How do other people feel about this? I am putting my fiscally conservative foot down. I didn't like the idea of the $700 billion dollar bailout to begin with. Now, the big 3 automakers seem to think they need a piece of it in order to survive. BS!! One of the arguments is "Oh no...Ford, GM, and Chrysler are such staples of American business that we can't dare let them go under". Why the hell not? See...I can't stand when that whole "patriotic" crap gets thrown in my face. Now I have never owned an American car. The boyfriend and I like German cars (great designs, reliability, quality, performance). I just never saw an American car that appealed to me. For those that have them...much applause. Different strokes ya know. But I'm sorry... I do not support a bailout of Ford, GM, or Chrysler. I agree with those who say let them file for bankruptcy, reorganize, clean house (i.e. the board and other upper management) and figure out a way to be more innovative and build better cars. Those automakers have spent years not planning for the future and making efficient cars. Their designs were never appealing, their quality basically sucks, and the increase in oil left them with their pants down. So I don't want to hear that its unpatriotic to not support this. Who else is going to have their sweaty palm out for a handout next?

I have mixed feelings about this topic. On the one hand I'm mad as hell that we keep talking about all of these bailouts, but have had little progress in terms of who's going to jail for the f**king banking/housing mess!

You know damn well that if any of us had taken a few thousand dollars, let alone billions, our asses would be in jail right this moment. I think the public needs to start demanding, "First tell us who the crooks are, send them off to Guantanamo for all I care, & then I'll support these bailouts."

On the other hand, not helping the auto industry will inevitably effect thousands of innocent employees/families of these companies. Plus, they have nothing to do with the above. So that, too, makes me say, "Well for the sake of your employees..." So I do not know what the appropriate resolution should be quite honestly.

If it were strictly a matter of those 3 particular companies I would say no bailout. But with the dealers, suppliers, and other businesses in company towns there are many other jobs dependent on the Big 3.

It would also drive out trade deficit through the roof which has its own consequences. We would be sending more money to Japan, Korea and Germany than ever before.

I agree with some of what you said, and I am particularly annoyed by EVERYONE who played a part in getting us to this point (from the GM leadership who killed alternative fuel vehicles, to the unions who STILL don't pay a dime for healthcare and whose costs are driving these guys bankrupt, to the dumb-*ss consumers of gas guzzling pickups and ginormous SUVs), BUT the consequences of letting these guys go belly up would be FAR WORSE than pumping a few billion dollars into them.

There would be no Chapter 11, they'd alsmot surely go straight to Chapter 7 liquidation unless the government ponies up several billion to keep them just barely solvent enough to avoid liquidation.

So, let's assume they all go out of business. What happens to the parts suppliers, the dealerships, the salesmen, the tire companies, the suppliers of raw steel, plastics, electronics? What happens to the retiree pension plans, the healthcare, the local hospitals, restaurants, public schools, the real estate values of the towns where the factories were located? What happens to the college dreams of all their kids, what happens to the local banks, the truck drivers and rail companies who transport the finished product from the factory to the showroom (and who transport all the unfinished parts to the factories)?

I seriously think that given the economy today, massive job losses in Ohio, Michigan, etc., and the catastrophic impact a Big 3 collapse wuld have on the psychology of the consumer, the US would dive head first into a depression. Sorry, I think 20 or 30 billion of the 700 billion dollars would be a fairly good bargain.

Good points made by all of you, particularly about the businesses and people outside of Ford, GM, and Chrysler who rely on their businesses. But when is enough enough? And who is going to be next in line with the same excuse that others rely on their existence. Its just gotten so far out of control. Who the hell has been running the show on these things, and why is it that such an educated society as the US with our Wharton Business School grads can have a bunch of complete dipshits as heads of these companies. Ugh....every day the news seems to get worse and worse. I feel sorry for people who are really feeling the pinch of this. This holiday season is going to be a wash for a lot of these companies.

I say extend a lifeline with significant restructuring of not only the auto industry but any other that wants financing to avoid the consequences of greed and negligence.

I'm willing to wait and see what an Obama administration has to say, but my fear is that all of the talk about a "free economy" suggests that they may put a bandaid over a gushing wound.

FDR did not pussyfoot around. He regulated private finance, created jobs and effectively built an alternative temporary economy to the so-called free market.

This distorted analysis from a conservative think-tank inadvertently identifies what needs to be done.

Further taxing the working poor is what the Bush tax cuts have already done, and created this problem.

For the first time in US history we should seriously tax the rich in a truly progressive manner.

The problem is that one of the things that has been bought with the wealth of the rich is the US government. No legislation to tax the rich will come out of a Congress that is dependent on wealthy donors. That system has to "change" at the same time that progressive taxes and regulation of usuary is enshrined in our system.

The only other thing I wanted to state is that IF we bail out the US auto industry, we need to add some serious strings attached to it. Most importantly, that they start making cars that are not only petro-friendly, but more importantly, IMHO, environmentally friendly. They have no choice at this point. The world has embraced such realities. It's time the US auto industry follow suit!

But when the alternative is billions of dollars of taxpayer money to support a company whose business plan is to sell cars at a $~3000 loss per unit? That's madness! Better the money be given in the short term as direct transfer to the workers and dealership employees effected then to have it pissed away in inventories of crap, non-labour overheads and salary for incompetent millionaires.

In the long run the dealerships are a non-issue as the going under of a few companies will not effect the overall demand for cars. The manufacturing is an issue, but at present, many foreign marks already manufacture in the US to avoid tariff and, although I don't support this model in the slightest, the money which may be marked for bail-out would still better be used to attract foreign companies to manufacture in the states rather than useless American companies continue to do so.

A bailout only works on the assumption that the American auto industry is viable in the long term. Anyone who truly believes this is living in fantasy.

This makes you wonder where the Bush money for research into non-fossil fuel technology has gone...

Or wait, no. It doesn't.

...Turns out there was never a market failure in R&D. The failure is in alternative energy infrastructure. The money being given to R&D was a strategic avoidance of the key issue. Contrary to popular belief running out of oil in the literal sense is an economic impossibility so long as other technologies exist (which they do). Transference to other technology will take place once the cost of the next best technology becomes cheaper than the cost of fossil fuel plus the future discounted overhead for the transference. Most economic estimates place the cost-minus-transference of technologies such as electric and fuel cell at about $75 a barrel, so the obvious investment, if any, by the government should be in alternate fuel infrastructure.

The key problems prohibiting transference are twofold. First the cost of switching infrastructure to support use of hydrogen/electric/biofuel is prohibitively expensive on a large scale in the short run and at present the government has done very little to alleviate those costs. This is not to say they should, but simply to say that if any money is to be spent by the fed this is where it should be invested. Second, the majority of alternate technology is not useful until such time as primary power generation becomes eco-friendly. For example, hydrogen is not a fuel per se. It is, rather, an energy storage medium. Because hydrogen requires energy to produce, it will only ever be as green as the energy used in its production. BioFuel on the other hand is useful but due to potential scale issues only a partial solution...

But the government need not invest at all. All they need do is create a regulatory environment that allows individuals to sell power directly to the grid. This is a model that has been employed in various european states to great effect. By allowing numerous private actors to personally invest in wind, solar and biofuel (at farms), individual households can make direct profit by personal investment in alternate fuel technology and are likely to do so. As the grid becomes more green (a process which if precedent is an any indication will take about a decade), there are two main benefits. First, it lowers the eco-footprint of transference to non-fossil fuel and insodoing it also lowers the overall impact of primary power production.

Due to federal grants the US auto industry has not been too bad at designing good environmentally friendly concepts. There is just no market incentive to employ any at current. This is not the fault of the auto industry. It is the fault of the government and to a lesser degree the consumer.

Here's my take on it.

Before the latest credit crunch, GM was looking to purchase Chrysler from Cerebus Capital. I wonder if 3 large auto makers are needed now. IF, and it's a big if, the government comes through with funding, maybe one of the options should be a forced merger of the 2 weakest, or maybe even all three, to create a viable company. All of the big 3 have sectors that make money, so why not keep those, and let the rest go. Keep the Ford truck division, as when the economy improves, it has always proved to be popular, as well as the Jeep division of Chrysler, and the small car divisions of Ford and GM. In Europe, Ford is profitable, and makes a great small car. When I was over in Europe for the month of May, we rented a Ford Fiesta Eco Car. Great car, incredible gas mileage, (we drove 2700 miles, and only filled up the tank 4 1/2 times).
The SUV market is essentially dead, with some exceptions, such as the Cadillac Escalade, GMC Yukon and Chevy Tahoe. Keep those, but in smaller volumes.

My example for this is what the British Government did in 1934, (wait, it IS relevant). Cunard and White Star were both hemmoraging money, and went to the British Government for bail out funding. The government agreed to underwrite the company, ONLY IF they merged, in order to reduce the available product on the Atlantic run. What did the government get out of this? They got their money back, with interest, and 1 very strong line survived, albeit in different forms, to today.

The remnants of a merger between the big 3 would be taken up VERY VERY quickly by the foreign manufacters, who know they need a US base to sell their product. While the Japanese, and Korean car makers dominate the US market for imports, (or made in the US), th European makers are still looking for a foothold. Renault/Fiat, Vauxhall, and others make a good product, but have no market prescence in the American market.

I look at the auto industry bailout as something that's certainly not a good thing but it's necessary. The collapse of the auto industry in this country would be devastating. If we think things are bad with the economy now, just wait and see what would happen if the big 3 auto companies collapse.

The number of jobs affected will be monumental. Not only would 350,000 directly-employed auto workers join the unemployment rolls immediately, so would a huge portion of the 4.5 million auto industry-related workers around the country. There would be millions out of work! With the economy already in turmoil due to the trillion dollars spent in Iraq and the huge tax cuts for the wealthy under Bush, things will deteriorate even further. Millions more out of work means more trouble for the housing industry and so forth.

This doesn't even take into account the estimated 1 million auto industry retirees whose pensions, benefits and health care would disappear with the collapse. I can't imagine some 70-year-old person who spent 40 years working in Detroit suddenly ending up with nothing... no money, health care, etc., after spending a lifetime working hard. The trickle-down would be enormous.

I heard one of the Repug talking heads on Fox News this morning talking about how great it would be if the auto industry collapsed because they hadn't been building fuel-efficient cars... and most importantly... because it would bring an end to the all-important auto workers unions. Don't be fooled. The Repugs would love nothing more than to bust up unions and they would succeed if a bailout does not occur. They had some new blond lady on Fox News this morning (they're almost interchangeable these days) and she actually said, "So maybe you're saying we could see Michigan turn red again in 2012?"

I am with the "we can't avoid a bailout" because the costs to the economy will be too high. It is not just the jobs from the actual manufacturers, suppliers and dealers that concern me, it is the domino effect of an industry this large collapsing. It means even more job losses among service sector - restaurants, stores, daycare centers - when the auto industry employees stop spending. All those job losses mean even more foreclosures and a continuing decline of the housing sector, which means a further tightening of credit as mortgage securities lose more value, which means more industries that can't get credit and fail, which leads to more job losses, more foreclosures....

If you look at the US economy during the "robber baron" era of the second half of the 1800s, you see what we could be in store for. That was a time of nearly unfettered capitalism, with huge booms and equally big busts. The market worked, and eventually righted itself after all the downturns, but at huge costs of human suffering.

It is also true that long-term productivity and growth of economies are as much tied to their future predictibility as to their ability to create wealth under capitalism. Huge boom-and-bust cycles only serve to reduce predictibility, and reduce investment, etc. There is a reason our economy grew the fastest during the 20th century - when it was clear the US would be the dominant producer for some time, and we had a stable, regulated banking system.

I also agree, though, that any bailout has to include a.) consumer ownership of part of the auto companies (why would the government not get stock in these companies?) and b.) a restructuring of the industry as Obama noted in the 60 Minutes interview.



Just a note - as I understand it, the unions took over the costs of healthcare provision in a recent restructuring of Big Three UAW contracts.

All three Big Autos should begin issuing corporate bonds with graduated rates of return and/or convertible to common and preferred stock. How is it that this method and plan for a return to solvency is not in the current discussion? Ford came back to life this way in the late 1940's and early 1950's.

TRL

There should be NO bailout of the auto industry. They've been woefully mismangaed, and the unions have buried their head in the sand too long - a few years ago they threatened to strike because the companies were suggesting they make $10 co-pays on doctor visits and prescriptions, and they screamed that was outrageous. Meanwhile, I pay $120 a month for individual employer-sponsored health care with a $30 co-pay, and people with families pay four and five times that, or have no coverage at all. So should people who don't even have health insurance foot the bill so retirees can continue to have no-cost health insurance in their retirement? I don't think so. In addition, I think the Wall Street bailout was a sobering lesson - the government still is unsure how to administer the plan, and it's done nothing to reverse the inexorable economic slide.

As for the workers who will lose their jobs, let's face it, demand for cars in this country will continue. The Japanese and European carmakers don't have the excess capacity in their factories to meet that demand, so they will eventually seek to hire more people in this country and utilize the existing plants that have been shut down - it's the only way to quickly meet that demand. It's estimated that up to 50% of the workers could be re-hired within 18 months. The catch? It would be at lower wages, with no union representation. Hurray for that, I say.

Remember, there were equally dire predictions that we could not let mining and steel mills go under. We did. The country survived, and the companies in those industries that survived were more nimble and ultimately better off. It's definitely painful, but we can't put off the ineviable. We need to bite the bullet here.

I'm afraid I have to agree with Munson Man on this one, and right now it doesn't look like the auto industry has the votes for it to pass. Chris Dodd ripped them today regarding some of the same points many have been making about their spending years making inefficient gas guzzline automobiles. Yeah...I'm just not feeling it. People are verbalizing doomsday scenarios and I'm just not buying into it.

Whereas the bank bailout was truly a "bailout," this is a loan, according to the experts. Especially with all of the stipulations that will be written into it, including steep pay cuts for execs. The total value would be just a small fraction of the bank bailout. Like some in the Obama camp said, if the Bush administration can bail out Wall Street, the nation can afford to loan the big three auto dealers a much smaller amount. I know the Republican party wants to end unions as we know it, but it's not going to happen under Obama's watch. And that's a good thing. It wouldn't be the CEOs and auto company heads who get hurt if the auto industry collapses. It would be the middle class workers in those upper midwest states who helped elect Obama. It's a shame that he is in such dire straits right when he's coming into office. My biggest complaint is with Pelosi who said impeachment was off the table back in 2006. Bush could (and should) have been impeached on a variety of different issues.

By the way, Sarah Palin's senate plans have been foiled. The Associated Press has called the race for Mark Begich. He leads Stevens by almost 4,000 votes with only about 2,000 overseas ballots remaining. That's a great Democratic pickup, but shows you how ridiculous Alaskans are when they would almost elect an 85yo convicted felon.

There is no easy answer to the Big 3's auto problems. A total collapse, (Chapter 7 liquidation of assets )could lead to 3 million job losses in the short term. I do think over time many might get hired back with foriegn carmakers operating in the US. A large percentage of foriegn cars are made in this country. The problem with this approach is just how long is short term, and how long can the country endure the increased unemployment and possible further housing foreclosures due to lack of income.

Although I am bit torn on whether they should get funding, I believe the way to go is a hybrid approach that has been talked about. In this scenario the automakers must declare Chapter 11 in order to get federal funding. Chapter 11 allows continued operations but in a different way. Concessions would be required by shareholders, management, workers and creditors. The choice is they accept these changes or chose Chapter 7.

The UAW did give some concessions in the last contract, one of which is newly hired workers are now paid at the same rate as the foriegn autoworkers. But the legacy workers would also have to give something up in order to keep their jobs. Management and senior people would need a cap on what they could earn during the reorganization process. An example of cuts for all workers would be health benefits in retirement which I believe the majority of Americans don't get. Also some new senior people may need to replace the old in to change the direction of the companies. Creditors would have to reorganize debt with lower rates and payments. Lastly a firm detailed plan for return to profitablity should be mandated before the government doles out funds.

Well if it's gonna be in the form of loans & it'll save tons of jobs for families, as others are suggesting, than I say give it to them.

Being the son of a father who was a lifer in the Big 3- and being a Detroiter- I think there is something that needs to be done, but the question is- what is the fix?

This will be davastating to us here in Michigan and we already have a piss-poor economy because we are so industrial based in our economy. I truly believe that we are going to have to become THE leaders in wind and water based alternative energy sources and manufacturing.

The problem that I will have on a personal level- I work in physical rehab- is when all these people no longer have insurance coverage- and even those that do have coverage will be limited- will my job become a luxury versus a necessity

Alabama Republican senator Richard Shelby has been one of the most vocal critics against the proposed $25 billion loan to the auto industry. Why? His state has more than doubled its number of auto industry jobs since 2001 and now has plants run by Mercedes-Benz, Hyundai and Honda. According to the AP, those workers are non-unionized and making roughly half as much as U.S. workers in Detroit while working longer work weeks that sometimes range to 64 hours without overtime.

With KIA now having a plant in Georgia and BMW in South Carolina, it's clear that these foreign car builders are trying to find cheap labor in the south.

President Obama is hopefully going to say no to this Republican boondoggle. Don't think for a second that Republicans against the auto industry loan are doing so to benefit the American people.

I don't think AP is a reliable source for that kind of data. I had our HR Director access the CES database of the Bureau of Labor Statistics, and it says the average starting hourly wage at non-unionized plants in the US is $17.98 per hour (a new Honda plant opened just last week in Indiana and is paying $18.41 an hour, so that seems right). Assuming it's the mid-point of $18.20 or so, that works out to annual earnings of $37,856 (wages only) based on a 40-hour only work week. Considering that most of these plants are in fairly low cost of living states like Indiana, Tennessee, Alabama, etc., that's a decent living starting wage, especially considering that most of the people in these jobs have no post-high school educations, and that on top of those wages another $9.86 is added in costs for health and life insurance, retirement benefits, vacation pay, etc. There's many, many people - including in my own family - who would love to have jobs like that. According to BLS, the average wage at a UAW plant was $29.22, plus a staggering $33.35 for the same benefits. I believe the huge discrepancy in the benefit costs is due to the "legacy" costs at the UAW, where people retire and get full compny-paid medical insurance until death. You and I go on Medicare, and maybe pay for our own Medigap insurance if we can afford it. So, yes, that needs to change.

That, coupled with Detroit's insistence - and the complicity of every Congressperson and Senator of both parties of the last 30 years - on resisting requirements for more fuel-efficient vehicles from Detroit, and on making huge gas-guzzlers to the exclusion of developing more fuel-efficient and/or hybrid vehicles (the only notable exception being the work on the Chevy/Dodge Volt car, scheduled to debut in 2010, which has won rave reviews from those who've seen prototypes).

Finally, I think the word "boondoggle" is being misused here. There IS no Republican boondogle. A boondoggle is a scheme to waste money. People opposed to the bailout are not advocating a boondoggle; rather they are railing against what they see as a waste of money. That's the opposite of a boondoggle.

Fox News continues to beat the issue to death. Repugs don't want the loan bailout because they want to bust the unions. Plain and simple. An Ohio Repug today came out and said he's for it and then he was blasted by some others in his own party. The Repugs desperately want to tie Obama to this even though it's all a product of Bush and I believe Bush is still president and has been for the last 8 years.

It's more than a little ironic how the country is in meltdown mode and Bush has had time in the last three weeks to hold a pumpkin-carving contest at the White House, entertain the various NCAA spring sport champs for a day and a half, spend a day with Laura in Miami and now get ready to attend this weekend's Army-Navy football game along with a dinner and separate banquet for it. At least McSame lied and said he was suspending his campaign to put all of his energy on the economy. Bush doesn't even attempt to do that anymore. It's like he finished his presidency in Nov. of '06. I don't like the man, but you almost have to admire how he's gotten away with ignoring the country for years and no one seems to have much of a problem with it. He's like that crazy uncle everyone has. "Oh, just ignore Uncle George. He's always been that way. It'll be over soon."

Well, this isn't going to help.

Big Three auto CEOs flew private jets to ask for taxpayer money

Best part of the article: "There is a delicious irony in seeing private luxury jets flying into Washington, D.C., and people coming off of them with tin cups in their hand, saying that they're going to be trimming down and streamlining their businesses," Rep. Gary Ackerman, D-New York, told the chief executive officers of Ford, Chrysler and General Motors at a hearing of the House Financial Services Committee.

"It's almost like seeing a guy show up at the soup kitchen in high hat and tuxedo. It kind of makes you a little bit suspicious."

He added, "couldn't you all have downgraded to first class or jet-pooled or something to get here? It would have at least sent a message that you do get it."

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Of course the companies are defending them with the "our CEOs must fly under the safest conditions". Their asses are not dignitaries or the President. Its like the AIG dickwads who went on those luxury excursions after getting bailout assistance. Its the principle. As leaders of the companies I think it would've been a good idea to put their asses on AirTran. Now of course this does not reflect the average worker, but I'm still not for this bailout and I don't think that the votes are going to be there to pass this thing.

Oh yeah...the dow dropped below 8,000 for the first time since 2003 "amid worries over the auto industry". Nope...not going to be scared into supporting another bailout. So they better come up with something; a merger, filing chapter 7 or 11...something. The only way I support this thing is if it is under the strictest of rules that has ever been implemented in a bailout plan in the history of bailout plans. I do feel for those who would be affected by their collapse...I really do. It sucks. But, this country has survived far worse and I just can't bring myself to do anything other than oppose this.

SFJohn hear hear! I could not agree with you more. You are right with your comment about the Republicans wanting to bust the union. In comments I have heard about the proposed big 3 bailout more often than not, the Republicans will constantly mention the unions and their fault in this mess as well. As far as Shrub, there is a reason the old fart has been smiling so much, its because he knows soon he won't have to deal with the MESSES he helped to create!!! I am beginning to believe that $700 Billion he and/or Paulson said we needed wasn't really needed after all........most of it seems like its being sat on.......that or they haven't got a CLUE what to do with it.... .

It is absolutely all about the unions and the Republicans wanting to stop them. In those Rust Belt states like Ohio, Pennsylvania, Michigan, Indiana, etc., the unions are huge and are a key Democratic constituency and all were blue in 2008. It is quite possible that unions were the difference in Obama winning in both Ohio and Indiana. The Republicans are hoping to break up the auto unions as a way of getting stronger footing in those states in the future. Spending $25 billion is nothing compared to spending $1 trillion on a war that was/is ridiculous. These Republicans are touting "fiscal responsibility" now but they couldn't have cared less about fiscal responsibility in the last eight years.

I heard the next industries to go bankrupt appear to be credit cards and universities. I just read where Oral Roberts University is laying off 100 employees, and the California State University system is cutting enrollment for the first time in its history. Now, Oral Roberts is one school I wouldn't mind seeing collapse.

Army-Navy is actually being played on December 6th.

And those events (NCAA teams, pumpkin-carving contest) are things that every president does, no matter what. I wouldn't want a president who wouldn't do those things. As serious as the problems are, I don't think it ever hurts to try and maintain some sense of normalcy.

Well, of course it's about the unions. Who said it isn't? Why wouldn't or shouldn't it be? Let's put aside partisan sloganeering for a moment and look at the current state of affairs. The fact is if the Big 3 were indeed producing smaller, more fuel-efficient cars (which they're not), their fixed costs would still be between $2,200 - $3,000 higher per car. That's fixed cost, mind you. There are two ways to reduce that per car cost: sell three and four times as many cars, or reduce your costs. Well, the US is a mature market for autos, so increasing units sold by 3 or 4 times is impossible, therefore costs have to be reduced. So what's the biggest cost? Parts, obviously. But you can't use lower grade metals, glass, rubber, etc. because you wind up compromising relaibility and safety, which negatively impacts sales, and the problem worsens. So what else is there? Labor - specifically wages that are 50% higher than at non-union companies, and health/retirement costs that are 300% higher. It doesn't take a genius to figure out that that HAS to change. The UAW has said they're not giving up any more, and instead have told GM to get a loan from the government. Well, GM wants $25 Billion. They've also said their burn rate (the amount by which you reduce cash balances) is $2.2 Billion per month. Well, guess what? If the burn rate is not lowered - and nobody has come up with a way to do it without drastically cutting labor costs - that $25 Billion is gone in 49 weeks - less than a year. It wouldn't be a loan, because in a year the company is gone anyway. That presupposes the economy does not get even worse in the next few months - a big assumption, methinks.

Should we make the big cheeses at GM cut their own pay and perks? Absolutely, and according to The Finacial Times that saves $200 million per year. That leaves another $2.14 Billion that needs to be cut. Where does that come from? Really, for all the sanctimonious blather about saving the unions, let's have some real proposals. Where do you find the huge savings that will make American carmakers competitive? Please, let's have specific ideas grounded in facts and numbers as opposed to politically-motivated excoriations of one party and mindless denunciations of union busting - let's hear serious proposals. If the proposal is that we just leave things as they are, then that $25 Billion is an annual cost for one company alone. Add to that Ford and Chrysler in another year or so. Then in three years add more because China will have started satisfying their own internal demand and will be looking to export to this country in order to keep their own workers employed. Folks, the chickens have come home to roost. Call it union-busting and wring your hands all you want, but the economic reality is it has to happen. Yes, jobs will be lost. But is it not better to lose some jobs than all jobs? I think so. And changes have to be made. Union members have to share in the cost of their healthcare via payroll deductions and co-pay fees. I do that, you probably do, too - why shouldn't they? Union members will have to start contributing to their own retirement funds, and switch to 401K plans rather than the outdated defined benefit plans. I do that, you probably do, too - why shouldn't they? Retirees will no longer get the same free health care in the 30 years of retirement as they got in their 30 years of working - they'll have to use Medicare and buy Medigap insurance for prescriptions and additional services. My folks are doing it, your's probably are, too - why shouldn't they? It's easy to rail and call it politics and union busting, but it's not easy to find a way to solve the real problems without doing it.

Great points Munson Man. I totally co-sign on that, and was having a conversation with a buddy of mine who works on Capitol Hill who said basically that exact same thing.

We should not lose sight of the fact that the fundamental problem with the economy, as I see it, is that there is too much idle money accumulated representing less goods and services. The reason is heavy borrowing from foreign countries who assumedly got much of that money by selling us goods and services.

It appears that international financiers have slowly milked the US economy for years, profiting with each financial transaction. Loans of this money have been made to house-buyers and manufacturers (including car makers) at substantial interest. Servicing that interest is consuming money that would otherwise be used to stimulate production of more goods and services.

These financial "services" (or gimmicks, schemes, hedges - whatever you want to call them) should not even be defined as services unless they increase the efficiency of mutually beneficial exchanges between the producers of actual goods and services. Free producers are more productive than enslaved producers.

We have assumed that the "market" will determine whether these financial services should live or die. But they have become independent of market forces, operating in secret (privacy laws) with the backing of governments - the US in particular - as their enforcer. Borrowers can only take loans that are available.

Read Inequality of Wealth and Income in this wiki entry on The Great Depression. It suggests "lower prices or higher wages" could have avoided the calamity.

Here is something that is getting very little notice.

Of the big three looking for billions, Chrysler has no business asking for funding.

Why?

Because, unlike Ford and GM, Chrysler LLC is NOT a public company. It is owned by Cerberus Capital Management, a huge fund that purchased it from Daimler-Benz.

1. Cerberus has enough money at its disposal that it can afford to bail out Chrysler by itself. The main beneficiaries of a Chrysler bailout would be Steve Feinberg, the mysterious head of Cerberus, John Snow ex-treasury secretary and Dan Quayle (ex-vice president)
Cerberus owns, Chrysler, GMAC, Albertson's grocery stores, National Car Rental, Alamo Car Rental, 7 TV stations, etc etc

2. Should Chrysler declare bankruptcy, the US Govt would not be responsible for the pensions. As a condition of the sale to Cerberus, Daimler-Benz agreed to be responsible for the pensions.

"Chrysler was purchased in 1998 for $36 billion by Daimler-Benz AG. Earlier this week, Daimler sold all but 19.9 percent of its stake in Chrysler to Cerberus Capital Management LP for 5.5 billion Euros ($7.4 billion). Under the deal, Cerberus agreed to invest $5 billion in Chrysler over the next five years and take responsibility for Chrysler's $18 billion liability for its workers' health care benefits and pension obligations, according to the Associated Press."

So then... why is Nardelli (who by the way is an ass****) at the table begging for tax dollars?

So that's what happened to Dan Quayle. He of the infamous quote:Guess he's having the last laugh.

Don't get me started on Bob Nardelli. He took over Home Depot with no retail experience in 2000 and waS ousted in 2007. He was compensated with 240 million during this period and left with a 210 million dollar severance package. Meanwhile the stock essentially stayed flat during this period. Their chief competitor Loews', stock doubled during the same period. Why the board felt compelled to give his such a tidy sum is beyond me. Some will point out that sales doubled over this period. Sorry but a caveman could have doubled sales during the euphoric housing boom.

I asked someone I know (who will remain nameless) who happens to be the head of a major TV Network why this story about Chrysler/Cerberus is not being covered. The response I got is, " He's my friend"

My guess is that the reason why the other News divisions, newspapers are not covering the angle is that many of the head honchos are investors in Cerberus. And the main ones who benefit from bailout billions to Chrysler are Cerberus investors. Remember, we're not talking about investors as in owning stock. We're talking about a private equity firm and their direct investors.

Ung, maybe I can answer your question. The auto industry makes up about 25 percent of the advertising market. Guess where they advertise the most...television. As shady as it sounds, and as much as it shouldn't be, there will be a bias against covering your best customer. Also, the media industry has been reeling in cutbacks and reduced revenue. There simply isn't the manpower to cover stories, especially in-depth ones, that there was in years past. There is also something to do with the "dumbing down" of America. It is a limited audience that would be interested in the details of the issues. Sad, but true. Britney Spears gets more press than suits in a board room.

all things being equal, your answer would not be a bad hypothesis.

But as I said, it's a little more sinister than that if you will.... as I said, this is not a guess. These are people I know very well. The reason why Cerberus does not get high scrutiny is that many of the people who make the decisions are heavily invested in Cerberus. They have a direct vested interest... ergo a conflict of interest.

I don't want to see all these workers out of jobs, and it'll affect hundreds of thousands of people that will be left with no medical insurance, etc, but it ticks me off that Detroit made crap for the past 40 years, and is now surprised that many people have decided to buy Japanese, and German cars....

Bias in the information we receive through the media is not limited to the MSM unfortunately.

Does anyone really know how much information is lost because it is supressed by the fact that a relatively small number of computers or servors are controlled by other than a few very large internet-related corporations.

PC is considered generic but almost always refers to one of two privately held computer operating systems: Microsoft or MAC. Most of the others have to communicate with one of these most of the time, and therefore must have compatibility.

Even national security does not trump the power of these private companies. All of them are making concessions in their software to enter the Chinese market. China is making significant progress in designing means of controlling these systems, supposedly to protect their own security, but turning this into an offensive capability is always a possibility.

Along with a fast developing near-space technology, this will give them the international influence to help both promote and protect their investments and security worldwide. Material wealth is the driving force.

Except that as good overall as FDR was as president, his policies actually prolonged the Great Depression by an estimated 7 years, as has been analyzed by many nonpartisan economists. The last thing we need is for Obama to adopt policies similar to FDR's.

I'll tell you who should pay for the bailout, its simple: the OIL COMPANIES! Why not???? Didn't they make BILLIONS over just the past last quarter alone? Wasn't it them and the car companies to a lesser extent who bought out any alternative energy source other than gas, or oil, that came up? Wasn't it them that did everything in their power to make sure Detroit kept building those great big gas guzzlers, and do everything in their power through their lobbyists to make sure the so called cafe standards never happened?? They can more than afford to pay for the bailout as far as I am concerned.

The three programs that I mention I think helped workers survive the Depression and eventually stimulated private enterprise. There was a mish-mash of other programs like arbitrary price controls that were misguided.

I think had an FDR been able to regulate financial schemes and impose progressive taxation before the Depression it would not have occured. An FDIC equivalent for Wall Street investors would I believe have prevented the current debacle. And graduated taxes would have allowed a middle class that could have better afforded to pay off its loans.

If loaners are not allowed to make loans to those who cannot show credible means to pay for them then make more money by selling the loans producing nothing but inflationary profits, then the housing bubbles could be avoided.

There will always be some people who will find a way to game the system, make exhorbitant loans and find suckers to take them. But regulation has gone a long way to prevent that in other civilized nations in Europe.

One thing that's always baffled me is this obsessive hatred toward the oil companies. Why? They're a corporation not too unlike most others, except that their commodity is vital to way more things than are commodities of most companies. When oil was over $150 per bbl, sure, their profits will be astronomical; but now, with oil around $50/bbl, things are much different. In either case it doesn't bother me.

I hated when gas was over $4/gallon, but I didn't bitch about the oil companies, and I wasn't one of the idiots (Pelosi, et. al.) who was recommending windfall profit taxes. God! That would have been one of the stupidest things we could have done, because guess who would have paid for such taxes? The consumer. You and I.

Let the auto companies go into chapter 11, reorganize, demand that all management be removed, and begin again with new contracts, new leadership, and more.

Sounds like plan to me: paying CEOs $1. In fact, the housing/banking CEOs should follow suit!

An interesting development has occurred today with the CEO of Ford who now is saying they don't need a billion(s) dollar bailout, BUT they would like about a $9 Billion dollar line of credit extended, just in case, but they/he claims they don't intend to use it.......interesting......

OH LOOK HERE COMES ONE OF THE BIG THREE NOW

"I DONT WANT MUCH, JUST A LITTLE TO WET MY BEAK"

SEND THEM TO PRISON, ALL OF THEM AND RON GETTELFINGER TOO

Everyone realizes, right, that $1 in salary is not all of their compensation for the year? There are stock options, bonuses and other deferred income that more than make up for their current below minimum wage income. They are NOT eeking out a living from what they have in a passbook savings account or money they've put away for their children's education as they would be if they were ordinary mortals.

Of course! My point about the $1 salary was that any future monies going to these buffoons should not be used to pay for any of their salaries (even though a dollar could be used as such type of a payment). To me $1 is simply a symbolic gesture of humility--if that's even possible at this point. What they already have is a dead issue. Unless of course their portfolios, bonuses, etc, were built/acquired by illegal means. Then it would be something to address. But you're right, they should also consider not receiving the extra bonuses as well!

Check this out:



Yes it's a small amount compared to the rest of his sources of income, but it certainly isn't a measly salary.

Somebody correct me if I am wrong, but I just heard on the news they now want $34 Billion. What happened to the $25 Billion ??? Their requests go up by the minute. Good Lord. Nope, I still say let the big oil companies pay for them.

It never ceases to amaze me how so many people are filled with emotional ignorance toward the oil companies and executives in general. Would I love to be paid like a CEO of a big company? You betcha. I'm a school teacher, which means I'm not paid as well as a lot of professions pay.

Am I jealous of CEOs who rake in millions? Nope. Am I bothered when the oil companies make record-breaking profits in the tens of BILLIONS? Nope. That's the free market, and that's the way it ought to be. When oil's price skyrockets, it follows that an oil company's profits will also increase. Now, with the price of oil below $50/bbl, it necessarily follows that oil companies' profits will be drastically lower. So goes a free market economy. Besides, the price of a barrel of oil is not under much control of the oil companies anyway. Speculators, OPEC, supply/demand--these are primary reasons why oil goes up and down the way it does.

"Windfall taxes!" "Big Oil!" "Make them pay!" "Greedy corporations!" All these sentiments and more are just emotional outbursts from people who are essentially clueless and think with their asses rather than their brains.

The Big 3 automakers' problems aren't the fault of the oil companies, and the latter ought not to be responsible for bailing out the former.

If there is anything more predictable than people bitching about greedy oil companies and multinationals getting bailed out, it's the inevitable arrival of High School Economics Guy in their wake, ruining the party by telling us "you don't know what you're talking about", "capitalism is about competition" (I'll make sure to note that in my Blue Book, doctor), and basically telling us that we don't have a right to be pissed because "that's the way the system works". Thanks for the speech, dad - it was about as painless as the one about "hard work putting hair on my chest", but not nearly as valuable as the one about "life isn't always fair".

Heads up, guy: just because the system works that way (and thanks for filling me in), DOESN'T MEAN I HAVE TO BE HAPPY ABOUT IT. You're a walking punchline with your attitude, too: you're basically saying that the most well-adjusted, educated, and intelligent of us are the ones who have nothing to say about the inherent greed or corruption evident in global economics - or life in general. If we all followed your dictum, we'd have elected a Republican last month and shrugged our shoulders and said, "don't want to betray my emotional ignorance by expecting political change."

I got a question for you: put your money where your mouth is and disclose who you voted for and why. I'm sure we'll find out just what a hypocrite you are.

In the words of Super Fly, "I'll tell you what you do, you go get you a gun and all those black folks you keep doing so much talking about get guns, and come back ready to go down, and I'll be right down front killin' whitey. But until you can do that, you go sing your marching song someplace else. Now we're through talking."

First, I don't teach high school economics.

Second, I never said you don't have a right to be unhappy about the bailout.

Third, I never said there wasn't greed or corruption in the system. There always has been and always will be. Until human beings can be made to be sinless and perfect, both negative ingredients will exist.

Lastly, I'm not going to discuss for whom I voted because I refuse to play that game or automatically be assumed to be some closeted Republican just because I decide to employ some common sense in this debate and not be some card-carrying anti-capitalist. I've discussed my political preferences in the proper section of this forum; I shall not do that here.