Wes Clark Says the GM Bailout is Good for National Security
By Ani on November 17, 2008 at 8:00 AM in Auto Industry, Barack Obama, Hillary Clinton
In his op-ed in the NY Times, former Supreme Allied Commander, NATO, retired 4-Star General Wesley Clark says What’s Good for GM Is Good for the Army:
AMERICA’S automobile industry is in desperate trouble. Financial instability, the credit squeeze and closed capital markets are hurting domestic automakers, while decades of competition from foreign producers have eroded market share and consumer loyalty. Some economists question the wisdom of Washington’s intervening to help the Big Three, arguing that the automakers should pay the price for their own mistakes or that the market will correct itself. But we must act: aiding the American automobile industry is not only an economic imperative, but also a national security imperative.
When President Dwight Eisenhower observed that America’s greatest strength wasn’t its military, but its economy, he must have had companies like General Motors and Ford in mind. Sitting atop a vast pyramid of tool makers, steel producers, fabricators and component manufacturers, these companies not only produced the tanks and trucks that helped win World War II, but also lent their technology to aircraft and ship manufacturing. The United States truly became the arsenal of democracy.
He then discusses the changing face of military defense spending saying that supersonic jets were ‘sexier’ and we therefore started paying less attention to improvements of ground vehicles…
But in 1991, the Persian Gulf War demonstrated the awesome utility of American land power, and the Humvee (and its civilian version, the Hummer) became a star. Likewise, the ubiquitous homemade bombs of the current Iraq insurgency have led to the development of innovative armor-protected wheeled vehicles for American forces, as well as improvements in our fleets of Humvees, tanks, armored fighting vehicles, trucks and cargo carriers.
In a little more than a year, the Army has procured and fielded in Iraq more than a thousand so-called mine-resistant ambush-protected vehicles. The lives of hundreds of soldiers and marines have been saved, and their tasks made more achievable, by the efforts of the American automotive industry. And unlike in World War II, America didn’t have to divert much civilian capacity to meet these military needs. Without a vigorous automotive sector, those needs could not have been quickly met.
Oh, Wes, you’re good. I’ll give you that. Who else would have come up with that one?
More challenges lie ahead for our military, and to meet them we need a strong industrial base. For years the military has sought better sources of electric power in its vehicles — necessary to allow troops to monitor their radios with diesel engines off, to support increasingly high-powered communications technology, and eventually to support electric propulsion and innovative armaments like directed-energy weapons. In sum, this greater use of electricity will increase combat power while reducing our footprint. Much research and development spending has gone into these programs over the years, but nothing on the manufacturing scale we really need.
Now, though, as Detroit moves to plug-in hybrids and electric-drive technology, the scale problem can be remedied. Automakers are developing innovative electric motors, many with permanent magnet technology, that will have immediate military use. And only the auto industry, with its vast purchasing power, is able to establish a domestic advanced battery industry. Likewise, domestic fuel cell production — which will undoubtedly have many critical military applications — depends on a vibrant car industry.
No one could ever doubt Wes Clark’s deep love and dedication to the Army and to the troops who serve and sacrifice for our nation.
And I’ve got to hand it to him, he sure goes to bat for the Democratic Party. They are making their argument for the bailout of the auto industry and General Clark has made one of his own.
A man with 34 years of military service and more medals, knighthoods and honors from the U.S. and around the world than you could possibly pin on any one chest, like most in the Military he was an Independent during his long career, remaining neutral politically to better serve the current Commander in Chief, regardless of party. He retired in 2000, and in 2003, declared as a Democrat.
Though he hasn’t been with the party long, he’s certainly making up for lost time. Aside from his own Presidential candidacy in 2003-4, since then he has been campaigning tirelessly for down ticket Democrats, criss-crossing the country and making his case, using his political action committee, WesPAC, for the purpose.
Noble as that might be, I was infuriated that after his strong support and endorsement of Hillary, once the primary was forcibly brought to an end by cowardly super delegates bowing to pressure from Ms. Pelosi et al, Wes would once again take up the mantle of good soldier and good Democrat, preaching party unity and stumping for the inexperienced, disingenuous, and now, President elect, Obama.
Lo and behold, here is General Clark, first in his class at West Point and a Rhodes Scholar, once again chowing down on an extra bowl of Wheaties to think up an argument on behalf of the Dems’ position re the auto industry bailout. I have to say it is creative, if nothing else, and he does make a very good point.
But he conveniently ignores part of the reason the industry is in this mess to begin with – they have neglected and buried alternative technologies up until recently and were slow to embrace hybrids and buried the electric car, instead choosing to make Escalades and one big gas guzzling monstrosity after another. Cafe standards, anyone?
Uh, now they are not selling so well. And under the premise that we would be “helping the troops” we should now go bail them out?
While I would do whatever possible to help those brave souls putting themselves in harm’s way, once again, I feel we are being blackmailed into overlooking the wrongs perpetrated by the companies that got us into this horrid situation. Backed into a corner now, they tell us, we have no choice but to pony up for this, and other bailouts. When does it end? Who will ever have to answer for putting the American taxpayer in such a spot in the first place?
To be sure, the public should demand transformation and new standards in the auto industry before paying to keep it alive. And we should insist that Detroit’s goals include putting America in first place in hybrid and electric automotive technology, reducing the emissions of the country’s transportation fleet, and strengthening our competitiveness abroad.
On this point, Wes Clark and I wholly agree. In his capacity as a foreign policy commentator with various networks over the years, Clark always talks about the need to offer “a combination of carrots and sticks” to enforce performance.
Well I have had enough of bailouts in which we offer up all the carrots but don’t wield the stick first. We need to get assurances and policies in place that the industry, bank, or institution to be bailed out will have better oversight and act in our best interests – not to continue their reckless practices. If indeed, it is advisable to bail them out at all.
I am certainly no expert in this particular field, so I hope you will pardon my dust. But as a concerned citizen and taxpayer observing this situation and the debacle of our other bailouts this year, I can’t say that I have any faith that any transformation, accountability or oversight will happen in re the auto industry either, and therefore wonder at the wisdom of doing this.
General Clark closes with the following:
This should be no giveaway. Instead, it is a historic opportunity to get it right in Detroit for the good of the country. But Americans must bear in mind that any federal assistance plan would not be just an economic measure. This is, fundamentally, about national security.
Get it right? Yes, Wes, as usual, your heart is in the right place, but since the powers that be in the corrupt Democratic Party seem no more anxious to see you, a person of integrity, in a position of leadership, any more than they wanted Hillary Clinton there, who do you think is going to oversee that this is no “giveaway” and that we are now going to make Detroit follow up on their historic opportunity to “get it right?”
I never believe that the ends justify the means, so, no, I am not happy with our President-elect, even though that means we have Democratic leadership once again. By the same token, our fortunes are tied to his success in putting the right people and policies in place and figuring out how to govern effectively — if indeed that is possible. I don’t like having to make a decision from a place of desperation.
General Clark has more faith than I do that this action will lead to a positive outcome.
Is he right? What say you?
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By Sarah Palin (Release date: November 17. 2009)
They need chapter 11. It’s the only way they will restructure. Bailout money is going to employees, management and retiree benefits.
At this point, GM’s retirement list is so long it amounts to more money than their payroll. It’s a cumulative thing over decades for many of these major corporations.
Besides, GM’s comparatively large gas-drinking cars are persona non gratis in other countries among consumers. They got this message during Carter years and they started producing smaller cars, but then they just went back to their old ways.
They are no longer Number One. Toyota ate their lunch a couple of years ago. They need to ask themselves Why. They are going to have to think outside of the box they have been in for so long if they want to survive. And their management needs to be shaken out–and their unions will have to start being a bit more giving too. If not…they will just be back for more money and the taxpayers will be paying everybody’s salaries and benefits. If it were up to me, I would sic Mitt Romney on them to straighten out their bones.
Uppity Woman has is right. We should pledge money to the auto industry, collectable after they go into bankruptcy.
A bailout is only delaying the inevitable.
A friend had an idea–How about instead of bailing them out, the government simply buys up the uhsold cars and give them to people who need cars instead of just giving the industry money? At least we would have something and the industry would have a cash infusion.
At first I laughed, then it started sounding more reasonable.
Let’s have the government buy 840,000 GM cars for a total cost of 25 Billion, then give each state 16,800 cars to have a lottery, one entry per person, and then at least some citizens will have a new car and GM can get its money through the sale of their vehicles.
Nice idea but I’ll keep my Audi.
Oh! Oh! I want an Escalade please!!
LOL!!
Fact: William C. Durant founded GM with J.P. Morgan money funding his acquisition of Buick then the others (Cadilac etc….). The current state of GM going bankrupt, aided by J.P. Morgan’s analyst Patel making statements, will have the end result of the J.P. Morgan family getting our (taxpayer’s) money for nothing.
The auto industry has been in dire straits for a long time. But they never change. A bailout won’t do a damn thing. You can’t stop an avalanche by throwing more snow on it.
You mean you can’t stop an avalanche by praying.
yep! At this rate, a $25B is going to be gone in a year and a half, then what? A band-aid is not going to help a wound that needs a tourniquet.
I would only say to help them out if they start producing hybrids and make a commitment to researching improvements in gas consumption. That I would support, because they need a little nudging in innovation and development.
Their current model is not working!
Hybrids seem great, but why do I want a car whose battery, horribly expensive, is shot after 5 years?
I don’t get it, to be honest.
You missed the innovation and development part of my post. If you looked deeper you may find some common ground apart from tr@lling my posts.
Trolling? I don’t even recognize your handle.
Good gravy…..
You’ve got one whopping ego!
They make hybrids. You haven’t looked lately. They also have many cars that get over 30 mpg. look that one up, too
It won’t last that long. The auto industry has 850K retires that get their pension and full medical coverage with that money paid through the Unions and the present number of union employees is vastly lower than that. Presently the UAW is expecting a $16 billion payment out of that $25 billion bailout bill. That leaves $9 billion to cover upcoming costs including the retooling of several plants that are converting to the manufacture of smaller, more fuel efficient cars and trucks and also the new hybrids such as the Chevy Volt. That’s not enough to finish the job. Add to that the union is going to be coming back in March for another handout of $16 billion and the car companies have a problem. No money! They have several problems coming out of this without coming back in March for another handout. They cannot survive under the existing union contracts and IMO they shouldn’t. The “Big 3″ are mismanaged, the unions are refusing to cede any benefits they have coerced from the car companies over the years and the companies don’t have a viable product to sell. The system as has been set up between the “Big 3″ and the Union is a failed one. Let them go under via chapter 11 and reorganize. The Union and its members will have to choose to either work for a pay and benefit package such as those offered to the non-union plants down south or refuse and get nothing. Its a decision that they have to make because its going to become either a bailout by the politicians and a continuation of the same failed model or the politicians are going to hear enough screaming from their constituents and to protect their own asses (as they are prone to do) will let them go under and they lose even more than through a negotiated restructure.
I agree with Jim S here….let them file for Bankruptcy and reorganize (and that’s not merely because I drive an Audi too…..).
No bail out to the car industry !
You can thank the Unions for bankrupting the American Car Industry.
Tell me how a person on a GM assembly line is making 70 bucks an hour , compared to someone at Toyota or Honda making 40 and producing a better car?
Screw em….It’s not up to the taxpayers to fix this.
Let them go bankrupt..they did it to themselves.
Probably those making 70 are the ones producing less than most of the rest making less. Obviously we have found that those making the most produce less, in most cases.
I’m with you. I was HORRIFIED to hear about this 70$/hour thing. Ughhhh. Let them bust up the union, go bankrupt, reorganize and then get some money. This is why America is in this situation.
They don’t, the pay is similar between the union and non-union shops. The difference is that the “Big 3″ have to pay they union huge sums of money to cover the costs of pensions and free for life medical and dental benefits for retirees and the present employees. The companies located down south don’t have the legacy costs built into their product and because they are all in “right to work” states, are not unionized. The odds of them going union is remote, the people that work in these plants are comfortable, management doesn’t hassle them and the way the system is constructed every person on the assembly line has more authority and interest in the assembly process than floor managers on the factory floor of the Big 3. What you get is a well made product made by enthusiastic employees, something that Detroit has lacked for 40+ years.
You can thank the Unions for bankrupting the American Car Industry.
Amen LisaNY. Also, the American people belly ache about how all their jobs are shipped overseas. Unions and their costs make companies uncompetitive. I’m not saying all unions are bad, but this is the 21st century where companies must be lean and mean. When I worked for IBM during the dotcom bubble, employees were leaving in droves for the promise of riches through stock options. We literally couldn’t find people to fill jobs that had to do with old mainframe computers. What was our option? We had to move it to India, China, Russia. The cost of labor and skill level over there only made the move that much more easier. When the dotcom bubble burst, Americans bitched about how all the jobs went overseas. Helllooo!! A company just doesnt’ one day say let’s move our work thousands of miles away where English is a second language. It’s a lot of preparation, a lot of legal wrangling, and a lot of headaches. However, if the cost benefit is there, you betcha they are going to do it.
wow, i didn’t know about the $70 an hour thing… and I didn’t think about the unions too. good point.
Great POst Ani!! :O)
Wow–assembly line workers make $70.00 hour?! I’m an epidemiologist and PHD level epidemiologists only garner $35-55/hour. I guess I’m clearly in the wrong field. As someone who works in occupational safety and health, I commend the unions for being some of the earliest/biggest advocates for worker safety and health and the field, however, I think things need to be restructured so the American taxpayer is not obligated to ensure the pensions and healthcare for a “failed” industry. Unfortunately, so many other industries are tied to the US automakers.
There is not one assembly worker that makes $70 per hour. The last contract changed the wages to a 2-tier system with new employees making $16 per hour and existing employees making $27-$28 per hour. The $70 figure comes from taking the costs of every single retiree GM has and all other benefits costs and divides that by the number of working employees. They then take take that number (which is roughly $42) and add it to the hourly wage. The $70 number is excessively inflated. The union employees have taken concessions and a huge change in their healthcare package. Let me tell you, our Country would not have the standard of living it had up until now if it weren’t for the unions and General Motors. I’m not saying there aren’t flaws there - there are many - but allowing people to make a decent living isn’t a sin. Bankruptcy is not an option. People will be afraid to buy from them and the only thing that bankruptcy will do for GM is allow GM to break their promises to their suppliers and employees. We need these jobs and we need the money to stay here in America. GM is really only asking for a loan. They believe they will have it paid back within 2-3 years. If the US auto industry goes under, it is going to be “ugly” for everyone. I guarantee there won’t be many who will be able to afford your “import”.
FYI - The number one foreign brand of auto in China is Buick.
Weasley is right about one thing. the Volt MUST be built. Who builds it may be another issue.
But is Buick among,say the Top Three cars sold in Japan?
The Buicks sold in China are made in China or so I think.
lark, you are correct. Buicks sold in china are made in China. Buick as a brand is very popular in China.
Let me give some reality to ponder instead of ideologue republican talking points..
My partner’s cousin is principle of a middle school in Ohio where the Lordstown GM plant is the main employer. Four years ago, the percent of “economically distressed” children was about one third. Today the percentage of children that are “economically distressed” is about 55 percent. GM going under will create economic hardship to families and children well over 80 percent. Despite the bubble headed thinking that the Republicans use that some miracle company will come in..forget it.
We are not talking about “unemployment” , we are talking poverty. We aren’t talking about families “tightening their belts”, we are talking about families in foreclosure.
By investing in auto making we continue with good paying jobs, people staying in their homes and we have a tangible product being produced. We have been throwing money down a rabbit hole with AIG trying to figure out the value of a “toxic asset” and a credit swap derivative, which is nothing more than a piece of paper tied to another piece of paper, gambled and traded like a pyramid scheme in a fool’s game of speculation.
Since none of that 700 billion bail out is going to the average family in need of assistance with foreclosures, investing in the automakers is a way to keep the economy going by providing people with employment. Since the automakers actually produce a real product that can be sold, it is far more likely that we will see a return on our investment than we will with the 150 billion and counting we are pouring into AIG.
But my question is, what will we do in six months when they come back for more? Should the taxpayers pay these salaries indefinitely? Of course not. There is something fundamentally wrong with GM. If the unions and the management don’t give up some of their goodies, they are dead meat because America can’t pay for their losses indefinitely. That’s why I suggest Chapter 11. SOme jobs will be lost but many will be saved. Going on like they are indefinitely will mean everybody’s jobs will be gone eventually.
I think Chapter 13 will be better. We should allow a bubble to rise from the liquidation of all of GM assets. A bubble made out of a hundred potentially viable new car makers that could generate from having a need and having lots of people capable of filling those needs in new and innovative ways.
But what am I saying. Stupid of me. Palin lost her bid for VP. Now we have Obama and the Democrats. Erase what I said above. Let the whole thing continue whichever whatever whatever whichever.
I agree. GM and the unions made this bed and they are now falling out of it. I hate to see people losing their jobs or pension benefits, but both sides knew that the gravy train would end sooner rather than later. People are living longer and so keep their benefits for a longer time, especially healthcare. GM/others refused to produce the kind of cars wanted or needed by consumers. Everyone knew that energy costs were going to go up. But they pushed the envelope because they had to sell cars that could keep their profits up and we the consumer continued to buy them for the most part until gas hit $4 a gallon. They need to restructure and take the hit. Otherwise this is a band aid on a bleeding artery. My brother is a retiree and he would be hit hard by this, but even he understands what needs to be done. The unions better get on board here and work to restructure contracts with these companies. A job at a lower pay rate and benefits is better than no job or benefits at all.
Health care, too, is a primary force behind the dismal economics, this is really not being mentioned, instead the blame going to unions.
Same old shit.
Certainly, they need to put some type of oversight in place, but, given the current climate, I doubt it will happen.
As with the other bailouts, without a proper infrastructure in place to oversee improvements, or correct the problems that brought the big three to this crisis, why bother?
The system, the government is broken, full of stupid corrupt cowards.
Let’s see those issues addressed, first, before billions of dollars are again given to those just looking to cover their crimes.
Right.
So glad they put Bush, and now Obama in charge.
Disgusting people, both the democrats and republicans, responsible for the corruption, undermining national defense, traitors, really.
General Clark should know this, why are those people still in charge?
Eliot Spitzer wrote an excellent editorial in the WAPO yesterday, addressing this problem in a roundabout way, explaining how deregulation, and the psychological factors behind it helped to bankrupt the economy.
Our economy is NATIONAL SECURITY, someone brought up the point of economic terrorism in conjunction with Wall Street vulnerability, certainly NOT tin foil hat territory, it’s pretty easy to see how a lawless stock market can be gamed, from the top.
Here, though, at least they’re recognizing the problem, so it’s a start.
I agree, the union workers as well as the CEOs need to take a huge pay cut say around to $12.00/hr. This tactic would slow the bleeding,but not stop it completely. Restructuring is the only way to save any of the failing businesses. The big 3, AIG, and any other BIG CORPORATIONs asking for the handout….Start with the taxpaying Americans by restructuring the terms of their mortgages not bailing out the greedy……
Unions have taken a pay cut and took over their own health care.
I would like to know how people feel about “sorry some are going to loose their pension and health care” if that was you or your family suffering with looking poverty in the face. Who do you think is going to be supporting all of these newly poor…? You…. that is who. Who is going to make up for the loss in property taxes to the local governments..You…that is who.
You still haven’t shaken off the effects of Reagan brainwashing. Name me one autoworker or retired autoworker..”living high off the hog”.
Chapter 13 is not an option. Who is going to buy a car from a company in Chapter 13?
Ideological republican talking points satisfy me. Republicans politicians don’t. I just want to build my next car in my garage with parts I purchase at ebay.
Linda C. - thank you for your post.
Peg
The problem Linda is this. You have a big company like GM. Then you have lots of people or a few whichever that think they have a solution. Say X. Those are the Dems. They always have a solution to other people’s problems. They are smarter and know. And usually a big part of their solution involves mostly more money. More money puts more people to work. More people working end up producing more waste. And that waste fills the landfills with more and more stuff. Insatiable. What happened to relax.
More people working makes more waste…so therefore less people working provides more efficiency?
The bottom is going to hit hard my friends. Does anyone know the answer…Frankly no. We are not even close to bottom yet.
The “Republicans” are throwing money at big finance and hope that some of it sticks and trickles down to the rest of us. The Democrats want to throw a fraction of that money into a heavy industry.
I would rather throw some money into industry with some requirements on management pushing innovation than throwing money at a credit swap derivative.
Fine, they can have the money. They need to take paycuts, bust the union, get rid of some benefits, etc. EVERYONE is tightening their belts. Too bad for GM that they got here. Not our problem. And it’s not a REPUBLICAN talking point. That’s BS. I’m paying for this with my tax dollars too. Everyone has a hand out and we don’t have enough to keep doing it. I will be in poverty too when this is done with.
I grew up in the South. So I don’t get this line of thinking.
Why not move?
Why not retool one’s skills?
I just simply don’t get the notion that people sit and just go down the tubes.
The only people in the South who did that?
They ended up permanently poor.
I am also from the South. My father was a RR worker as was his father. Lots of work during WWII but afterward, layoffs were frequent. Hard to plan a family budget losing 2 or 3 weeks or work now and then.
My family came to CA after the war on a vacation (Route 66!) to visit relatives who had come here 10 years earlier and were still working at Mare Island Shipyard. My father looked up an old friend who was with the So. Pacific. He told Dad that he should go to the office because they were hiring and that he’d never be laid off again. He did, was hired on the spot. My mother, brother and I went back home on the train to sell our house and ship out our furniture, etc. He was right. My father not only was never out of work but was constantly promoted beyond anything he expected. Every time he was promoted it usually meant a house move…usually between the San Joaquin Valley and the Bay Area. But that’s what they did to promote their dreams.
My relatives remaining in the South prospered as well; not as quickly but had more stability.
*nodding*
My friends who remained in the South did OK, but they had their bumps along the way, too.
What I DON’T get is just sinking into poverty.
Those of us old enough to remember know there have been multiple “bailouts” of various members of the car industry.
This has literally been going on for decades. The car makers seem to be too incompetent to hire people that will manage the company well.
Then they dangle the “poor workers” in front of us as blackmail to get us to agree.
How about they hire competent CEO’s and COO’s, stop raiding worker’s pension funds, and stop giving the top managers who fail multimillion dollar golden parachutes?
Oh the poor families! Oh the poor workers! Funny how their sympathy only seems to show when they want something from the American taxpayers.
There is a symbiosis between the car maker’s top echelons and university faculties everywhere. This problem with automakers is the fault of universities unwillingness to challenge any part of that industry. Most universities have had the same sort of enabling and co-addiction to power as Hillary has shown as of late.
Glad to see I am not the only one who remembers the Lee Iacocca/Chrysler bail-out! Seems to me Chrysler was sold to Daimler and then Daimler dumped them.
Did that bail-out encourage the auto makers to go green? PLEASE! Still making gas guzzlers!
The technology exists for electric cars, natural gas powered vehicles, hydrogen. Why this continued dependence on fossil fuels??
NOT ONE PENNY of my tax money to continue propping up an industry stagnating in the last century. If they want to succeed, let them adapt and get in the forefront of green technology.
Right, but the problem is people can’t afford to BUY the cars, with so many other businesses shutting down.
They need a full economic overhaul, they simply don’t have the talent in place.
Other than Krugman, (and those who are more forward thinking, those able to understand the current dynamic and synthesize new solutions, unique to today’s problems, TRULY talented people as opposed to those with intellectual pretensions), I fail to see any in Washington who can understand, much less address these problems, constructively.
Obama is not Roosevelt, not even close.
My first car is a Toyota, my second car is a VW. I will never buy an American brand car because they are junk. Now tell me why we should bail out junk car manufactures?
Let them fail, let the union dissolve, cut the fat, and find competent management to get them back in track. Otherwise they will just come back to American taxpayers asking for more.
Exactly. I have purchased brand new VWs Rabbit and brand new Galant. Both excellent cars. I have owned many many GM cars, most of them used. I wouldn’t buy a brand new GM car for nothing. Why would I want to pay thousands of dollars for a car that the electric window will fail at about 20 months and at about that same time the alternator and the dash board will also short. I would be stupid. The cars are good cars, but not at a new car price. GM cars come to be good cars at about the 8th. year of use. The price at that stage are good, you can get a good deal and then its worth to fix them. And fun too. Much more fun than with a Japanese car which you can get in and out in half an hour. A GM needs at least a whole day’s worth of work to disassemble and assemble back.
Almost 9years ago i bout Plymouth Grand Voyager. Runs great, 187,000 on it, never fail.
More than 40 states are on the brink of bankruptcy. The poverty of those children now is only a drop in the bucket compared to the scope of our problems. It’s not just those children; it’s children across the US. The NBER hasn’t even pronounced us in a “recession” yet–can you wrap your brains around that? But we have tent cities springing up everywhere, bankruptcy rates soaring from September to October, we’re headed into something worse than a recession–and more and more articles in mainstream media use the word “depression” frequently now, in coverage of anecdotal evidence of what is going on in every industry–not just the auto industry. Whether or not the auto industry gets bailed out, the children in those families will still be living in poverty. You can’t sell cars to consumers who can’t afford to buy them; you can’t ship them overseas because the Eurozone is now in a “recession” and so is Japan. Baltic shipping index is a nightmare.
Think bigger in scope–and you’ll see the real threat to our national security. This country is bankrupt.
http://www.thehistorybox.com/ny_city/panics/panics_article1a.htm
No one is calling to use the “R” work officially until a Democrat is inaugurated as POTUS.
The change of Administration will be much more the passing of a turd rather than a torch or baton…
These workers and the auto industry in general along w their unions have been GREEDY, GREEDY, GREEDY. Our local GM plant went on strike because, omg…they asked workers to help pay some of their insurance premiums. Can you imagine?? With all the workers they have, along w the sky high wages they make, it would have been a blip in their income. Maybe they should come down to reality where the rest of us are.
They have been producing gas guzzling mammoth vehicles and now they are crying because sales are down? Please! Most of the cars are nowhere near the quality of Toyota or Honda either. I drove a Chevy for a long time. Kept having problems. Drove a Toyota and now a Honda Civic, excellent and much less expensive. Alot better gas mileage too.
If it is going to be detrimental to the economy, then help them but there needs to be major concessions by automaker CEO’s and all the employees. No bonuses, no free trips, wage cuts etc. And I mean MAJOR cuts. They also have to stop producing the gas guzzlers and build the economical ones.
The only other thing I have to say is BOO HOO.
We had a similar situation here in NW PA. Local company- Andover Industries- begged their union members to pick up some of the cost of their health care premiums. Guess what? The union said no- and three months later - Andover closed it’s doors here.
So rather that give up some of their pie- they now have NO PIE at all.
I know…GREED, PURE AND SIMPLE.
“Greed is GOOD!” - Gordon Gecko and the Yale classes of 1971-2007.
My employer offers pretty good health benefits, when I signed on for coverage, I didn’t really examine the plan. I was surprised after a Dr. visit that they sent me a bill for a hundred bucks. Turns out I have a five hundred dollar deductible.
I’ve signed up for medical savings accounts ever since they became available, so it’s no sweat I’ll just use money from that account to cover the deductible, but the point is, all of us are experiencing some kind of cutback in benefits, therefore PLAN ACCORDINGLY. wtf ever happened to stewardship of your own money?
I`m not taking sides but these are the latest wage figures I can find.
How much are current UAW auto industry wages?
In 2006 a typical UAW-represented assembler at GM earned $27.81 per hour of straight-time labor. A typical UAW-represented skilled-trades worker at GM earned $32.32 per hour of straight-time labor. Between 2003 and 2006, the wages of a typical UAW assembler have grown at about the same rate as wages in the private sector as a whole – roughly 9 percent. Part of that growth is due to cost-of-living adjustments that have helped prevent inflation from eroding the purchasing power of workers’ wages.
http://www.uaw.org/barg/07fact/fact02.php
my wages did not grow 9%, they grew about 3% then take away the increase of prices and I am in the hole. These people make almost twice that I do and I have a college education and most of them don’t. So they are still grossly overpaid. The pensions and benefits are ridiculous too.
So they are still grossly overpaid
Or you are grossly underpaid.
Actually, I work at a bigger company and my job at other companies is either about the same or less. So, No I am not grossly underpaid, The point is, most people without a college education do not or should not be making $27+ per hour plus lucrative benefits. That’s $56k a year, alot of college graduates don’t make near that.
The point is, most people without a college education do not or should not be making $27+ per hour plus lucrative benefits.
Why not? If a company is willing to pay why not? What is wrong with people being paid a decent wage and benefits?
Nothing is wrong with it if the company in question and its industry overall can afford it.
Clearly, automakers can’t.
My boss can’t afford to pay me $20.00+ an hour, so he doesn’t. My boss can’t afford to pay for a super-stellar health plan, so he doesn’t. He pays me a decent living wage and provides (at his cost) a health plan which pretty much amounts to little more than catastrophic coverage. I don’t whine and moan too much about my wages or my health care because, on balance, I am satisfied to earn a fair living and have a health care plan that would save me from financial ruin in the event of illness or accident. This allows my boss to stay in business, which thereby keeps me employed!
Automakers need to live in the real world like the rest of our employers do. Or they need to get out of business.
Ani, thank you for your article.
This is such a mess…who knows what is the right thing to do? I agree that the fundamental nature of the auto industry in the US must change, or all the bail-out money in the world won’t do them any good.
Another issue is the buyouts offered months ago. I read somewhere that GM employees were offered $100,000 buyout and a new car, not bad eh?
click my name for this story from Feb/08
The Detroit-based automaker is offering a new round of buyouts to all 74,000 of its U.S. hourly workers who are represented by the United Auto Workers.
The buyouts are not being offered to any of the approximately 13,000 GM workers in Canada, company and union officials said.
That is absolutely true. A co-worker has a neighbor that is 50 yrs old and GM gave her this buyout offer. Ridiculous.
I am against the auto industry bailout. Why are we doing handsprings on this sector when the government basically turned their back on the airline industry after 911. Management and labor did nothing to create the insuing fallout from that catastrophe. I think the Chrysler loans with Iococca worked great-how about that arrangement? Too far gone for that kind of workout, then let’s not throw good money after bad. Let’s not forget, however, that the workers build what they’re told to build. It’s the management that has been calling the bad shots while they stuff their pockets with millions. It all starts at the top and just goes down hill from there. Off with their heads!
but don’t forget the workers are the ones who decide whether to take concessions when the company is in trouble too. Most of the time, they go on strike.
Losing GM? About 10 years back, Oldsmobile’s last models were named “Intrigue;” it was hard to even find the name “Oldsmobile” anywhere on the vehicle. Then in 2004 Oldsmobile totally stopped production as a brand name. I remembered the wonderful Oldsmobile Rocket 88’s of the late ’40s and early ’50s. T thought it was very sad when Olds disappeared. Wiki says “When it was phased out, Oldsmobile was the oldest surviving American automobile marque, and one of the oldest in the world, after Daimler and Peugeot.” I guess “Olds” just sounded too “old” for this young brave new world.
Apart from military and economic considerations, how sad it would be for America if GM were to perish: no more Chevy, Buick, Caddy, Corvette, or Pontiac; no more GMC. Our culture would be impoverished by these losses.
Of course, some foreign automaker would likely buy at least some of the brand names. “Chevy” could be made by a Japanese company, or a German company. Now how sad is that?!?!? I didn’t even like losing the Edsel.
Losing GM is not change I can believe in.
Wes, if that’s the case, and we need GM’s plants to go to war, then let the Army take it over and manufacture tanks, military transport, etc. Or if you don’t want to be that “out in the open,” force the bailed out auto makers to cease making cars that are not good for the nation and start making those alternative fuel cars they love selling to anyone but Americans. And take a look at the overpaid positions in the organization and restructure. Cut salaries and tell the auto makers to get the hell out of the “mortgage” business. If people need a loan to buy a car, they should go to a credit union or a bank. On second thought, Wes, let the Army take it over. You all seem determined to go to more war so let’s just cut to the chase and start making those big bad tanks!
maybe the civilian security force can get into the automaking business.
GM has essentially ignored the market demand. They were not ready for the demand for fuel efficiency. Their problems are internal. The American taxpayer is not responsible for their greed and mismanagement.
I saw just the other day, the Toyota plant that builds the Tundra was shutting down for three months to retool to build a more efficient truck. Employees would be retrained during that period and lo and behold they don’t need government [ taxpayer ] money to do it.
Aren’t all the Toyota, Nissan, Honda plants located in the South?
aka the red states?
No, they are located in Ohio, Michigan, Indiana, Missouri and many other states. Not just in the south……..
Interesting post Ani!
My first inclination is that the unions, who whole-heartedly suported BO, are now in line for their bribe payments.
I do agree with Clark that we need a stong industrial base…many have said that for years, while workers have been pushed into high-tech fields and the lowly service industry. We should have maintained some middle ground for talented people who are skilled in manual labor!
In truth, no matter the brand of vehicle, component makers across this country, produce parts for auto makers.
This problem spans much futher than Detroit!
IS this really the fault of the unions, though, or of management?
I dont really see much difference between a corrupt union head, and a corrupt GM manager.
Well, Wes Clark’s point is one that many of us probably hadn’t considered.
In any event, it appears that some form of a bailout is a slamdunk.
I personally think they need to retool and provide a product that someone will actually buy.
In Western new york, we have a General Motors, and a Ford plant. I am a retiree of Ford. I always felt that our wages could have been much reduced, but the ‘Union” always wanted more! We do pay monthly for Health Ins, and it should be more.
I do not believe that the auto cos. need this bail out.
Ford still owns Volvo, Land Rover and Jaguar, $$$$$$
I’ve always driven Fords and have been satisfied with their performance. My last car, a crown vic was just sold, with 187,000 miles, still running. I have a 1992 van with 152,000 and still running.
I now drive an 08 Merc Milan (27.6mpg city).
If people would not adore Toyota so much, the auto cos. would be in better shape. Their upper management is obscenly overpaid.
Did you know that in the 70’s Ford owned a large per cent of Toyota (when they were junk) I guess they learned a lot from Ford!!!
I will NEVER buy foreign and support Japanese auto makers. And will always look for the American made products. There are still many in the stores.
I have no respect for any one that supports Japanese autos. (VW has a small market share)
Well, that makes sense to me, since you’re an employee.
I currently drive a Ford - It’s an escort, so no complaints on the mpg.
I’m in the market for a vehicle, I actually like the Mercury Mariner.
I do not think the Detroit automakers are dead.
Ford in particular is coming out with some forward thinking ideas and car designs. Brian Mullaly as the new CEO was supposed to get them back on track.
I wonder what are his thoughts on a possible auto bailout?
if US automakers were not so greedy and charge so much maybe some of us would buy their cars. I looked at US cars first before I purchased my Honda. I got a much nicer and well equipped car for about $7000 less. These US manufacturers forget that we all don’t make the wages they do. We have to buy according to the best deal. The US makers don’t have it. GREED.
For me, it was always an issue of dependability.
I bought a Jeep Cherokee about 15 years ago, it barely lasted 100, 000 miles, and really, I didn’t drive it THAT hard, fast maybe, at times, but not very aggressively.
The small, moderately priced Japanese cars just seem better able to handle the slams and bumps that comprise modern urban driving. My first car, a Toyota Corolla, went over 100, 000 with barely a bump, except for a fan belt problem due to a moronic mechanic, out of FL.
My very expensive BMW would slightly bump a curb, messing up the alignment, it was fun to drive, but I can’t say it was superior to an American car in terms of reliability. And for the money, it should have been.
For awhile, BMW was not putting cup holders in it’s 5 series, it was a snub, you know, “if you’re looking for a cup holder, you shouldn’t buy a BMW.” But where I live, fifty mile commutes are not uncommon — how arrogant can a car manufacturer be to not meet it’s customer’s demands? Bad business decisions, all around, like the American manufacturers.
I too, would rather buy American, they just make it difficult.
Ford, though, has come up with some styling I find superior to the others cars, I dont’ want anything flashy, I’m not my car, again, it comes down to price, dependability and gas mileage, a green car now, progressing with the times.
They CAN do it, they just aren’t.
And that’s from the top, bad management, nothing to do with even the concept of unions…
And even though they haven’t lowered the speed limit, I try to drive about 55, or 60, when on the freeways, to save gas.
It’s prudent, speeding is stupid, those days are gone. Those who drive by at 90 mph look the kook, unable to exercise any command of their vehicle, whatsoever, obtuse to their surroundings.
Re:
your Jeep Cherokee.
I was also looking at Grand Cherokees, but Consumer Reports doesn’t have a whole lotta love for them…
Mine WAS a grand Cherokee, and they were right…
I wouldn’t buy another one, though I did like the styling.
In the end, it comes down reliability, a shop car is useless…
I haven’t looked at American cars in 20 years.
How can they survive when nobody wants the product?
Gosh, this is tough to read. Since his post primary performance I can’t stand Wes Clark.
My heart goes out to employees and retirees of the Big Three. However, my understanding is that their pension benefits are actually overfunded at this point and how many retirees get health benefits anyway? Think about this — the money spent bailing out a failing industry will not be available as seed money for new industries and technologies that our country needs.
Here’s the thing - there is $25 Bn available for the re-tooling/R&D necessary for changes Detroit needs to make. The ADDITIONAL $25 Bn is for the pensions, etc. Seems to me that this is massive mismanagement on the part of the automakers. They charged more for the cars to compensate for union wages, yet now they can’t pay? SOMEONE got that money, so who was it?? And why should WE be paying others’ pensions when so many of US lost our savings over the past two stockmarket meltdowns? What happened in Detroit was mismanagement on a major scale, and they should be held accountable for that.
And given that the Army has been getting all of these Humvees from Detroit, why aren’t they doing better???? Those things aren’t FREE, after all! Considering how long we have been in Iraq and Afghanistan, no doubt they have had to make plenty. Are you telling me management didn’t take into account the COST of making those when it started selling them to the gov’t?? C’mon, already.
And Linda, I have never been a Rep. a day in my life - well, until I voted for McCain. But this is getting to be ridiculous. We’re bailing out the banks (thanks, Dodd, Obama, Pelosi, et al for NO oversight of Fannie and Freddie, and THANKS ACORN for pushing those banks to give sub-prime mortgages!), now American Express? And paying the Union benefits the COMPANY was supposed to pay?? It’s ridiculous! When companies go into bankruptcy, it allows them to RESTRUCTURE, and there is money for Detroit to do that. They are where they are because of their own management, plain and simple. At some point, these companies have to be held accountable (that goes for the unions, too!!).
Oh, Wes…Stop. Just stop. You were held in such high regard, WHY are you trashing your reputation so?!?!?
Yeah, thanks, Amy, I’m in the same place with all of this.
I just don’t know why he’s out there pushing so much koolaid.
And if someone knows something we don’t know, I wish they’d just come out and tell us what that is — instead of asking us to do something that feels irresponsible with so little information.
I agree, but he kinda pointed out our economy has been subject to an almost economic terrorism, and perhaps people need to start understanding how it plays into national defense, how the devastation of the markets is as dangerous to America as the WTC bombing, in it’s own way, a corrupt Wall Streeter as dangerous as Osama.
But giving any of those losers anymore money is just irresponsible.
I smell RICO.
I recollect that the US taxpayers already bailed out Chrysler once…They didn’t learn their lesson then…I’m skeptical that their management will learn anything from a new bailout now, except that if they continue to mismanage their assets, taxpayers will bail them out yet again….
I love Wes Clark. I always carefully reflect on anything he says. This is worthwhile considering for sure.
Yes, I just wish I had more faith in who would be overseeing this — I, too, fear it is just delaying the inevitable since there have been so many bailouts in the past.
Gore was talking about the fact that American autos are becoming far less competitive in the world marketplace because of cafe standards.
This is something that should have been addressed a long time ago instead of these companies continuing to produce gas guzzling cars — how selfish, with no concern for economy, safety or environment.
And ctiizens have to take responsiblity, too, because they didn’t have to buy them.
I don’t know enough about manufacturing to truly comment.
I understand our plants are terribly outdated.
Retooling is not something done overnight.
Seems to me?
We’ve blown it.
The industry is dead.
If the plants are outdated, it gives them the prefect excuse to go green, with more modern technology.
That alone will get the juice running, for some.
No bailouts.
They just delay the inevitable and reward badly run businesses.
I worked for Wes Clark and in my opinion he should be first against the wall. He is a selfserviing creep who would condemn his own mother for his ego. Like Obama.
It is vital that the big 3 go into chapter 11. It is the only way we can possibly set them up for success.
I understand the need for collective barganing–but no to the extent that the leaders of the unions are earing money like the CEO’s on the backs of the union dues of laborers.
I haven’t owned a car built by Ford,GM or Chrysler ever. The last one owned by my parents was such a disaster I am unwilling to trust my family to them.
I buy German. Even when there are built here in the USA because they are reliable.
The honest to god reason that the BIG 3 are losing market share is that they build rotton cars that don’t last. Ford Trucks are the exception.
My BMW had over 600,000 miles on it when I sold it. But this is not exceptional it is common. VWs are great cars and last with great mileage. The 18 year old Mercedes sedan has well over 100,000 miles on it and still gets 28 MPG City. The newer one (2004) gets 32 MPG City. Better than most hybrids on the market today.
When the carmakers make cars that we wnat to buy they will succeed. Until then they will struggle and the Unions will kill them. No matter how much money we as the taxpayers sink in the industry it will not help. The leaders of Industry failed the first rule of business–watch the balance sheet and keep ahead of the trends.
Jackie,
Surely you are entitled to your opinion about Clark but I know people who have worked for him as well and say the opposite. I just wonder about your reasons here (not wanting to invade your privacy, though) but overall - why you feel this way, if you feel comfortable sharing that. Thanks.
“when car makers make the cars we want”
Let’s not forget that we consumers loved buying those SUVs and kept that market humming for quite a number of years. We loved those cars and only stopped buying them when gas prices started to get too pricey. Thye were so much cooler than the beloved minivan. Not until gas got over $3 a gallon did sales begin to slip. Consumers have a hand in this disaster too.
Wes Clark…nothing but someone looking to get into the “in crowd”…to think, I used to be a Clarkie!
His gushing about the Lebanon war a couple of summers ago on FOX was the turning point for me, away from that!
The auto makers down south aren’t having the problems that they are seeing up north….yet. Less union entitlements. Very few unions in the south.
Why not open the corportions up to the employees, and let the employees buy the company? Corning did that here in my area, and they turned the company around, and it is now a high paying, steady, firmly grounded company that turns a profit every year, and seldom if ever has layoffs. So open the company up, let it become an employee owned and employee run corporation.
Perhaps the employees aren’t intelligent enough, I mean, that’s what the smart people in Washington keep telling us, only those with a graduate degree can do the work, right?
I mean, the guy who developed one of the derivative formulas which broke the economy, I was reading, not too long ago, where he still thought the economy could on, using those formulas, without any real job or asset creation.
Their economic and defense models, flawless, as evidenced by the success of the war, and Wall Street.
Good post.
You know what my own grad degree did for me?
Finally disabuse me of any notion of my own superiority. LOL*
I FINALLY saw that what I don’t know will ALWAYS be bigger than what I do know.
That’s probably why I liked Sarah, too. I am not, obviously if you read my posts, too darn keen on the intelligensia.
They are very often wrong.
It really isn’t the graduate degree, per se, but the belief it somehow confers superiority, when the holder of said degree is such a mediocre nut, such a stupid inferior, with absolutely no results, whatsoever, to show for his advanced education.
In fact, those responsible for this debacle still are in denial, or still unable to even understand how their models were so easily cracked, so flawed.
Why?
I mean, I can’t take them seriously, I certainly hope someone can catch on, taking psychic refuge under a worthless graduate degree is the first sign they don’t have the talent. In the real world, you get hurt.
I will be treading in the waters of graduate school soon. And, after my bachelors, I feel like you guys.
So why go to graduate school? To remain competative. I guess.
No, you can learn, you can be original and contribute, it’s just the advanced degree has become such an empty marketing tool, as opposed to a true measure of intellectual worth, and creativity.
B Gates dropped out of Harvard, as a freshman, yet no one questions his abilty. Yet Paul Bremner, and Wolfowitz, despite their advanced degrees, crashed Iraq, and the economy, the whole war design catastrophically flawed.
Yet they still take refuge in their degress?
Who do they think they’re fooling?
Someone once told me the minute they start referring to their credentials is the minute they feel threatened, revealing they don’t understand the alphabet, so to speak.
And he’s never been wrong, in that.
So, you know, you have them, the insecurity easy to push.
Well, they’re smart enough to get paid $83 an HOUR!!! Holy cow, with all of my advanced education, I would NEVER get paid that much an hour (in fact, ministry is one of the areas in which we are supposed to be happy with a pittance - I guess because it is our “calling,” which seems to take major advantage of one’s core being. That’s another story. Anywho - people coming out of college were making more than I was,and working far fewer hours. My pay was actually considered GOOD, too.).
Either you believe money is the standard by which you are judged………
or you don’t.
I don’t.
Artists and musicians get taken advantage of the same way. Because they love their work, people ask them to do things for less or even nothing.
You could always go into televangelism or become the pastor and confidant of a future president and get a huge payout for you to keep your mouth shut.
I was thinking yesterday maybe I was wrong and you were a pseudo minister which makes you the kind of minister I would like, if I would ever choose a religion for myself.
In other words, you think outside the box and use colorful metaphors, kinda like that preacher in the Poseidon Adventure.
Wes Clark is a parrot at this point.
http://mjperry.blogspot.com/2007/07/uaw-pricing-themselves-out-of-market.html
I do not have the direct link to that study, but apparently it comes through Forbes.
At any rate you can see the GIANT problem with The Big 3, they are spending way tooo much money paying their workers. It sounds harsh, but they are trying to exist in an economy that for the longest time has not be able to bear them. Their average wage (pay+benefits) is out of sync with the market.
Then you can compare them to the Japanese auto workers who make a better car at a cheaper employee price.
Although the whole thing is kinda funny to me. If you check out the prices for Ford- they are cheap as h*ll. While Honda remains pretty darn pricey. It would seem to be the opposite when you look at at least one aspect of their overhead.
But the reality is that they can not survive unless they become competative. And in order to become competative they need to spend more of THEIR OWN MONEY on R&D and cut overhead.
NO MORE BAILOUTS!!!
At any rate you can see the GIANT problem with The Big 3, they are spending way tooo much money paying their workers. It sounds harsh, but they are trying to exist in an economy that for the longest time has not be able to bear them. Their average wage (pay+benefits) is out of sync with the market.
———
The data doesn’t mean a thing, it’s the ability to identify the true causative factors, and how they relate.
(And in this case, it’s not labor).
For example, health care costs are destroying the economy, (for all of us, union or not), no matter if the benefits are cut, it will still destroy the economy until action is taken, the work force bearing more of the burden, more problems developing for management, and the business still failing.
They kinda miss this, always specious thinking, leading to this mess, we see today.
So, the data, if it’s even correct, is never analyzed correctly, the decision making flawed from the start.
And I’m not even speaking bias, I’m speaking a lack of intellectual ability.
So you think govt should control healthcare too? Recipe for disaster. How about going after the big lobbyists for the pharma companies or the insurance companies. Lobbying should have never been allowed. Was supposed to be illegal at one point in time but oh how that changed. So many things should be changed that nothing probably ever will. The perfect storm has made landfall in the good old USA.
From Linda C:
I’m not a Republican so your comment is irrelevant to me, personally, and it’s also irrelevant to the discussion. A point is either valid or not, regardless of the source. All Republicans are not evil, as all Democrats are not closet commies.
So, let’s skip the name-calling and talk reality since that’s your stated preference.
Nobody wants to throw innocent children out into the snow or into a ditch. To suggest that the issue at hand is merely a question of social justice and personal conscience is delusional.
You want the federal government to hand over money to auto companies (not through the bankruptcy courts, which is the normal way that the government “gives” money to companies by allowing them to pay creditors on a structured basis, release companies from some compensation requirements, temporarily, and in other ways, assuming reorganization will work — in either case, the business fundamentals have to be sound or it’s merely postponing the inevitable), solely because it’s “good” for these companies to stay in business. Good because, otherwise, people who work for the companies won’t have jobs and that will be “bad” for the people involved.
[I'm also assuming, perhaps unfairly, that the workers (and unions) involved would march in protest if asked to actually contribute to fixing the mess through wage and benefit reductions so they're more in line with the rest of the world.]
Don’t take this as a lack of sympathy; merely a dose of reality.
The principles of economics have no brain, nor heart, nor hands nor feet. They are not human. And they don’t care whether or not we’re comfortable with that. They are principles and they operate as principles, as expected, given certain variables. Doing what they do without regard to their effect on particular people or whether those people are our friends, our enemies, or our own family.
Giving GM money so they can continue to make vehicles that people don’t buy makes no sense and, simply, won’t work. No matter how much we wish it were possible. The economy just won’t work like that. You might as well just close the plants and send the money directly to the workers, if that’s the goal, because making the cars is simply an afterthought in this scenario. We’ll make unprofitable products just so we can pay people to make them?
That’s just plain dumb. No matter what your political persuasion.
Yes, sometimes, reality bites.
p.s. / I expect we’re going to do it anyway, though. Why? Out of sympathy? Maybe a little. But, mostly because of the electoral college map.
I’m not a Republican so your comment is irrelevant to me, personally, and it’s also irrelevant to the discussion. A point is either valid or not, regardless of the source. All Republicans are not evil, as all Democrats are not closet commies
———
Ya know, it wasn’t my impression she made an invalid point.
Republicans, and their democratic counterparts rely on talking points as part of a larger political agenda.
But the greater point is, without the right policy and decisions, no matter your agenda, you will fail.
As with Cheney, and deregulation, do you have a right to take the country with you?
And the asnwer is no.
We have a process for aiding distressed companies: it is called Chapter 11. It is overseen by a bankruptcy court, to ensure that a company operating while in Chapter 11 does so according to basic minimum standards of good business sense. The company submits to a court a business plan - how it will pay creditors, how it is going to restructure so that it can emerge from bankruptcy.
Part of the plan can be how to handle the issue of warrantying cars that are being produced by a company that may not survive a bankruptcy - although the usual way of dealing with this is to drop prices.
The point is, we HAVE a system for dealing with distressed companies, and some very large companies - e.g. U.S. Steel - who were no less important to national security than GM is, have gone through that system.
Congress and Sec. Paulson opened a pandora’s box with TARP and there’s no telling when the handouts will end.
Great post, Heidi. I’m with you.
I think we send a very dangerous message with these bailouts.
Absolutely correct but will it happen? Probably not because too many elected officials owe too many favors for their positions of power, including the One. Plus the controlling party (Dems) want to manage every private citizen’s life. There is only one small hope in my opinion, and that’s for all of us to blitz our representatives daily not to vote for anymore bailouts for private industry.
a lot of people are putting this GM problem on the union employees. I guess that is easy you can find out what they are being paid. I don’t see any wage,
and beny package of management!!! Also the person on the production line does’t not deciede to build cars that get 20 miles to the gallon and have more add ons than I can list this is done by management. I also think you should think about all the other jobs that will go down the drain and the tax money that will not be collected this will be very hard on all of us.
MT
I work in a factory on an assembly line that supplies parts to the big 3. I only make a little less than $12 per hour. We get a cost of living increase of 2% every year, but we haven’t gotten one in a last couple of years.
Our benefits have been getting cut because of the big 3. The big 3 have been demanding that their suppliers sell them parts cheaper and cheaper. That means my company has to cut our benefits and workforce. Whereas, alot of us have to do TWO jobs and work faster for the same pay. Bullshit. Let the big 3 go fail!!
Sounds like you could use a Union in your shop.
Maybe GM should include a DVD of ‘Pearl Harbor’ with each new vehicle.
It was American manufacturing that helped the US win WWII. It also saved alot of American lives.
Maybe, if it had gone the other way. Alot of these naysayers would not even exist. They would have no parents or grand parents.
Cars that dont last?
We have..
2001 Cadillac DTS 182k miles.
2003 Saturn VUE 147k miles.
Just bought a new 2009 Chevrolet Traverse. (01/03/2009)
Others we have had..
1992 Pontiac Bonneville. 232k.
1993 Cadillac SLS. 224k.
1987 Buick turbo. 230k.
I think the big problem all over the North America is with forein imports even on clothing to cars .we can not compite with salaries of 2 dollars an hour .The costs of living over here is not the same as the undevelope countries .Big companies pay taxes and the salaries employies also .How can we keep the North American people have a living up to our needs .health care ,pension and education and rents are all too important to us and our people .But the big bonsus and big ceo salaries they are the one that affects our econcomy .The big 3 started here and made our country what it is .