Links and Minifeatures 2008 11 17 Monday

Carnival of Personal Finance

What he said: Stephen Den Beste (profanity warning applies)

There is no way in this universe that Obama can govern in accordance with how he campaigned. To the extent that he tries, his term will be a disaster.

If I were an Obama supporter, I'd be fervently hoping that everything he said was just an empty campaign promise. He's the president-elect. I am going to give him a chance. I'm not going to criticize him without reason rooted in his actions since the election.

Here is one such reason: By asking Rahm Emmanuel to be his chief of staff, he's also signaling that he's going to be the most partisan president since Nixon (at least). So much for "bi-partisan". Mr. Emmanuel has been one of the more vicious attack dogs in Congress.

On the other hand, he campaigned against Guantanamo, but now that he's actually President, Obama appears to be backtracking on that There may be hope for an Obama administration after all. Maybe the nutroots will even allow him this. Buddha knows the extent of their logical thinking is "Bush Evil! - Obama Good!"

VP-elect Biden hopes to be a hands-on No. 2

Vice President-elect Joe Biden was all smiles Thursday when he paid a courtesy call the man he will succeed, Dick Cheney. But he has insisted he wants to be nothing like him. Biden has called Cheney "the most dangerous vice president we've had probably in American history" and said he couldn't name a single good thing Cheney had done.

But even if he won't acknowledge any similarities, there's one way that Biden wants to be like Cheney - a strong partner in governing the country.

Partisan Politics 101: When we do it, it's good sense. When they do it, it's an unconstitutional abuse of power the vice president was never given.

I am not going to play that game. If I believe Cheney remained within his constitutional mandate (and I do), I must believe the same thing about Joe Biden. There is nothing forbidding the President from assigning other duties to the Vice President. The Dems just didn't like it because they couldn't force President Bush to spend political capital getting an appointment through when the Vice President is legally elected without a need for confirmation by the senate.

If Joe Biden does something in particular that is stupid or illegal (pretty much a matter of clockwork with him), you can expect me to say something. But assisting the president? That's a good idea as far as it can go, and I like the idea of the Vice-President being a power player in their own right. After all, does anyone remember voting on who would be White House Chief of Staff? I certainly don't. But the Vice President was elected with the same ballots the President was. Just because I voted otherwise in no way changes this.

Top Republican senators oppose automaker bailout

About time.

Sens. Richard Shelby of Alabama and Jon Kyl of Arizona said it would be a mistake to use any of the Wall Street rescue money to prop up the automakers. They said an auto bailout would only postpone the industry's demise.

and

Added Kyl, the Senate's second-ranking Republican: "Just giving them $25 billion doesn't change anything. It just puts off for six months or so the day of reckoning."

Right he is on that score. However:

"They're not building the right products," he said. "They've got good workers but I don't believe they've got good management. They don't innovate. They're a dinosaur in a sense."

Even here he has his elements. The problem isn't the workers, or even today's management. It's that when Detroit owned the worldwide automobile marketplace, their management then gave the labor unions more than they should have, and those contracts are weighing on the automakers like a millstone on the neck of a drowning man. The unions are unwilling to renegotiate, and federal labor laws make it impossible for the companies to do anything without the union being willing to renegotiate. They can't legally abrogate the contract, they can't legally refuse to deal with the union.

The original power of the union was that the companies could not afford to replace everyone, and so it was in their best interest to give them a fair share of the profits of their labor. But when laws were passed forbidding the companies from hiring an entirely new work force if that was more efficient, the power of the unions became too great. The automakers cannot hire an entirely new work force; they are legally forbidden. They can't refuse to deal with the union, they are legally forbidden. They can't force the union to renegotiate if the union is unwilling; they are legally forbidden.

Detroit has some very nice products (my wife and I just replaced a Saturn that got crunched with a Ford Minivan, and we like it a lot), but union contracts which prevent them firing anyone, force them to pay workers to sit around, and saddle them with lifetime health benefits for retired workers and their families - something not even the federal government does. The difference in competitiveness between domestic and foreign autoworkers can be directly ascribed - in the mathematical, accounting, sense - to the differences in the legacy contracts Detroit's automakers are saddled with.

I very much regret this fact, but there are only two ways out of this situation: A way can be found to break the UAW's stranglehold on the profitability of our domestic autoworkers, or Ford, Chrysler, and GM are going to be gone. If anyone thinks that would be a good thing for the United States, I would love to hear a rational reason why, because that is almost certainly what is going to happen. Oh, we might suffer a sudden attack of rationality after we lose one of them, but by then it will be too late for the other two as well.

And when they go under, what will the UAW and its members be left with?

The Same Old Change