The Big 3 Auto Bailout

[Ash]

Most of you know that congress might bail out the Big 3 auto makers.
I was curious to know your opinion on this matter.

Automotive Industry Crisis of 2008

Should they bail them out?
Or should they let them fail as if they were any other business?
What do you think should be done?

[Jack]

I don't know.  On the one hand, I consider gov't bailouts to be one of the better uses of tax dollars, because if it helps the economy and prevents massive layoffs throughout the country, then we're actually getting something positive out the deal, which is a hell of a lot more than can be said for a lot of the stuff our tax dollars are being spent on.  And they're only talking about loaning money to the automakers, not giving it to them.  When they bailed out Chrysler years ago, they repaid the loan in full with interest.  On the other hand, there are mechanisms in place to deal with these situations that don't require bailouts.  Declaring bankruptcy doesn't mean a company ceases to exist, it allows a company to restructure itself so that it can continue in business.  I think the automakers saw the credit industry bailout and said, hey, why go through all the pain of restructuring when we can just get a big whopping pile of money to allow us to continue to do things the way we always have. 

So yeah, I dunno. 

[asimpson2006]

I'm going to have to with Jack on this one.  If we give the Big 3 money so they don't collapse, is anything going to change other than the fact that Ford, GM, and Chrysler will still exist?  Since the Big 3 see bailout is an easier option than Chapter 11 bankruptcy, and of course seeing the credit industry bailout the Big 3 say it ask an easy fix.  Throwing money at everything doesn't always fix the base problem.  While yes it would keep the Big 3 afloat for now, it does not fix the problem that got the Big 3 into this mess and I would bet that if the bailout did occur, years down the road the Big 3 would still be in the same mess again with money problems and be asking for money again from the government.

I would like to see them file for Chapter 11, restructure itself, get better people running the show all together and making more fuel efficient cars that are much safer.  While yes some people would lose their jobs in the process which in itself will be a shame, The Big 3 could be more efficient with their money and have far better business practices.

[ghouck]

The idea of 'giving' them money is ludacris. Any help has to be a loan, or at least a grant with MANY MANY strings attached. There needs to be many many stipulations with people OUTSIDE the industry, people with brains, setting rules and standards. Also, Chrysler looks like it might be best to let die, and Ford says it may not need the bailout. Either way, there's no point in a bailout unless we get the UAW under control also.

[lester1/2jr]

no, they sholdn't have bailed out wall street either.  it's called a "correction" for a reason.

[ER]

No way. Plus it just irks me when the proponents of "free trade and unregulated capitalism" come crying for government intervention when things aren't going their way.

[Rev. Powell]

No.  Automakers are acting like its still the 1970s and they are the backbone of the economy.  Taxpayers already swallowed hard and bailed out a more crucial industry.  If we bail out the Big 3, we might as well bail out everyone.

[akiratubo]

Seems like the American people have already "cast their vote" on the issue by not buying Ford, GM, or Chrysler cars.  If the American people gave two s**ts if the big three automakers went bankrupt, they'd have been buying their cars.

[lester1/2jr]

notice that mcDonalds and Wal Mart don't need bailouts? 

[Fishasaurus]

I voted "yes," but hesitantly.  I think they need to show that they're going to do something constructive in order to make that money work for them, and they need to prove that it's really happening or they need to give the money back.  I HATE to reinforce the Big Three's laziness by loaning them a dime, but I hate it much, much more to think of an entire state's economy and most of its workers going down the tubes because Billy Ford thought things were OK the way they were.

[trekgeezer]

We have a system setup for this, it's called bankruptcy.   They need to go into Chapter 11 and restructure themselves.  If this doesn't happen they will just continue doing business as usual.   A lot of people are going to lose their jobs no matter which way this goes.  The UAW is going to have make some concessions like it or not.

What's the deal with the Car Czar? I agree with one of the southern senators about this, the government can't effectively run the financial bail out so how the hell are they going know how to run the car companies?

[ghouck]

The UAW is going to have make some concessions like it or not.

The UAW, and some other unions, have been bargaining people out of jobs for decades, I really don't think they can fathom the concept of making concessions. That's one of the few reasons I am leaning toward supporting the bailout, because without intervention, the UAW isn't going to move much I feel. Their beliefs seem to be that if the market is doing good, the workers are responsible and need to be compensated, and if it's doing poorly, it's a management problem, therefore the workers shouldn't have to suffer any change.

[Rev. Powell]

The UAW is going to have make some concessions like it or not.

The UAW, and some other unions, have been bargaining people out of jobs for decades, I really don't think they can fathom the concept of making concessions. That's one of the few reasons I am leaning toward supporting the bailout, because without intervention, the UAW isn't going to move much I feel. Their beliefs seem to be that if the market is doing good, the workers are responsible and need to be compensated, and if it's doing poorly, it's a management problem, therefore the workers shouldn't have to suffer any change.

They're already offering concessions, including dropping the horrible "job bank" (which, as I understand it, lets laid off workers receive most of their salary for two years whether they look for new work or not!)  But in exchange, they're asking for something even crazier and potentially more disastrous: a position on GMs Board of Directors!

http://www.marketwatch.com/news/story/UAW-seeks-board-seat-exchange/story.aspx?guid=%7B4D2F357F-8D26-4052-9EF4-E13DD89A91D4%7D

[ghouck]

The UAW is going to have make some concessions like it or not.

The UAW, and some other unions, have been bargaining people out of jobs for decades, I really don't think they can fathom the concept of making concessions. That's one of the few reasons I am leaning toward supporting the bailout, because without intervention, the UAW isn't going to move much I feel. Their beliefs seem to be that if the market is doing good, the workers are responsible and need to be compensated, and if it's doing poorly, it's a management problem, therefore the workers shouldn't have to suffer any change.

They're already offering concessions, including dropping the horrible "job bank" (which, as I understand it, lets laid off workers receive most of their salary for two years whether they look for new work or not!)  But in exchange, they're asking for something even crazier and potentially more disastrous: a position on GMs Board of Directors!

http://www.marketwatch.com/news/story/UAW-seeks-board-seat-exchange/story.aspx?guid=%7B4D2F357F-8D26-4052-9EF4-E13DD89A91D4%7D

I was right, they don't get it. . . .

As for the Job bank, I read a story about how supposedly some could get paid for doing community service. Apparently helping out at the local school was one of the 'services', and one of the schools would just sign them off as having done some form of service in the morning and let them leave. Turns out, the principal did this because the school staff was getting upset that these people hung around the school all day drinking up all the staff's coffee, which the staff, being paid generally a bit LESS than those people, had to pay for out of their own pocket. I really don't know if that was true or not, or even that I am remembering it correctly, but it was a pretty messed up situation.

[Jack]

Changed my vote to "No Way!".  Just heard a speech from the president of the UAW talking about how his employees, who make about $30 an hour on average, can barely feed their families, and how dare anyone suggest they take a pay cut.  We're supposed to bail them out with tax money taken from people who don't make half that much.  What unbelievable nerve.