Wednesday, December 17, 2008

That auto industry bailout

First the banks, now the auto manufacturers. If we bail them out, everything will be all better... right? Isn't that what they're saying? If we don't bail them out, it will hurt the economy?

Shhh... don't tell anyone, but our economy is already hurting. We gave the banks the money they wanted and it didn't help anything. So we give the auto industry the money they want... and what will that do?

It will:

Give the government part ownership of the auto industry.
Open the gates to other industries wanting their share (hear the rumblings about the credit card corporations?).
Cause class rift by taking from the poor (us) and giving to the rich (them). (Think the people won't resent that?)

And will it cure any ills? Well, if we believe them, some workers will get to keep their jobs.


  1. I disagree with you on this. The auto industry, unlike the banks, is asking for a LOAN, not a BAILOUT. Millions of working class people will be affected if the Big 3 fail. In addition to the the jobs of people who work in the auto plants, jobs in related industries (tire companies, battery makers, car lots, etc.) and unrelated work areas (the companies that run the plant cafeterias, stores where auto workers buy food and clothing, schools and governments that depend on taxes paid by workers,etc.)would be lost.
    Germany is bailing out the VW plant in Tennessee. Japan is bailing out their US auto plants.
    The 700 billion given to the bankers was supposed to keep the economy from collapsing but seems to have gone to CEO bonuses instead. Twenty-five billion to keep millions in the work force seems like the frugal thing to do.

  2. I'm in the middle of the road on this. Yes, I can see that jobs need to be saved, but will the auto industry change their ways? I doubt it. And we will be throwing good money after bad. Because you can bet that they'll be back with their hand out. Do I want my taxes to go up even more than they already are? The auto industry has been mismanaged for years, and they made a ton of money making all those large vehicles! As a tax payer, I don't want 50% of my paycheck bailing out those that make more $ per hour (isn't the word about $75 per hour?) and getting all those perks, living way beyond their means, while I pay for it (while I still have a job).

  3. The $75 per hour is bogus. I had a cousin and couple of friends who worked for GM. None of them were rich. Most died young. The one surviving friend is scraping by on his pension,living in a trailer in Florida.
    Many people here in Michigan work for companies that supply parts to the auto plants. They make about $15 an hour. The local plant that makes rear view mirrors is talking about shutting down.
    A GM dealership here closed recently. After the banks got their bailout, they decided to tighten credit to the average guy. I don't know of many people who can buy a car without a loan, and if people don't buy cars, the car dealerships don't make enough to stay in business.
    I'm only suggesting that about 4% of the $700 BILLION already earmarked to bailout Wall Street and the banking industry be LOANED to the auto industry.

  4. I also reluctantly agree that America needs to bail out their auto industry. If it doesn't it will bring on the 'mother of all depressions'. I think Barack Obama has it right, you have to get the economy on track before reforms can be made and major problems fixed, and there is one thing I know - Barack is one pretty smart cookie.

    I can also see one major hurdle for the car companies, for at least the next year, no one is buying cars...

  5. My .02 is that I just don't think it's going to help. The companies may be able to hang on a while longer because of the loan, but if people aren't buying, it's a death sentence to them anyway.

    With Chrysler reporting yesterday a 53% decline in sales for December (the highest of the auto companies) and others including Toyota in the 30-40% decline, it's more than just a manufacturing issue.

    Sadly, I think we're heading for some really rough times ahead and we need to face the reality that the government isn't going to be able to really fix it.