In what appears to be another example of The General thinking not much further along than what’s for lunch that day, GM announced plans to chop the brands down to four.
Sure. It’s a pretty obvious move and a good one. Not sure why they wouldn’t cut to two. But four is a good start.
But here’s the Soup of the Day moment: The four they’re keeping: Chevorlet, Cadillac, GMC and Buick.
I didn’t stutter. Buick.
Don’t get me wrong, i think it’s sweet that GM wants to keep the single remaining Buick devotee in cars for the remaining days she has on the planet. Especially since she turfed her last Regal.
But Buick? Really? Were GM execs worried that all 4,429 members of Buick Forum would be upset and start an online protest? If so, apparently it’s unlikely they’d do so during daylight hours. Actually, I have to say I was shocked to find an online Buick community. I expected there to be only a few pen pals. But even Pen Pals have gone online it seems.
Everyone needs a friend.
And it seems like The General is worried about not having any. I thought General Motors pulled up short when they only let Oldsmobile go in 2000. They should have kept going then. Why not pack up Buick at the same time? A twofer. Get that Band-Aid off in one, hard, sudden pull. But they checked up. One couldn’t possibly alienate close friends like Michelle. Not when they keep you informed on the latest celebrity gossip.
Instead The General went back to picking around the edges.
Something interesting could have come of the integration of Opel vehicles into the Saturn line up. But instead they’re going to keep Buick afloat. It’s like building a raft out of cinder blocks. As far as I can tell: Anyone who owns a Buick now and plans to purchase a new Buick probably has one remaining purchase left.
The way the GM executives really think through the long term health of the company—it’s inspired.
Nate Silver over at FiveThirtyEight.com posted this earlier today, and I think I’ve never seen economic growth tracked as clearly in one chart as I have here. He nicked the data straight from the Census Bureau, there’s nothing statistically complex about it. But it pretty clearly sums up my own conclusions about why the Democratic Party is the real party of growth, at least in its post-1992 form. It’s really not that complex, though we seem to make it so: pursue reasonably pro-growth economic policies and tax the richest Americans at considerably higher rates, though not at the extreme rates of the 1950s and 1960s.
Meanwhile, the Republican Party continues to hump Reagan’s dead corpse and pretend He-Who-Must-Not-Be-Named wasn’t a “real” conservative. He carried forth Reagan’s agenda as clearly as anyone could hope to, at least domestically. Wake up, GOP. I miss when you actually had sane politicians.
The Financial Times carried an article this week that suggests tracking tick-by-tick stock market transactions for the purpose of predicting financial bubbles. I suspect that if this is done with elegant simplicity (for example, just putting all the data out there on the web in real time and letting investors and academics manipulate the data) it could possibly work. I also suspect it would change the dynamics of the market. A more transparent market should tend towards less volatility, and over a long period of time that should mean fewer recessions.
I would love to apply the same analytical strategy to figuring out how governments can apply inverse financial pressure to the economy without relying solely on the federal funds rate or a central bank. It is obvious today that in a recession the demand for government services goes up at exactly the same time that revenues go down. Furthermore, while additional public spending is exactly what is needed, most governments below the federal level can’t run a deficit or print money. This leads to a vicious cycle and constant downward pressure on the economy.
How about these ideas to get rid of this cycle once and for all?
- Bongo Bucks: In a recession, have state and local governments print their own money, legal tender within their borders. It has been done before. Unemployment benefits, tax refunds and other government remittances can be paid partially in local currency. People will spend a higher percentage of their disposable income locally (big box stores don’t count) and stimulate the economy on a more local scale, which can have a multiplier effect.
- Hedge Nationalization: If governments were to enter the markets (including stocks, real estate, commodities) and trade in quantities invesely proportional to the changing price of the instrument, it would have the effect of smoothing out the markets. This would be a kindof strategic petroleum reserve, but for other types of commodities. Obviously dedicated capitalists don’t want the markets smoothed out when they are going up, but wouldn’t that be better in the long run? Or maybe the government just starts kicking in a buying when the market trends down? I see lots of problems with this idea of course, but I wanted to throw it out there for a discussion starter.
The city of San Diego is likely to enforce water restrictions this summer. Some highlights from the article:
Each household will be allocated a water usage based on a baseline year, possibly 2006 or 2007 or both.
If you use more than your baseline, you’ll pay rates up to 5 times the going rate.
There will probably be a waiver system for people to appeal their allocation.
It is possible the city will analyze sewer usage and enforce deeper cuts on irrigation water for landscaping.
The plan has some serious flaws. Many of these are pointed out by the comments on the web site cited above, and include the following:
If you recently moved into a house that was unoccupied, rarely occupied or occupied by an old lady whose cats took more baths than her, you get nailed on your allocation.
If you recently had a child (a newborn, or worse! a boomerang, or even worse! octuplets!!) then you aren’t given credit for the additional water you’ll require for real sanitation needs – baths, laundry, food prep (including warming all those bottles) and cleaning.
If you have a drought-tolerant yard, use greywater on the roses and shut off the shower while you soap up (military style), while your neighbor lets their irrigation water run out of their fabulously green lawn and down the street past your house twice a day, the neighbor will end up with an allocation much higher than yours. Yes this is a personal example and the reason I’m peeved.
So why this plan? Because politicians can’t seem to grow the rocks they need to ask people to sacrifice – they have a very low threshold for whiny constituents who feel like they deserve to live their lifestyle at the expense of everyone else.
In an effort to be a little more constructive than most of the commenters on the cited web site, I’ll offer this plan, based on the assumption that sanitary use of water in a city of 2.5 million is more critical than landscaping.
Give every person in the city (adults and children) a water share.
Estimate the water supply for the year, lop off industrial usage, and divide the rest evenly among the shares.
Optionally include a safety factor if the water supply gets even worse
People can use their share for showers, the vegetable garden, the pet llama or whatever they decide. This plan doesn’t provide an incentive for renters who don’t pay a water bill to conserve, but neither does the city’s plan. A financial kickback (rate reduction?) to property owners who can get lower water use from their renters might be a good idea. Then again those owners may be able to cut way back on their irrigation to offset renter usage.
Finally, since I love to solve things with technology, let’s propagate some real-time water meters to every household, and include remote displays (in the kitchen, bathroom, laundry, garage) that show instantaneous water usage in gallons/minute and $$$. It is well known that a good feedback system is the best way to get people to regulate themselves. The cost of such a system will pay for itself eventually.
As much as we have ragged on the Big 3 in our conversations, it seems wrong that the first post on the auto industry is positive. This weekend, I was telling my wife that it appeared that Ford has a real chance to come through the current crisis not only alive, but thriving. Not only have the ys aid they won’t need bailout money, but they seem to be steadily but surely overhauling their line-up and building up their reputation for quality, technology and making cars the public wants. My wife really likes the Ford Fusion. The hybrid version might be on her shopping list, even though it would be an under-budget purchase. Then, I read this.
Ford really gets it. For the first time in maybe 50 years, they really get it.
In what appears to be another example of The General thinking not much further along than what’s for lunch that day, GM announced plans to chop the brands down to four.
