The Watering Hole

Do we have a choice?  I sure as fuck hope so.  After hearing GM's plans to drop Saturn and Saab, it's two most fuel efficient lines, and focus on the dinosaurs that are Cadillac, Chevrolet, and Pontiac, I think that GM needs a big fucking wakeup call.  If the only US automaker left after this is Ford, I would be okay with that.  It seems these guys engineered their own demise, by not being able to even glimpse a year or two into the future.  Making gigantic vehicles was something the American auto industry was well known for in the 60's and 70's; the fact that they returned to such a stupid path in the '00s shows how totally undeserving of success these companies are.  

Yes, losing the auto industry in the US (except for Ford) would certainly be painful on the job front.  But is it worth it to throw billions at them, only to postpone the failure?  Nothing in their plans seems to indicate that they have a clue.  They are still three to four years off on commercially available hybrids, and the Japanese have been selling them for 5 years!  How the fuck can an entire industry in one country be so poorly managed?

I seem to recall that most Fords are now built outside the country while many Toyotas (for example) are actually built in America.  What IS a US automaker anymore?  :-?

Good point Craig!

I personally, think it's time for America to take care of America.

Bailing out auto industries, including the foreign ones, has become the norm.

I think we need to say the hell with all the foreign cars and concentrate our efforts on the big three. Not really a bailout, just a temporary helping hand of some sort.....while we........

Revamp and reorganize our American companies.

Retool our own plants and get serious about new technology.

Temporarily require all three companies to comply with regulations to build the car of tomorrow right now. The technology is there, fucking use it.

Reprice all cars from all three companies, meaning....trucks are work vehicles...price them high with a break for companies that need them. If a consumer wants to drive around in a 3/4 ton pickup and burn shit loads of gas needlessly....they'll pay a huge price for the damn thing. I would double the price for trucks for consumers. At least. Keep them the same or less for construction, power companies, stuff like that.


We don't need foreign cars if we make the ones we have worth a shit. I have a 2006 Malibu, Chevy, and it's a piece of over-priced shit. No wonder people want foreign cars, compare American to Forieign. I think GM products are absolute shit, with the exception of the engine. The rest of the car is trash.

I have had many Ford cars and I think they are hands down a much better car than GM, especially the interior and tightness of the car. I have no experience with Dodge and never have, so I don't know about them.

I guess I'm with Charger on this if I understood him corectly, I say fuck them all except Ford. Let the chips fall where they may for them. Cut the cord.

Look at the small company Tesla Motors. This company is years ahead of all three of our majot players.

http://www.teslamotors.com/

I say give this company the damn money. Fuck Ford Dodge and GM.

You want protectionism - that sucks.

How will you deal with the drop in income from US tech companies when they get hit by protectionist retaliation.

You want to save General Motors by screwing over Microsoft/Apple etc,

No. SOme type of bailout is gonna happen.

I'd prefer to reward success, and it falls within Obama's vision, rather than reward failure over and over again.

Tesla is on the right track. GM, Ford, and Dodge, are on the wrong track, or at least so far behind Tesla it's pitiful.

With money to do research to find a less expensive way to build their batteries, the sky is the limit. I'd rather invest MY money in progress, for a change! ;)

Hookbender — Dec 04, 2008
I personally, think it's time for America to take care of America.
Bailing out auto industries, including the foreign ones, has become the norm.

I think we need to say the hell with all the foreign cars and concentrate our efforts on the big three. Not really a bailout, just a temporary helping hand of some sort.....while we........

Revamp and reorganize our American companies.

Since when has the US ever bailed out a foreign auto industry ?
How exactly are you going to say  "the hell with all the foreign cars" and "for America to take care of America"
what does that mean in practice ?
If you don't mean protectionism,  it means fuck all as a statement.

If you are talking about protectionism and it is a very short sighted, knee jerk and dumb response guaranteed to make the situation worse.
It would simply start a destructive trade war

You will still have a shitty car industry, except you will have bailed them out so you have to buy their shitty cars as they will have no competition.
And in return you will have protectionist retaliation in those industries the US does well in  and kill their market.

The US Tech sector would be royally screwed over in the bargain.

recent example - about 6 years ago Bush put tariffs up to protect steel and in retaliation Russia slammed a ban on imported chicken legs.
It is a hilarious example of the law of  unintended consequences.

http://news.bbc.co.uk/1/hi/world/europe/1864844.stm

fingers — Dec 06, 2008[quote author=Hookbender link=1228329193/0#2 date=1228350679]
I personally, think it's time for America to take care of America.
Bailing out auto industries, including the foreign ones, has become the norm.

I think we need to say the hell with all the foreign cars and concentrate our efforts on the big three. Not really a bailout, just a temporary helping hand of some sort.....while we........

Revamp and reorganize our American companies.

Since when has the US ever bailed out a foreign auto industry ?
How exactly are you going to say  "the hell with all the foreign cars" and "for America to take care of America"
what does that mean in practice ?
If you don't mean protectionism,  it means fuck all as a statement.

If you are talking about protectionism and it is a very short sighted, knee jerk and dumb response guaranteed to make the situation worse.
It would simply start a destructive trade war

You will still have a shitty car industry, except you will have bailed them out so you have to buy their shitty cars as they will have no competition.
And in return you will have protectionist retaliation in those industries the US does well in  and kill their market.

The US Tech sector would be royally screwed over in the bargain.

recent example - about 6 years ago Bush put tariffs up to protect steel and in retaliation Russia slammed a ban on imported chicken legs.
It is a hilarious example of the law of  unintended consequences.

http://news.bbc.co.uk/1/hi/world/europe/1864844.stm















I was listening to NPR the other day and they said a Honda plant was bailed out on the state level for something like 300 million bucks.

I'm a tax payer, and a customer of the car industry.  It's my opinion that the big three has failed the American people with sub standard products. Also with poor management and poor decision making. Add to my opinion.....the hell with unions.

These companies have been bailed out before. They continue to fail and also continue not to learn from their mistakes. They are by definition, ignorant. Insane. They continue to do the same thing over and over and they must expect a different result, but never get it.

It seems to me that their is a interest in the big three of joining together to form one company. I say, let them go bankrupt and work the shit out themselves. Not that they can, but they will have no other choice. Hopefully, the end result will be the three working together to form, at last, a well run car company.

You think we should bail these guys out every ten years or so forever? I don't. I say cut the cord.

Now Tesla, and other companies, are trying to move the industry forward. They actually want to build a gas-less vehicle. They are the driving force in technology right now. They are the future, imo. The big three have to many political ties and to many ties with gas to seriously consider a dramitic change in the future of their company. They either change now, or die now. I hate that so many people will lose jobs, but I could give a shit less about the three companies.

Why not invest in Tesla? We don't have the money to throw at failure right now. Why not throw some at success? Tesla.

Their are many good options to consider other than giving more money to failed companies. This isn't the only option.

That isn't bailing out Honda - that is a subsidy to keep a car plant in a state - a bribe to keep the investment and jobs.
That shit happens with all car plant deals worldwide.
That is not a bail out - it is a bribe to stop Honda shutting the plant.

And where the fuck did you get the idea that I want these companies to be bailed out  :o
My argument is with the protectionism implicit in your argument.

OK - The US car industry sucks compared to international competition, it is bloated,  inefficient and poor quality.
There is no point in bailing it out as it will still be shit.
And nothing is gained in trying to protect it from superior competitors unless you want to start a trade war.

So - it needs to be drastically cut down to size, which means letting much of it die a natural death in bankruptcy.
Manage the economic fall out from it and try to resurrect some competitive industries out of the carcass.

i.e. spend bailout money on investing in good companies that have a future.

So I agree with you on that.

But  protectionist arguments suck - they are populist, but they don't work in practice.

Yeah, these so-called bailouts have done nothing but fucked me over.  Before they occurred, my mortgage company was pretty willing to negotiate things with me.  Literally as soon as they were bailed out (notice I said "they" not "me"), they pretty much stopped caring about my issues and even have gone so far as to get in the way of positive proceedings since it's in their interest if I get screwed.

So far the bailouts have cost me money and I don't think the paying is done yet.  Once the dust settles Joe Tax Payer will be paying for all of the companies that got the money from the bailouts (basically getting rewarded for fucking things up in the first place).

fingers — Dec 06, 2008That isn't bailing out Honda - that is a subsidy to keep a car plant in a state - a bribe to keep the investment and jobs.
That shit happens with all car plant deals worldwide.
That is not a bail out - it is a bribe to stop Honda shutting the plant.

And where the fuck did you get the idea that I want these companies to be bailed out  :o
My argument is with the protectionism implicit in your argument.

OK - The US car industry sucks compared to international competition, it is bloated,  inefficient and poor quality.
There is no point in bailing it out as it will still be shit.
And nothing is gained in trying to protect it from superior competitors unless you want to start a trade war.

So - it needs to be drastically cut down to size, which means letting much of it die a natural death in bankruptcy.
Manage the economic fall out from it and try to resurrect some competitive industries out of the carcass.

i.e. spend bailout money on investing in good companies that have a future.

So I agree with you on that.

But  protectionist arguments suck - they are populist, but they don't work in practice.

Call it what you want Fingers, it's tax payer money used to keep a Honda plant open. It's close to the same thing only on a state level. The goal is the same.

I didn't get the idea you wanted a bailout. I just ask you, would you rather bailout these companies or let them work itout themselves.

And I agree with you on the protectionist part of your argument. Most of the time.

I would consider, in this case, foucsing on American companies and removing a problem for the car companies as they reconstruct...problem, competition from foreign companies.

Free trade is great, I am for that 100%. As long as it doesn't negatively effect our economy and our own companies. If the government is going to bailout these companies, they need to assure me that the companies have the best opportunity to survive this mess. Restricting competition from foreign car makers should help them survive and make spending all this money of ours more likely to help and be successful. We've bailed out these companies before. This should be the last time we do it and we should not do it the same way we have in the past. Drastic measures call for drastic actions.

You simply don't get it do you.

Trade is not a pick and choose thing, you protect the car industry, you will start a trade war then this downturn will be a depression 1930's style.

If you want to protect America from foreign competition, you will find out that America is a foreign country to 90% of the worlds economy, and they will protect themselves from American competition in their markets in retaliation.

Protectionism is the biggest bail out of all, the ultimate bail out.
It is the most costly in economic terms as it means sacrificing the future of good industries to bail out  the bad ones.
It rewards bad industries by fucking up the markets for the good ones.

Why do you think that Boeing should be fucked over to save GM ?

And this doesn't even get into the fact that the bail out is funded by foreign money, the US tax payer is borrowing this money.
and much of it is from Asia.
That would be the Asia you want to start a trade war with.

Well, I guess your right Fingers. I just oppose the bailout so much of these car companies, again, that my vision is clouded a tad. Just pisses me off that we the tax payer keep getting fucked by these rich fuckers that don't seem to know how to run their companies. Seems as if they "expect" help at the drop of a dime when they need it, or they fuck up again. It's irritating as hell. Their has to be a logical option other than fucking us out of more money.

They have to bail it out and shrink it.
restructure what is left.

They can't afford to let it collapse in this economic situation.
But they can't afford to keep factories open producing cars nobody is buying for long.
Where the fuck will they put them all.

It will look ridiculous very quickly.

So one of them at least will have to go bust and break up.

for many years, the backbone of our country were the auto and housing/mortgage/finance companies.  The mortgage  and housing companies are taking a brutal beating.  The auto manufacturers are as well.  

I can tell you this from the inside, There is MUCH fat to be trimmed from the "Big Three."  IF, IF, IF, they learn something from this, then they can regain their position as a major POSITIVE factor in our economy.  If they don't, then we are all in trouble anyway.  What we need is not to just throw money at them, but to hold them accountable for there excesses.  I personally know MANY guys who are common factory workers and who make over $100,000 a year and brag that they only work 3 hours or 6 hours, on those 12 hour days they are getting paid for.  This can not continue in this economy and should not have worked in ANY economy.  But it did.  Fix that, and well be ok.  

It's a myth that the auto workers' pay is so high, and they do no work.  Much of the inflated numbers you hear are related to the fact that the Big Three are paying for workers who are retired, in a huge way.  

Robots do most of the hard work in the factories.  

The big three are fucked because they never anticipated a day when gas would be expensive again, like it was in the '70's.  99.99% of businesses that make massive miscalculations, and then do not have the right product to sell when they go to market, fail.  Everyone is thrilled now that their SUVs are still usable, now that gas is under 2$... and the big 3 are once again saying, "hey, maybe we can keep selling behemoths and make some cold hard cash.  The reality is, gas will be 4, 5, 6$ in a couple of years, if not this summer.  The big 3 have no plan for this.  Because they can not run businesses with any level of competence, they deserve to fail.  Ford may be an exception to this... they seem to be able to survive without a bailout, at least for a year or two.  

The bottom line is that all three are poorly managed companies with no vision of the future. The future is now, and the big three are locked into the past. They got cought with their pants down. These companies haven't EARNED the right to call for money from me. via taxes or anything else. Their products are just fair, and their prices are inflated for what we get for our money. I think their ego needs a ass whipping.

Not only that, to have this bailout go through and these companies receive this money, with the same failures as heads of the companies, is simply stupid. Now we are gonna spend more money appointing a board of some kind to keep check on these guys. More wasted time and money. The fact that government see's a need to watch over the heads of the companies should be a sign that the leaders are not capable, trustworthy, or responsible.

Charger, for the most part, it's no myth.  I have friends and even a few relatives-in-law who work for Ford.  Also, remember that my dad ran or owned a GM dealership for about 25 years.  

I have a client who I've done loans for.  His last year of school completed is 8th grade.  If you talked to him, you'd be surprised he made it that far.  Not a slam, just saying.  He has made OVER $100,000 for over 10 years running.  Yeah, he works 7x12s a lot of time, but he's always telling me he doesn't actually work half that.  And that's the same story I get from a close friend, and one of Amy's brothers.  Her oldest brother retired after 33 years with Ford.  Had 10 years in a row over $90K (didn't work Sundays).  Common production line worker.  Not a foreman, specialist or any skilled labor.  He told me he averaged 3-5 hours a day actually working.  He retired last year, and get's over $4,000 per month retirement.  

Charger's point was that, personal anecdotes aside, most ANALYSTS say that the biggest problem for the auto industry is not the union pay or benefits of current workers (since the reality is that it's not all that much higher than non-union plants) - it's the retirees' compensation and the piss-poor management decisions that have been made in recent years.

You can choose to believe people who have looked at the business as a whole, or you can believe some people you know who think they know what they're talking about.

Of course, the latter is flawed thinking, because individual cases do not necessarily represent the complete reality...

My gut still tells me it'd be wiser if we let the motherfuckers go bankrupt and reorganize that way...
Tripper

Got this in an email today.  Fucking banks!  I do all the correct planning and setups only to get screwed, they make all the wrong moves and get rewarded.  Bastards... >:(

In order for the Detroit 3 to secure $17.4 billion in government loans to keep their businesses afloat, and the entire domestic auto industry, they agreed to adhere to strict guidelines. Oversight will be heavy, and the companies will be forced to prove their viability by March 31.

By comparison, the first half of the $700 billion bank bailout money has been handed out. That’s $350 billion, or roughly 20 times the size of the loan to the Detroit 3.

So far, no one has any idea where any of the money went.

If the banks know, they aren’t saying.

The Associated Press contacted 21 banks that received at least $1 billion in bailout money and asked four basic questions:

How much was spent?
What was it spent on?
How much is being held in savings?
What’s the plan for the rest?
The answers were absolutely ridiculous.  Here are some of the responses from the AP article:

"We've lent some of it. We've not lent some of it. We've not given any accounting of, 'Here's how we're doing it,'" said Thomas Kelly, a spokesman for JPMorgan Chase, which received $25 billion in emergency bailout money. "We have not disclosed that to the public. We're declining to."

"We're not providing dollar-in, dollar-out tracking," said Barry Koling, a spokesman for Atlanta, Ga.-based SunTrust Banks Inc., which got $3.5 billion in taxpayer dollars.

Kevin Heine, spokesman for Bank of New York Mellon, which received about $3 billion said “We're choosing not to disclose that," and later added "I just would prefer if you wouldn't say that we're not going to discuss those details."

Wow.  Great use of taxpayer money fellas.

So let me try to understand this: the reason the banks got in the mess they are in is because they placed huge bets on exotic mortgages, ignoring traditional risk models that likely pointed out that such loans would never be repaid.

When the day of reckoning came and loans started defaulting, the banks weren’t really punished for their transgressions; instead they were given money to stay in business. And now we aren’t even asking them to show us where that money has gone.

I’m not implying that the banks shouldn’t have been bailed out. Allowing them to fail would have caused a systemic collapse of the country’s banking and financial industries.

But to give them an actual blank check without any sort of accountability is absolutely criminal. The taxpayers who are footing the bill have absolutely no idea where the money went, or where the next $350 billion is going.

Just like the loans to the automakers, the banks should be forced to provide a gameplan for where the money is being spent. If the banks can’t provide a basic breakdown of where the money was used, they shouldn’t be able to get any more.

I feel a majority of the money should be used to restructure mortgages that are either in default, or in high risk of default. After all, isn’t that what got is in this mess?

If instead of the answers given above, we all deserve to hear “we kept $75 million of the money for the balance sheet, $350 million was spent restructuring 1600 loans, and we plan on using the second part for similar plans” and actually force them to account for the money.

The first $350 billion of your money has likely been completely wasted. Let’s hope the second half gets put to good use.

Tripper — Dec 11, 2008Charger's point was that, personal anecdotes aside, most ANALYSTS say that the biggest problem for the auto industry is not the union pay or benefits of current workers (since the reality is that it's not all that much higher than non-union plants) - it's the retirees' compensation and the piss-poor management decisions that have been made in recent years.

You can choose to believe people who have looked at the business as a whole, or you can believe some people you know who think they know what they're talking about.

Of course, the latter is flawed thinking, because individual cases do not necessarily represent the complete reality...

My gut still tells me it'd be wiser if we let the motherfuckers go bankrupt and reorganize that way...
Tripper

Any cost to auto makers should be considered.

And.....wasn't the retirement pakages the companies have to pay out designed by mostly the union? I'm not a fan unions. Obviously.

It's going to be tough but their pensions are bust if the company can't pay them who can.
If the government pays it, it is like running a welfare++ scheme for ex car workers.

It won't happen because it can't last - financially or politically.
Pensions have to be fully funded and independent to mean anything.

A very tough call politically, but no choice.

the unions will not be a problem, the ones who are working will want to cut a deal and the pensioners -
well they have no choice, why should all these car workers support them.

It is a between a rock and a hard place scenario.

But the active car workers are boss.