Let GM go Bankrupt

the industry has been failing for 40 years, the industry has been mismanaged for longer, and we are supposed to believe that a measly $25 will save them??

I did not just fall off of the turnip truck. I am insulted that I am supposed to be naive enough to believe this story.

Many are believing it hawkeye10, as proven by the support for the bill by those on this thread alone.

I suspect that many approve considering the $25 billion to be a band-aid, that we will go back after the crisis lifts and figure out a long term solution. There is a good argument that we don't have the time or energy to deal with the auto industry collapse right now. Considering that the execs turned up at Congress with their palms out and ZERO turnaround sketches tells me that they figured they have Congress over a barrel.

You know, I'm beginning to think that whole 700 billion bailout was just a setup so we'd start feeling that 25 billion here and 100 billion there are just chump change. It isn't

They may have shown up without a plan but I guess they got a surprise when they were told to head back and come up with a plan.

Dems delay auto bailout vote, seek plan from Big 3

According to this CNN money article, bankruptcy for the automakers would be different than when the airlines went bankrupt.

Why GM can't survive bankruptcy

Letting GM fail is like NyQuil, it sucks to take down, but it will leave us better off.

Agreeing with Roger. The idea that it somehow doesn't affect all of us for the government to spend a billion here or a billion there is ludicrous. The government generates no income--it has to come from us. That Citibank bailout overthe weekend? That cost $1,000 for every man, woman, and child in theUSA. That was one....count it ONE....of many such bailouts already authorized. How many can we stand?

On the plus side I traded a very real $1,000 for an imiginary $400 increase in my 401k (that will probably be gone tomorrow)

[/sarcasm]

Naw, you've got one more day of rally to go at least here so maybe you'll get your thousand back before it crashes again.

The point is, how many of us would care enough about Citicorp to write out and hand over a $1000 check? Or, if you're a couple, a $2000 check? Or a family of four a $4,000 check?

Your bill as a single for the bailout the auto industries want? A $1600 check. That AIG bailout? More than $2000 for each and every one of us. Now they're talking about buying up mortgages that people aren't paying. Those of us who are paying our mortgage won't get any help of course, but it does make the housing market look better for the short term.

And as yet, I haven't seen any news that in return for these staggering sums that any of these businesses are required to reorganize and clean up their acts so that this doesn't require a repeat on down the road. Has anybody leaned on the unions to back off on unaffordable demands? Is there anything in the news that says Fannie Mae and Freddie Mac and lending institutions are supposed to secure only viable debt? Is management being held accountable for sound business policies? Etc. Etc. etc.

I would feel a whole lot better about it if I thought they were actually fixing the problem.

It's the democratic result of the baby boomers. Back then they voted for inflation (25%) to take it off their parents and grandparents and then they got into easy jobs, long life medical intervention, property speculation on borrowed money, used up the cheap oil and gas, stuffed waste out of sight, heads exploded, greed without limit and all points south with Lady-Media cheer leading and now it's all come on top they are shoving the debts and the clean ups onto their kids and grandkids all the while asserting how much they love them and moaning and groaning like the ******* dead-leg self-pitying hypochondriacs that they are and they just voted for more of the same with the best snake-oil salesman I've ever seen.

They thought they were educated on the basis of handing out expensive diplomas and degrees to each other and most of them can hardly read or write and they go into sulkie mode when any of these facts are pointed out to them and stick it up the messenger with empty windbaggy assertions which they actually believe, religiously, mean something on the evidence of them having uttered them.

As if signing a few pieces of paper (the bail outs) is an economic category. What a joke. And the market for personal armaments booms.

The notion to bail out failing corporations, no matter how big or small is
so wrong on so many levels, one cannot begin to explain why.

Fact is that American automakers are not competitive when it comes to design, quality, safety and environment, and that is besides utter mismanagement and horrendous CEO salaries and expense account that are not only unjustified but also contributing to the downfall of the "big three". Toyota, Honda, and Mercedes all have manufacturing plants in the United States - using the same American work force as the "big three" do, yet their quality control seems better, their safety features are better, and their fuel economy far exceeds the American cars. I leave off design as it is a matter of preference.

So my question to the bail-out proponents is: how come that other car makers in the United States can achieve what the "big three" lack?

Furthermore, do you really think a bail-out will change the "business as usual" mentality? Do you really think that Ford, GM, and Chrysler will
make better cars with better safety standards and fuel standards/fuel alternatives overnight? Do you really think that the CEOs of the "big three"
will scale down in their salaries and spending?

If any of these questions are answered with yes, then you are in utter,
complete denial.

Perhaps one should read some foreign press to the bail-out of the "big three" to gain some objective pointers in how the world perceives the
Americans right now. BBC would be a good start!

One "expert" on the BBC last night said that if the Auto industry, the banks and the housing businesses tank you are in uncharted territory and he managed a desolation gesture as he said it.

The body language tells me that they don't know what to do but know that they have to try to look as though they do which Mr Paulson had great difficulty managing.

What makes me laugh Cal is that it is the evolution wing which is calling most for the bail outs which are obviously contra-evolution theory. Imagine the dodo having been bailed out and being still with us. Or those birds which made it go dark when they flew over.

I'm the evolution wing spendi.....

Actually, they compete well, if not always excel in these areas. The problem is, the only things they can make at a profit are light trucks and heavy SUVs. It's the profit issue that goes back to management and unions.

I agree spendius, they don't know what to do, that's why a chapter 11 bankruptcy is the preferable method of "helping" the big 3. At least under the chapter 11 procedures, the government will step in and reorganize these
corporations. Airlines have emerged from chapter 11 to a full functioning operation again, so why not the automakers?

Roger, you're right the SUV and truck market is still strong with the big 3
makers, so why don't they take what they're successful in and expand their
market to only trucks and SUVs?

Mismanagement will not resolve itself with a bail-out, on the contrary: we
will throw good money after bad money, that's all.

I also can understand what Sen. Jeff Sessions, R- Ala., told reporters Wednesday, “I can not imagine a real justification for a worker in Alabama who does not have any health insurance at his company to be taxed to maintain a Cadillac health care plan for somebody in Detroit.”

Honda, like the rest of the automakers is being hurt by the economic downturn just like others, but they are changing fast. Their fuel-hungry
Odysee minivan is being replaced now against a different model that is
much more fuel efficient. Smart companies change with the economy
and are trying to stay on top of technology, design and environmental
issues, and are rewarded for their innovations. Why should they be
punished now and help bail-out the ones who mismanaged their corporations for years and years.

We need to help those poor workers, yes, except not with a carte blanche
to their CEOs but a chapter 11 bankruptcy plan to reorganize and reshape
the car industry. If they're (CEOs) looking for government handouts, they have forfeited their rights to do as they please. Let the bankruptcy court
take over!

CAFE. Not sure, but I think they are included in CAFE figures, even though epa mileage ratings are not required. I heard, though cannot prove that they wanted to include mileage from foreign subsidaries to increase the corporate average. GM's Opel subsidiary does quite well, there.

c.j. wrote :



i don't think a "bailout" should mean , just continue doing what you have been doing .
but i also can't see 2-3 million unemployed pounding the pavement in the U.S. or 500,000 unemployed in ontario - i think our social order would break down .
the consequences of a complete shutdown of the big three would be even more of a disaster for ontario (and canada) than for michigan and the U.S.
we might as well became "hewers of wood and drawers of water" again .

i don't see why there can't be a somewhat orderly transition period :
a cutback of production to what the market can sustain , fostering new and modern industries and re-training of workers .
but it should be done NOW and not "sometime in the future" .
there is no question in my mind that the government would have to become involved .
governments have become involved in the industry during wartime - is this any different ? i think the current worldwide crisis could easily result in widespread unrest and perhaps even war - so why not act NOW .
it's happenened before and could happen again .

it would be cheaper to spend money "at home" than for wars in iraq and afghanistan .

canada's parliamentary budget officer just announced :



that's $1,500 for every household - rich or poor !
and the costs are continuing at least until 2011 !
that money could do a lot of good right here in canada !
hbg

That's what I said, hamburger: let the government step in under the chapter 11 procedure and reorganize.

Yes, we cannot let the workers suffer more than they have already, but at
the same token, they will need to understand that mismanagement, unions,
lavish retirement plans and high labor cost need to be scaled down as well.
The base wage at GM is $ 28/hour but the average worker reaches good
$ 38/hour. Too high in my opinion when you take the comparison of the
average national hourly wage of a blue collar worker.

Those companies that had been failing for 40 years have had profits as high as 6 billions a quarter not that long ago.

If that is failing I would love to know how.

an interesting article comparing toyota and GM wages .

i don't know what the toyota wages in ontario are , but understand they are VERY competitive - and apparently the "work climate" is second-to-none .

http://www.aftermarketnews.com/Item/28594/uaw_losing_pay_edge_foreign_automakers_bonuses_boost_wages_in_us_plants_as_detroit_car_companies_struggle.aspx