Failure of auto industry could set off catastrophe

[Roon]

DETROIT (AP) -- Advocates for the nation's automakers are warning that the collapse of the Big Three -- or even just General Motors -- could set off a catastrophic chain reaction in the economy, eliminating up to 3 million jobs and depriving governments of more than $150 billion in tax revenue.
http://finance.yahoo.com/news/Failure-of-auto-industry-apf-13552316.html

[Triana]

1. The pigshits would LOVE to leave Obama with that to deal with...I think they're gunning for it. n/t

[SpiralHawk]

2. "Catastrophe? That's our republicon speciality. Smirk." - Commander AWOL

[Gman]

3. The RW talking heads are saying let GM go out of business

because of the UAW and "bad" management. I'm not sure this is even more irresponsible than the hate in October that made the Secret Service warn the Obamas.

[Donnachaidh]

5. NATIONALIZE the big three

The people who run them are willing to let 3 million people lose their jobs -- why not just get RID of the owners and nationalize the companies - saving those 3 million jobs. Then we can re-tool the factories and bring back jobs that were off-shored.

F*CK the owners and their shareholders. Save the jobs, and get some return from previous bailouts.

[HereSince1628]

4. Equally probable--billions spent on auto bail-out COULD be a complete waste.

In the winter of 2009, when people need help to keep from freezing, there will be money to help them. But the CEO's will be wintering in the Turks and Barbados.

[sutz12]

6. The catastrophe was "set off" a long time ago...

You can trace the roots of it back to Reagan, at least. If the auto industry goes down, it will just be the next stage in the decline.

It's what happens when you have laissez-faire economists "running" things. Their basic philosophy is to do nothing to interfere with the corporations, and the world goes to hell in a handbag.

[Hubert Flottz]

7. Two steel plant in this area are already shutting down.

Reality is a bitch Karl.

[INdemo]

13. Are those shut downs just temporary?

The steel mills in IN have inventories backed up to fill orders(what orders) for several months.
So the auto industry has already affected the steel market. There were signs of this coming over a year ago.If Congress would fast track this 25b through to aid the auto industry we could possibly see an upturn almost immediately.But it now appears that this administration now wants to leave this whole mess to President Obama..its the Republican way.I dont think the auto industry will survive 'till January if they are left out in the cold.

There are those that think foreign auto manufactures will use US suppliers,think again.Our manufacturing industry is built around the big three and if they go so goes the economy.
In my lifetime I have seen some really bad economic times but there was always that little bit of light at the end of the "tunnel" but this time its pitch black and I'm really worried.

[Hubert Flottz]

17. So far it's temporary but they are saying that if things don't change

soon the plan could change.

America's heavy industry IS our "National Security" and Bush and the neocon/reaganites free traitors have all but destroyed the very things that have kept us safe for over a century and a half. History teaches that...Greed Kills.

[rdublue]

8. If they bail out the Auto industry, there will be no qualified oversight

The bail out will be same fiasco as the bank bailout.they will still manufacture outdated gas guzzlers the American public won't buy. I hate to see one job lost in this country but I don't think the gov't is capable of running the private sector. This is a mess with no real good answer

[SammyWinstonJack]

9. And apparently the private sector isn't capable of running the private sector, either.

Now running it into the ground, and then running to the taxpayers for bailout money, they are capable of doing that, over and over and over again. So why not let the government take a stab at running the private sector, but wait until the poo flinging chimp's reign of greed is over, first.

[Wapsie B]

10. Who's to say the auto industry wouldn't take a cue from the banks

and plow at least a portion of that money into bonuses for incompetent management? Any bailouts need to come with strings.

[nebenaube]

11. gee

If they had evolved they would be doing just fine... Maybe the owners will just have to risk their assets and rebuild the companies and produce what the market wants eh? People need jobs to buy cars and no one in the world wants these expensive gas guzzling piles of junk when they are worried about eating and staying warm. Oh and if we bail out the credit card companies they should just cancel their client's debt; after all it must be more expensive to keep trying to squeeze blood from a turnip than it would be to just start over with customers that can pay.

[Kokonoe]

12. The bailout is less than the tax revenue that would be lost..

But its not about money, its about defeating union workers in the middle class who tend to be democrats.

[pampango]

16. One issue seems to be whether a bailout or bankruptcy is a bigger threat

to union workers and retirees.

The threat posed by a bailout depends on details of a specific bailout and how it deals with management, stock holders and workers. Bankruptcy is also unpredictable. While the companies might continue to operate, bankruptcy courts can restructure practically anything, including payments to creditors, dividends to stock holders, health care benefits, union contracts, retirement benefits, etc.

One way politicians make the call. The other way judges make the call.

[Auggie]

14. Could? It will. What about the millions of retired autoworkers living on pensions?

[MadHound]

15. Let it go. Let it blow up, let it explode, then come in and rebuild from the groundup

Sorry, but we've already dumped 25 billion into the auto industry in the last month, and they're back wanting more. If this bailout is going to go through, it will be used to consolidate and cut jobs anyway, and give the example of the Wall St. bailout, there will be little or no oversight, allowing Detroit to continue to follow the same old business model, and just put the final collapse off for a few years.

Much like any old car, there comes a time when continuing to throw money at it is counterproductive, and you have to start anew. That time is now. Let the market sort out who survives and who goes under. Yes, it will be painful, for all of us. But in the long run it will be the best move, because arising out of the ashes will be an auto industry that is leaner, nimbler, smarter and better able to compete in the world marketplace by producing cars that people actually want and need, and with the ability to move in the direction that Obama and the country wants with fuel efficient, alternatively fueled and electric vehicles that are right for the 21st century.

I realize that sounds harsh and cold hearted, but reality is like that sometimes. Like I said earlier, we can continue to throw money at the problem now, only to watch it all blowup worse in a few years. Better to go through the pain now, while it is still manageable rather than later when it isn't.