"Government Motors" A failure? Think Again.

sync0s · Jun 17, 2011

http://online.wsj.com/article/SB124958049241511735.html

In recent months, France imposed American-style "co-pays" on patients to try to throttle back prescription-drug costs and forced state hospitals to crack down on expenses. "A hospital doesn't need to be money-losing to provide good-quality treatment," President Nicolas Sarkozy thundered in a recent speech to doctors. And service cuts -- such as the closure of a maternity ward near Ms. Cuccarolo's home -- are prompting complaints from patients, doctors and nurses that care is being rationed. That concern echos worries among some Americans that the U.S. changes could lead to rationing.
The French system's fragile solvency shows how tough it is to provide universal coverage while controlling costs, the professed twin goals of President Barack Obama's proposed overhaul.

French taxpayers fund a state health insurer, Assurance Maladie, proportionally to their income, and patients get treatment even if they can't pay for it. France spends 11% of national output on health services, compared with 17% in the U.S., and routinely outranks the U.S. in infant mortality and some other health measures.
The problem is that Assurance Maladie has been in the red since 1989. This year the annual shortfall is expected to reach €9.4 billion ($13.5 billion), and €15 billion in 2010, or roughly 10% of its budget.

Parker · Jun 20, 2011

UncleBuck said:
suppose gm fails. then not only are those thousands of people at gm out of a job, but all the industries that depend on gm, from parts manufacturers to distributors to truck drivers, are all out of a job too. then we get to pay them unemployment and food stamps until they get new work (if they get new work), equaling a greater net loss.

that is indeed an interesting way of looking at things from whatever band of the spectrum you come from.

So the answer is to prop up a poorly run business with my money? My money will go to the hands of successful businesses and we will prosper in the long run. It is inconceivable to think we should reward failure. They should have gone through normal bankruptcy.

"The claim that the bailouts were done at little cost is even more dubious. This side of the story rests on the observation that GM's success in selling a significant amount of stock, reducing the government's stake, and Chrysler's repayment of its loans, show that the direct costs to taxpayers may be lower than many originally feared. But this doesn't mean that taxpayers are off the hook. They are still likely to end up with a multibillion dollar bill—nearly $14 billion, according to current White House estimates.

But the $14 billion figure omits the cost of the previously accumulated tax losses GM can apply against future profits, thanks to a special post-bailout government gift. The ordinary rule is that these losses can only be preserved after bankruptcy if the company is restructured—not if it's sold. By waiving this rule, the government saved GM at least $12 billion to $13 billion in future taxes, a large chunk of which (not all, because taxpayers also own GM stock) came straight out of taxpayers' pockets."
http://online.wsj.com/article/SB10001424052702303745304576361663907855834.html?mod=rss_opinion_main

sniffer · Jun 20, 2011

it was ok to bail out the banks ,, but everybody is mad about bailing out the auto ,,
what if we let them fail , ,,
what would we all drive ?
foreign cars ?

jeff f · Jun 20, 2011

sniffer said:
it was ok to bail out the banks ,, but everybody is mad about bailing out the auto ,,
what if we let them fail , ,,
what would we all drive ?
foreign cars ?

yep, definitely, if gm goes out of business there will never be another car company. we will have to drive ponies.

can anyone say studebaker, etzel, delorean, fill in a hundred other companies here......

"Government Motors" A failure? Think Again.

sync0s

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Parker

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sniffer

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jeff f

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