Should the Government bail out the Auto Makers in the US?

[slingshot]

It is complicated.  I lean toward a loan package or essentially government credit for the time being. I believe the Democrats are sure to push something through because of the unions.  But I would want some union concessions prior to any money changing hands.  Unions say it's a partnership, so let's make it one.  Both parties give. The viagra thing with General Motors bugs me to no end; $17 million.  What are your thoughts?

[Boomhauer]

Hell NO.

Let them FAIL.

The Big Three have screwed themselves, and it's time to pay the piper. Letting the unions take control and producing crappy cars...they need to GO.

[Modifiedbrowning]

I am very torn on this issue as it the Democrats who destroyed the economy and now are in charge of the whole bailout. I can (very slightly) see the need to give the COs money to keep operating, but it should not be in any way under the control of the Dems.
Also, I am firmly opposed to .gov have any sort of ownership in any of these companies.
The Gov caused this problem so they are responsible to fix it, but it should have never happened in the first place.
It just amazes me that the Dems somehow convinced the people (and the Repubs did nothing to refute it) that the Repubs and deregulation are the cause of the problem.

[Firethorn]

chapter 11.  Those who dealed/loaned/owned are up the creek a bit, but the assets would be liberated for use by a company that might actually be able to make a profit with them.

They need to shed their legacy costs and legacy overpaid management.

One guy at work asked me what would happen if the company that his mortgage is through goes belly up - I responded that his contract would be up for bid like all the other assets- at most he'd have to change his payment address.

[De Selby]

I am very torn on this issue as it the Democrats who destroyed the economy and now are in charge of the whole bailout. I can (very slightly) see the need to give the COs money to keep operating, but it should not be in any way under the control of the Dems.
Also, I am firmly opposed to .gov have any sort of ownership in any of these companies.
The Gov caused this problem so they are responsible to fix it, but it should have never happened in the first place.
It just amazes me that the Dems somehow convinced the people (and the Repubs did nothing to refute it) that the Repubs and deregulation are the cause of the problem.

How did the government cause the failure of the big three auto makers?

[Bigjake]

should the .gov bail out union infested big 3 auto makers??

Abso-friggin-lutly  not.

[Standing Wolf]

Not with my tax dollars! Not under any version of the Constitution I've ever read!

[Lee]

Depends....do I get a free Toyota if I say yes?

[Modifiedbrowning]

How did the government cause the failure of the big three auto makers?

Please reread my post. Federal regulation overburdened the Financial Industry which is now causing problems with other industries. I never said .gov caused the failure of the big three auto makers.

[Jim147]

I don't agree with bailing them out.

But you do have to look at the number of jobs involved.
Not just the UAW.
There are a lot of vendors that live on those contracts.
Then you have the dealerships.
Then you have the blow to America.
A car is a big investment.
If you don't think a manufacturer will be around to back it, you don't want to buy that product.
There are still a lot of Americans that are stuck on buying American only.

It is a very rough call on this one.

[Monkeyleg]

Yes, it's a tough call. I don't see an upside for our economy if they go under, especially right now when the economy is teetering as it is.

On the other hand, when I saw that my business was headed south, I sold all of my equipment, cashed in all of my retirement savings, and paid off my creditors. Nobody bailed me out. Also, in spite of the fact that I've worked 60-100 hours a week for over 20 years, I don't get the equivalent of $81 an hour in wages and benefits that production line workers do.

Hard to be sympathetic when the white and blue collar guys who were flashing their cash now want little guys like me to pay for their self-inflicted problems.

[Sindawe]

Nope.  The big three have turned out garbage for years, letting the Asian manufacturers eat their lunch on reasonable priced transportation that was well built AND failing to live up to their image on the high priced SUV/Lux market.

Bailing 'em out makes as much sense as bailing out makers of whips & tack would have 100 some years ago.  If they MUST spend our money, put it into revitalizing the road and rail systems.

[Manedwolf]

Bankruptcy is not a bad thing. It means they HAVE to reorganize and toss out dead weight.

The factories will exist, the machines will exist. The companies will still exist, they'll just be leaner and quicker to respond to the market, with the Old Guard execs tossed out.

Any bailout is just denying the inevitable.

To be a bit crude, the Big Three really, really, REALLY need to use the restroom to do a #2. And if you try to stop that from happening, you'll delay that for a short time, and then they'll just expire completely.

Better to just let it happen now, there's a lot that has to go.

Why did people get this idea that bankruptcy means anything more than forced reorganization to return to profitability? That's what the laws are meant for!!!

[Jim147]

Bankruptcy is not a bad thing. It means they HAVE to reorganize and toss out dead weight.

The factories will exist, the machines will exist. The companies will still exist, they'll just be leaner and quicker to respond to the market, with the Old Guard execs tossed out.

Any bailout is just denying the inevitable.

To be a bit crude, the Big Three really, really, REALLY need to use the restroom to do a #2. And if you try to stop that from happening, you'll delay that for a short time, and then they'll just expire completely.

Better to just let it happen now, there's a lot that has to go.

Why did people get this idea that bankruptcy means anything more than forced reorganization to return to profitability? That's what the laws are meant for!!!

I take it you were not a vendor burned by a TWA bankruptcy.

[Manedwolf]

I take it you were not a vendor burned by a TWA bankruptcy.

It doesn't matter. Either they go bankrupt NOW, or they fail completely LATER no matter how much taxpayer funds are thrown at them.

Today's word is: inevitable

[De Selby]

It doesn't matter. Either they go bankrupt NOW, or they fail completely LATER no matter how much taxpayer funds are thrown at them.

Today's word is: inevitable

Yeah, but does putting 3 million people out of work at a time when banks are already failing left and right because consumers can't pay their bills, and when retail is free-falling because no one has money to buy....have the same effect as delaying the unemployment to a point where the economy is otherwise better off?

[Jim147]

Maybe AIG will buy the Big Three.

[Manedwolf]

Yeah, but does putting 3 million people out of work at a time when banks are already failing left and right because consumers can't pay their bills, and when retail is free-falling because no one has money to buy....have the same effect as delaying the unemployment to a point where the economy is otherwise better off?

You're not getting it.

No matter how many taxpayer billions are thrown at the Big Three, they will burn through them and end up at exactly the same place in a short time if they do not change.

The only way to change is to let them be bankrupt and break the UAW chokehold that is destroying them. Or there will be no companies, and no jobs, period! Ever! They will be gone.

A bailout is trying to throw paper at a fire to put it out, instead of water. The fire will just consume the paper, and still be a fire, perhaps even bigger.

[De Selby]

You're not getting it.

No matter how many taxpayer billions are thrown at the Big Three, they will burn through them and end up at exactly the same place in a short time if they do not change.

Yeah, you're not getting what I said though:   Do you recognize the difference between having 3 million people go unemployed in this economy, where banks are already failing and retail is in a free fall, and having those same 3 million unemployment notices delayed to a time where the banks and other sectors are in a stronger position to face the losses in customer/payment amounts?

[mfree]

Shoot,

I don't think there's enough money in the treasury to stretch them out that long.

[Monkeyleg]

Does anyone remember Harley coming back from the brink of bankruptcy in the 1980's? The executives got Citibank to agree to dimes on the dollar for the company, and bought it out from AMF. They also got an agreement from the White House to have temporary tariffs put on foreign bikes. Then they got to work producing new bikes that people wanted to buy.

They didn't need the tariffs for as long as they thought they would and told the government to lift them. They didn't ask for taxpayer dollars.

If the auto executives and the workers want to stay in the market, they need to do a couple of things. First they need to do what everyone else does when their income drops: adapt. Second, they need to produce products that people will want to buy.

I don't have a problem with the government helping them buy some time to get their acts together, but I don't think that help should take the form of welfare.

[Headless Thompson Gunner]

The UAW and the Big Three recently made a deal to shift their crushing pension and health care obligations off the carmakers.  The corporations will fund a huge trust that the UAW will operate and use pay the workers/retirees their benefits.  On the surface, this is a great plan.  The Big Three won't have to carry their crippling pension obligations going forward.  The union gets major clout.  The workers still get their promised checks.  Everyone wins

Thinking deeper, though, there are major problems.  The biggest of those is the fact that the Big Three don't have the scratch to fund the trust right now.  They're near bankrupt as it is, and they just don't have the spare billions they need for the trust.  So, they're knocking on Uncle Sam's door. 

Should Uncle Same give 'em the cash?  Obviously not. 

The money would go straight into the UAW trust and be paid out to retired UAW members.  It would amount to massive theft, UAW workers staling from the taxpaying public, from their neighbors.  That's not how a free country is supposed to work.

Will Uncle Same give 'em the cash?  Probably.  Definitely. 

Obama is too Marxist to pass up an opportunity like this.  He'll give the car companies a few billion, knowing that he's really giving it to a labor union.  Worse, Obama will probably push through his universal health care system.  That'll mean that the UAW won't have to use their new trust wealth to pay for worker health care, because Uncle Sam will do that for 'em.

It's all about wealth transfer.  Government under Obama will be all to eager to do that.

[280plus]

Considering the POS GM calls the Monte Carlo I can understand what their problem is, they're selling POSs. Nothing but trouble with that car, and then the GM "Not So Smart" buy program where they screw you in places you don't want to be screwed? We were going to bite the bullet, pay off the loan and keep the car, but it's just been one thing after another with it and we only have 75,000 miles on it. We don't want no stinkin' lemon. Can't wait to see what they try to pull when we go to turn it in. Eff em, the losers. Nobody's going to bail me out if MY business fails. But then again, my business is not failing, it's doing rather well actually.

[De Selby]

One of the main reasons why Obama won:

-Crying foul when money might go to a pension fund for people who worked their whole lives, but not saying much when 700 billion shows up in the federal budget to bail out millionaire investment bankers and insurance industry executives.

It is probably necessary, but it's welfare.  Why is it such a crime when a bunch of retired workers get paychecks that will sustain them through retirement, but not so horribly marxist when the government gives out billions to aid failing corporations?

That question right there is why people are voting for a candidate like Obama.  It's simply not possible to pretend that either party opposes welfare; so given that, the majority of the population is obviously going to vote for welfare for the majority, which Obama seems to favor, as opposed to the welfare for Wall Street and select corporations that conservatives tend to champion.

[HankB]

How did the government cause the failure of the big three auto makers?

Allowing unions to create "union shops" where the automakers are not allowed to hire anyone other than union members is a major contributor to the problem . . . it's a policy worthy of Tony Soprano.