What’s Happening in Business

"Earnings, Economy, Here Comes Terrible." Initial Post Due by Sunday (2/1) 11.59PM CST, and Response post due by Thursday (2/5) by 11.59PM CST

Posted Monday, January 26, 2009 by Matt Gargano

Read the article entitled "Earnings, Economy, Here Comes Terrible", and answer the following questions:

The government has already dumped a massive $750 billion in the form of a corporate bailout (aka corporate welfare) last quarter (Fall 2008), claiming that if they [the government] did not bail out these companies, then the economy would fail. Based on this article, has the bailout worked? Is it still to soon to tell? Will another bailout work? Explain.
Here is more evidence that given the choice to do the right thing, most people won't. Read how corporate executive John Thain spent $1.2 million of our taxpayer dollars that his company was given as part of the corporate bailout on redecorating his office. Based on this, does any report of economic disaster warrant a corporate bailout? Explain.

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Bailouts, bailouts, bailouts. We are looking at 750 billion dollars. If we truly wanted to bail out these companies and save our economy here is the easiest thing to do. The government would create a mortgage forgiveness plan, buy all outstanding mortgages from the banks, let the money ride (considering it would probably be quite a bit lower than the billions already handed out to the banks) and tell everyone you owe nothing. NOW PAY YOUR BILLS! Leave the auto industry to fold on top of itself because Belvidere Chrysler plant is still shut down and no one returning to work. It was a bad idea to begin with. We don't need to stimulate the economy, or bail out the companies. We need jobs, we need our debts paid, and we need steady manageable income. Not a paycheck that won't even feed our kids every week. HEY WASHINGTON! Want to see how you can help? Come live with me for a week, and you will see this is true. 750 billion dollars. Heck with it, want a real bail out? Give everyone in the U.S. a billion dollars and we can all build our own businesses for illegal immigrants to work at. We would all just be blwoing money everywhere, it would be great! We would make the U.S. dollar as high as the YEN and our billion dollars would be worth nothing. Oh wait, these billions of dollars are worth nothing because it is not being pumped into our economy, or to save companies. I still have this feeling that a lot of the money is being thrown overseas in out of country ventures. It makes sense since no one can account for their money. President Obama, if you really want the American people to stand with you then make all these businesses accountable and if the money is not used properly then penalize them. Send them to prison, and I mean a state run prison, nothing frilly FED style. Put the fear into the businesses again. Do we need regulation once again? Yes we do. The invisible hand is no longer present. It shriveled up with Bernie Ebbers.

Posted by Stephen Kentner on 1/26/2009 12:00:00 AM

I personally think that this bailout will only prolong the inevitable. Realistically I think it is still to early to tell because no one knows for sure how severe this recession will be in the future and no one knows for sure how long it will last. I don't think the government will make another bailout plan because any bailout plan goes against business ethics anyway.

Posted by Shawn Pryor on 1/27/2009 12:00:00 AM

I think the first bail out was a joke. The companies are still in the toilet. Companies do not deserve any more help or forgivness. Help the people that really need it. Some people use millions of dollars to redecorste while some single moms struggle to make ends meet, or a man works everday for years and all of a sudden his retirement plan isn't worth anything and the company he works for is closing. These are the people that need the help!

Posted by Jakee Thrasher on 1/28/2009 12:00:00 AM

Bailouts have not helped anyone. It has enabled the companies to mature. This is all to buy time to dig further into corruption. Will it happen again? I hope not. Repetition without consequence devalues the honesty and integrity ethics. Instead of giving back to the community as their code of conduct should show, the CEO have abandoned the principles of good workmanship and are keeping the money for themselves. It is irresponsible to allow this behavior to continue. The nations will fall more out of control. Doubtfully, they will not find their way back. President Obama's real agenda is forth comming. Everyone cries change; however, our ideas of what change is are opposite of one another. It is an Obamanation! Everyone must come to place of repentance. Since the first bailout did not work, why does anyone think that the next will, or the next, or the next? These crooks should be held accountable for their actions. The authories must also enforce a strict contract between government and companies. Otherwise, the companies will face harsher consequences.

Posted by Megan McDermott on 1/28/2009 12:00:00 AM

All this talk about bailouts isn't helping. I personally thonk the bailout needs to be given to the people. Why give a business money to get out of debt? The company gets out of debt and still there are massive layoffs. Thath doesn't help the economy at all. Why can't we bailout the fathers who are behind on child support due to unemployment. The fact is that we need more jobs. With that being said I think the bailout should be divided between both the businesses and the people. Customers make the businesses and businesses help improve economy. In other words we can't help them if we can't help ourselvs.

Posted by Fourte Johnson on 1/30/2009 12:00:00 AM

In response to Shawn. The recession is near depression, and the way things are still going we will either slip to a depression or stay this way for over a year. We will see though. With the republicans refusing to act any time soon it looks like depression.

Posted by Stephen Kentner on 1/30/2009 12:00:00 AM

I totaly agree with the comments from Fourte Johnson about the bailout should be for the people and business not just one. The bailout looks to me to be for the banks and the banks are keeping the money and giving it to the CFO as bonuses and not giving anything to the hoomeowners that they are supposed to help. The government should help the homeowners directly and the banks have enough money and they do not need to get more from the government for the bonuses. I cannot name one bank that is refinancing homes for owners that want to keep their homes or owners that want to reduce the interest on their mortgage loan. So where is the help?

Posted by CarmenM on 3/16/2009 12:00:00 AM

I do believe the bailout is a good thing for the economy, but some companies make bad use of the money, which sends out a negative message and makes it impossible for companies that truly need it unable to receive it. When the government gives out money, there should be strict stipulations that the companies can not give out any bonuses to their top employees. The money should not be used for personal use at all. If they show signs of not uses the money in favor of the company, then they should give it back and also be given penalties for not following the rules.

Posted by linda on 4/9/2009 12:00:00 AM

I feel it is to early to tell whether or not the spending plan will work, oops I mean stimulus plan. We are spending money we don't have and which in turn is going to cost my kids and grand kids. I do not have all the answers it just seems that the economy would be better serviced if we could give money to people who actually deserve it, not people who are lazy and choose no to work. Also we spend much more helping other countries who are less fortunate than we do our own people, help America if not our government chooses not then who will?

Posted by David Carlson on 4/13/2009 12:00:00 AM