Hard to argue with any of the points against the auto sector. Bad management, poor decision making, greedy unions, over-paid executives, bad product. It's one hell of an abortion.

But do the math when looking at the impact of failure and its easy to see why its such a huge fucking problem.

- lost tax revenue from est. 1,000,000 jobs (combined with spin off industries) = billions
- lost tax revenue from auto manufacturers and their sub-contractors = billions
- increased cost to social programs to support displaced workers = billions
- the impact on communities dependant on the auto sector = billions

I just don't know how someone can say, go ahead, pull the plug. Its not that simple.

<h1> Yet Another GM Bailout</h1>
Daily Article by Briggs Armstrong | Posted on 11/10/2008

General Motors has once again approached the federal government with its hand out. It should not be forgotten that in September of 2008, Congress gave the "big three" automakers a loan totaling $25 billion. Now they are back. This time they say that with a mere $50 billion they can turn things around and become profitable in the future. The management of GM and Ford as well as the UAW have been meeting with Nancy Pelosi to arrange a deal. GM claims that if the government does not give them the money they demand it will spell doom for the company and thus the entire US economy.

Let's consider the impact of GM ceasing to exist — highly unlikely even if they declare bankruptcy. Hypothetically, GM would close its doors and all 266,000 workers would be unemployed, never to find work again, or so GM would have the public believe. GM maintains that it is really in the best interest of the country and economy to continue to support their failing business model. After all, in what kind of a world would the government allow a company that employs 266,000 workers to fail?

Descending into an abstract economics lesson about shifting resources to marginally more productive activities may be ineffective; therefore, I will approach this issue from a more philosophical angle.

The basis of GM's claim is essentially that they are too big or too important to fail due to their massive labor force. But how massive is their labor force relative to other American companies? It may be surprising that the following companies employ a larger number of workers than GM: Target, AT&T, GE, IBM, McDonalds, Citigroup, Kroger, Sears, and Wal-Mart. It is also worth noting that Home Depot, United Technologies, and Verizon all employ nearly as many workers as GM.

The question must be posed: Should the government bail out all 12 of these companies and, if so, at what cost? I doubt that if Wal-Mart, with their 2.1 million employees, went to the government or the American people and demanded a bailout that they would receive much sympathy, let alone money. But if we are going to base worthiness of bailout on number of employees alone, then Wal-Mart is almost 7 times more worthy than GM.

(I have largely neglected Ford, whose executives are also demanding a bailout. I believe that it is enough to simply state that Abercrombie & Fitch employs almost 7,000 more workers than does Ford. Would the failure of Abercrombie & Fitch's threaten the economy? I think not.)

It is unethical to force taxpayers to pay billions of dollars in order to bail out a company with a failing business model. After all, they cannot even claim, as banks did, that it is an industry-wide problem. Because if it were industry-wide, Toyota, Hyundai, Honda, Volkswagen, etc. would all be joining their American counterparts on Capitol Hill with their collective hands out.

For years GM and Ford have produced a product that consumers do not value as much as the product provided by their competitors. Rather than changing their products or business model, they instead spent small fortunes on lobbyists. If the government does bail out GM, rest assured that this will not be the last time. But even if the government gives GM a check every week, there will come a time when no amount of government money will be enough to save them.

What is the best solution? In a word, bankruptcy. By filing for bankruptcy protection, GM can escape the death grip the UAW has on the business. Bankruptcy would allow for restructuring on an unprecedented scale. There is a good chance that a highly competitive company could rise from the ashes of what we today call GM. Even if GM itself was unable to survive bankruptcy, the resources freed from its grasp could be hugely beneficial to other automotive companies that make products that American consumers value more. As taxpayers, we have a right to object to this misuse of our money.

Original Article

Anyways, to answer your question FUCK NO, LET THEM FAIL.

The American auto industry is one the worst(if not the worst) run industries there is.

Think about how many times they have literally TRIED to fuck people over. Think about all the fucking lobbying they have done to keep hybrids and gas efficient cars off the road. Remember occasionally hearing stories about cars running on water or on vegetable oil? Wonder why you never hear about these innovations again? Easy, the AUTO and OIL industries have tag-teamed to make sure you get screwed. They have had incredible techonology for YEARS that they have purposely kept under wraps strictly to FUCK the public out of a little more money. Let these greedy fucks die and then have OIL go right down with them.

A top GM exec was even quoted as saying something to the effect of "we build cars to run as efficiently as possible for nearly a decade...and then they fall apart. Service and repairs are a big part of our industry and anyone keeping the same car for over 10 years should expect to have major wear and tear."

I pretty much agree word for word with what BigJohn and Jesterwords have said. It's time to face reality folks. The U.S automakers have lost. They make an inferior product and have a much higher overhead than their foreign competitors. All the taxpayer bailout money in the world will not change the fact that American cars are a cheaply made joke, and no one wants to buy them. Pretty soon these guys will be crawling back to Washington, hat in hand, asking for one more chance.

Let them Fail. Fuck the American auto companies . And I agree, the dems almost certainly don't these guys going under, so while I'm at it, fuck the democratic congress as well.

my new wonder, how will they take out the new solar panel advances?
pye look up Nanosolar or photovoltaic inks if you haven't before.

 

Originally Posted by no_clue100

The funny thing about this is that my brother in law is a pipefitter and is a union guy. He used to get on my case all the time about me owning a Nissan Pathfinder (made in NC I believe) and a Camry (made in KY).

That's a strange thing in itself. I used to own a Chevy Nova which was a Toyota Corolla made at a Chev/Toyota joint venture in California. The whole industry is so convoluted its hard to say what you're getting and from where.

 

Originally Posted by Nickc011

Ok, what I don't understand is that won't the business just fail again? The whole crux of their business problems is that the Japanese and other foreign auto companies are putting out better cars, and I don't think thats going to change. People are always going to look at a honda and think that they can drive it into the ground. I dont think GM will ever get that reputation no matter how much they advertise.

Exactly. It's total weaksauceaments. These companies WILL NOT CHANGE UNLESS THEY FAIL. I don't understand at all how this isn't obvious to our government...actually I do know how it isn't obvious--$$$ and friends in high places.

It's retarded. It's like giving a drug addict money to "support" himself in the "hope" that he will suddenly just "turn it around." At some point you have to just let that addict shoot himself into oblivion.

 

Originally Posted by saxman

I agree that on the surface its not fair but the problem is that restaurant and retail businesses are service sector jobs that tend to be on the low end of pay scale. We're replacing many of our good paying industrial sector jobs with low paying service sector jobs and quite frankly, most people can't survive today on $10/hour. The other issue with this is that most of the goods that come from the retail sector are also manufactured off-shore. Take a look at the labels the next time you buy something at Wal-Mart or any other corporate retailer. The materials used to make those products didn't come from North America and the labour that was used to assemble them didn't come from North America either. It's a vicious circle IMO.

so break the fucking vicious cycle. you reap what you sow, period, and no form of welfare is going to change that. instead of trying to cover up the problem and delay the inevitable, why not examine the reasons why our businesses are failing and either fix them or let them die? when you punish the strong to prop up the weak, society as a whole gets weaker. companies don't exist to provide people with jobs, they exist to create value. when they cease creating value, they shouldn't exist. if you want to help, maybe think twice next time before you advocate higher taxes, more regulation, a higher minimum wage, or some other anti-business policy.

 

Originally Posted by emcee21

if you want to help, maybe think twice next time before you advocate higher taxes, more regulation, a higher minimum wage, or some other anti-business policy.

I was okay with your argument up until there.....well as okay as I can be...

But when you talk about higher taxes, more regulation, higher minimum wage, "or some other anti-business policy" - you lost me there.

I am anything but anti-business. Maybe you could explain why there is a need for regulation in industry? Perhaps because they continue to prove that they are not capable of regulating themselves? Or minimum wage? I guess everyone should just trust businesses to pay people what they think is fair? I mean i think its great that the guy who runs a failing company pays himself 20 million and argues against his workers making $40k. And taxes? Sure lets just let them pay what they think is fair while we try and repair the environment that they destroy. Let's just let the corporations run the show. They've proven that they can. Good thinking.

The Australian Government has just announced $AU 3.4 billion ( $US 2.3 billion) bailout for GM, Ford & Toyota here. All other car companies here are vehicle importers. I realise that that appears to be a pittance in terms of the American market but in our much smaller market its a significant investment.

It comes with a number of strings;

1. They have to invest in "green" vehicle development/production
2. They have to factor in reduced import tariffs
3. The payment is over the period of 2011 to 2020

All the articles from the local "experts" included side commentary that there is an expectation in the industry that GM and Ford will fail in the US. There was also some conjecture on the likelihood that the industry here would rationalise and Toyota would end up owning the local GM & Ford businesses in the longer term

Car industry was already doing bad anyway. So first reduce (less brands, sell some to competitors) and restructure (even after bail out, US cars are still too expensive to compete). So Gov't borrow money or buy preferred tock, sell of part and restructure amd then float again and recover investment at acceptable cost for tax payer.

Except they can do this (whilst getting rid of detrimental unionisation etc) without stealing any of your money.

This is exactly what will happen if they fail & someone else buys them.

Let the free market work.

 

Originally Posted by saxman

Emcee, I really don't understand how you can argue about the self regulation issue. I didn't post specifics because I didnt feel it was necessary. The recent banking fiasco being the most obvious.

I don't really think of it as "self-regulation" - regulation implies some goal, unless I know what that is I don't really know what we're talking about. I understand that the conventional wisdom is that corporations are evil and that we need kind-hearted, altruistic politicians to temper their greed. I'm here to question that wisdom.

With regard to the current financial mess, this has been debated ad nauseum on this forum - suffice to say there is a strong case that much of it is due to government intervention, and not the lack of it.

 

Originally Posted by saxman

Canadians have had many of the social programs you find "unconstitutional" for years and years. Our problem has always been, how much is enough, and at what cost (social programs).

It's never enough, and the cost is our rights to liberty and property (and that's just for starters).

sigh, hope and change

http://www.bloomberg.com/apps/news?p...amp;refer=home

its a proven fact foriegn cars made in the usa are more american made than american cars are. we import more parts for the cars from elsewhere than they do! the whole go american issue died long ago once they were made here.

imo a few people at the top get a check sent over there instead of to a rich family here, it wont break us. the american workers build the cars and thats the majority of the people and certainly the only people we should give a fuck about.

we get the taxes and the benefits of those employees spending their money in our economy and thats FAR better than just getting some import tax -which is nice too. most of them are made here now but a few exceptions like VW are building plants now also because the dollar is killing them overseas and then bringing them in. once they start making them here they wont be leaving. i would be better with a mandate that if you cant build plants here, tough break, the import taxes just went up again bish. they will build plants so fast it will be funny. currently they are trying to save jobs for their own countries which is admirable but not our problem if you are selling the cars here.

why would you not have two operation points for selling to two different places anyhow? yeah they have jobs to protect but they can still sell to the rest of the world from there. the costs of getting them here eat into margins. mcdonalds started growing all their food and beef in Russia when they went there because they found it too costly, guess who is the better run company?