Dems Press to Rescue Car Industry! Yea, Socialism!

saveuplifesaveuplife Posts: 1,173
edited November 2008 in A Moving Train
http://www.ft.com/cms/s/0/1fc10c0e-ae63-11dd-b621-000077b07658.html

So, where do we draw the line? Does every industry (even one's not tied to housing or MBS) get a rescue?
Post edited by Unknown User on

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  • saveuplife wrote:
    http://www.ft.com/cms/s/0/1fc10c0e-ae63-11dd-b621-000077b07658.html

    So, where do we draw the line? Does every industry (even one's not tied to housing or MBS) get a rescue?

    I would say the time to argue the finer points of our financial system would be PRIOR to or LONG AFTER an immediate crisis of liquidity and credit.

    Right now, i hate to say, i think a heavily contingent bailout is probably the best course of action.

    I would like to see that cash burn rate for GM come WAY down though.
    If I was to smile and I held out my hand
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  • saveuplifesaveuplife Posts: 1,173
    I would say the time to argue the finer points of our financial system would be PRIOR to or LONG AFTER an immediate crisis of liquidity and credit.

    Right now, i hate to say, i think a heavily contingent bailout is probably the best course of action.

    I would like to see that cash burn rate for GM come WAY down though.


    It's a matter of opinion. But, IMHO this is an enormous mistake. The automobile industry will continue to struggle regardless of a bailout. Demand is down and will remain down. A bailout won't help that. Cost cutting will. That's life in business.

    The question remains.... where is the line drawn? Or do we bail out every single industry during recessions from here on out?

    We really are creeping more and more towards socialism.
  • WobbieWobbie Posts: 30,507
    I don't know where you draw the line. I do know that if GM goes down the tubes, you've got a shitload of unemployed folks. Execs will get bonuses regardless. :mad:
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  • spongersponger Posts: 3,159
    saveuplife wrote:
    Cost cutting will.

    You mean like laying off 2.5 million employees? And from where do you think they will receive their unemployment checks?

    Uhmm...oh yeah, huh?

    This is what happens when corporations keep their factories in the United States. Their costs eventually exceed their revenues.
  • saveuplife wrote:
    It's a matter of opinion. But, IMHO this is an enormous mistake. The automobile industry will continue to struggle regardless of a bailout. Demand is down and will remain down. A bailout won't help that. Cost cutting will. That's life in business.

    The question remains.... where is the line drawn? Or do we bail out every single industry during recessions from here on out?

    We really are creeping more and more towards socialism.

    In systemic cases like the banking sector, or in heavily interdependent industries like the auto industry (where if GM fails, their suppliers fail, and if their suppliers -- who also supply Ford and Chrysler -- fail, then so too do Ford and Chrysler) it would behoove the American public ... much against their moral fortitude ... to suck it up and pay out.

    I hate bail outs, but i would also hate to see the significant deterioration of American industry for the simple fact that our system of credit is dishonest.

    The American automakers surely made some poor business decisions, but the primary reason for this current crisis in the automotive sector has virtually NOTHING to do with the automakers themselves. This is about a dishonest system of credit which is affecting EVERYONE ... and particularly large corporations that rely heavily on financing and easily available credit in multiple facets of their business.
    SUoL wrote:
    But, IMHO this is an enormous mistake.

    IMHO, the enormous mistake is continuing to allow a dishonest system of credit to operate in America. It is not only dishonest, it is actually outright unconstitutional.

    Of COURSE everyone suffers when dishonest and unconstitutional practices overrun the very fabric of our system of exchange.

    Unfortuantely, now everyone is stuck complaining about the relative trivialities of government response to mere SYMPTOMS of the problem, rather than having the longevity of thought and sight necessary to ascertain that the real solutions lie in addressing the SYSTEM of credit ... and not simply the immediate distribution of credit on an emergency basis to affected institutions.

    Again.
    I hate bailouts.
    They are emblematic of a dysfunctional system that attempts to operates outside of the constraints of free market economics.

    However, if you are NOT willing to address those issues BEFORE the major symptoms start to take their toll, it then becomes wise to at least wait until after the immediate and potentially fatal shockwaves subside before beginning your crusade for justice.
    If I was to smile and I held out my hand
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  • CosmoCosmo Posts: 12,225
    sponger wrote:
    You mean like laying off 2.5 million employees? And from where do you think they will receive their unemployment checks?

    Uhmm...oh yeah, huh?

    This is what happens when corporations keep their factories in the United States. Their costs eventually exceed their revenues.
    ...
    That is exactly correct. Auto makers are not just the workers at assembly plants. There are thousands of sub-contractors... many of them mid-sized companies all acorss the nation that make steering wheels, shock absorbers, windshields, seats, etc... that go into those autos. That also includes the big dealerships and all of their employees. Their jobs go away if the big auto makers collapse. And thousands of small companies, such as diners and coffee shops, dry cleaners and florists around those companies will suffer as more and more Americans are thrown into unemployment.
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  • FiveB247xFiveB247x Posts: 2,330
    It's funny how partisan politics spin things out of context or people who support the other side are quick to forgot their own sides ongoings.

    If this is an attempt of the Dems creating a "socialist" state by bailing out an industry, does this mean that during the Reagan and Bush administrations, when they bailed out the Airline industries multiple times, they were pursuing the same?

    What's the saying about stones and glass houses?
    saveuplife wrote:
    http://www.ft.com/cms/s/0/1fc10c0e-ae63-11dd-b621-000077b07658.html

    So, where do we draw the line? Does every industry (even one's not tied to housing or MBS) get a rescue?
    CONservative governMENt

    Our government is the potent, the omnipresent teacher. For good or for ill, it teaches the whole people by its example. Crime is contagious. If the government becomes a law-breaker, it breeds contempt for law; it invites every man to become a law unto himself; it invites anarchy. - Louis Brandeis
  • RiderRider Posts: 129
    Was Ronald Reagan a Socialist? He "bailed out" Chrysler in the 80's.

    If you think the USA can afford to let the american auto industry fail, you are truly not very bright. There is not one major country that does not produce heavy industry like cars, planes, etc. We need the industrial capacity too, in case there is a real war.
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  • NOCODE#1NOCODE#1 Posts: 1,477
    saveuplife wrote:
    http://www.ft.com/cms/s/0/1fc10c0e-ae63-11dd-b621-000077b07658.html

    So, where do we draw the line? Does every industry (even one's not tied to housing or MBS) get a rescue?
    but the bank buyout was ok? :rolleyes:
    Let's not be negative now. Thumper has spoken
  • NOCODE#1 wrote:
    but the bank buyout was ok? :rolleyes:

    The car corporations are in trouble because of their own inefficiency and poor business model. It's not like it's a result of the recession, they simply failed to keep up with their competitors (foreign manufacturers). Let them file bankruptcy so they can re-work their finances and then possibly come back.

    I'd say this is a pretty big case against unionization.
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  • FiveB247xFiveB247x Posts: 2,330
    Well the Airline indurstry was basically de-unionized if you recall by Reagan and have needed US taxpayer bailouts twice since... unionization is not the problem or issue at hand. As you stated, inefficiency and poor business model (ie, poor investments/leadership/greed), are the cause of these industries having problems (car, airline, banking, housing, etc). Trying to pin blame solely on the Dems, Reps or unions is partisan or biased.
    The car corporations are in trouble because of their own inefficiency and poor business model. It's not like it's a result of the recession, they simply failed to keep up with their competitors (foreign manufacturers). Let them file bankruptcy so they can re-work their finances and then possibly come back.

    I'd say this is a pretty big case against unionization.
    CONservative governMENt

    Our government is the potent, the omnipresent teacher. For good or for ill, it teaches the whole people by its example. Crime is contagious. If the government becomes a law-breaker, it breeds contempt for law; it invites every man to become a law unto himself; it invites anarchy. - Louis Brandeis
  • spongersponger Posts: 3,159
    I do sometimes wonder if the design managers at the Big 3 aren't a bunch of certifiable idiots.

    Not only are American cars among the world's fugliest, they still guzzle almost as much gas as they always did.

    When the Prius is selling like crazy, none of the big 3 have a single vehicle resembling its fuel efficiency.

    I can't count how many times I've heard people say they'd buy an American car in an instant if it wasn't fugly and if it set a standard for gas mileage.

    Why haven't the big 3 tuned into this concept? Are they stupid? They must be. They must be a bunch of fucking dumbasses. There can be no other explanation.

    Of course, I don't think it's the designers themselves that are stupid. I am positive that our universities churn out brilliant engineers left and right every year. It's the dumbfucking managers that they have to work for that is the problem. I'm willing to bet brilliant idea after idea have been shunned for the sake of preserving eternal stupidity at the Big 3.
  • South of SeattleSouth of Seattle West Seattle Posts: 10,724
    sponger wrote:
    I do sometimes wonder if the design managers at the Big 3 aren't a bunch of certifiable idiots.

    Not only are American cars among the world's fugliest, they still guzzle almost as much gas as they always did.

    When the Prius is selling like crazy, none of the big 3 have a single vehicle resembling its fuel efficiency.

    I can't count how many times I've heard people say they'd buy an American car in an instant if it wasn't fugly and if it set a standard for gas mileage.

    Why haven't the big 3 tuned into this concept? Are they stupid? They must be. They must be a bunch of fucking dumbasses. There can be no other explanation.

    Of course, I don't think it's the designers themselves that are stupid. I am positive that our universities churn out brilliant engineers left and right every year. It's the dumbfucking managers that they have to work for that is the problem. I'm willing to bet brilliant idea after idea have been shunned for the sake of preserving eternal stupidity at the Big 3.

    Exactly.

    Must be the drug testing. ;) Not enough creative people wanting to work there.

    We have creative people working in many other american industries, why not Auto? :confused:
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  • dmitrydmitry Posts: 136
    Peter Schiff starts around 3:15.
    http://www.youtube.com/watch?v=E4sLx5O_3M0
  • dmitry wrote:
    Peter Schiff starts around 3:15.
    http://www.youtube.com/watch?v=E4sLx5O_3M0

    CNBC is crap.
    You should turn it off.
    Nothing good comes on CNBC.
    ;)

    [j/k joke directed at someone else, sorry]

    anyway,
    schiff has had excellent commentary about all of this meltdown going WAY back in this mess.

    no different here.
    If I was to smile and I held out my hand
    If I opened it now would you not understand?
  • saveuplifesaveuplife Posts: 1,173
    sponger wrote:
    You mean like laying off 2.5 million employees? And from where do you think they will receive their unemployment checks?

    Uhmm...oh yeah, huh?

    This is what happens when corporations keep their factories in the United States. Their costs eventually exceed their revenues.


    First, there are other options to cut costs besides cutting labor.

    Second, even if labor is one of the resources chosen to cut, that's the firms decision. Gov't should not be getting involved. If you make a bad product or if you don't max profits properly the market will kick you out. We are making poor products and our auto industry is not making solid profits. Let the market work. And if that means we need to write unemployment checks, so be it. Utilize comparative advantage.

    Your last two sentences are 100% dead-on. The labor costs are too high in the U.S..... why? Maybe unions have something to do with it.
  • saveuplifesaveuplife Posts: 1,173
    In systemic cases like the banking sector, or in heavily interdependent industries like the auto industry (where if GM fails, their suppliers fail, and if their suppliers -- who also supply Ford and Chrysler -- fail, then so too do Ford and Chrysler) it would behoove the American public ... much against their moral fortitude ... to suck it up and pay out.

    I hate bail outs, but i would also hate to see the significant deterioration of American industry for the simple fact that our system of credit is dishonest.

    The American automakers surely made some poor business decisions, but the primary reason for this current crisis in the automotive sector has virtually NOTHING to do with the automakers themselves. This is about a dishonest system of credit which is affecting EVERYONE ... and particularly large corporations that rely heavily on financing and easily available credit in multiple facets of their business..


    Is it that, or is it that their business plan is horrid? Is it possible that their products simply suck? Is it possible that they should be prepared to weather the storm (a downturn in demand) by being fiscally sound? Or should the U.S. auto industry be continued to be coddled?

    IMHO, the enormous mistake is continuing to allow a dishonest system of credit to operate in America. It is not only dishonest, it is actually outright unconstitutional.

    Of COURSE everyone suffers when dishonest and unconstitutional practices overrun the very fabric of our system of exchange.

    Unfortuantely, now everyone is stuck complaining about the relative trivialities of government response to mere SYMPTOMS of the problem, rather than having the longevity of thought and sight necessary to ascertain that the real solutions lie in addressing the SYSTEM of credit ... and not simply the immediate distribution of credit on an emergency basis to affected institutions.

    Again.
    I hate bailouts.
    They are emblematic of a dysfunctional system that attempts to operates outside of the constraints of free market economics.

    However, if you are NOT willing to address those issues BEFORE the major symptoms start to take their toll, it then becomes wise to at least wait until after the immediate and potentially fatal shockwaves subside before beginning your crusade for justice.

    So your point is that the downturn in credit markets is responsible for the downturn in demand for autos? If that is your point, I simply disagree. I'd say that the downturn in demand for U.S. autos is a function of a downturn in aggregate demand.... or due to the recession. I do agree that financing may be a bit more difficult to obtain in this environment, but I don't think that's the real problem in the auto industry. IMHO it has very little to do with people obtaining financing. People are scared to buy big ticket items during recessions,..... that's the real problem. Hence the decline in demand. It's an issue of confidence. The gov't should be working on solving the consumer confidence issue.... not the production side. Supply is not the problem... demand is.
  • polarispolaris Posts: 3,527
    haha ... the socialism thing again ... it's like if you say it enuf - it'll stick ...

    anyhoo - if anyone doesn't know that they live in a system with socialistic principles by now already, then i suggest they start figuring it out ... it is indeed your lack of socialistic values that has led your country to the state it's in ...
  • know1know1 Posts: 6,794
    saveuplife wrote:
    It's a matter of opinion. But, IMHO this is an enormous mistake. The automobile industry will continue to struggle regardless of a bailout. Demand is down and will remain down. A bailout won't help that. Cost cutting will. That's life in business.

    The question remains.... where is the line drawn? Or do we bail out every single industry during recessions from here on out?

    We really are creeping more and more towards socialism.

    I agree. Why keep throwing money at an industry that is failing? All we're doing is prolonging the agony and wasting a lot of money. It's holding us back to keep this going.

    Heck - we didn't keep bailing out the horse industry after automobiles became popular, did we?
    The only people we should try to get even with...
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  • mammasanmammasan Posts: 5,656
    saveuplife wrote:
    It's a matter of opinion. But, IMHO this is an enormous mistake. The automobile industry will continue to struggle regardless of a bailout. Demand is down and will remain down. A bailout won't help that. Cost cutting will. That's life in business.

    The question remains.... where is the line drawn? Or do we bail out every single industry during recessions from here on out?

    We really are creeping more and more towards socialism.

    I have to agree with you 100%, but as other have stated this would be a crippling blow to our economy if the Big 3 are allowed to fail. I guess we do have to choose, at this point, between the lesser of two evils.
    "When one gets in bed with government, one must expect the diseases it spreads." - Ron Paul
  • Arent the car manufacturers amongst the largest financial lending institutions in the US?
    the Minions
  • I would say the time to argue the finer points of our financial system would be PRIOR to or LONG AFTER an immediate crisis of liquidity and credit.

    Right now, i hate to say, i think a heavily contingent bailout is probably the best course of action.

    I would like to see that cash burn rate for GM come WAY down though.

    its not a liquidity issue its a trust issue.
  • Pacomc79Pacomc79 Posts: 9,404
    Interesting to see if they don't start finding out exactly how efficient they can make vehicles now that they are essentially in debt to the government for thier existance.

    I wonder if there will be more cafe standard whining now.
    My Girlfriend said to me..."How many guitars do you need?" and I replied...."How many pairs of shoes do you need?" She got really quiet.
  • Pacomc79Pacomc79 Posts: 9,404
    Arent the car manufacturers amongst the largest financial lending institutions in the US?


    Not exactly, the industry financing is done through large banks like Chase for instance.
    My Girlfriend said to me..."How many guitars do you need?" and I replied...."How many pairs of shoes do you need?" She got really quiet.
  • mammasanmammasan Posts: 5,656
    Pacomc79 wrote:
    Not exactly, the industry financing is done through large banks like Chase for instance.

    I was under the impression that GM had it's own financing department, where they themselves "loaned" the money to buyers.
    "When one gets in bed with government, one must expect the diseases it spreads." - Ron Paul
  • Pacomc79Pacomc79 Posts: 9,404
    mammasan wrote:
    I was under the impression that GM had it's own financing department, where they themselves "loaned" the money to buyers.


    They might have thier own bank actually, I'm not quite sure, but it's probably underwritten by several of the bigger banks that they have to make thier own loans from I imagine.

    GM is a fantastically huge company so they probably do a lot of stuff in house. I know Toyota uses JP Morgan Chase.
    My Girlfriend said to me..."How many guitars do you need?" and I replied...."How many pairs of shoes do you need?" She got really quiet.
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