Bailout of the big 3, is it really such a bad thing?

Recommended reading, economic debates, predictions and opinions.

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 02 Mar 2011 19:48

Brix wrote:E.g., even the most cursory glance at the pattern of political donation in the US reveals that labour unions seem collectively determined to help fund union-supporting Democrats almost exclusively, while large corporations tend to be more impartially civic-minded, with individual corporations commonly donating to both major parties at the same time, giving most encouragement to whichever party is most likely to bear the burden of governance. :wink:

Nice slip and slide. We were talking about the reactions of people, which you narrowed down to opinions of people on this forum. We vote, we don't donate (or at least not much). I doubt any of us donates to more than one party.

As regards corporations, my recollection of the last time I was active in politics, which was about ten years ago, the Liberals were the party of Big Business, the Conservatives were the party of Small Business, and the NDP was the party of Big Labour -- the latter with an effective veto, as I recall. There was NO party looking out for the ordinary citizen. Somehow I doubt that's changed.

The government is NOT my friend. YMMV.

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby Brix » 02 Mar 2011 21:23

ghariton wrote:Nice slip and slide. We were talking about the reactions of people, which you narrowed down to opinions of people on this forum.
Meta, but I'll bite:

Narrowing down? In fact I wrote "There seems to be considerable enthusiasm [...]" Perhaps I should have added "in this forum, and in particular in this often-reanimated thread", just as when one says "It's raining" one should perhaps add "here, at the moment". :oops:
User avatar
Brix
Gold Ring
Gold Ring
 
Posts: 3249
Joined: 22 Feb 2005 13:29
Location: Victoria

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 03 Mar 2011 00:19

Brix wrote:
ghariton wrote:Nice slip and slide. We were talking about the reactions of people, which you narrowed down to opinions of people on this forum.
Meta, but I'll bite:

Narrowing down? In fact I wrote "There seems to be considerable enthusiasm [...]" Perhaps I should have added "in this forum, and in particular in this often-reanimated thread", just as when one says "It's raining" one should perhaps add "here, at the moment". :oops:


Fair enough. But I still fail to see the leap from individuals' opinions on this forum/thread to corporate donations.

Would that be meta-meta? Or perhaps non sequitur? :shock:

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 03 Mar 2011 05:48

chiaroscuro wrote:we have fraud and collusion on a massive scale and no one from wall street goes to jail.

Apparently prosecutors take a keen interest in what Wall Street bankers have been up to.

Rajat Gupta, former Goldman Sachs director, faces SEC accusations.

More generally, New York State prosecutors have a reputation for being tough on white collar crime -- think of Elliot Spitzer. It's hard to believe that they would overlook "massive" criminal conduct, especially now that they have been under intense pressure for over two years.

I'm afraid that, once again, you're lost in your little world of conspiracy theories and such. :cry:

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby chiaroscuro » 03 Mar 2011 08:18

ghariton wrote:
chiaroscuro wrote:we have fraud and collusion on a massive scale and no one from wall street goes to jail.

Apparently prosecutors take a keen interest in what Wall Street bankers have been up to.Rajat Gupta, former Goldman Sachs director, faces SEC accusations. More generally, New York State prosecutors have a reputation for being tough on white collar crime -- think of Elliot Spitzer. It's hard to believe that they would overlook "massive" criminal conduct, especially now that they have been under intense pressure for over two years. I'm afraid that, once again, you're lost in your little world of conspiracy theories and such. :cry:
How can one argue with wise old george? Hmmm...one can ask why one of the most prolific posters on this board has avoided any comment on this graph even though it has been brought to his attention several times.
Image
As to Elliot, he was neutered a while back. We will be on the third anniversary of the market crash shortly and none on wallstreet has been convicted. George would like us all to believe that those billions and billions of dollars of bogus paper were created by accident...and who knew that it was crap paper? Certainly not wallstreet. :roll: George, you can be in love with the free enterprise system AND admit their are charlatans in the fold. You would think that keeping it pure would strengthen the free market system, that is unless you believe that free enterprise can not exist without unchecked fraud and trickery. :wink:
"Common sense is the collection of prejudices acquired by age eighteen." ~~AE
User avatar
chiaroscuro
Gold Ring
Gold Ring
 
Posts: 3042
Joined: 09 Apr 2005 09:56
Location: SW Ontario

Re: Bailout of the big 3, is it really such a bad thing?

Postby Brix » 03 Mar 2011 14:01

ghariton wrote:I still fail to see the leap from individuals' opinions on this forum/thread to corporate donations.

No leap necessary, as you provided a tempting stepping-stone:
A common misconception of the left [is] that the right is more motivated politically by self-interest than is the left.

And it's surely something of a commonplace to see labour vs. corporations as a major scene in any historical painting surveying the contest between left and right.

Admittedly I could have responded with conscientious reciprocity to your arguments about the distinction between bailouts and the mere provision of liquidity, the disparity re externalities, etc., but I'm currently rather pressured by business (yet wanting occasional release via other distractions such as this forum). My bad, and I apologize.
User avatar
Brix
Gold Ring
Gold Ring
 
Posts: 3249
Joined: 22 Feb 2005 13:29
Location: Victoria

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 04 Mar 2011 23:30

chiaroscuro wrote:comment on this graph even though it has been brought to his attention several times.
Image

Okay, I'll bite. The graph shows that, during the greatest housing boom in recent times, growth in private mortgages outstripped growth in GSE or government-backed mortgages. Then, once housing crashed, private sector mortgage lending dried up. So what? What else would one expect?

The role of Fannie Mae and Freddy Mac keep evolving. Again, that should be no surprise. Right now, they seem slated to disappear:

Life without Fannie and Freddie is the rare goal shared by the Obama administration and House Republicans, although it will not happen soon. Congress must agree on a plan, which could take years, and then the market must be weaned slowly from dependence on the companies and the financial backing they provide.

The reasons by now are well understood. Fannie and Freddie, created to increase the availability of mortgage loans, misused the government’s support to enrich shareholders and executives by backing millions of shoddy loans. Taxpayers so far have spent more than $135 billion on the cleanup.

The much more divisive question is whether the government should preserve the benefits that the companies provide to middle-class borrowers, including lower interest rates, lenient terms and the ability to get a mortgage even when banks are not making other kinds of loans.


none on wallstreet has been convicted.


Bernie Madoff?

Eric Butler?

Julian Tzolov?

James Davis?

I can't believe I'm wasting my time doing the Google searches you are obviously too lazy to do for yourself.

Sheesh.

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby chiaroscuro » 05 Mar 2011 01:36

"Common sense is the collection of prejudices acquired by age eighteen." ~~AE
User avatar
chiaroscuro
Gold Ring
Gold Ring
 
Posts: 3042
Joined: 09 Apr 2005 09:56
Location: SW Ontario

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 05 Mar 2011 03:23

I see. Bill Black, Ron Paul's new buddy. He claims that there is a huge conspiracy, headed up by Tim Geithner, and that : "This will destroy Obama's administration, both economically and in terms of integrity."

Gosh, I have had reservations about the Obama administration's competence, but I thought that they were well-meaning and relatively honest. Now Mr. Black -- and, by implication, you -- are suggesting that Mr. Obama is a crook lacks integrity?

Mr. Black also favours letting a whole lot of banks fail. Sounds like "Liquidate! Liquidate! Liquidate!" to me. I assume, from you linking to him, that you support him in this also.

So tell us, do you go to Tea Party rallies often?

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby chiaroscuro » 05 Mar 2011 05:36

The clip was posted to demonstrate that fraud and collusion happened on a massive scale. Your response to that notion up thread was:
ghariton wrote:It's hard to believe that they would overlook "massive" criminal conduct..
Now your last post argues for major collusion. :roll: You're waffling George and I'm not sure which side of you is speaking what you truly believe. Spell it out for me George...massive fraud or a series of unfortunate financial coincidences.
"Common sense is the collection of prejudices acquired by age eighteen." ~~AE
User avatar
chiaroscuro
Gold Ring
Gold Ring
 
Posts: 3042
Joined: 09 Apr 2005 09:56
Location: SW Ontario

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 05 Mar 2011 17:34

chiaroscuro wrote:The clip was posted to demonstrate that fraud and collusion happened on a massive scale.

Of course it shows nothing of the sort. Increasing one's volume of business, by itself, does not in any way imply fraud.

You're waffling George and I'm not sure which side of you is speaking what you truly believe. Spell it out for me George...massive fraud or a series of unfortunate financial coincidences.

Well, let's see. First you allege huge fraud by Wall Street in issuing mortgages. While there was indeed a lot of fraud in issuing mortgages, by and large it wasn't committed by Wall Street. While the banks were certainly negligent in not doing their due diligence, that in itself does not constitute fraud. (Otherwise, all of Bernie Madoff's clients should be charged with fraud.)

Next, you allege that nobody on Wall Street has been convicted of fraud in this recent episode. This time, you don't qualify this as mortgage fraud, so you must be talking abouty fraud of any kind. So I produced a few counter-examples. The counter-examples do not show massive fraud (which may or may not have happened). But they do show that your second assertion is wrong (as usual).

I must say I'm tired of trying to correct your mistakes. They are much too numerous. From now on, let them stand.

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby chiaroscuro » 05 Mar 2011 19:57

ghariton wrote:I must say I'm tired of trying to correct your mistakes. They are much too numerous. From now on, let them stand.
The hissy fit is par for the course of those on the far right. Rather than discuss and analyze points in their entirety and in a civilized manner, they seek to demonize their opponent and the facts laid out so they don't have to concede a point. Put a dollop of false indignation on top of it and sell it as the messengers fault. Isn't such behaviour not acting in a cowardly and bad faith way George? :roll:


Did you actually watch the video? Here are some facts from the video. It spreads the blame around but since you assume wall street is innocent I've collected the relative points for you.

Lehman's loans were fraud loans. Most of the frauds were induced by the broker. At Lehman's the former vice president Matthew Lee chief, hand delivered a letter spelling out the fraud of selling these loans to four higher ups at Lehman including the chief risk officer and the general council and the head of internal audit. Within a few days he was fired on the spot. Earnest and Young was also contact by Matthhews was also contacted and E&Y were obliged to report this but didn't. Instead E&Y gave Lehmans a "clean opinion".

Goldman Sachs lied to investors. Paulson created a "fail list" of loans. He rushed to get the seal of approval from ACA. The investors were told by GS to pick these loans as most likely to succeed because a competent independent overseer had recommended them. Furthermore after investigation all 7 key institutions were all found to also to be most likely involved with fraud.
"Common sense is the collection of prejudices acquired by age eighteen." ~~AE
User avatar
chiaroscuro
Gold Ring
Gold Ring
 
Posts: 3042
Joined: 09 Apr 2005 09:56
Location: SW Ontario

Re: Bailout of the big 3, is it really such a bad thing?

Postby chiaroscuro » 06 Mar 2011 15:40

ghariton wrote:
chiaroscuro wrote:comment on this graph even though it has been brought to his attention several times.
Image

Okay, I'll bite. The graph shows that, during the greatest housing boom in recent times, growth in private mortgages outstripped growth in GSE or government-backed mortgages. Then, once housing crashed, private sector mortgage lending dried up. So what? What else would one expect?
Thanks for sulking George...it allows me the time to correct your many misconceptions you spew to divert attention from facts. Allow me to correct your interpretation of this graph.

The inflection point on the graph happens in 03. The private sector increased it's share of mortgage backed securities by over 150% in 2 years while F&F's share drops over 40%. This is the time when lending standards deteriorated and one couldn't paint a clearer picture what was happening. Likewise one sees the banks in a great rush to off load all their bad paper that they floated and from 2006 to 2008 we see their share of mortgage backed securities drop by over 90% just before the housing crash starts. So george could you be more wrong? They create trash when the opportunity arises and then sell if off when the market is saturated BEFORE it crashed. George would like us all to believe it's just one of many unfortunate financial coincidences that happened during this era of fraud. Right George? :roll:
"Common sense is the collection of prejudices acquired by age eighteen." ~~AE
User avatar
chiaroscuro
Gold Ring
Gold Ring
 
Posts: 3042
Joined: 09 Apr 2005 09:56
Location: SW Ontario

Re: Bailout of the big 3, is it really such a bad thing?

Postby adrian2 » 06 Mar 2011 18:57

This post was made by chiaroscuro who is currently on your ignore list.

This post was made by chiaroscuro who is currently on your ignore list.

This feels good!
User avatar
adrian2
Gold Ring
Gold Ring
 
Posts: 9442
Joined: 19 Feb 2005 09:42
Location: Greater Toronto Area

Re: Bailout of the big 3, is it really such a bad thing?

Postby chiaroscuro » 06 Mar 2011 19:07

Crybabies of the world unite !!! :lol: Waaahhh you can't make me deal with facts!! :rofl:
"Common sense is the collection of prejudices acquired by age eighteen." ~~AE
User avatar
chiaroscuro
Gold Ring
Gold Ring
 
Posts: 3042
Joined: 09 Apr 2005 09:56
Location: SW Ontario

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 06 Mar 2011 22:12

adrian2 wrote:This feels good!

Yes. I apologize for having fed the troll for so long.

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby chiaroscuro » 06 Mar 2011 23:32

Bottom line is in the old wise ones really don't want to deal with facts for a greater length of time than to post a quick quip or two. Hold their feet to the fire on any issue and they become indignant. Grumpy old men they are. :wink:
"Common sense is the collection of prejudices acquired by age eighteen." ~~AE
User avatar
chiaroscuro
Gold Ring
Gold Ring
 
Posts: 3042
Joined: 09 Apr 2005 09:56
Location: SW Ontario

Re: Bailout of the big 3, is it really such a bad thing?

Postby chiaroscuro » 09 Mar 2011 08:52

ghariton wrote:Well, let's see. First you allege huge fraud by Wall Street
Yup, done.

ghariton wrote:Next, you allege that nobody on Wall Street has been convicted of fraud in this recent episode.

The New York Times has a different take.
So much for Angelo Mozilo taking the fall for the financial crisis. Angelo Mozilo, the former chief executive of Countrywide Financial. Prosecutors have found it tough to build cases against executives whose companies helped kindle the financial crisis. Late last week, word leaked out that Mr. Mozilo, who had co-founded Countrywide Financial in 1969 — and, for nearly 40 years, presided over its astonishing rise and its equally astonishing fall — would not be prosecuted by the Justice Department. Not for insider trading. Not for failing to disclose to investors his private worries about subprime loans. Not for helping to create a culture at Countrywide in which mortgage originators were rewarded for pushing fraudulent loans on borrowers.

Just months earlier, the Justice Department concluded that Joe Cassano shouldn’t take the fall for the financial crisis either. Mr. Cassano, you’ll recall, is the former head of the financial products unit of the American International Group, a man whose enthusiasm for credit-default swaps led, pretty directly, to the need for a huge government bailout of A.I.G. There was a time when it appeared that there was no way the government would let Mr. Cassano walk. But it did.

And then there’s Richard Fuld, the man who presided over Lehman Brothers’ demise. Though he was the subject of an investigation shortly after the Lehman bankruptcy, it appears that prosecutors are moving on. Most of the other Wall Street bigwigs whose firms took unconscionable risks — risks that nearly brought the global financial system to its knees — aren’t even on Justice’s radar screen. Nor has there been a single indictment against any top executive at a subprime lender.


...and compare this to the last time wall street screwed us.

In time, nearly 1,000 savings and loans — a third of the industry — collapsed, costing the government billions. According to William K. Black, a former regulator who teaches law at the University of Missouri, Kansas City, “There were over 1,000 felony convictions in major cases” involving executives of the thrifts. Solomon L. Wisenberg, a lawyer who writes for a blog on white collar crime, said, “The prosecutions were hugely successful.”

http://www.nytimes.com/2011/02/26/busin ... &src=busln

So yes George, no wall street executives have gone to jail. It's pathetic. :roll:
"Common sense is the collection of prejudices acquired by age eighteen." ~~AE
User avatar
chiaroscuro
Gold Ring
Gold Ring
 
Posts: 3042
Joined: 09 Apr 2005 09:56
Location: SW Ontario

Re: Bailout of the big 3, is it really such a bad thing?

Postby newguy » 10 Mar 2011 13:46

Here ya go chia.
http://www.businessinsider.com/scott-wa ... deo-2011-3

Holding up a pair of handcuffs and looking right into the camera, Moore had a message for those accused of bankrupting the country:
"Anybody that works on Wall Street, anybody that works for one of the banks, take a look at this, okay? Because this is what's coming.


newguy
User avatar
newguy
Gold Ring
Gold Ring
 
Posts: 7632
Joined: 10 May 2009 18:24
Location: Montreal

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 13 Mar 2011 20:52

The future of manufacturing in the U.S. (and, by analogy, in Canada), from Matt Yglesias (hey, I read left wing blogs too):

Obviously, it’s not viable for the United States to be a country in which no things are made. But the reality is that lots of products are manufactured in America:

What’s declined isn’t manufacturing output, it’s manufacturing employment. And I think it’s important to understand that there’s real arbitrariness in how manufacturing employment is defined. The security guard at a factory has a manufacturing job if he’s employed directly by the factory, but not if he’s employed by security firm that has a contract with the factory. Obviously, though, he has basically the same job (“security guard”) in either case, and it’s a job that has a lot in common with the security guard at the office building. If your job is to turn fresh green beans into canned green beans, you’re manufacturing. If your job is to turn fresh green beans into someone’s dinner, then you’re not manufacturing. But if people switch away from canned green beans to more restaurant meals, that’s almost certainly a sign of progress.


George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 02 Jun 2012 01:48

More on the success of the GM bailout:

The Canadian Auto Workers union says General Motors is going ahead with plans to close its consolidated plant in Oshawa, Ont.

The union says it's been told the facility — the older part of the Oshawa car plant — will close by June 2013 and says that could mean 2,000 layoffs.

<snip>

GM is scaling back its overall operations in Canada as part of a North American restructuring begun two years ago under bankruptcy court protection. Part of that process was an $8-billion cash injection from the governments of Ontario and Ottawa for ownership stakes in the new GM, something the union was eager to discuss on Friday.

Buckley pressed governments to pressure the company to reconsider, and ask what the taxpayers had gotten for their investment.

Opposition parliamentarians were quick to agree. "It's one thing for the company to survive," NDP MP Peggy Nash said. "If the jobs don’t survive here in Canada, it’s not much good to Canadians."

Liberal MP John McKay wants Ottawa to review the terms of GM's original loan. "They haven’t actually paid back the loan at this point," he said. "They have declared dividends, they have sold off shares and … the poor taxpayers of Ontario and Canada are left holding the bag."

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby DenisD » 02 Jun 2012 23:51

The Canadian Auto Workers union says General Motors is going ahead with plans to close its consolidated plant in Oshawa, Ont.
Caused by the Dutch disease, no doubt. :wink:
DenisD
Gold Ring
Gold Ring
 
Posts: 1709
Joined: 19 Feb 2005 02:24
Location: Calgary

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 19 Jan 2013 14:16

Andrew Coyne:

...the latest raft of government handouts to corporate Canada: $250-million to the auto sector in the form of a renewed federal contribution to the Automobile Innovation Fund, on the theory that automobile manufacturers should not be expected to innovate on their own; $400-million more in federal subsidies to the venture capital business — yes, you read that right, government-funded venture capital — to be dispersed through a handful of private equity funds. By this bit of sleight of hand the venture capitalists were persuaded they were still venture capitalists and not wards of the state, while the prime minister was persuaded that this did not involve the government in “picking winners.”

The economic arguments against this are well known, and have nothing to do with whether the recipients turn out to be winners or losers. The subsidies given to any one industry or sector come at the cost of every other: costs measured not just by the taxes they must pay, but in the capital, labour and sales diverted into the subsidized sector. Fading industrial dinosaur or high-tech start-up, the fact that a particular sort of enterprise cannot raise as much capital as it would like on its own does not make the case for governments to supply it: most often there is good reason for investors’ reluctance, namely the anemic returns they are likely to collect.

What’s interesting is the response of the proponents of these industrial handouts, whose ranks now include at least one former economist: not only do they fail to present any economic arguments for them, but neither do they offer even non-economic arguments — or not openly. Rather, they rely on a number of what might be called pseudo-economic arguments for why Canadians should pay (and pay, and pay) through their governments for things they would not pay for willingly.

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby ghariton » 27 Feb 2013 12:22

This is not about the automobile manufacturers, but rather about the U.S. fiscal stimulus, launched in 2009. Many of the projects were not ready to go, and it took some time before actual spending started. In telecommunications, there was careful planning, and so few projects actually started before the end of 2010. Here are some of the results:

Marmet, West Virginia is a town of 1,500 people living in a thin ribbon along the banks of the Kanawha River just below Charleston. The town's public library is only open Thursdays, Fridays, and Saturdays. It's housed in a small building the size of a trailer, which the state of West Virginia describes as an "extremely small facility with only one Internet connection." Which is why it's such a surprise to learn the Marmet Public Library runs this connection through a $15,000 to $20,000 Cisco 3945 router intended for "mid-size to large deployments," according to Cisco.

In an absolutely scathing report (PDF) just released by the state's legislative auditor, West Virginia officials are accused of overspending at least $5 million of federal money on such routers, installed indiscriminately in both large institutions and one-room libraries across the state. The routers were purchased without ever asking the state's libraries, cops, and schools what they needed. And when distributed, the expensive routers were passed out without much apparent care. The small town of Clay received seven of them to serve a total population of 491 people... and all seven routers were installed within only .44 miles of each other at a total cost of more than $100,000.

In total, $24 million was spent on the routers through a not-very-open bidding process under which non-Cisco router manufacturers such as Juniper and Alcatel-Lucent were not "given notice or any opportunity to bid." As for Cisco, which helped put the massive package together, the legislative auditor concluded that the company "had a moral responsibility to propose a plan which reasonably complied with Cisco's own engineering standards" but that instead "Cisco representatives showed a wanton indifference to the interests of the public in recommending using $24 million of public funds to purchase 1,164 Cisco model 3945 branch routers."


The government is not my friend.

George
The plural of anecdote is NOT data.

In God we trust, all others bring data (William Edwards Deming)
User avatar
ghariton
Gold Ring
Gold Ring
 
Posts: 9356
Joined: 18 Feb 2005 19:59
Location: Ottawa

Re: Bailout of the big 3, is it really such a bad thing?

Postby ockham » 27 Feb 2013 12:30

What about Cisco, is it your friend?? Just asking.
Though the dogs may bark, the caravan moves on.
ockham
Silver Ring
Silver Ring
 
Posts: 979
Joined: 04 Apr 2006 21:50
Location: The Prairies

PreviousNext

Return to Financial News, Policy and Economics

Who is online

Users browsing this forum: No registered users and 2 guests