Mark Schauer – Congressional Comedian

A Constituent Schools A Congressman

The Beauty of Bankruptcy

Many do not think of bankruptcy as something that is beautiful, but like many things, it all depends on how you look at it. Most would appear to view bankruptcy as nothing more than death of a company, and as such, see a conclusion of darkness and despair without hope. Certainly for the one declaring bankruptcy, it is an unpleasant experience, but there is hope for employees and consumers alike when a company declares bankruptcy. “Hope in death,” you ask? Of course, for there would be no resurrection without first having the death.

A perfect example of the beauty of bankruptcy can be found in the case of the Archway Cookie Company, which filed for Chapter 11 bankruptcy in October of this year. Two plants were closed, and employees found the prospects of financial turmoil to be more than a little disheartening. In a situation like this, all hope must be lost, and there is obviously no chance of Archway Cookies returning from the black abyss, right? Wrong.

North Carolina based Lance, Inc. purchased the assets and brand of Archway Cookies at auction for $30 million in December. Lance has already reopened one of the factories and has re-hired about 60 former Archway employees at their previous salaries. All current employees that Lance has re-hired, and the other former Archway employees that have yet to be re-hired, were given $1,500 Visa gift cards to help with bills and Christmas. Their plan is to steadily hire the rest of the former Archway employees as business grows and increased production goals need to be met. Lance, Inc. which already has a successful corporate business model, will likely create a more stable employment situation for all their employees, unlike the former leaders at Archway who received their just deserts from the free market. This situation is a perfect example of the beauty of bankruptcy.

The fear mongers of bankruptcy and the enemies of laissez-faire capitalism would have the public believe that if the U.S. auto industry goes under, it will cease to exist, and the grass will grow tall around decrepit facilities and factories riddled with graffiti. Nothing could be further from the truth however. Like Archway above, auto manufactures that declare bankruptcy will be bought out at rock bottom prices, restructuring will occur, and proper stewardship is likely to be exercised to produce a successful company that does not need to be sustained by tax dollars. This is the beauty of bankruptcy.

Peter Schiff vs. Lansing Mayor

Part 1

Part 2

Obama On Stimulus

Today President-Elect Barack Obama introduced his economic team and talked a little about a coming stimulus package. Unofficial figures put the proposed plan somewhere between $500 billion and $1 trillion dollars. Obama says that the economists agree that a new stimulus package is necessary to turn the economy around. I’d like to know who the economists are that he’s talking to. It’s amazing that all of the economists agree. It sounds to me like he’s going to the sources who will give him the answers he wants to hear instead of getting the opinion of people who have a different point of view. That’s a pretty good recipe for failure.

Peter the Prophet

Judge Napolitano: Presidents Ignoring the Constitution

And So It Begins… But Where Will It End?

It didn’t take long for President-Elect Barack Obama to begin making decisions that will surely be detrimental to our economy in the long run with his announcement that we will have another “stimulus package”, as well as additional “loans” to the floundering auto industry. In all fairness, I’m sure that John McCain would be making similar decisions, which would also be detrimental to the future of our republic.

Let’s take a look at the absurdity of “stimulus checks”, which are nothing more than tax dollars (or in this case printed and/or borrowed money) handed out to tax payers and large portions of the population that pay no taxes. First, the government is bankrupt… we have no money. So, the government takes money that is non-existent (they print it which causes inflation, or borrow it which creates debt) and they give it to the citizens to spend to spur the economy. In other words, for immediate gratification we either further destroy the dollar through inflation and erode the prosperity of future generations, or we enslave future generations to the debtors of our own creation, again eliminating their prosperity through our own greed an selfishness. How many stimulus checks will it take to “stimulate the economy?” Where will it end?

Concerning “loans” to the auto industry, like bailout, after bailout, after bailout before the current one (and more are sure to come), it is sure to be a dismal failure. The bailouts will inevitably lead to the eventual nationalization of the auto industry. With talks of possible nationalization already circulating, and the empty coffee cup extended toward the government by the hand of the auto industry, investors are likely to continue to shy away from putting money into the struggling “Big-3.” As a result, stock prices will likely continue their decent, the government will see the industry as “to big to fail,” and the prophecy will fulfill itself. The “loans” then in essence become a “bailout” as US taxpayers again become owners of industry. As mentioned above, because the country is bankrupt, this will be funded through inflation or debt — either way we lose. Undoubtedly other industries will surely follow with their hands out as well, and as usual we’ll be left asking, “But where will it end?”

No matter how many times the old adage is repeated that those who fail to learn from history are destined to repeat it, it would seem that the majority of those in public office fail to learn from the past mistakes of government intervention within the marketplace. Government meets market, government intervenes in market, market gets fouled up, government proposes the solution of intervening within the market to fix the problem, and things end up worse than they were before. The vicious cycle continues, but where will it end?

After-Election Thoughts

Last night marked the end of another election cycle, and with its conclusion I have various thoughts and emotions that run though my head as I’m sure many do.  What follows are some of those random thoughts concerning various aspects of the elections.

The Presidency – Either way the coin fell I knew that I would not be happy with the outcome.  Being that I voted for neither one of the main party candidates, I can’t say that I would have felt any better should John McCain have won.  Let’s face it, our choices were between a real democrat, and a republican pretending to be a democrat.  That being said, it will be interesting to see just where Barack Obama will take this country as president.  Also, on a positive note… can anyone say, “Ron Paul 2012″?

Congress - I’m very happy to see that the democrats were unable to gain a super majority.  If that had happened, I feel that we would have been in for even tougher times than we are about to face as a nation.  Government has ballooned over the last 8 years and I still worry that it will continue to grow at an alarming rate.  One of the things that amazes me though is that with the dismally low approval rating of Congress, people still increased the size of the controlling party.  Doesn’t seem to make a whole lot of sense.  It will also be interesting to see if the Congress does an adequate job of investigating the whole bailout issue like they promised to do after the election.  Being that the trail will lead back to many democrats, and many have a short memory of promises made, if it is done at all, I’m sure it will be a sham on the public.

Third Party Candidates – The third party candidates showed very low numbers as was to be expected, but there was one interesting thing to note… Bob Barr took 1% of the vote nation wide which I feel is a direct reflection of some of his words and actions related to Congressman Ron Paul’s unwillingness to “play ball” the way Barr wanted.  Obviously the 6% polling Barr continued to cling to throughout the race was a figure that likely had diminished long before the ballots were counted.  Be that as it may, we must continue to work to make sure that third party candidates have a voice in elections, and that people truly have a choice in elections rather than just having the option of the current two-party-as-one system.

With the next election cycle two years away, I continue to wrestle with my own options of running for office.  Should I run, or shouldn’t I?  That is the question, and it’s one that I’ll have to continue to discuss with my wife and children.  As for now I’ll have to leave everyone hanging as to whether this will become official for 2010…

Cato on Obama’s Health Plan

The Cato Institute’s director of health policy studies, Michael F. Cannon, discusses the Obama health care plan and the claims Obama has made in favor of it.