US treasury sells 75% of its stock with GM

[cjscully]

Deficit spending is government spending. With the government's money. And incurring debt to the government.

Once we are taxed, it ceases to be our money and is now the government's money. Which they spend however they choose. If they feel the best use of that money is to bail out a large corporation - that's up to them. It's not our money.

Just try asking for some of it back.

If you don't like how they are spending THEIR money, you can elect different people to run the government.

So what you're saying is, if you don't like WalMart you can shop at a different store instead. You need clothes. You need food. If you don't want to get them from WalMart you will get them elsewhere (say Kroger, or Target, or American Eagle)

By the same logic, if you don't like this Government, you can move to a different government.

And if we all moved out of the US, the US government would in fact go out of business.


A democratic republic is run by elected officials who represent those whom they are supposed to serve. But the people do not run the government, they decide who gets to. And elected officials then take the responsibility to make the decisions with the government's money, time and resources - in what they feel is the best interest of the country.

Your vote does count - toward who will run the government. But just because you get to vote, does not mean that the government's money is your money.

Again, and you haven't responded to this statement: if you believe it's your money, try asking for some of it back.

They won't do that because it's not yours. It is the government's.

Just like it pays the men and women of Congress to decide whether or not it should use its money to bail out GM.

I mean, they are on salary to make those types of decisions, right?

That's their job, not yours.

I'm very stubborn when I think I'm right. And here I definitely think I am (both stubborn and right).

Just about the only thing you're right about is your statement that once the government collects the taxes the money ceases to be mine.

Let's say we're no longer talking about the government for a minute. Let's say a member of this forum advocates using payday loans to live beyond his means. He says what you should do is take out a payday loan to buy some junk you don't really need. Then when the payday loan comes due, take out another one for a little more so you can pay back the first loan and buy some more junk that's not necessary. Repeat the same pattern over and over. Obviously the individual would eventually end up in a position where all of his paycheck is used to pay the payday loans. At that point this operating basis becomes unsustainable. What would you say to that member about his fiscal policy? "It's your money, do what you want."

That's pretty much how your posts read, "It's the government's money, they can do what they want. I'm going to ignore the fact that it's fiscally irresponsible and unsustainable. I would rather argue about semantics."

Sure I can vote for someone else when election time comes around. I can even move out of the US if it gets so bad I can't stand it. All citizens of this country have those options available. We also have other options available.

Don't forget that the cause of the revolutionary war was dissatisfaction with the way the British were governing the colonies. More recently Prohibition was a dismal failure because the population did not support it. The elected representatives thought it was in the best interests of the public. The people didn't see it that way, therefore they gave more support to the bootleggers than they did to the government.

Don't make ridiculous statements like "It's their job, not yours." Elected officials at any level of government will only be accountable if held accountable by the people they are supposed to represent. That is not limited to election day. It is most definitely our job to question their decisions, publicly state our disagreements with those decisions, and refuse to follow bad laws when they are enacted by those same officials.

So yes, on the point that money paid in taxes ceases to be mine the second the taxes are collected by the government you are right. On the rest of it, you're annoying at best or a complete idiot at worst.

[jpg7n16]

Just about the only thing you're right about is your statement that once the government collects the taxes the money ceases to be mine.

Good. Cause that's the main point I was trying to make.

Let's say we're no longer talking about the government for a minute. Let's say a member of this forum advocates using payday loans to live beyond his means. He says what you should do is take out a payday loan to buy some junk you don't really need. Then when the payday loan comes due, take out another one for a little more so you can pay back the first loan and buy some more junk that's not necessary. Repeat the same pattern over and over. Obviously the individual would eventually end up in a position where all of his paycheck is used to pay the payday loans. At that point this operating basis becomes unsustainable. What would you say to that member about his fiscal policy? "It's your money, do what you want."

Why are you posting an analogy about borrowing for the budget deficit in a discussion about the government bailout of GM?

A better analogy would be: poster says he's doing just fine financially, has a great credit rating, and a fantastic income - but is spending a good deal of what he earns, and usually a little more. But his brother just lost his job and needs some money to tide him over for a few months. OP is asking if he should borrow against some of the equity in his home (which he's getting at a great interest rate) in order to help his brother out? If he doesn't his brother will lose his home, car, and will have to provide for his wife and 2 kids some other way. Or should he just let his brother fail and declare bankruptcy? His brother agreed to pay him back on the money with interest once his job situation pans out.

What should he do?

Many people would say, "free market - just let them fail." Others would say "it's in his family's best interest, even though the numbers don't fully work out right now."

In the end, yes it is his own decision what to do with his own money. The bank should never be able to come and say, "listen, we don't agree with what you're doing with our money." Because it's not the banks.

That's pretty much how your posts read, "It's the government's money, they can do what they want.

That is true, and I do think that way.

I'm going to ignore the fact that it's fiscally irresponsible and unsustainable.

When you get a better analogy, the decision makes more sense.

Though I know a lot of people disagree with it, and that's fine. In the end, the government had to do what they felt was in society's best interest.

Is it irresponsible to borrow at a good rate to save your brother?

I would rather argue about semantics."

There is a big difference between "my money" and "the government's money." That is not semantics. That is a legal distinction.

It is just as important as the difference between "your money" and "my money."

Sure I can vote for someone else when election time comes around. I can even move out of the US if it gets so bad I can't stand it. All citizens of this country have those options available. We also have other options available.

Don't forget that the cause of the revolutionary war was dissatisfaction with the way the British were governing the colonies. More recently Prohibition was a dismal failure because the population did not support it. The elected representatives thought it was in the best interests of the public. The people didn't see it that way, therefore they gave more support to the bootleggers than they did to the government.

Agreed. We should speak up by voting if we disagree with what's going on in government. Also you can write letters to your congress representatives if you don't like their decisions. Sure, let them know.

Don't make ridiculous statements like "It's their job, not yours." Elected officials at any level of government will only be accountable if held accountable by the people they are supposed to represent. That is not limited to election day. It is most definitely our job to question their decisions, publicly state our disagreements with those decisions, and refuse to follow bad laws when they are enacted by those same officials.

You know what, that statement doesn't mean what I meant it to say at the time. It came out differently because I was angry about being called immature, just like I'm mad at you for trying to call me an idiot.

I see how that statement can be taken differently than what I meant. So yeah - it's wrong.

I meant it more as "it's their job to make those decisions, it's your job to vote for who gets to make them." And I never meant to say that we should have no say about what's going on in the government.

I'm sorry if that's how it came across.

So yes, on the point that money paid in taxes ceases to be mine the second the taxes are collected by the government you are right. On the rest of it, you're annoying at best or a complete idiot at worst.

Most people think anyone who disagrees with them is wrong. Most people also don't feel that they have to insult anyone who disagrees with them. I'm sorry that you felt the need to insult me because I disagree with you.

-----------------------------------
Please note that I also made the following statements.

If you don't like how they are spending THEIR money, you can elect different people to run the government.

I understand the disagreement with bailing out companies. Free market and all that. Many people agree with you on that.

I don't understand why you think it's still your money.

Same goes for the gov. You personally have no ability to change what the government does. You can only request that the people who do (congressmen/representatives/President/etc.) run things differently. Send a letter to your congressman asking them to do something differently.

Just like I have the ability to ask a manager at WalMart to open another lane if the line is backed up. I cannot control it, but I can ask.

[cjscully]

Why are you posting an analogy about borrowing for the budget deficit in a discussion about the government bailout of GM?

A better analogy would be: poster says he's doing just fine financially, has a great credit rating, and a fantastic income - but is spending a good deal of what he earns, and usually a little more. But his brother just lost his job and needs some money to tide him over for a few months. OP is asking if he should borrow against some of the equity in his home (which he's getting at a great interest rate) in order to help his brother out? If he doesn't his brother will lose his home, car, and will have to provide for his wife and 2 kids some other way. Or should he just let his brother fail and declare bankruptcy? His brother agreed to pay him back on the money with interest once his job situation pans out.

What should he do?

I'm posting it because I feel it's relevant. The thread has to do with the government's stake in GM. Opinions were posted about whether or not the government should even have had a stake in GM. You posted the argument that "it's the government's money." The bailout was done with borrowed funds and to me that means I should be concerned because payment of that debt is not a certainty in my view. Further, the fiscal policy being followed in Washington (and Sacramento, and Athens and...) is very much like an individual who serially borrows from payday loan companies to cover his expenses, which was the point of my analogy. So, when you bring up "it's their money" all of the above come into play because those people who are following poor financial policies are supposed to be answering to me and every other citizen.

As for your "better" analogy, the first issue I have with it is the hypothetical relationship between GM and the government. Brother? I don't think so. Friend? maybe. Acquaintance? I'm okay with that. The analogy you give changes entirely if you substitute the word acquaintance for the word brother. It affects how I view the problem quite a bit. Why am I making this distinction? Because I would feel I have a strong moral obligation to help a member of my family, but far less of one to help a friend or acquaintance. I also don't see that kind of relationship between private corporations and the government. If you follow that logic through, what is the distinction between "Ma and Pa Groceries, Inc." and GM? Is Ma and Pa a brother too? If Ma and Pa are on the brink of failure, would they get the same consideration as GM? In my book they should if they have the same relationship. However, they wouldn't. The family tie thing therefore doesn't work for me.

Now, if we look at your analogy in terms of acquaintance or even friend, we have to also add into the story that there are 1000 or more other friends (such as Ma and Pa) who are also on the brink of failure. He can't afford to try to help all of them and some of them may not even want his help. Which ones should he help? Should he help any of them at all? If so, how much should he borrow knowing that some of them may fail anyway and won't pay him back and he could be stuck with the debt?

To me, this comes back to the arguments about "their money", accountability and whether or not they made a good decision (which was how we got onto the subject at all). Now, if I'm merely a "customer" of the government I have no say or concern about the soundness of their spending and I should shut up. However, a more accurate way of looking at it is as if I'm a shareholder in the government. If I'm a shareholder in Disney and the CEO or the board make some boneheaded moves I have a say. (How much weight my voice has with a corporation depends on how many shares I own.) In theory I could even move to elect an entirely new board. It's one of my rights as a shareholder. Same principal applies to the government and it's bailout of GM (and AIG and the banks, in my opinion). I have the right to examine and question the decision and campaign to change the people who made the decision if I feel it was wrong.

It doesn't matter whether or not we agree on this. The point I was trying to make is that the decision to bail out private corporations has to at least be looked at and questioned in context with things like the Federal deficit, national debt and even the reasons the decision was made. (I personally do not buy the "too big to fail" crap that was being thrown around.)

You know what, that statement doesn't mean what I meant it to say at the time. It came out differently because I was angry about being called immature, just like I'm mad at you for trying to call me an idiot.

I see how that statement can be taken differently than what I meant. So yeah - it's wrong.

I meant it more as "it's their job to make those decisions, it's your job to vote for who gets to make them." And I never meant to say that we should have no say about what's going on in the government.

I'm sorry if that's how it came across.

...

Most people think anyone who disagrees with them is wrong. Most people also don't feel that they have to insult anyone who disagrees with them. I'm sorry that you felt the need to insult me because I disagree with you.

Well, thank you for the clarification. I have to tell you that I personally found that statement insulting so I guess I responded in kind.

[jpg7n16]

As for your "better" analogy, the first issue I have with it is the hypothetical relationship between GM and the government. Brother? I don't think so. Friend? maybe. Acquaintance? I'm okay with that. The analogy you give changes entirely if you substitute the word acquaintance for the word brother. It affects how I view the problem quite a bit. Why am I making this distinction? Because I would feel I have a strong moral obligation to help a member of my family, but far less of one to help a friend or acquaintance.

Now who's arguing semantics?

We'll never agree on this. The people in gov felt that the success of GM was very urgent and important (like the success of your family), not something important but not urgent (like an acquaintance). Obv you don't think it's as important as the people in the gov did, so obv you'd come to a different conclusion.

I specifically said "brother" because family is urgently important.

And you'll just disagree that it was important at all.

I also don't see that kind of relationship between private corporations and the government. If you follow that logic through, what is the distinction between "Ma and Pa Groceries, Inc." and GM? Is Ma and Pa a brother too? If Ma and Pa are on the brink of failure, would they get the same consideration as GM? In my book they should if they have the same relationship. However, they wouldn't. The family tie thing therefore doesn't work for me.

It's not just about GM, it's about the citizens that GM supports (through jobs and pensions and sales)

According to a recent Wall Street Journal article, the GM bailout saved about 1.14 million jobs.
GM IPO: Auto Bailout Saved More Than 1 Million Jobs, Study Says - Deal Journal - WSJ

Why not the mom/pop stores? Cost/benefit ratio. Likelihood of payback. Can you imagine a congressional hearing for a locally owned mom pop store that supports 2 owners and 3 employees? That wouldn't be worth it. And to properly help out any failing store, they'd have to evaluate on a case by case basis - which would be a terribly costly ordeal, for not a large benefit - with low likelihood of payback.

I think that's obvious that a small mom&pop store with low citizen impact would be a much lower priority than GM with it's 1.14 million. Frankly it's just not worth the time, money, and effort. But GM was a different story.

According to the OP, the Gov was able to sell 75% of their holdings in GM (aka payback). They didn't bail out GM for no reason, they did cause they determined it was very important and there was a probability of being paid back.

The bailouts were not expenses, they were investments.

Now, if we look at your analogy in terms of acquaintance or even friend, we have to also add into the story that there are 1000 or more other friends (such as Ma and Pa) who are also on the brink of failure. He can't afford to try to help all of them and some of them may not even want his help. Which ones should he help? Should he help any of them at all? If so, how much should he borrow knowing that some of them may fail anyway and won't pay him back and he could be stuck with the debt?

Do you seriously think that we should give the same priority to a local store and a million employee firm?

Now that I think about it, the government already has in place a system for helping Mom & Pop stores - the US Small Business Administration. Where struggling firms can present their cases and receive loans if needed (similar to the bailout). And where do you think the Gov gets the money for these small business loans? So if you approve of the SBA Loans, why not the bailout? They are essentially the same idea, just GM was on a much larger scale.
U.S. Small Business Administration-Your Small Business Resource

To me, this comes back to the arguments about "their money", accountability and whether or not they made a good decision (which was how we got onto the subject at all).

Exactly. The Gov used its money to help save 1.14 million jobs, has at least recovered a portion of its investment, and still has a large ownership percentage - allowing for further payback.