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Perhaps the republican party is going back to their roots. Time will tell.
Wow, finally good news. How about we just put the rest of the 700 billion in a mattress and know that it didn't lose value.
Yay! Let them fail. Some smart new guys will buy that equipment and hopefully start a company that is profitable and makes good products.
"The financial straits that the Big Three find themselves in is not the product of our current economic downturn, but instead is the legacy of the uncompetitive structure of its manufacturing and labor force," Mr. Shelby said in a statement. "The financial situation facing the Big Three is not a national problem, but their problem."
I couldn't have said it better.
Good, let them fail. They've resisted every saftey innovation from seat belts to air bags. They've filled our skies with pollution from their low mileage cars and filled our streets with dangerous over-sized vehicles. Now they want a handout? to produce more of the same crap? Sorry, no. Don't let the door hit you on the way out.
The problems for GM is that they spend something like 2400 bucks from each car on Health insurance. The foreign automakers are not unionized and do not encounter these problems.
How about we go bust up the unions in these shops so that there is money to be innovative. This story is deeper than most on here even know. GM is a retirement company and if they go under then there are millions of unemployed and millions without their retirement benefits.
Good Jorb!
UAW is to blame. It's also the reason why American car companies can't compete with their foreign contemporaries.
Solution 1: Union busting. It would take someone with giant brass balls. Not likely to happen.
Solution 2: Auto makers move to states that are more business friendly and less union friendly.
Solution 3: Bankruptcy for all. Thereby de facto union busting. Set up shop all over again with consumers and investors in mind. I have a feeling they'll be able to find workers.
I'd rather give someone the $700 billion to start a new car company that doesn't make giant gas-guzzling piles of shiny suck.
@Bladefist: If the 700b bailout bill's popularity among House Republicans was any indication, they're only waiting for more pork to be added for their home districts. Besides, it's too early for them to have finished soul searching -- they're still trying to decide on a suitable scapegoat for last week.
@mattshu: UAW's been around longer than the manufacturers have been asking for alms. I think your analysis of causation is missing something.
About damn time they stopped shelling out free money to every company that can't make decent products or run themselves well. If only we'd thought of this sooner.
I don't understand why we don't just buy a controlling interest, stop production, and pour money into R&D. They're already not selling cars, so why try.
Spend a year, use the governments money to develop cars that actually work (IE are affordable and efficient) and then let the (now profitable) business go on it's merry way.
Meanwhile, the government profits from both taxation and dividends. problem solved.
Oh, and fuck the unions.
Looks like the auto industry needs to prop itself up on someone else's matchsticks.
@Red_Flag:
Yeah those are possible candidates, but HOPEFULLY, some enterprising new US company emerges. Maybe we should use that bailout $$$ to stimulate new production business in the US and A.
@m4ximusprim3: and yes, it's is a contraction for "it is", which doesn't make any sense in that context.
I'm a jewish grammar nazi.
@The_Red_Monkey: About those retirement benefits? Ya. My dad is 83 and has cancer and GM cut off his retiree benefits for him and my mother. I think it's horrible. Then they go and try to kiss and make up by having some 3rd party company "help" people figure out what health insurance to buy to replace GM's with. Well, that was a disaster too according to my mother. Funny thing is, nothing was ever seen in the news about this other shoe dropping; I read it on a a blog from the UK and forwarded it to her. GM thinks they are doing well by giving retirees an extra 300.00 to cover what they have to pay out for their own health insurance but they don't mention that those funds are taxable. I'm happy the bailout is most likely a bust for them. Karma comes around when you treat your staff like crap.
@Bladefist: If by, "returning to their roots", you mean, "shoveling uncountable amounts of laxly supervised cash to reprobate financiers, banks and military contractors while turning their backs on working people", then yup. They sure have.
Good to see they're consistent.
Not that I think there should be a bailout. The Big Three chased after ever-larger SUV models while ignoring quality, value or mid-to-low sized vehicles when it was painfully obvious this was a stupid, destructive and ultimately flawed approach.
Let 'em use our very fine bankruptcy laws to dig themselves out. Hopefully one of them will be seized unwillingly by a Japanese firm, their management team eviscerated to better serve as an object lesson that focusing only on the short-term results in ruin.
Well, seeing as how I work for an automotive supplier, I guess I'll be out of a job as of Jan. 1. Thanks to all who are in overwhelming support of myself and millions of others being out on the street while AIG executives are getting mani-pedis. Happy 2009!
@Trai_Dep: I still cant read your whole comments. You're too hateful to present a objectionable comment.
@The_Red_Monkey: Wow, nice dodge that didn't mention that the foreign companies don't have to pay employee health insurance because their citizens are the happy recipients of single-payor healthcare.
So I guess that you're coming out in favor of one for the US? Yay!
@tedyc03: You obviously don't live in Michigan. Letting the Big 3 fail will, in effect, idle 1 in 10 workers in this country. Think things are bad now, just wait.
@The_Red_Monkey: Actually, it's closer to $4000.. However, the last contract negotiations had big cuts to wages & benefits for new workers and unions made huge concessions.
I do not work for the auto industry and I'm not in a union, but I live in metro Detroit and I can see how letting the Big 3 fail will affect every business around here. As I said in a previous response, 1 in 10 jobs in this country are connected to the auto industry.
@technopimp: Well said! It's kind of sickening to read the comments on this thread and see how little these people care about the "little people" that will get hosed if this happens. They obviously aren't considering the people who have built businesses around the auto industry. We're talking suppliers, restaurants and bars, dry cleaners, day care, grocery stores, schools, the list goes on and on. Not only that, but they can't go anywhere because they can't sell their homes.
@Trai_Dep: Obviously those wouldn't be their roots, that would be the failed Bush "Compassionate Conservatism", aka beat the Dems at their own game. Convserative roots would not have spent all that money, voted for the $700B bailout, nor likely invaded Iraq. Check out Ron Paul for someone who is pretty rooted in true conservatism (albeit a little wacky in some areas).
@Red_Flag: The cries of "darned unions" from the Freepers is wryly amusing. No one looks at the stupidity and short-sightedness of the Captains of Industry and says, "abolish Capitalism". Even though it was the leaders, and their ineptitude, that caused the ravages racked on the United States.
Nope. Nope. Nope. It's gotta be the fault of that guy making $20/hr lucky enough to have bargained for a health care package running machining tools that make car doors. Yup. Totally his fault. Every last bit of it. Uh huh.
@Trai_Dep: Do you know about Japan's health care system? It's not single payer:
"The Japanese healthcare system is highly regulated by the government and, as described by the OECD, "combines a mainly private provision of services with mandatory health insurance. Service providers are paid directly by insurers (the third payer system). Payments for outpatient care are predominantly on a fee for service basis, and inpatient care is paid through a mixture of per diem and fee for service." --[www.medhunters.com]
@m4ximusprim3: They actually TOOK billions of dollars of our money to supposedly crack the hybrid car nut. Then frittered it away making their cup warmers and DVD players run off their "hybrid" battery system.
They had their fun. Lotsa laughs. Let Chapter 7 sort 'em out.
@ technopimp - It happened to the horse & buggy business, it happened to the typewriter business, it's kind of happening to the brick & mortar retail business now. Times change, and with that the products that people want / need. Giant oil-guzzling SUVs are not in fashion now, so it's no wonder American car companies are suffering. If only they would have some foresight to really research electric cars, or better hybrids.
I feel for your plight, but we would live in a really crappy world if no companies ever went out of business. Everything would be old tech, and not what consumers really wanted...
You guys suck. Listen, I'm a Libertarian at heart, but these guys have been paying their due for decades. Not in corporate taxes, but in property taxes, payroll taxes, inventory taxes, and their employees and dividends have been taxed and taxed and taxed. When some worker -- his fault or not -- is canned, he can often claim unemployment benefits.
This isn't just about a couple of rich CEO's or heavy stock holders, but the lives of 5,000,000 "small people" like you and me. The intent here isn't to save three companies, but to save a friggin' significant portion of the US economy. You can say, "it won't affect me," but chances are, it will affect you in some small degree. This isn't just "Detroit"; if you don't know that, then you need to educate yourself.
There are strings attached. Checks and balances. My God, all of you nay-sayers have no idea what you're wishing for when you say you want them to go under. This is at least as significant as the credit crisis.
@mattshu: The unions don't need to be busted. The unions are doing what they are supposed to be doing, looking out for their members. (Do you like your 40 hour work week, thank the unions, btw, and no, I'm not union). What the big auto companies need to do, is be a little stricter with the unions. Do away with "earn your final salary the rest of your life, and your spouse gets it after you die" and go to 401k type plans, like most other businesses went to quite some time ago. The pension worked great when life expectancy and medical costs were what they were decades ago. The huge amounts per car that go to benefits for retirees is a promise they made, and they need to keep it, however, they don't have to keep making the promise to new hires. If they were smart, when they were making money hand over fist, they would have stuck billions in an account to pay for those pensions, and let it collect interest.
They also need to get the unions to back off on automation, the unions are against it, since it takes away members. Automation is why we can't compete with so many other countries cars. We have so many more people manually doing things.
@Counterpoint:
Thanks...that should comfort me come the middle of January when my key card stops working. Hey! At least there's new technology I can buy with all my hard-earned money...oh, wait. :(
@balthisar: Sorry, dude. The Big Three may be just victims of bad timing, but if all the pawns and peons of the 'evil' finance industry deserve to be on the street than so do autoworkers.
@technopimp: It's economic Darwinism. Adapt or fail. It's harsh, but kind words won't but food on your table. If you know January is going to be rough, that gives you two months to start learning a new trade after work. Or more likely, taking your talents and applying for jobs in a different field.
@balthisar: No one (I hope) wants them to fail, but it's better than the alternative of allowing the government to partially own them. The end of the Big 3 automakers is far more preferable to the end of American capitalism.
Wait till we have 10-12% unemployment because the big three shut down. We are looking at the difference between a 50 billion loan and the economic and social consequences of putting 2 million people on the street.
American capitalism didn't end when the government bailed out Chrysler. I'm glad they did. Our Jeep has 120K on it and is a reliable vehicle. BTW the Govt. Made money on that deal. Isn't that what capitalism is about?
@ageekymom: a vote against the bailout does not mean the big 3 will fail.
[www.cnn.com] gives a good argument against the bailout
@starrion: As I understand it, the government didn't make any money on that "deal," we just didn't lose any. What happened was, the government guaranteed investors who loaned Chrysler money that the government would pay back the investors if Chrysler couldn't, thereby letting Chrysler borrow money at a lower interest rate than it could have otherwise.
i'm not going to say that i'm for a bailout for automakers - i'm not sure that i am. but i came across a documentary last nite on hbo - Dirty Driving: Thundercars of Indiana. anyone who thinks we should all just sit by & let the american auto industry tank would do themselves a service to watch it.
the program follows a few sub-nascar drivers & their families in anderson, indiana - a once flourishing town that is disintegrating as local auto plants shut down. it gives a good perspective of how reliant midwest towns are on the automakers.
as the plants shutter, for sale signs pop up all over town, local retail businesses start to go dark & soon entire sections of the town are vacant.
we need to do something. maybe writing a big check isn't the answer, but we should be pumping some money into those mills. perhaps credits for fuel efficient vehicles? perhaps subsidies to develop & mass produce NGVs? something...
The government is pouring money into the financial sector for the specific reason that they resume lending. Is there any reason why automakers can't go to the banks for a loan instead of lobbying the government? If banks aren't willing to lend money, then they are breaking their promise to the taxpayers by taking the money in the first place (Which wouldn't surprise me)
Thank God.