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US automaker bailout poll

Should the US bail these ungrateful automakers out?

  • Too bad, let them sink!

  • Blindly hand over 25 billion

  • Provide limited assistance in other ways.


Results are only viewable after voting.
Let them sink.

When a business fails, it goes under. That is the threat that drives competition and good business models. Start throwing rescue plans and bailouts around, and not only do we waste money - but we do so to our own demise. Competition disappears, and companies who should have long gone under remain. Such a rescue plan has zero long-term implications; it does nothing to foster competition. It only ensures that poor businesses continue running, and can do so while abandoning all fear of failing. How good is a product going to be if its maker does not have to fear competitors? This has to do not only with the quality of the product, but the efficiency of their entire system, to the Unions, health care, and other bonuses.

Additionally, we can not be so short-sided as to ignore the recent months: bailouts don't work. Especially with the lessons learned from AIG. That kind of thing is despicable, and we need not cater to systems which allow that sort of behavior to thrive.

We've got multi-millionaire CEOs riding first-class in jets asking for billions of dollars. These CEOs aren't alone - they've got men and women right next to them and not far below them making the same kind of cash - more in one year than most of us will make in a life time. How much of the money they're asking for will go to those salaries?

The moment we have the federal government in bed with private corporations, using tax dollars to keep failed businesses afloat, you might as well forget everything you know about capitalism.

When businesses fail, they fail.

No one was making a stand when hundreds of thousands were losing their homes; you don't see the governement knocking on your door with a rescue plan if you make poor decisions and a failed mortgage results.

Business decisions have consequences, and to assert that a business can do as they please, then get federal money when things go south, is absurd.

Accountability should be demanded, and responsibilty must be owned.

Let 'em sink - but at the expense of the directors, CEOs, and chairmen/women. Use their ridiculous salaries to help the standard employees make it. Divy up those billions of dollars to support the regular workers, their pensions, and the aid they need when they lose their jobs and pensions. Those are the people that need rescuing, not the sinking businesses.

The purposal that the rich get off scot-free (with bonuses) while the responsibility of their mistakes is put on the rest of us to shoulder and burden is so outrageous that it is without definition.

These companies should go under, and the only rescuing being considered should be for the working and pension-earning men and women who would lose their income, and the dollars required for that should come from the billions held by the CEOs and managers. Sell the jets, the company cars, and support the workers - not the greed.
 
Let them sink.

When a business fails, it goes under. That is the threat that drives competition and good business models. Start throwing rescue plans and bailouts around, and not only do we waste money - but we do so to our own demise. Competition disappears, and companies who should have long gone under remain. Such a rescue plan has zero long-term implications; it does nothing to foster competition. It only ensures that poor businesses continue running, and can do so while abandoning all fear of failing. How good is a product going to be if its maker does not have to fear competitors? This has to do not only with the quality of the product, but the efficiency of their entire system, to the Unions, health care, and other bonuses.

Additionally, we can not be so short-sided as to ignore the recent months: bailouts don't work. Especially with the lessons learned from AIG. That kind of thing is despicable, and we need not cater to systems which allow that sort of behavior to thrive.

We've got multi-millionaire CEOs riding first-class in jets asking for billions of dollars. These CEOs aren't alone - they've got men and women right next to them and not far below them making the same kind of cash - more in one year than most of us will make in a life time. How much of the money they're asking for will go to those salaries?

The moment we have the federal government in bed with private corporations, using tax dollars to keep failed businesses afloat, you might as well forget everything you know about capitalism.

When businesses fail, they fail.

No one was making a stand when hundreds of thousands were losing their homes; you don't see the governement knocking on your door with a rescue plan if you make poor decisions and a failed mortgage results.

Business decisions have consequences, and to assert that a business can do as they please, then get federal money when things go south, is absurd.

Accountability should be demanded, and responsibilty must be owned.

Let 'em sink - but at the expense of the directors, CEOs, and chairmen/women. Use their ridiculous salaries to help the standard employees make it. Divy up those billions of dollars to support the regular workers, their pensions, and the aid they need when they lose their jobs and pensions. Those are the people that need rescuing, not the sinking businesses.

The purposal that the rich get off scot-free (with bonuses) while the responsibility of their mistakes is put on the rest of us to shoulder and burden is so outrageous that it is without definition.

These companies should go under, and the only rescuing being considered should be for the working and pension-earning men and women who would lose their income, and the dollars required for that should come from the billions held by the CEOs and managers. Sell the jets, the company cars, and support the workers - not the greed.

The point is that if these companies go under it the rich CEO's will still be rich. All the people that you feel needs punished will survive with no trouble. It's only those people that you said need rescuing that will get hurt. There will be no rescue possible as it will be too late. The rescuing needs to be proactive.
 
Outside of several one-time charges that were spent on restructuring efforts, GM was profitable last year. If not for the current monumental economic crisis we've been facing, I have no doubt GM would be turning a profit this year as well. Many of the things posters here have been suggesting the Big 3 need to do to be profitable were implemented by GM during their last contract negotiations. A larger share of healthcare costs was shifted onto the workers. Retirement pay is now managed by a union run trust fund. Perks such as tuition reimbursement are being phased out. A two-tier wage system was implemented to control labor costs. GM knew they had to change the way they did business to stay afloat, made the changes, and then had the misfortune to be hit by a global economic crisis before the positive effects of said changes could be realized.

The concept of re-tooling has been thrown around a lot here as well. GM also has already begun to tackle this problem. My father is employed at a plant in Lansing, MI that was opened in 2006. This state-of-the-art plant was designed so that it can be reconfigured to build any type of vehicle on the fly.

A lot of you are also saying we shouldn’t keep these companies afloat because nobody even wants to buy American automobiles anymore. This is just ridiculous and untrue. While their market share is definitely dwindling, the Big 3 are still in the top four in market share. Also, while everyone’s sales, even the foreign manufacturers, are declining as a result of the economy, sales at my father’s plant (which produces the Acadia, Outlook, and Enclave) actually increased in September!

I’ve also seen a lot of complaints about the Big 3’s lack of fuel-efficient vehicles. While none of their vehicles can match the fuel efficiency of foreign hybrids, GM does offer the most vehicles that get over 30 MPG than any other company with 17 models. Ford has hybrids on the market and is on the verge of releasing a hybrid F-150 pickup truck that gets 60 MPG, better than a Prius. GM will be releasing two fully electric plug-in vehicles in 2010 and 2011 if the company survives until then. GM also operates a fleet of 300 hydrogen fuel cell powered buses used for public transportation in 18 cities across the globe. The fuel cells currently cost about $150,000 to produce. Once they can get production costs down to around $5000, they’re going to start putting them in vehicles you and I can buy. It would be a shame if the company failed before that could happen.
 
Too much of what's left of America's manufacturing power is tied up in the Automakers. If its limited assistance to help them get through this downturn then I'm fine with that. I'd rather have taken a chunk away from what was given to AIG and give that to the Big 3.
 
The point is that if these companies go under it the rich CEO's will still be rich. All the people that you feel needs punished will survive with no trouble. It's only those people that you said need rescuing that will get hurt. There will be no rescue possible as it will be too late. The rescuing needs to be proactive.

That is why I suggested the following:
stevensj2 said:
These companies should go under, and the only rescuing being considered should be for the working and pension-earning men and women who would lose their income, and the dollars required for that should come from the billions held by the CEOs and managers. Sell the jets, the company cars, and support the workers - not the greed.

It isn't about punishment; it's about not rewarding poor business practices.
 
That is why I suggested the following:


It isn't about punishment; it's about not rewarding poor business practices.

The problem is that what you are suggesting will never happen. It's like killing the dog to get rid of the fleas. You are not alone in your anger at corporate management and their excesses. I am right there with you. But, too many people are not taking into consideration the consequences. The collapse of one of the big three could very easily lead to the collapse of the other two, which could lead to the collapse of hundreds, if not thousands of other companies - including your own.
 
What you are calling trickle down can also be called the free market righting itself. If the ancillary companies cannot adjust and fill the market needs without the big 3 (there are other auto companies, even in the USA) then they too are destined for failure, no matter how much money is thrown at them. The suppliers will supply parts to the growth of the Toyota/Honda/etc. that is inevitable, should the big 3 shut down. Same with the service workers.

The growth of Toyota/Honda/etc? Have you read these headlines in today's news?

Toyota Will Cut 3,000 Jobs in Japan as Car Sales Fall

Nov. 21 (Bloomberg) -- Toyota Motor Corp., Japan's biggest carmaker, will cut its domestic temporary workforce by 50 percent as vehicle demand slumps globally.

...

The automaker follows Mazda Motor Corp. and Isuzu Motors Ltd., which yesterday said they would slash a combined 2,700 temporary jobs in Japan in response to slowing sales. Earlier this month, Toyota forecast a 68 percent drop in full-year net income, the biggest decline in at least 18 years, as a global recession cripples auto demand.

...

Honda Motor Co., Japan's second-largest carmaker, also said today it is cutting 270 temporary workers at its Saitama plant, where the carmaker is reducing output of Accord sedans by 40,000 units. Honda is also cutting production in the U.K. of Civic compacts and CR-V sport-utility vehicles by 21,000 units.

Nissan Motor Co. said last week it will reduce its domestic production by an additional 72,000 units. Japan's third-largest automaker had its credit rating cut one notch today by Fitch Ratings, which cited the company's dependence on the weak U.S. auto market and an appreciation of the yen.
 
Outside of several one-time charges that were spent on restructuring efforts, GM was profitable last year.

"Excluding the tax charge and other special items, GM lost $23 million, or 4 cents per share, for the year..."

That's for 2007, taking into account the various charges and write-offs.
http://www.mindfully.org/Industry/2008/GM-Record-Loss12feb08.htm

a bunch of too little, too late

Unfortunately, it would appear they only very recently did things they should have done years ago. If they're not able to stay afloat, why should people making, on average, less than the average UAW member, have their taxes shuffled to prop up a losing battle? Again, it's great that GM made all these sweeping changes, but it would appear that both the Marketplace, and the general consensus, is that it's just not quite enough.
 
The growth of Toyota/Honda/etc? Have you read these headlines in today's news?

Toyota Will Cut 3,000 Jobs in Japan as Car Sales Fall

Nov. 21 (Bloomberg) -- Toyota Motor Corp., Japan's biggest carmaker, will cut its domestic temporary workforce by 50 percent as vehicle demand slumps globally.

...

The automaker follows Mazda Motor Corp. and Isuzu Motors Ltd., which yesterday said they would slash a combined 2,700 temporary jobs in Japan in response to slowing sales. Earlier this month, Toyota forecast a 68 percent drop in full-year net income, the biggest decline in at least 18 years, as a global recession cripples auto demand.

...

Honda Motor Co., Japan's second-largest carmaker, also said today it is cutting 270 temporary workers at its Saitama plant, where the carmaker is reducing output of Accord sedans by 40,000 units. Honda is also cutting production in the U.K. of Civic compacts and CR-V sport-utility vehicles by 21,000 units.

Nissan Motor Co. said last week it will reduce its domestic production by an additional 72,000 units. Japan's third-largest automaker had its credit rating cut one notch today by Fitch Ratings, which cited the company's dependence on the weak U.S. auto market and an appreciation of the yen.

Does anyone know why they're not cutting jobs in the USA, and they're cutting jobs mainly in Japan?
 
And just as an aside, does anyone else see the difference here?

Nissan/Toyota/etc. are cutting jobs to respond to the global economic downturn (nothing unusual, since the economic crisis is affecting billions of people worldwide).

GM/Ford is asking for money from taxpayers, so they can make the bankroll/pay the bills/keep the lights on.

A distinct, yet important difference. If the big 3 were merely announcing job cuts, like most every other industry lately, that would be understandable.

The big surprise would be for Nissan/Toyota/etc. to be begging the Japanese government for $25B in operating capital, and threatening to go bankrupt if they don't get it.
 
"Excluding the tax charge and other special items, GM lost $23 million, or 4 cents per share, for the year..."

That's for 2007, taking into account the various charges and write-offs.
http://www.mindfully.org/Industry/2008/GM-Record-Loss12feb08.htm



Unfortunately, it would appear they only very recently did things they should have done years ago. If they're not able to stay afloat, why should people making, on average, less than the average UAW member, have their taxes shuffled to prop up a losing battle? Again, it's great that GM made all these sweeping changes, but it would appear that both the Marketplace, and the general consensus, is that it's just not quite enough.

WOW!!! Look at that huge amount!!!! When you make that kind of money you must prepare for things to happen. Save for a rainy day so to speak.

Look what happened to Eastern Airlines because of Union greed. Same goes with auto makers. They had a great run while it lasted!!!! Making that kind of money they deserve to sink!!! Even cut those amounts in half and that is not too bad for wages! What a horrible mess they are all in. Too bad Detroit.
 
Does anyone know why they're not cutting jobs in the USA, and they're cutting jobs mainly in Japan?

What do you mean "not cutting jobs in the USA"? :confused: They cut a full shift in our local plant earlier this year. GM also plans to lay off an additional 3600 employees early next year.

Why single out the US automakers when the whole global industry is suffering from the same woes.

BTW ... France takes a hit, too!

International Herald Tribune, France - Nov 20, 2008 - PSA Peugeot-Citroën, Europe's biggest carmaker behind Volkswagen, announced a fresh wave of job cuts Thursday. Peugeot said it would cut 2,700 jobs across its sites in France, and it forecast that car sales would drop 17 percent in the final quarter of this year in main European markets and by at least 10 percent in 2009.
 
And just as an aside, does anyone else see the difference here?

Nissan/Toyota/etc. are cutting jobs to respond to the global economic downturn (nothing unusual, since the economic crisis is affecting billions of people worldwide).

GM/Ford is asking for money from taxpayers, so they can make the bankroll/pay the bills/keep the lights on.

A distinct, yet important difference. If the big 3 were merely announcing job cuts, like most every other industry lately, that would be understandable.

The big surprise would be for Nissan/Toyota/etc. to be begging the Japanese government for $25B in operating capital, and threatening to go bankrupt if they don't get it.

BINGO! The big three have been making job cuts and are announcing more. Is it understandable now? :wink:

The difference is that the niche which has been making the US automakers successful has been quickly eliminated and they are requesting a loan to shift direction.
 
WOW!!! Look at that huge amount!!!! When you make that kind of money you must prepare for things to happen. Save for a rainy day so to speak.

Look what happened to Eastern Airlines because of Union greed. Same goes with auto makers. They had a great run while it lasted!!!! Making that kind of money they deserve to sink!!! Even cut those amounts in half and that is not too bad for wages! What a horrible mess they are all in. Too bad Detroit.

Nope. Too bad everywhere. :frown: Believe me, you will feel in down there in Georgia much more than the rich CEO's in Detroit.
 
Let'em sink. They deserve it. The employees can find another job. Let capitalism work.

On another note, did anyone notice the guy sitting at the table with the auto execs while they were begging for money?? If I'm not mistaken, thats the president of UAW. I didn't know UAW needed a bailout too.
 
Nope. Too bad everywhere. :frown: Believe me, you will feel in down there in Georgia much more than the rich CEO's in Detroit.

The adage holds true, "if you are gonna be stupid, You gotta be tough." applies here. I can see much being hurt because of this. Suppliers of parts and accessories will feel it. Stealerships will feel it.

I recall years ago in my younger days people I was working with would brag that they are getting a job with US auto makers making A LOT of money, even back then. I would be tempted to apply, but common sense told me throughout the years I had seen the layoffs and it was not worth the risk!!!! Period! Why hop on the sinking ship for a short time payout. I have had family lose their jobs with GM.

I guess that is why I chose public safety as a career, not much chance of a layoff...even though it can happen especially if you live in a city run by idiots. I have never heard a county going belly up!!!

Like I stated earlier.. I am looking at buying a GM product and if things are much worse, I will simply buy Jap.
 
Let'em sink. They deserve it. The employees can find another job. Let capitalism work.

On another note, did anyone notice the guy sitting at the table with the auto execs while they were begging for money?? If I'm not mistaken, thats the president of UAW. I didn't know UAW needed a bailout too.

I know it sucks to be out of a job and looking for one is horrible as well. Most people get used to making a certain living and live beyond their means. Then they are in bad shape when forced to take a job making substantially less. If I were making what an average auto worker I would definitely be saving a huge portion instead of buying nice cars and huge homes I could barely swing the payment on.
 
What do you mean "not cutting jobs in the USA"? :confused: They cut a full shift in our local plant earlier this year. GM also plans to lay off an additional 3600 employees early next year.

Why single out the US automakers when the whole global industry is suffering from the same woes.

BTW ... France takes a hit, too!

International Herald Tribune, France - Nov 20, 2008 - PSA Peugeot-Citroën, Europe's biggest carmaker behind Volkswagen, announced a fresh wave of job cuts Thursday. Peugeot said it would cut 2,700 jobs across its sites in France, and it forecast that car sales would drop 17 percent in the final quarter of this year in main European markets and by at least 10 percent in 2009.

I meant why Nissan/Toyota is announcing job cuts only in Japan in the recent announcements. Sorry if I confused anyone with my question.

We agree the entire industry is suffering, but only the big 3 are claiming complete and utter ruin and closing up completely if they don't get $25B.

Again, there's a big difference between forecasting slumping profits and cutting jobs to respond to a global crisis... and announcing that you cannot continue making/selling cars in the next 12 months without taxpayer money, to the tune of $25B.
 
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