My favorite way to find things to sell, though, is to scan the auction house for items that are, frankly, being sold too cheaply.  I buy them at the seller’s asking price, and immediately place them back up for sale at a higher price.  The price I sell for more closely matches the price that the market will bear.  Sometimes, I can multiply my investment several times on one item.

Not everyone looks at these tactics the same way I do.  More than once, I’ve been criticized publicly for selling “vendor patterns” on the auction house.  Vendor patterns can be purchased in stores around the Warcraft world by anyone, though some are fairly rare and may not always be available.  Some of these patterns can be purchased for a fraction of what they will sell for on the auction house.

Personally, I see the sale of vendor patterns and items in a different light than some do.  Some of these patterns are in areas that only high-level characters can visit.  The only way a low-level character can get these items is on the auction house.  Sometimes, you might travel a long distance to visit the vendor that sells an item, only to find that it is sold out.  By purchasing these items when I can, and selling them on the auction house for a higher price, I am providing a service to others.  They don’t have to travel.  They don’t have to risk the effort, only to find the item is sold out.  All they have to do is search the auction house, and buy.

When I choose to buy an item from a vendor, or on the auction house at a low price, I am accepting a certain amount of financial risk.  One recent visit to the auction house, I spent over 1400 gold on low-priced items. I then paid deposit fees to list these items again at a higher price.  The sellers of the items got their asking price with little effort on their part, even if the price was too low.  I placed the purchase price, and the listing fees, at risk.  If I can’t re-sell the items at the higher price, I lose that money.  The seller got their asking price.  No one is forced to buy from me at a higher price.  I am the only one taking a risk in this situation.  Some, though, consider me a bad guy for doing this.

There are other benefits to my actions.  By removing items from the auction house at prices that are too low, I increase the likelihood of higher-priced items selling.  Anyone else with those items for sale sees a better chance of making a sale, because the lower-priced competition is dissapearing at my cost.  I will be competing with them for a sale, but I will compete at prices that are closer to the market prices.  My actions benefit others who are selling the same items on the auction house, because they can get a better price.

There’s another great benefit.  I don’t just buy things on the auction house to resell.  I also buy things I need there as well.  If I find an item that would require a lot of travel to find, or a lot of questing to hope that it drops from a mob, I may just buy it on the auction house myself.  I can afford it, and don’t think twice about spending the gold, because I’ve taken steps to increase my available gold.  I’ve purchased many vendor patterns and items at higher auction house prices, simply because it was much more convenient to do so.

I’ve placed thousands of gold in game-wealth at risk, and provided great benefits in the game.  I’ve made items more easily available.  I’ve propped-up the market price and increased profits for others.  I’ve made many things conveniently available with little effort, and I’ve paid untold hundreds of others exactly what they asked for items I’ve purchased, making them happy for the sale.

Some consider me a bad guy.  That’s all right.  Some consider the oil companies bad guys for their profits.  Some consider healthcare companies bad guys for saving lives while making money.  Some consider McDonalds bad for selling food people want at affordable prices.  I don’t mind being in that group.

Plus, I want the mammoth.

First, we need to think about why the US auto industry is doing badly, while foreign automakers are performing better with US based plants.  A large reason for this is that the unions have, over time, gained far too much control over the automakers.

When most think about union involvement in the automotive industry, they think of the line-worker.  It isn’t unreasonable that automakers provide decent pay and benefits to those who make the cars. When someone talks about reducing the power of the unions, the automatic assumption is that this would mean lower pay and benefits for the line workers.  While that may be a side-effect of reducing union power, it’s not the area in which the unions need to be broken from the process.

The most cumbersome requirement of the unions is that the automakers rely on unionized vendors.  Let’s take brake pads, for instance.  If Ford has bids from three different manufacturers of brake pads, each capable of producing the same pads to the same standards of quality, they are able to make a decision on price.  Manufacturer #1 can create the brake pads for $20 per car in its North Carolina plant using non-union labor.  Manufacturer #2 can make the brake pads for $30 in Massachusets using some union labor.  Manufacturer #3 can sell their brake pads for $50 per car out of their Ohio plant using nothing but union labor. 

Given identical standards of quality and safety, the choice is easy.  The North Carolina manufacturer gets the contract.  In Detroit, this isn’t allowed.  Union contracts require that the parts that go into the cars be made by union labor.  This means that each part of the car costs more to produce than it should, thus driving up the price

It’s the extraneous requirements on the contracts that have to go.  The best way to do this is the bankrupcy process.  Bankrupcy proceedings could allow the big-three automakers to renegotiate these contracts.  The end result could, and should, be reduced manufacturing costs per car, and therefore a lower cost per car.

Lower prices per car would increase sales, allowing for profitability.

Lower prices aren’t the only answer, though.  In order to be able to sell the cars, the automakers also have to be able to make cars that people want to buy.  That’s easy enough, isn’t it?  A little market research, good design teams, and quality engineering should be able to produce the cars that America wants.

Wait a minute, though.  That isn’t how it works.  Thanks to the US Government, the automakers can’t just produce what America wants.  The greatest impediment to this is called CAFE standards.  CAFE stands for Corporate Average Fuel Economy.  In short, the CAFE standards say that each automaker must produce CARS with an average mileage defined by the government.

Notice the emphasis on cars in that last sentence.  That’s important, and I’ll get to why in a moment.

My parents love their Mercury Gran Marquis. It’s not a gas hog, but it isn’t going to get any awards for economy, either. The estimated miles per gallon on the highway is 25mpg. This is below the government’s CAFE standard rate of 27.5mpg.  In order to compensate, Ford must produce cars that exceed this standard.  The Ford Focus exceeds this standard.  Unfortunately, the Focus is a tiny car that, quite frankly, wouldn’t meet my parents needs in a car.  By averaging the fuel economy across the full production, the automakers try to keep the number below 27.5mpg.  If they exceed 27.5mpg, they pay civil fines.

Personally, I love my Mustang.  If I change the plugs and wires, and buy a new air filter, it should get more than 27.5mpg.  It is, after all, a six-cylinder model, and I drive conservatively.  I’d really rather have a V8, as I’m sure many other people would.  What happens, though, if  the automakers find that there’s more demand for the V8 model, and other less fuel-efficient automobiles?  They either follow the CAFE standards and make cars that are in less demand, or they pay fines on their cars and pass the costs on to the customers.

There is another answer.  You see, the standards for light trucks are necessarily lower than those for cars.  People in need of more space for their family, more cargo room, more pulling power, or safer cars (CAFE standards kill, but that’s another post and a radio interview I gave several years ago) have to buy a light truck, instead of a car.  The intersection of needs for more car and a family-friendly format created the surge in SUV sales.

The SUV turned out to be the best way you could get a “real car” in the current regulatory environment.  A new format, the crossover, still qualifies as a truck while providing better fuel economy to meet the light truck CAFE standards of 22.2mpg.  They’re lighter, and less safe than the SUV, but still provide more than that little Ford Focus in room and carrying ability.

So, the second thing that should be done is to abolish the CAFE standards, and allow the automakers to create cars based on customer demand, rather than government mandate.  Let’s face it, letting the government decide what you can and cannot buy has never been a good idea.  For the automakers, it’s been a disaster.

Thirdly, the government should reduce taxes on the auto manufacturers.  The fact of corporate taxes is that the companies have to pay the taxes out of money they get from the consumers.  If you buy a car, part of the cost of that car is taxes paid by the company.  Corporations DO NOT PAY TAXES.  Their customers pay them in the price of the products consumed.

The government should, therefore, start a 12 year tax reduction plan for the automakers.  For the first two years, corporate income taxes on the big three should be reduced to zero.  That’s right, they should pay no corporate income taxes.  The savings should be taken out of the price of the cars, thus allowing consumers to buy new cars at lower prices.  After the first two years, the taxes can be put back into place in 10% increments.  At the end of 12 years, the corporate tax burden would be back where it was in the beginning.

Of course, reducing or abolishing the corporate income tax isn’t just a good idea for the car companies.  It should be done across the board.  Corporate income taxes should be abolished entirely.  The best way to demonstrate this is to experiment with the auto industry in their time of need.  It would be a great benefit to the manufacturers, the employees, the consumers, and the economy as a whole.

Three simple steps.  Reduce costs by reducing union controls over every aspect of the big three automakers.  Remove the crippling restrictions that government has placed on the industry, and allow the companies to create cars that people want for a change.  Finally, cut the unnecessary cost of government out of the automakers’ bottom line by cutting their taxes to zero for at least a short time.

If, after all this has been done, a loan is needed to get the companies past the short run, then maybe that can be done.  Just don’t add on extra requirements that hurt their business like demanding they make certain types of cars, or disallow dividend payments for stockholders.  That’s just more stupid government micromanagement, and that’s been half the problem the automakers had in the first place.

First, you’ll have to set the stage for what is to come. Over the next few weeks, you’ll be giving speeches on a variety of topics. Make references to the current economic client. Use phrases like “researching to determine what we can afford,” and “economic realities.” Make it clear that, while your tax plan represented an “ideal plan based in the realities of the moment,” the “current realities” will require that all options be placed on the table.
Now, the tax cut plan you laid forth has three basic brackets.
* _The Poor _- Their “tax cut” amounted to receiving money that they never paid. Giving money for nothing is the best way to buy votes for a re-election, so this “tax cut” is a must.
* The Rich – You never promised this group a tax cut anyway. In fact, you promised to raise their taxes. Keeping this promise will prevent, or at least slow, economic recovery. Keeping this promise will cause job loss, or at best a slowing of job creation. Nonetheless, a promise is a promise, so taxes on the rich will have to go up. The top 25% currently pay 86% of taxes. With tax increases, and the impact on the economy to go with it, this percentage may be about to fall. That leads to:
* The Middle Class – Let’s face it. This block is the hardest to deal with in writing a tax plan. They actually make enough money to pay taxes, unlike the poor. Unlike the rich, they only pay a small portion of the total tax burden. The 86% of the tax burden paid by the top 25% of taxpayers would be higher if we could just make them richer, but higher tax rates will do the opposite. That places the burden on the middle class to make up the difference. You’ll say how sorry you are to do it, but then as President, you’ll drop the middle-class tax cut just like you always planned.
The important aspect of this is that you must create the image that you’re fighting for that tax cut. Tell the middle-class how important they are. That’s what they want to hear. All the way to inauguration day, you’ve got to tell the american people how important these tax cuts are, especially to the middle-class.
Be careful, though. While you have 100 days to show how much you can get done, you don’t want to drop the idea of the middle-class tax cut in the first 30. Two months in should be enough time to wait before dropping the bomb.
Clinton moved too quickly in telling the truth about his middle-class tax cut plan. He talked about “revisiting” the plans, and how he was “mystified” that the media somehow believed the middle-class tax cut to be a part of his “big plans” after he had talked about it the entire campaign
You’ve got to slow down. After the first 30 days, you’ll have some positives to build on, and you can drop the news of there being no tax cut for the middle-class at 5:30pm on a Friday. That way, the news media will have a hard time reporting on it until it is old news. Most of the weekend shows will already be taped by then.
I know you can do it. Heck, it’s not like you don’t already plan to drop the middle-class tax cut from your plan already. It’s the implementation of this move that’s important, if you want to solidify yourself into America’s future as a great President. Unlike Bill Clinton, you have to lie to the people without them calling you a liar.
Hey, with how well you hid your past during the election, this should be a breeze.