Bailout No, Gas Tax Maybe
If there is one thing our Readers Who Comment have made clear in recent weeks, it is that they don't like taxpayer funded bailouts. That theme continues with the news that Congress is working on a new auto industry rescue plan.
As Lori Montgomery writes, the Democratic plan would establish a board of Cabinet officials and a chairman to oversee short-term loans and long-term efforts to restore industry profitability. Companies that take the cash would be accountable to the government.
While some readers argue that we can't afford to let the industry collapse, more oppose a bailout. They see no problem with just letting bankruptcy happen. Some want auto executives to leave; some want the congressional overseers to leave. One suggested that a gasoline tax could be used as a source of a loan to the automakers.
Which brings us to a Post editorial, suggesting that "Congress should enact a steep, inflation-indexed hike in gas taxes." Comments on that proposal seem at this hour to be evenly divided.
We'll start with SeahorseFive, who wrote, "This really isn't fair to the taxpayers. The automakers knew nearly 40 years ago that they needed to upgrade to make more fuel efficient cars and they thumbed their noses at us."
But easygoer88 said, "The unfathomable economic reverberations we felt worldwide when Lehman failed has taught us that we can't let our automakers fail. The bonds of these companies are held by financial institutions and individuals around the world and the impact on the financial system becomes exponential..."
sami_jadallah wrote, "As a condition of public funding, the top executives including board members of all companies receiving funding should be forced to resign without a sigle penny in compensations. These executives are the problem, they simply failed at their job while highly compensated..."
18taipei said, "...pass legislation to make it easy to dump the dealerships--they never helped anybody. Witness all of our experiences over the years getting ripped off by dealers. Let the market sink them."
meerkkatt suggested that "In addition to firing top management in all auto firms who accept taxpayer funds, the interest rate on the loan should be tied to the average fuel mileage of their fleets - say 6% for 30 mpg going down to 1% for 75 mpg."
ssavage2_3 wrote, "Congress failed to properly regulate the banking industry causing a worldwide collapse in lending. Now Dodd et al have the nerve to start finger pointing. Is this some kind of sick joke?"
jack824 said, "It's well past time for the GM Board to move on as well. They have been malfeasant enablers to one of the worst industrial collapses in modern history."
1234xyz said, "...Detroit auto leadership is thick with the corporate inbred practicing age old company politics. This culture encourages focus on ladder climbing verses sound decision making, greed over cooperation, deferral & complacency over action, and status quo over renewal..."
To which officermancuso replied, "...If you're right, the best outcome would be for that enterprise to fail and some other enterprise which does business differently to enjoy a windfall from that failure. Without government getting involved."
snorfy wrote, "maybe Dodd should resign, or "move on" as he says |||| as Chairman of the Senate Banking Committee - if anyone was asleep at the wheel while the credit crisis was coming into bloom, it was Senator Dodd"
thall1 warned, "...It becomes more clear each day that the most effective procedure to rehabilitate GM and Ford is for them to take the opportunity to file for Bankruptcy and reorganize into a smaller, more profitable company. The shareholders and the taxpayers will both be better off in the long term."
citystreet proposed that "A very real solution to auto-makers woes are for oil companies instead of tax payers to provide them with loans from the massive surplus they enjoy from gorging tax payers over the past several years. After all, wasn't it car makers who refused to build fuel efficient cars so oil companies could continue to gorge tax payers? So why not help out their counterparts in this predicament?"
vatownsend wrote, "Another industry bites the dust. Lets pay attention to see what else the Federal Government will take over. LOL!!! Freedom is slowly being taken away.."
crlchild suggested, "Dear MR Obama, Most people could accept the price of gas at a little below its recent peak. So keep the price at around that figure - the difference being fuel tax. Use this cash as a small LOAN to the auto makers."
Which brings us to comments on the Post editorial urging an inflation-indexed increase in gasoline taxes.
HFNY wrote, "Don't hold your breath waiting for any politician to do the right thing and raise gasoline taxes. Politicians seem incapable of putting anything ahead of their pathetic need to be reelected."
zcezcest1 said, "not only that, but a gas tax would mean smaller vehicles on the roads, meaning the roads would last longer. And given the state of many of the roads in this country ... that's not a small benefit"
But kronberg wrote, "Instituting a totally regressive tax, such as a gasoline tax, is not in the best interests of working Americans who need to use their cars and trucks in order to survive. Living in a city that has a semblance of a mass transit system, such a tax may seem a lot more reasonable than it is to those of us who live in places where cars are absolute necessities..."
TwoHotel9 said, "No matter how much you idiots collect in taxes you just want more. As one commenter said, lets cut to the chase, government is against the people, and it totally screws up everything it touches. Giving it more money to waste is the problem not the answer..."
But english_august wrote, "Thank you for continuing to push for this idea - we really really need a consistent gas price. With the prices hovering in the $1.70/gallon range and threatening to go further down, we are in a dangerous territory. The government needs to act fast to stabilize gas at around $3/gallon."
All comments on the article are here.
All comments on the editorial are here.
December 8, 2008; 7:49 AM ET
Categories: Auto Industry , Congress , Economy Watch | Tags: Auto Industry, Congress, Economy Watch
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