About the Bailout…..

A little over a year ago the Republicans were screaming about the bailout of the auto industry. The Republicans scream about almost everything so I guess that is no biggie. But it is ironic that less then two years later they are filling their portfolios with the very stock they rallied against.

Back in the days when I studied economics, which was before the MBA craze, it was commonly believed that corporations were founded on the principle of a three legged stool. When the three legs were of equal length the company was stable and worth putting in your portfolio. The three legs were: Customers, Owners, Employees. Somewhere along the line this belief, much like Freud’s “All your problems are because of either your mother or your sex life”, the theory of the three legged stool fell out of favor. I think it happened during the Reagan years. I really enjoy putting all this stuff on the “trickle down” president 🙂

Anyway that stool has become so unstable that even a fly could not perch on it for long. And remember flies can hang from a ceiling for hours at a time. (I know I watched one do that!) The first leg to be shortened was the customer one. Many U.S. companies thought that we were somehow idiots and they could sell us about anything they chose to make. The Employee leg basically got ripped entirely off the stool when companies decided that their workers were liabilities instead of assets. I can remember that happening personally to me about 1985 or so. (Oops, that the Reagan years again).

So now all we have is the round seat of the tool being blown about with one long leg. So you know what happened? Company started swirling around the drain.OK now that I have laid the foundation for this story let’s get back to the bailout. When the government bailed out the auto companies they pretty much insisted that they start making products what were good for the customers and good for the country. I.E. no more gas guzzling Hummers! I suspect the most disgruntled groups around now are the marketers. They were pretty much give the door I guess. But I think I know where they landed. They are in the home improvement business now with the mantra “If your kitchen doesn’t have granite counter-tops, cherry cabinets and stainless steel appliance then you are totally unable to cook a delicious meal.