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Originally Posted by roachboy
even the bush people are making the argument that how the auto industry got into this position is at the moment irrelevant. the fact that, once you factor in supply and distribution chains, something on the order of 8-10 million jobs are at stake means that most rightwing perspectives on this are irrelevant. what they are trying to stave off is a considerable acceleration of an economic crisis of very significant proportions--->the magnitude of which you do not seem to be able to process. for the bush people, this acceleration of economic crisis is also a political Problem of the first order.
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Perhaps I am splitting hairs here, but it is one thing to say up to 10 million jobs are at stake and to actually believe up 10 million jobs will be lost if Congress fails to provide the US auto industry a bridge loan. GM in particular simply loses money every time they make and sell a car. Someone has to make up the difference it will be shareholders until there is no enterprise value or taxpayers. However, there is still a market for the products GM makes and some companies can do it and make money on every car made and sold. GM needs to be restructured, and they can do that in chapter 11 bankruptcy, and the best way to go would be for the government to guarantee warranties until the reorganization is complete. There are alternatives to the current proposed bailout.
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as it should be, given that there are no coherent alternatives to seeing in this cluster-fuck of a situation the fallout of 8 years of george w bush et al. this is how political delegimation unfolds, it seems.
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You blame Bush for 40 years of mis-management in the auto industry? You blame Bush for the union contracts the auto industry negotiated? You blame Bush for Cafe standards mandating vehicles that people don't buy unless those vehicles are subsidized? You blame Bush for forcing the ethanol flex fuel waste of time and money? You blame Bush for the competition building new plants in the US in areas where costs are measurably lower than in the "rustbelt"?
It is ironic that a company like the formerly named Phillip Morris in the cigarette business (in declining market, billions in litigation costs, no ability to advertise, etc) can make money and add value for shareholders but our auto industry can't! Phillip Morris diversified when they needed to and divested when it needed to all the while focusing in on long-term viability. GM could have done the same. They built new brands like Saturn and Hummer, that could have been spun off to make profitable stand alone companies. They could have taken a brand like Corvette and spun it off to make a performance car division or stand alone company similar to Porsche. There are endless numbers of possibilities but they did nothing and you blame Bush. Wow.
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there's little doubt that the auto industry aristocracy banked on the track record of panic-driven ad hoc measure that opened up federal coffers to the tune of 700 billion for the financial sector---and there's little doubt that the actions and non-actions of henry paulson have created their own, separate level of static. so it's complicated.
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The CEO's of these companies seeking handouts are failures. That is not complicated. If I run my business into the ground with no profit, no positive cash flow and can't get financing, I go out of business. That is not complicated. If I go out of business the competition picks up my customers and my best employees. That is not complicated.
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at the same time, one of the elements of conservative economic policy of the past 30 years that has become obvious even to congress (except, apparently, for the republicans in the senate) is that neoliberalism is a form of class warfare, that the decision to prop up the financial sector and not do shit for manufacturing is also a form of class warfare---as is the desire to use this situation to deliver a bit of republican payback to the uaw for being a union at all.
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How about looking at the UAW? The number one rule of a symbiotic relationship is not to kill your host.
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what i expect to happen is for cowboy george to either order that a chunk of the "troubled asset" fund be diverted in this direction or to try to use executive signing order power in an unprecedented manner to create separate funds---of the two, the former seems more likely.
as for how the american auto industry got into this mess---i think it's time to stop the simple-minded pseudo-analysis of this and start doing a bit of actual research. what's involved is the history of the car industry in general since the 1970s. what's involved is the way in which neoliberalism has changed the world that detriot operated in prior to that time. what's involved is a particular management structure, a particular set of technological and cognitive barriers that set detriot (which is largely still wedded to forms of production that are not amenable to jit organization) against more tightly integrated and flexible technological and supply-chain arrangements. in short, it seems to me that among the major explanations for the situation that detriot now finds itself in follows from the absence of a state industrial policy from the 1970s forward---just-in-time and the other major features of toyotaism were developed in the context of extensive state underwriting of research, development and retooling.
this means that not only is the problem managerial, but it also has to do with the entire american/neoliberal way of thinking about the economy as some separate sphere outside the political, outside the social, that is internally rational etc etc etc.
i'll put up stuff that might lead toward a more coherent view of the paths that lead detriot here--but what;s clear is that you aren't going to learn much of anything coherent from either tv or newspapers at the moment---and this simply because what's involved with this is a history and not a series of discrete decisions by isolated individuals--and the dominant media in the states does not do context well at all.
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No, no, no. The bottom line is companies need to make a profit. If they can't make a profit, they need to go out of business.