NY Times teaches us about "what capitalism can learn from socialism" and cars

Monday, November 30, 2009

I admit it, I love reading the NY Times!  Why read the funnies when you can watch the left's spin machine in action.  With last Friday's piece "US Teaches Car Makers Capitalism," comedy is at your fingertips.

Obama's nationalization of the car companies was vastly unpopular and aside from the stimulus, it is the only thing Obama has actually done since taking office.  Time for the Times to manufacture a stunning success for socialism.  Please remember to check your energy and health care usage at the entrance to your new Obama utopia!

As with all MSM outlets, news is covered in half-truths.  I've got to be honest with you the problems with the article were many and I can't possibly present them in a way that doesn't make my post look like a dissertation.  Here is all the information abridged.

The spin formula:

1.  Capitalists do not care about efficiency. They are greedy and want only want profit.  
2.  Their greed blinds them to logical, objective decision making (the Times says while batting their eyes at Obama)
3.  The rising price of domestic cars is proof that Obama's cost cutting strategies are working?  I don't know how the opposite outcome proves the strategy, but this is why they call it spin folks.
4.  Gee!  Why can't we just take over the banks and be socialistic.  Then we'd do everything right.

Here is the article's greatest hit:  (Please remember: this is not exhaustive by a longshot!)

Evidence of what is going on came this week in the consumer price figures for October. The index for new autos was up 1.6 percent for the month, and 3.8 percent for the last 12 months. It has been more than a decade since that index rose by nearly that much. That is what can happen when companies focus on raising margins, no matter what the impact on volume.

The Times is totally correct that GM and Chrysler are focused on margins.  One way to do so is to cut costs.  By lowering your costs and holding price steady, you can increase your profit.  The problem?  The proof of a successful cost cutting strategy is a stable or slightly lower price, but level or increased profit.  Instead, the article is touting higher prices, which is indicative of a value or quality centered strategy.  It sounds like nit-picking, but in actuality, it means all the marbles.  

Why?  Because unlike the Times' straw man argument that:

One rap on socialism has always been that governments are much more worried about jobs than profits. No politician wants to be responsible for layoffs, so the government is happy to rely on optimistic assumptions to avoid painful decisions.

The real rap on socialism is that it favors cronies.  The UAW now owns GM and Chrysler, check.  The other rap is that government does not run as efficiently as the profit seeking behavior found in free markets.  Proof that the government is not running efficiently would be…rising prices!  

Maybe double check!

1 comment

C-Gen - Leave it to the NYT to point to the 'success' of the socialistic takeover of the car companies. Recall the Obamanation, "We have no interest in running the car companies", then doing the precise opposite. Leave it to the NYT to praise the bailout and cronyism under their guy when Americans were resoundly against bailing out Chrysler and GM. What a joke!

November 30, 2009 at 7:42 PM

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