Thursday, March 19, 2009

Why Bailouts Aren't Working!

AIG got billions in bailout money which they used to buy anything from Orange Amps to High School Musical (Blu Ray) all the way out to a cavalcade of unsanctioned substances and services.

Your money paid for there luxury. Good job tax payers. Congratulations. You rewarded top AIG executives for MEETING A DEADLINE. A deadline isn't something a good employee needs a bonus to meet. It's something they met or GET FIRED! If your employees don't meet deadlines or need bonuses too do such a task your problems ARE NOT GOING TO BE SOLVED BY GETTING MORE MONEY!

Common sense, is it so hard to find today? Is Capitalism dead? Laissez Faire a farce?

Here is the problem with bailouts: THEY DON'T SOLVE THEM.

Throwing money at a problem doesn't solve it, IT ENABLES IT.

If the Gov't really really wants to help solve a problem in a company here is how you do it. You don't just throw money at it. You use the money smartly. Here is how I would do it.

First off, most people wouldn't ask for my kinda bailout because I would probably fire most of the executives who made bad business calls. I would promote/replace/hire proven successful businessmen to set the company straight. 

Second: Teach companies to fish, do not feed them. 
Question every investment, question every business practice. Figure out WHY they failed and how to fix it. If it isnt' fixable, see if the company cannot be sold to one that is. 

Third, thought probably should be first: DONT LET GOVERNMENT CONTROL IT. I'd set up a bailout committee filled with proven sucessful businessmen who KNOW what they are doing. Give them a certain amount of money and let anyone crying "bailout" fall under there power and furthermore there budget. Let them take companys they think can still make it and make them PROFITABLE. Companys who may never recover thanks to long standing bad business practice SHOULD FAIL. 

Doesn't this make sense? Of couse it does. Which is why the gov't is content to simply feed the problem instead of STOPING it.

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