wins by breaking the Big Labor stranglehold, you get to be on the side of freedom and prosperity for a change. Of course, you may want to get as far from MI as you can after your term ends.  Possibly back to Canada.

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August 01, 2008

How long before Jenny suggests a bailout?

GM posted a $15.5 Billion loss in the second quarter of this year. Could be the high cost of oil making imports more attractive, could be UAW making it unprofitable to manufacture cars in Michigan, could be the retooling needed to meet higher CAFE standards, could be a lot of things.

I'm wondering how long it will take Granholm to push for a state or federal bailout. I fully expect the state to "loan" huge amounts of money to GM and Ford, driving up the state debt even more, probably counting on revenues from the asinine "Michigan = Hollywood" plan. Why? GM is "too big to fail" in common parlance. Employs too many people, owns too much real estate, generates too much tax revenue; too big to fail. All of those are value judgments about what constitutes "too many" or "too much", and none of them are reasonable. Michigan's auto industry is dying, for a lot of reasons, and Michigan will not and cannot succeed by keeping them on life support.

In fact, I strongly suspect that GM and Ford are committing "suicide" at this point. Knowing that they are too big to fail, they're counting on the bailouts, and deliberately setting themselves up to be as unprofitable as possible... for the moment. I'm sure they aren't profitable, of course, but any legitimate accounting procedure or suboptimal plan that lets them be even less so increases the chance they'll be bailed out. The government bailed out Chrysler in 1979 (thanks Jimmy!), and look how well that turned out. The precedent is set, the fix is in. Further, the execs and GM and Ford have literally nothing to lose. If they somehow aren't bailed out, they get to declare bankruptcy, and maybe -- just maybe -- shed MI and the UAW once and for all. The real winner in all this could be Alabama, Mississippi, Louisiana, or some other Right-to-Work state.

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