Chinese automaker SAIC may buy GM stake/IPO - Page 3

Berean · 09-22-2010, 09:54 AM

It's a fine line to walk. We had high protective tariffs from 1865-1900, which worked wonders in developing our manufacturing base. It also had the unintended consequence of creating monopolies which led to decreased competition and higher prices.

Free trade has the unintended consequence of moving the manufacturing base to the location with the cheapest production costs.

China is poised to become the next superpower and there's nothing we can do about it unless the American population suddenly decides to return to a culture of individual responsibility and self reliance, which would change our economic policies, both domestic and international.

Since that will never ever happen, prepare yourself for the economic collapse that is sure to come.

a_Username · 09-22-2010, 11:48 AM

Quote:

Originally Posted by Berean

It's a fine line to walk. We had high protective tariffs from 1865-1900, which worked wonders in developing our manufacturing base. It also had the unintended consequence of creating monopolies which led to decreased competition and higher prices.

Free trade has the unintended consequence of moving the manufacturing base to the location with the cheapest production costs.

China is poised to become the next superpower and there's nothing we can do about it unless the American population suddenly decides to return to a culture of individual responsibility and self reliance, which would change our economic policies, both domestic and international.

Since that will never ever happen, prepare yourself for the economic collapse that is sure to come.

Capitalism does not create monopolies. The only monopolies in existence are government granted monopolies. If you're proposing high tariffs in the midst of a global recession, then you'll realize that we'll be in far more economic hurt than we are now. Of course, this hurt is mainly due to the terrible monetary policies of our government.

Berean · 09-22-2010, 12:18 PM

Quote:

Originally Posted by a_Username

Capitalism does not create monopolies. The only monopolies in existence are government granted monopolies. If you're proposing high tariffs in the midst of a global recession, then you'll realize that we'll be in far more economic hurt than we are now. Of course, this hurt is mainly due to the terrible monetary policies of our government.

I never said capitalism creates monopolies. I said high protective tariffs create monopolies. High protective tariffs are anti-capitalist in many ways.

High protective tariffs in the late 19th century created monopolies in the steel, oil, and tobacco industries just to name a few. However, the progressives under Teddy Roosevelt reacted with government regulation rather than free trade principles to break up the monopolies which has led us down the path of government intervention in business that we see today.

syr74 · 09-22-2010, 12:22 PM

Unless such an eventuality would create a national security risk the U.S. government is legally not supposed to, and most likely wont, prevent foreign entities from buying however much of GM they see fit. The Obama administration may be talking tough about limiting outside investment, but the reality is that it would be extremely difficult to manage in a situation like this even if they actually intend to carry through with such a strategy, and I am far from convinced.

To be honest I hadn't thought of this before, but if the initial price per share is as low as I expect it to be it isn't at all unthinkable that the the Chinese could end up owning a huge share of GM.

a_Username · 09-22-2010, 12:58 PM

Quote:

Originally Posted by Berean

I never said capitalism creates monopolies. I said high protective tariffs create monopolies. High protective tariffs are anti-capitalist in many ways.

High protective tariffs in the late 19th century created monopolies in the steel, oil, and tobacco industries just to name a few. However, the progressives under Teddy Roosevelt reacted with government regulation rather than free trade principles to break up the monopolies which has led us down the path of government intervention in business that we see today.

I guess I misunderstood your post, my apologies.

Berean · 09-22-2010, 02:00 PM

Quote:

Originally Posted by a_Username

I guess I misunderstood your post, my apologies.

No worries.

2010-1SS-IBM · 09-22-2010, 02:17 PM

I'm not concerned with China having a minor interest in GM. A major interest, yes, but only because I don't think foreign ownership understands the US car market.

I dislike China being closed to foreign investment and trade. But that's something that will end up hurting China, not us. We went through this same scenario 25 years ago with Japan, and that ended up with Japan in the ditch.

Also, US manufacturing is not hurting, manufacturing jobs are (manufacturers are automating more than they are outsourcing). I wish it was just outsourcing, because that would mean those jobs could come back. Automation means those jobs won't be coming back.

If we want to increase manufacturing jobs, we'll need to allow businesses to explore and harvest the resources (oil, mining, etc...) in the US again instead of making them go overseas to do it. It would have the additional benefits of being done cleaner than anywhere else, pushing commodity prices down, and increasing our GDP.

09-22-2010, 09:54 AM	#29
Berean Drives: Truck Join Date: Apr 2010 Location: Home Posts: 2,439	It's a fine line to walk. We had high protective tariffs from 1865-1900, which worked wonders in developing our manufacturing base. It also had the unintended consequence of creating monopolies which led to decreased competition and higher prices. Free trade has the unintended consequence of moving the manufacturing base to the location with the cheapest production costs. China is poised to become the next superpower and there's nothing we can do about it unless the American population suddenly decides to return to a culture of individual responsibility and self reliance, which would change our economic policies, both domestic and international. Since that will never ever happen, prepare yourself for the economic collapse that is sure to come.

09-22-2010, 12:22 PM	#32
syr74 Account Suspended Drives: Thunderbird Join Date: Sep 2008 Location: Kentucky Posts: 951	Unless such an eventuality would create a national security risk the U.S. government is legally not supposed to, and most likely wont, prevent foreign entities from buying however much of GM they see fit. The Obama administration may be talking tough about limiting outside investment, but the reality is that it would be extremely difficult to manage in a situation like this even if they actually intend to carry through with such a strategy, and I am far from convinced. To be honest I hadn't thought of this before, but if the initial price per share is as low as I expect it to be it isn't at all unthinkable that the the Chinese could end up owning a huge share of GM.

09-22-2010, 02:17 PM	#35
2010-1SS-IBM Drives: 1998 Nissan, 2010 Camaro Join Date: Jul 2009 Location: Dallas, Tx Posts: 827	I'm not concerned with China having a minor interest in GM. A major interest, yes, but only because I don't think foreign ownership understands the US car market. I dislike China being closed to foreign investment and trade. But that's something that will end up hurting China, not us. We went through this same scenario 25 years ago with Japan, and that ended up with Japan in the ditch. Also, US manufacturing is not hurting, manufacturing jobs are (manufacturers are automating more than they are outsourcing). I wish it was just outsourcing, because that would mean those jobs could come back. Automation means those jobs won't be coming back. If we want to increase manufacturing jobs, we'll need to allow businesses to explore and harvest the resources (oil, mining, etc...) in the US again instead of making them go overseas to do it. It would have the additional benefits of being done cleaner than anywhere else, pushing commodity prices down, and increasing our GDP.