Why GM, Ford, or Chrysler going bankrupt is a very bad thing

[AllentownJake]

1) They have employees. Union employees with good wages.
2) They have suppliers. Parts manufacturers in the US with guess what more union employees
3) They have a substantial Pension liability. If they go under that liability is transferred to the US tax payer via the Pension guarentee corporation
4) There are small businesses (dry cleaners, coffee shops, gas stations, Fast food franchises, restraunts, beer distributers, grocery stores etc.) that make their money of their workers. Workers have no money small businesses go out of business
5) They may have been behind the curve with fuel efficiency but they have amazing vehicles in development. They go out of business you run the risk of oil companies buying the patents in bankruptcy court and destroying the research. Remember Toyota and Hyundai are hurting now too. The only companies who have been doing ok and stock piling cash have been the Exxon Mobils of the world.
6) Cars are one of the few things that we still make
7) Housing crisis bad now? Imagine 10% of the population with no income.


Feel free to add.

[blondeatlast]

1. Iacocca honored his contract with the American people--I don't think the execs are worthy of that

kind of trust now.

It's a bitter pill to swallow. Chrysler was honorable and paid back its loan,saved thousands of jobs, and wised up about their management.

I'm not sure there is that kind of responsibility in the executive offices now. Iacocca was very public both in apology and reassurance--for a while he spent millions on ad time just to make Americans understand he was putting that money to good use.

At this point, I'm watching and waiting.

[maxsolomon]

2. so keep doing what's not working because we can't afford to change?

i'm getting tired of waiting for 'amazing' vehicles. remember the jetpacks we were promised?

[AllentownJake]

4. Ok in the midst of a financial crisis

lets cause 10% of the workers to get laid off and lots of small businesses to go out of business.

See you in the bread line.

[msallied]

9. Do you really think a bailout is going to solve their problems?

Really? My god... Look at the fine print here. Unless GM can get their labor costs subsidized, they're going to fail no matter what.

[AllentownJake]

15. Temporary fix

to keep people employed while we weather this storm.

Its either that or take on 2.5 million workers and all the downstream people onto welfare rolls.

[msallied]

19. When your boat is full of holes, at some point you have to jump off.

We're at that point. We can't save the boat by throwing money at it anymore. People are already losing their jobs.

[AllentownJake]

23. This really isn't a debate over a great idea or a bad idea

its a terrible idea or a catostrophic idea. I don't like it but 2.5 million people out of work at a time when there are no jobs to be had and getting a loan for re-training is impossible could plant the seeds of facism. I'd rather keep people busy and fed till we have the ability to address the fundamentals.

[msallied]

27. Yeah, and you trust that the CEOs would use that money wisely, eh?

What did the Lehman Bros execs do when they got their money? I seem to remember hearing about junkets and such. You give the money to the top dogs and just see if it makes it down to the lower part of the totem pole.

[AllentownJake]

43. We will have a different President on 12:01 January 20

Have a little faith in the guy we elected.

[msallied]

48. And what is Obama going to do exactly?

He isn't Jesus Christ.

[AllentownJake]

58. Ummm

Maybe hold people accountable. We have this wondeful thing in the executive branch called the Justice Dept. You should read up on it.

[msallied]

64. Your sarcasm is duly noted.

I'll believe it when I see it, however. I haven't seen anybody in the corporate world or in government held accountable for anything since I've been old enough to pay attention. Obama's an idealist and I think he's gonna try like hell, but I think the game is too big and too dirty for even the best of men to win anymore.

[AllentownJake]

72. Your almost RW sounding hatred of unions

has been noted as well

[msallied]

82. I'm sorry I'm not sycophantic enough toward unions for you.

If the concept of corrupt and greedy union bosses hurting the workers they're supposed to be protecting is news to you, then you really haven't been around much.

The union bosses in conjunction with the corporate idiots have made it IMPOSSIBLE for the companies to remain competitive. There is no reason in the world a company that is expected to make over 12 million unit sales this year should still be going under. It's happening because of egregious mismanagement and corruption that has been going on for DECADES. And you want to throw more money at them. Jesus. The 2+2=5 logic is overwhelming.

[AllentownJake]

85. FreeRepublic is

over here
www.freerepublic.com

find plenty of like minded souls for a discussion on unions and their evil bosses over there.

[msallied]

98. Wow. You really are a simpleton. Maybe YOU need to be over there.

I'm sorry, sir, that I didn't follow the Democratic mantra line for line that says if I don't agree with every plank on the Democrat platform that seems to include giving fellatio to corrupt union bosses, then I must be a Republican.

I guess corruption is okay if it also happened to provide swag for the DNC.

[AllentownJake]

104. Your experience with Unions

seems to come from working at a bar.

Unions get screwed more than they screw people. There are bad apples in every group however comparing the bad union boss to the CEO is laughable. Talking to you is like talking to Sean Hannity.

[msallied]

116. Why? Because I disagreed with you?

Grow a spine. I apologize for having a different opinion from you. You are clearly superior to me. Your strawmen are, after all, much bigger and such.

[PassingFair]

124. No, because you sound like Sean Hannity. n/t

[AllentownJake]

125. No because

generally the only time I generally here vitrolic hatred of union workers is when I'm

a) amongst my few GOP friends
b) listening to talk radio

[Every Man A King]

145. Democrat platform or DemocratiC platform ????????? n/t

[Doityourself]

143. WTF! n/t

[bahrbearian]

11. Too Much Debt got them in the mess,

you think more Debt will make things better?

[maxsolomon]

16. if the auto industry gets a bailout, why not the housing industry?

i'm in danger of losing my job also, so i'll be able to save you a place in line. but no one's going to pump money into architecture firms or developers, are they?

i get that we have a huge number of the populace dedicated to maintaining an unsustainable business model. so IF something along the lines of Friedman's suggestions in today's NYT are imposed on the auto manufacturers, MAYBE. but they've got to change, and the longer it takes, the more it will hurt.

[Kalyke]

10. Because that's not what it is

The loans would be used to help General Motors Corp., Ford Motor Co., and Chrysler LLC retool their factories to produce cleaner, more fuel-efficient vehicles as required under an energy bill passed last year.

http://www.mlive.com/business/index.ssf/2008/09/support_of_mccain_obama_buoys.html (oldish article, but explains the loans)

[KansDem]

150. "i'm getting tired of waiting for 'amazing' vehicles."

I remember during the gasoline shortages of the 1970s how Detroit started building smaller cars. In fact, I remember a Time or Newsweek cover that said precisely that: "Detroit Thinks Small" with a photo of one of the smaller cars Detroit was making. I believe some of these cars were getting something like 30-32 miles per gallon.

Now we have Detroit promising "35-mile-per-gallon cars" in 10-15 years(?) I mean, where the hell were they during the last 30-35 years? It seems they're always promising fuel-efficient cars in xyz number of years.

One would think they read the writing on the wall back in the 1970s, but nooooo...they had to make gas-guzzling SUVs and Hummers. And they had to have Bush push for a tax credit of $100,000 as an incentive to buy them.

[Tatiana]

3. We are talking about 2.5 MILLION American workers here.

There aren't enough public works projects we can get off the ground to employ all of those people.

We have to do something. And honestly, I would rather we have focused on bailing out the American auto industry (with any assistance tied to going green and producing more fuel efficient vehicles) than the banking leeches.

[AllentownJake]

7. Union workers as well

Killing off the auto unions would be a nice feather in Bush's cap for himself and probably why he isn't playing ball as much.

I have no sympathy for management but if we are saving the Yaley investment banker surely we can save the Union guy. Probably cheaper to save than the banker with more long term effects anyway.

[msallied]

13. The unions screwed their own company.

I grew up watching those guys make $30 bucks an hour sitting on an assembly line and then go drink six packs for lunch. And then pull those massive paychecks even when they were laid off or not working. I'm all for unions, but give me a break. When a company has to tack on $1500 to the cost of every vehicle just to keep its union workers happy, there is a PROBLEM.

[PassingFair]

44. $30 bucks an hour!!!!1!

No one should make a living wage like that!

:sarcasm:

In your happy world, everyone will be selling
cell phones to each other for $10.00 per hour,
and migrating south because homes and heating
are beyond the average worker.

Your attitude doesn't surprise me, with your
scary picture.

Rahm Emanuel = Lee Atwater

[msallied]

54. Oh whatever.

The truth is the fucking truth. I am fine with people making those sorts of wages if they aren't getting drunk on their lunch breaks and returning to the plant to make a shit product for one thing. For another, I'm PERFECTLY fine with people making that kind of money when they're ACTUALLY WORKING.

[PassingFair]

73. Yes, all the auto workers I know get drunk off their asses at lunch.

Hell they drink ON THE LINE!!! THEY ALL DO!!!1!

And Mexicans are filthy thieves!
And Jewish people are usurers!
Chinese people are bad drivers!

Got any other "fucking truths" you want to add
to your drunken auto worker caricature?

[AllentownJake]

76. You missed the Irish

[PassingFair]

86. She already used the "drunk" thing...

;)

[AllentownJake]

88. Didn't use the fighting thing?

[PassingFair]

93. Hadn't thought that far....

Errata:

Don't forget the
pugilistic Irish!

:hi:

[Bozita]

84. Some people say that some of the drunk workers put moonroofs on the trunk lids

I know a guy who has a friend who bought one of those cars.

[PassingFair]

96. I heard the drunk workers threw up in the glove boxes!

Cristal and cheeseburgers!

[Bozita]

118. Other people say they bring food scraps to work and stuff it into the door panels.

Bet you never heard of that in a Toyota plant.

[PassingFair]

119. Those non-union Toyota workers are tee-totalers.

They are vegans who value every scrap of food.

On Edit:

I hear they are very CLEAN.

[msallied]

94. I saw it with my own two eyes.

I'll tell you something. I never said that the unions don't have a place in the American workplace, because they do. But they can get just as big and corrupt as the companies themselves, and they tend to breed a sense of complacency among workers once they get fat enough. If you knew that even if you got fired, you would still be drawing a paycheck because you paid a special club run by thugs to protect you, then it's not too hard to understand why the bar I once worked at that was adjacent to a GM plant would fill up with assembly line workers at lunch time.

[PassingFair]

99. Did the dirty drunk bastards sully you with their salty language

...and leering looks?

I'm proud of our "thugs".



I LIKE weekends.
I LIKE health care.

[AllentownJake]

100. My dad was management at a technology firm

and he drank during lunch time as well. Two vodka martinis everyday. BTW he wasn't the only one at that bar it was filled with everyone from mid-level management like my dad to low level executives and line workers. The worker bees just went to the bar...my dad had lunch so he sat at a table.

If a person has a drinking problem they have it regardless of whether or not they are in a union or not.

[Bozita]

103. Why does your DU profile list "vodka" as one of your hobbies?

[AllentownJake]

107. OMG She's with the UAW?

:rofl:

[Tatiana]

122. Could you BE any more STEREOTYPICAL? Really. Think about what you just typed. n/t

[Bozita]

65. Yup, the labor unions are the cause of the entire fucking economic meltdown.

Give me a break.

I'll bet the UAW sent suicide bombers to sit at the negotiating tables. That's how it all happened.

[msallied]

66. Not all labor unions. But corrupt and greedy ones, yes.

[Bozita]

70. Please list the corrupt and greedy ones. How did Bushco avoid going after them?

[AllentownJake]

69. Those coal mining unions are responsible for the energy crisis

all their talk about "safety" and "worker's health." You know how much we could save if we deregulated? They are killing the American people with high energy costs! :sarcasm:

[JohnnyRingo]

102. Good one.... Don't ask for a living wage, demand that others earn less.

The unions worked hand in hand with the automakers for 50 years to everyone's benefit. It wasn't until the late '70s, when the companies wanted to outsource that suddenly, the unions began breaking their backs with "unreasonable demands".

I'm not mad at you, but I hear people all the time who don't understand union history carp about how they earn too much compared to themselves.

When I started at GM in 1972 I earned $6.50 an hour, and a new Camaro cost $3,000. When I retired in '03 I was making four times that amount, but the cost of that new Camaro escalated by nearly ten times.

Do the math, and refigure who's draining the automakers.

[PassingFair]

111. And they don't even have ....wait for it....

college degrees!

The sentiment is pure envy and hostility.

When things get REALLY bad around here,
they start going after the teacher's unions,
too.

Filthy drunken teachers!

Making $25.00 an hour!

Outrageous!

[Every Man A King]

134. wtf n/t

[Tatiana]

21. Absolutely. Which is more than we can say for the foreign automakers with plants in the US.

This is one of the last things this country actually MAKES. We allowed so much of our manufacturing sector to be outsourced to China, Indonesia, and other countries overseas.

We have to do something. The United States can be a leader in the auto industry again. We just have to force them to turn in the right direction. Overseas the Ford Focus is actually a very popular vehicle. Imagine if Ford made first electric car. We have to give them the tools and incentive to do so. Basically produce what the market demands or you go under.

They don't have a choice. Merging is not going solve anything. They're all going to either produce for the future or die off and be replaced by Toyota and Nissan.

[StreetKnowledge]

156. Electric Cars AREN'T VIABLE

How often can I say this? The battery technology for electric cars to be viable replacements to internal combustion engines DOES NOT EXIST. It's many years away, if ever, and would require building tens of thousands of charging stations. Decades away, at best.

Focus on making more efficient gasoline and diesel fueled cars for now, go to electrics later. Need oil for that? There is a process called Fisher-Tropsch synthesis, which turns coal into synthetic crude oil. How about funding the building of these in the American coal belts? Then we can shower Appalachia and the Rockies in money instead of showering the Arabs in it.

[blondeatlast]

14. Agreed as long as we get guarantees from the management--and that they talk

with the unions, too.

Had Detroit had more foresight I still think this would have happened; it's an inevitable fallout from the credit collapse.

The Chrysler bailout worked because Iacocca was honorable and took his responsibility for that money very seriously. I don't think we can say that of the dunderheads in Detroit's cushiest offices anymore.

[Tatiana]

39. Oh I am positive that we will get guarantees (at least under an Obama administration)

Now that the public has seen the fruit of the banking bailout, they will not stand for risking taxpayer dollar without getting something concretely beneficial in return.

[msallied]

5. A check from Uncle Sam isn't going to fix the Big 3's problems.

The problem isn't localized. The industry has been hemorrhaging money for decades due to the fact that their labor and legacy costs are too high and they have been building gluts of cars that people aren't buying. GM's healthcare costs tack on $1500 per vehicle! They are paying over 2 million retirees. Toyota's healthcare costs are about $400 per vehicle.

Their business models were built on mudflats and they are finally sinking. No bailout is going to help them become profitable again. They hedged all their bets on what would make them the most money at the time, when gas prices were low. They're lower now. What do you think is going to happen when the economy picks back up again? Energy prices will rise with it.

We can't save them. Yes, people will lose their jobs. But those people will go on to get other jobs with companies that aren't going to screw them (and the rest of America) where the sun doesn't shine.

[AllentownJake]

12. Really

Pray tell me who is hiring in America and where the investment capital is for these new jobs and the education and training for them at this point in our history.

If this was 1997 I'd be more prone to agree with you.

[msallied]

17. Millions are already losing their jobs.

And a bailout is NOT going to rescue them. Either way, the business models of the Big Three have sunk them. There is no saving them at this point. Ted Turner was right in that it would be like throwing money down a rat hole.

[AllentownJake]

18. See you in the bread line than

[msallied]

22. And why would I be in a bread line?

[AllentownJake]

26. because this doesn't just effect

those UAW slobs you don't like. Its a dominoe.

[msallied]

28. If that's the case, then we'll be in the breadlines in six months instead of three.

The end result is the SAME.

[StreetKnowledge]

157. You are ignoring the changes at all of the Big 3

GM's new products are exemplary. Your attitude, which is shared by a great many in America, is the biggest reason they can't sell crap without discounting the heck out of it.

They can be saved, they WILL be saved, and when they get back on their feet again having learned the lesson about short-sighted MBA bosses and ignoring portions of the market for extra profit, you'll be explaining to us why they will still fail. Right?

[blondeatlast]

30. Ah, that lovely belief in the simple answer--I had that once. If Ford bites the dust,

thousands of assembly plant jobs go with it. there's no where for those workers to go; they can't go to the competitors.

When Ford stops making cars, tose that make parts for Ford are sunk. so are people in the oil, repair, and insurance agency.

That's not to mention retail, service, etc. jobs lost as a result.

One Ford job loss easily means 3 jobs lost in the fallout. Multiply that by three and let's see if you are so self-assured then.

I'm not saying I want the bailout--but I do see the crisis in a broad view.

[blue_onyx]

136. Ted Turner is full of it

Why does anyone care what he has to say?

[Kalyke]

29. That would be the case, if you knew what you were talking about.

They are re-tooling to make eco-friendly cars - cars, by the way, that Americans WERE NOT buying until gas prices hit nearly $5 a gallon.

Americans DEMANDED these trucks and SUVs. Good God, accept some blame here as a consumer, en toto. YOU may drive an EV - or none at all - but given a choice between something functional and/or attractive that is $10,000 to $15,000 less than an ugly bubble-looking Prius, many Americans choose cost and style. Some of us do not like the look, feel or eventual-electrical/sensory failure of most foreign cars. Some of us can't afford a $30,000 car we don't even like the looks of. Please come down off the Toyota tower. It ain't that grand.

Ford is bringing over it's smaller European line (which is a bit too "bubble-looking" for my tastes, but still looks better than any affordable Toyota or Nissan on the road today).

GM is re-tooling plants.

And people need to feel good about supporting American companies - and not merely conceptual California car companies who can't build an eco-friendly car for under 50-grand.

[msallied]

34. They demanded them because they were told they demanded them.

They were made to believe that "bigger was safer." And gas was cheap enough at the time that it didn't matter. All the while, Detroit was laughing to the bank and not seeing past the end of its own nose.

And I was comparing LABOR COSTS in regards to Toyota. Health care and employee pensions are EATING THEM ALIVE, which none of you seem to be able to address.

[Vinnie From Indy]

138. Besides the bad management and drunken workforce what's your problem?

Your posts are as amusing as they are incorrect.

[lumberjack_jeff]

35. Toyota's healthcare costs are about $400 because the employees and us taxpayers pay the other $1100

From here in Olympia, you don't see the big picture. Imagine Microsoft, Boeing and Weyerhaeuser all closed at once. Those workers would have no where to go. There are no other jobs "with companies that aren't going to screw them". Besides, GM paid $1500 per car for healthcare for their employees precisely because they are one of the few remaining companies who (granted not willingly) support their employees and retirees.

The US needs to retain its auto industry and its manufacturing capabilities.

[msallied]

40. Yes, and GM needs to subsidize their labor costs the same way

if they have a hope of surviving. That was my point. If they can't do that and rescue their shit business model, then they will go under whether you throw money at them now or not. Just what do they have on the table right now that can move their staggering inventory of Tahoes and Hummers into the hands of consumers who can't afford to buy them or keep them filled with gas?

[monktonman]

6. I work at the Lordstown, Ohio GM plant

it has been said that when we get laid off or go on strike,
for every one gm employee out, there are nine area businesses
affected.
we roll alot of money into this area. I've taken three twenty
dollar bills from every paycheck for the past few months and
written "brought to you by UAW local 1112"
just my way of reminding people how much money GM / UAW
funnels into this area.

The bailout sucks but I really want to keep my job.
puts me in a sticky situation because I've opposed
any other bailout but this one affects my family.
I feel kinda selfish and guilty.

what to do but keep the wolf at the door?

[lumberjack_jeff]

24. It's a bigger issue than just your job. It is a national security issue.

We can't sustain our economy by selling starbucks to one another.

[Kalyke]

32. Excellent point.

:applause:

[blondeatlast]

59. You've summed up the situation very well. I'm not liking this, but I think

it's a necessary evil.

[lumberjack_jeff]

132. If bankruptcy can be structured that it preserves jobs and manufacturing capacity...

... then it may be appropriate. Simply shutting the doors on GM... not.

[JohnnyRingo]

128. I live near there, in Cortland

I worked 30 years at Packard/Delphi, and have a few friends still there at Lordstown.
I hope the best for you and your family in keeping that plant open. Like you, I understand the devastating effect that a closing will bring the valley.

I'm hoping the recent layoffs are just a game they're playing to influence public opinion toward a bailout. That Cruze should be a hot seller in a better economy.

Some people don't realize how hard you guys work, or that overturning employees every month costs more than paying the experienced ones. The company expects you to work tirelessly every day with exceptional quality, while never expecting to still have a job next year. Don't feel guilty for wanting the bailout, my pension depends on it as well (and thousands of others).

I know some ignorant people think you screw on a rear view mirror, then go take a break. I know better.
Hang in there, it's good to hear from a local DUer.

(btw... I like that idea about the $20 bills)

[monktonman]

153. thanks man, I needed that

Sometimes I think the lay-offs are there to influence opinion as well.
not counting on it though.
somewhat looking forward to it i guess.

thanks again.
stay strong bro.

[uponit7771]

8. GM has the Volt, case closed!! On that point ALONE they should be given whatever they want

[maxsolomon]

25. you forgot this:

:sarcasm:

[uponit7771]

36. Slight Hyperbole but look what the Volt does to OPEC and other energy markets?

[maxsolomon]

50. make the oil last 50 years instead of 40?

it's a finite resource & we're killing our planet burning it up as fast as possible. the volt is no panacea.

and besides, it IS a GM product. i currently don't believe they can pull it off.

[uponit7771]

60. Not a panacea but a start, right now Europeans are driving 75mpg Accord diesels and we

...can't get those cars over here because of the EPA. The Volt would be a bypass around that...

[Lance_Boyle]

154. not because of the EPA at all - because of CA and NY.

And apparently nobody ever told Honda and VW et al that they could sell their high-efficiency diesels in EVERY OTHER STATE.

[harun]

75. Once it is for sale they got it, until then... vaporware.

[trekbiker]

148. sure... a $40K electric car with a planned production of

only 10,000 units in 2010?? I'll believe this thing actually works as stated when I see it. GM is praying they can solve the battery technology/cost problems in time. And they've already backed off the original concept car's flashy design (production Volt is the boring sedan look like a dozen other models out there). The Volt will use a lithium 16Kwh battery that will actually be able to utilize only 8kwh and supposedly get 40 miles (electric only) on a charge in a car that can go 100mph and under 9sec 1/4 mile... right.. typical GM bullshit. GM and Ford execs laughed at Toyota's Prius when it first showed up in the late 90's. At the time they said it would never have a significant market share. The arrogance and hubris of the US CEO class is incredible.

Toyota pioneered the technology, believed in it for the long term and sold Prius's at a loss for several years. And now Toyota is quietly planning an advanced 80-100 mpg PHEV that will blow the doors off of GM.

I say keep the manufacturing jobs in the USA but let GM and Ford get swallowed up by the likes of Toyota with a superior management that is capable of looking 20 years into the future instead of 3 months.

[StreetKnowledge]

155. Few points

Firstly, the Volt hit everyone across the jaw right good. Toyota included. Their US President told Japan this, and Japan began soon feverently working to make a plug-in version of the Prius, which is their PHEV. (Prius is already a PHEV, note.) Also, since the Volt requires little more than idling to make the thing run on the highway, it's fuel efficiency in highway travel is expected to be well north of 60 mpg.

Secondly, this "imports are better" mentality pisses me off. They aren't better, folks. The difference in quality among imports and domestics is all but gone, and GM's engineer corps and UAW workers have gotten the point about the vehicles. Most of the management are idiots, but those that aren't are bringing out first-class cars. So fire the morons and put the best men in charge, and when the economy turns around, watch them start putting holes in the Japanese.

[lumberjack_jeff]

20. Add a few million more medically uninsured and see how expensive medicaid is. n/t

[Democrats_win]

31. In hindsight, it sure is good that we didn't raise those mileage standards.

Because if we had raised them in 2002, we would surely be forced to bail out the bankrupt car companies in 2008.

Then again, maybe they would have made more fuel efficient cars and this entire mess that started with high gas prices would never have happend.

Remember to thank your local Republicans.

[DU GrovelBot]

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[lumberjack_jeff]

37. Unintentional irony is sometimes the best kind. n/t

[blondeatlast]

51. I think our GB is learning, I really do. He's popped up in the most perfect places lately!

:rofl:

[scheming daemons]

38. "filing for bankrupcy" might be a good thing..... going out of business altogether IS bad

But filing for bankrupcy protection will give them a change to reorganize and make their companies have a better profit model.

Right now.... throwing money at them will simply delay the inevitable for a couple years.

They need to change their business model. And the only way they'll be able to do that is with the breathing room that federal bankrupcy protection will give them.

[uponit7771]

41. Who's going to buy a car from a bankrupt company?!?!

[scheming daemons]

45. Almost every airline, at one time or another, has been under federal bankrupcy protection....

...people still fly.



People will still need cars..... and after GM comes out the other side of bankrupcy with an improved business model, they'll make money by the buckets.

[AllentownJake]

53. A flight is a commitment of one trip

A car is a commitment of 7-10 years. Totally different industries.

People will be fearful that their warranties will not be guarenteed and that if the company goes out of business they will be unable to get a part or person to fix their vehicle.

[msallied]

46. One benefit of a bad economy is that if you drop the price low enough

then people will buy it. I'm not sure if this will hold true for the trucks and SUVs, however. But the cars, definitely.

[PassingFair]

They can't buy BICYCLES if they don't have a job.

You cannot afford a new car and insurance on
$11.00 an hour.

You can't.

[uponit7771]

63. Hmmm, who would buy a car you can't get the parts for if something goes wrong with something ALWAYS

...does?

[AllentownJake]

47. Exactly

How does bankruptcy deal with warranty or assurance in 5 years you will get the part or access to a mechanic that works on your vehicle anymore.

[msallied]

42. Precisely! Subsidizing labor costs would be a great start.

It would drop their prices. Of course, the albatross around their necks are their massive inventories of SUVs that people aren't going to buy no matter how damn cheap you make them.

[uponit7771]

62. Yeah, ...shoot...there's no easy way to deal with F, GM and C right now ....

[PassingFair]

49. This post has emphasis in that you are posting from...

Allentown.

You have SEEN what happens when
government forsakes industry.

[AllentownJake]

57. Ignoring the downfall of American Steel

nearly destroyed my community in the 80s. We recovered thankfully but it took over 20 years.

[PassingFair]

74. Thank you for working to spare Detroit the same fate.

:yourock:

[uponit7771]

80. RIGHT!! "Free Marketers" never factor in the LENGTH of the adjustment while giving their pitch

[AllentownJake]

83. or the effect on families

Guy in his mid 50s about to send his kid to college and suddenly not being able to do so.

Guy in his mid 30s with young children suddenly on food stamps.

It isn't pretty.

We hate the song Allentown in Allentown...because its accurate and its a painful memory.

[uponit7771]

89. +1

[olkaz]

52. heard all this before.

Amazing vehicles in development? Hilarious.

Time for it to go. The whole industry has been a national disgrace.

[Hippo_Tron]

55. How about we just give all of those unemployed workers money to start over?

I agree that it's a huge problem if 2 million people are unemployed and can't put food on the table. But instead of just throwing money at the auto industry, lets find a more sustainable solution for those 2 million people.

[harun]

78. You know a few years ago that would have sounded batsh*t crazy

but at this point I actually think that would be a better investment of tax payers money than throwing it at the automakers. The Execs will just loot most of the bail out money. Giving it to the workers in the form of special layoff insurance, to help them move, re-school, or just live off of would be better.

[Hippo_Tron]

135. It's a reality based solution but it's unfortunately politically unfeasible

Liberals don't like it because they want to save the big three because they want union members. Conservatives don't like it because they see it as welfare. Since Democrats just won a landslide, we're probably going to throw money at the auto industry on the premise that they will magically come out with green automobiles because we attach strings to that money that says they have to. And while I'm all for government subsidizing research for green automobiles, the primary aim is to save jobs and the green automobiles are some side thing that we hope will magically happen.

The problem is that government policy often isn't designed by people who are actually concerned about the economy at large. It's designed by people who want something for themselves.

[harun]

139. I think you are right, it will be to pay back the unions for support

It won't be to get electrics.

[paparush]

56. The only way we give them $$ is that they ship No, None, ZERO jobs overseas.

[IN-dem]

146. I agree 100% n/t

[Occam Bandage]

61. Giving them a few hundred billion to blow through won't make them any more sustainable. nt

[msallied]

67. Exactly. People are going to lose their jobs eithier way. They're losing them now.

[AllentownJake]

68. I just want them to survive

till we can afford to move people into new industries. This is not a good time for this to be happening.

[Occam Bandage]

95. There's never a good time, and most of the employees of GM can't be moved into new industries.

Nobody wants to see an industry fail, but what do you do when the industry can no longer survive without ever-increasing aid from the government?

[trekbiker]

149. like the old Soviet Union. propping up bad companies with crap products

sure to fail in the long run

[stklurker]

71. Bailout of Auto Industry

Correct.. There are several things that need to happen

1) They HAVE to change their business model.. they were too arrogant for years, while foreign competitors were making sure they were very nimble in production capabilities. At the end of the day.. if they cant make a car the public wants at a reasonable cost, they might as well go now because its just going to prolong the agony.

2) The workers are going to have to make some concessions here.. that being said I dont think we will ever be able to match offshore labor rates.. so we better be able to make BEST car going.. quality wise.. which hasnt happened lately.


Unless these happen the bailout is throwing bad money after bad...

[uponit7771]

77. Until the Volt? Volt in SUV? Come on, there's difinative upside to GM that's being igonred

[Occam Bandage]

90. I highly doubt that the Volt will

single-handedly reform their supply chains and eliminate their production-cost disadvantage. The Volt feels more like a public-relations stunt than it does a savior of a failed business. If GM were asking for this cash so they could close most of their existing plants and turn them into electric-car plants, then I'd think it was worth a gamble. As it stands, it just looks like it's too little too late.

[uponit7771]

110. Reply

"I highly doubt that the Volt will single-handedly reform their supply chains and eliminate their production-cost disadvantage."

It wont but health care reform would help

"The Volt feels more like a public-relations stunt than it does a savior of a failed business."

I see GM totally behind this car, I don't know why you think it's a low production number car? It's not the EV1

" If GM were asking for this cash so they could close most of their existing plants and turn them into electric-car plants, then I'd think it was worth a gamble. As it stands, it just looks like it's too little too late."

Good point

[Occam Bandage]

121. Health-care reform would indeed help,

and (though it's painful to admit this) a renegotiation of employee wages and benefits would help too. If we're serious about "saving GM," then we might have to decide that lowering employee wages and benefits will be part of that, despite the cascading damage that will cause.

I agree that GM is behind the car. I think it will be low-production-number for two reasons. First, its cost will probably be over $35,000 per car; that will mean it has appeal largely as a lifestyle-brand good and not as an economic investment--especially since gas prices will remain low as long as the global recession lasts, doubling the disincentive for people to buy them. They can make them, but that doesn't mean people will necessarily buy them.

The second reason is that it's a new model with new technology; I'd be surprised if there weren't any major bottlenecks in the first year or two.

[noonwitch]

79. My state (Michigan) will be devastated if no one does anything

It's hard to be the new West Virginia, after being one of the wealthier and more progressive states for so long.

[uponit7771]

81. "Free Market" folks NEVER factor in the adjustment period into their schtick on letting stuff fail

...and when confronted with the length into there's always a straw man thrown in.

[blondeatlast]

91. People don't get that it isn't just the Big 3 laborers who will hurt.

Especially with the auto industry, there are so many ancillary businesses DIRECTLY affected that we'll all feel it.

It's going to hit parts manufacturaers, the insurance industry, banking (ouch--like workers there need more to worry about), etc.

Locally, it will KILL any small businesses. do those that want to see the Big 3 suffer want to see nothing but Wal-Marts and Denny's? If so, they will LOVE Detroit if help isn't forthcoming...

[AllentownJake]

97. Indiana and Ohio will fold like a tent as well

They have alot of plants as well as part manufacturers.

[Waiting For Everyman]

87. Yeah, where did we get this idea that we can afford to kiss off industries?

I remember the "we don't need manufacturing", we'll all be service employees meme. So we all end up working for banks and then what?

Letting industries go is stupid-think. What we should have, are rules and incentives that keep them profitable and doing what makes us stronger as a whole. Jeez, that isn't that hard. People act like it's impossible.

The industries we lost, we need to rebuild and get back. And btw, we need to incentivize so that we are as self-sufficient as possible. That is merely common sense. We defy it at our peril. As we see. And it isn't pretty. Stupidity like this, costs. Big. And for what? What's the big payoff we get for junking our economy?

[PassingFair]

105. I think we "got it" from union busting republicans.

And shallow thinkers.

[RollWithIt]

92. The reality is that there are people who don't care about others, sadly...

I personally would never advocate the failure of GM or Ford, I understand the economic repurcussions of such an action. Millions of people broke or out of work within a few months.

[redqueen]

106. Is it vindictiveness? Is it spite?

If it's just ignorance I guess I could understand. Otherwise...

[AllentownJake]

108. Its the it won't/can't happen to me or my job syndrome

[redqueen]

112. Ignorance, then.

Pathetic. If you have time to post, you have time to educate yourself.

[PassingFair]

129. Yep. First they came for the textile workers....

but I was not a textile worker.....

[Waiting For Everyman]

133. Exactly. n/t

[tomnjoy]

101. I wish I knew...

Aaargh! I really wish the right answer in these cases would be obvious. Honestly, I do not have the knowledge or experience to even venture a suggestion in today's economy. All I know is we're seeing bailout after bailout after bailout for all these corporations - and yet letting them go under may be a worse option - but it is getting frustrating. All these corporations just yell "help me!" and they get a huge bailout from the government (us taxpayers) while the taxpayers are struggling to pay their mortgage, utilities and basic living expenses. On the other hand, we can't afford to lose the automakers and all those jobs...

I can't help but ask, where's our bailout? With all the money we're dumping into these companies, let's just pile on more and give every taxpayer a pile of cash to infuse into the economy! Forgive my debts, pay off my mortgage! :sarcasm: (okay, only slightly sarcastic) Or how about the oil companies chip in with their billions in profit to help support the automakers??? I'm just afraid this is only the beginning of a slippery slope and a trend is beginning...more companies will be lining up every day waiting for their "bailout". I better get my place in line.

[blondeatlast]

109. Exit the American auto industry; enter a sea of Wal-Marts and Denny's.

If you HATE corporations (and therefore oppose help for the Big 3) you are going to tear your hair out over Detroit post-Big 3.

Small businesses will fail within weeks or months. Laid-off workers will have to survive--and the only choice they will have to do business with is Wal-Mart--and for a treat, they can take the kids to McDonald's--maybe, if eating out doesn't become a complete luxury.

It's a bitter, jagged pill--but we gotta suck it down in order to survive.

[tinrobot]

113. Bail them out on the condition they change for the better.

-- Better gas mileage for all cars

-- Better fuel options for cars (electric, hydrogen, etc)

-- Better treatment of employees

-- Source more parts from the US.

...and reduce CEO pay to a multiple of the lowest paid employee. No golden parachutes or giant paychecks on the taxpayer's dime.

[trekbiker]

151. I agree. US automakers and thier lobbyists have

fought against increasing CAFE standards for decades. The CEO's and VP's who presided over this disaster should be fired with no golden parachutes before any bailout.

Take the bailout money and apply it to an alternative energy "moonshot" program. Imagine if these 100's of billions were funneled into a huge alternative energy tech race... wind, solar, tidal, cellulosic ethanol, etc. It would take 10 years but we would end up with truly sustainable new industries with good paying jobs that could not be outsourced.

with these bailouts we either take the pain now or later. all it will do is delay the inevitable. Sort of like our obscene national debt. just keep kicking the can down the road.

[tinrobot]

114. (self delete)

[totodeinhere]

115. Yes, it's a bad thing, but that's not the point.

Like Ted Turner said, giving billions of dollars to the auto companies would be tantamount to pouring that money down a rat hole. No amount of money can save these companies now. They will go under whether or not the taxpayers try to bail them out. So why not use those billions of dollars to retrain the laid off workers to do jobs that will be in demand in our high tech economy? At least that way we will get some use out of that money instead of wasting it all.

[Waiting For Everyman]

123. The workers retrain, then they're highly skilled with student loans to pay off, and

then they find that we outsourced their jobs to India or somewhere. Retraining isn't working either - because nothing is right about the way we're doing this.

Retraining is no panacea. We cut people adrift on their own, in an impossible environment, and expect it to all (somehow!) work out. It doesn't. That's a nice thought, but it isn't our reality today.

Our whole viewpoint on how to run our economy needs fixing.

Even if the automakers ultimately go bankrupt, they cannot be allowed to disappear. That is really crazy.

Screw the market at this point. We need to go entirely outside the market, and override it (at least for a while), to fix this larger mess. It all comes back to the banks at the center of everything that's wrong. On that...

I'd start with a full stop on foreclosures for a year while we overhaul all the laws on that and bankruptcy and get some usury limits, plus extended and increased unemployment benefits and food stamps etc., retraining, and targeting some government job-finding help to those in dire trouble. Too many people are going under from the mistakes we've already made.

And btw, with usury limits and consumer transaction laws reformed, more people could buy CARS.

[TheKentuckian]

117. Its probably pretty much over for the old model

Where going to have to switch horses economically, Its getting harder to see how we can maintain capitalism in the current form.

If we allow the big 3 to crash out the unemployment cascade effect will be extensive and leave us somewhat vulnerable from a national security standpoint as well because our manufacturing base will be decimated. We'll be pretty much down to GE, which will give them even greater influence, which I see as a bad thing.

I just don't see how anyone can see this many jobs and businesses as expendable. We already need massive job creation for the millions that are already unemployed and the many more that are underemployed.
What are we going to do with all these people and their families? Whats going to happen with a very dicey global credit situation if millions more can't keep above water?

Throwing money at the big 3 isn't going to fix much but letting them collapse invites grave meltdown. We have to navigate a different path and that likely is going to involve massive nationalization.
If that bothers anyone take it up with the Republicans who crashed us out.

[hogwyld]

120. We could put all of those out of work auto employees

working on a new energy distribution system. That can never be shipped overseas. I feel that the era of the automobile is soon at an end. Oil has dropped, but remember, it is a finite resource. If we can invest those billions being aimed at the auto industry into other, more productive areas, I'm sure the country would be better off in the long run.

[Waiting For Everyman]

126. Just because gas fuel is on its way out, that doesn't mean cars are.

We still have to get around somehow. And there's never going to be mass transit across this whole country. Cars in some form are not going to disappear. In cities maybe, but nowhere else.

[AllentownJake]

127. Hoverboards

Back to the Future promised me hoverboards and Mr. Fusion

[Willo]

130. These corporations sound like Republican Party

#1: "Just because we've screwed you all of these years we still expect you to buy our crappy products, because patriotism is determined by what you buy, not by what we sell."

#1-4: (Screw. Guilt. Trap. Repeat) You, the consumer, can't get off this freakish merry-go round because you'll be screwed even more and take others with you.

#5: What good is a fuel efficient Ford if it's in the repair shop every month? As for ...amazing cars in development..." How much time and money will it take to convince the consumer that this is change we can trust enough to invest in?

I hate the positions these greedy corps put me in. I have limited funds and try to spend it wisely. And, I also believe that I am my brother's keeper. These cycles of bailing out crap has to stop.


#1-7: How about we support and expand on the american car companies that have long records of making quality cars. Help them make fuel efficient cars for the future? Frankly, I'm coming up short in making out that list :( But, stop looking to shore up the weak and get behind the true american corps.

[JPZenger]

131. Reorganizational bankruptcy still an option

It is possible for the companies to go through re-organizational bankruptcy and come out stronger. Sometimes a company needs to declare bankruptcy in order to obtain private financing. No one wants to provide financing right before a bankruptcy, but many people are willing to offer it afterwards.

A re-organizational bankruptcy would likely eliminate any value of the current stock shares in the company. (As a Ford shareholder, that is not a pleasant thing for me, and certainly would not be attractive to the execs and Ford family members who still hold large numbers of shares). The company would then issue completely new stock to the persons who provide financing and to preferred creditors.

[Danger Mouse]

137. We don't want them to go out of business. Anybody who says otherwise is a Republican.

You heard me.
If you don't see the massive catastrophic effect this would have on our economy as a very, very bad thing, then you are either clueless or heartless.
That being said, I'm not sure bankruptcy is such a bad thing so long as their doors remain open.

[GoesTo11]

147. Letting GM go under would be a Katrina like decision for the govt.

You don't just say "let's roll the dice letting them go under and whatever the hell happens will happen." You do what makes the most sense with the hand that you're dealt. I think rolling the dice could lead to a 5-10 year depression, not recession.

[Bake]

140. No GM, no VOLT.

The soon-to-be amazing electric car.

Just a thought.

Bake

[Sensitivity]

141. The VOLT is great example of what NOT TO DO -- not transformation of auto line but token niche item

[Bake]

142. But if it goes well, it could be the future of the line.

Admittedly, they're not exactly "bold" about it.

Bake

[Every Man A King]

144. Agree

Big Auto rescue of $25 billion equals less that 3 weeks in Iraq

[madmom]

152. Anybody remember the old saying "As GM goes, so goes the country" ?