Wednesday, December 30, 2009
Failures should be allowed to fail
Can somebody please explain to me how this is consistent with the American way of capitalism and self-determination in the market place?
NEW YORK - The government on Wednesday provided a fresh $3.8 billion cash infusion to stabilize GMAC Financial Services as the financing company struggles with hefty losses in its home mortgage unit.
The Treasury Department said the new aid, which comes from a taxpayer-financed bailout fund, is less than the roughly $6 billion the government had earlier thought GMAC would need to stabilize the company.
The fresh infusion is on top of $12.5 billion in taxpayer money Detroit-based GMAC has already received from the government. The new agreement will boost the federal government's ownership in GMAC to 56 percent, from 35 percent.
Without the threat of failure, where is the incentive for companies to employ efficient and wise business practices? Obama says he doesn't want to be in the financing and mortgage business yet, the federal government now owns a majority share of GMAC thanks to tax-cheat boy-wonder, Timmy Geithner, as directed by the man-child President.
Is there any slice of the American economy this administration doesn't want to control? Heaven help us!