How would you fix the auto industry?
 

Are you interested in buying a new car in the next 5 years?

Things aren't looking too good. Did they produce cars that were too good in the 90s, so people like me can still drive a 15 year old car and have no problems with it? Are the unions making them pay the workers too much? Are the pensions and healthcare benefits for retirees the problem that allows foreign car companies to charge less? Is the 2 year lease keeping some people from buying brand new cars, instead buying lightly used cars at a discount? Is the production before sale method and over producing too many cars something that the US auto companies need to change? Or is it a perception of quality issue?

Here's my take on it. No one is producing the car that I want for the price I would be willing to pay. I would like to buy a GM Volt style car, but in a S-10 pickup truck model. And I wouldn't want to pay more than $20k for it. And they shouldn't make the car until I've bought it. This is what the US auto industry isn't doing right. They should have a few models on display at the showroom, but they produce about 2 times as many cars as they should. Then they have to have firesales at the end of the year. This destroys the resale value of the car.

Now, if they really wanted to shake things up, they would go to a perpetual lease style of business. Take a page from the evil cell phone industry. You have to buy the service in order to drive the car. You get every service possible, but you have to pay $100/month, even on a fifteen year old car. This way, the engineers can use stainless steel parts, solid plastic body panels, carbon fiber hoods, roof and trunk and prevent rust and other appearance of aging. The car 20 years from now should look the same as on day one. They can spend the money to put a plug-in hybrid system in it and people don't have to worry about the batteries.

To answer the question as stated;
I would examine what the rest of world has been doing to kick N.A.'s ass.
From stem to stern. I would restructure the executive salary structure so
they get paid when things improve.
If there was any room for vision, I would invest in non-fossil fuel infrastructure
and cars.

There is nothing wrong with the auto industry, just the iconic American manufacturers. Let'em fall, there are plenty companies, American and foreign, to take their place. Any bailout is a waste of money and we will be back in this position again in a few years.

Step one absolutely has to be severing the sick link between the auto industry and the oil industry. That GM is still producing gas hungry, massive SUVs speaks in volumes as to how one industry exerting influence over another can lead to the latter's downfall. 9MPG should be limited to big rigs. No commercial truck or large car should get any less than 17MPG combined.

First off this is the biggest load of bull, and I always feel the person saying it is insulting my intelligence if I don't stuff it into the ground. IF there was a link, the auto industry would be in much better shape. They would have been able to work together prior to any price spikes. Look, it takes about 5 years to build a new model. If they were working together in this vast-white-CEO-conspiracy, they would have started building hybrids so they were in full production in time for the oil spikes. They weren't, and got a large one stuffed up their ass because of it. They have tons of SUV's sitting unsellable, while they lost almost entirely the share of the sedans for the average American. They REACT to the changing oil prices, when oil was $20-30 a barrel gas was cheap and they went accordingly. No one went for the hybrid technology because the average price was $6-10k more per car, it wasn't economically worthy. IF there was a connection between big oil they would have had the technology rolling out with hybrids on the lot. Instead they react only, and because of that they are bottoming out.

/rant off.

I would move the plants from the Unionized-to-Oblivion Illinois/Michigan and move it south. I would tell the employees they get moving expenses paid for, on the agreement the union would not move with them. Cost of living as well as taxes are MUCH lower, as well as true at-will states. Give fair wages and benefits, lower the Manager:Employee ratio, and all-together follow the example of the foreign car plants which are symbols of efficiency and fair wages.

And by Manager:Employee ratio.... I would also make everyone in upper and middle management take a huge pay cut.

I would let them go bankrupt...their assets would be restructured and/or purchased by another company which would produce a better product at a better price and would be able to profit from doing so. I don't support bailing out any industry that has ceased to be competitive.

I'm not impressed with American automobile engineering. European engineering is superior. I wouldn't bail out GM and Ford. Most of their factories will likely be taken over by other automakers who will produce higher-quality vehicles with larger profit margins.

I strongly believe that companies that run themselves into the ground should cease to exist.

The reaction theory assumes the auto industry has no foresight. Obviously this isn't true considering that GM had the opportunity to fill the roads with electric cars, for which there was and is substantial demand, in the 90s and they simply stopped. Don't make me cite a documentary. Ford produced a hybrid vehicle nearly 5 years ago, and it's one of their better selling vehicles. It insults the intelligence of everyone to suggest overtly that auto manufacturers don't consider the interests of other industries. Of course they do. If you don't believe me, ask yourself why so many GM vehicles can run on corn ethanol, which we all know is a horrible idea.

Temporary demand isn't usually enough for a smart, long term industry to invest. It takes a clear indication of continued revenue stream to make an investment in, say, a 9MPG vehicle. Especially a 9MPG vehicle that's functionality can easily be replicated by a 15MPG vehicle.

There are active interconnections between big oil and big auto.
First off this is the biggest load of bull, and I always feel the person saying it is insulting my intelligence if I don't stuff it into the ground. Do you not think that other auto manufacturers in the US have unions? Of course they do, and they're still profitable, even now during our recession. Toyota is unionized. Subaru is unionized. Even Honda is unionized.

I'm sure you think it's a knee-jerk reaction for a liberal to blame big oil, but to have the knee-jerk reaction of blaming unions in the same breath... doesn't that seem somewhat inconsistent?

Things have to change with BOTH the manufacturers and the unions before any real progress will happen.

In the free-market solution, I would let Detroit fail completely, which would destroy both the makers AND the unions, and then within bankruptcy and other protection negotiate new contracts and plans to rebuild.

In the government solution, I would pass legislation both to put General Motors and Ford under direct government control temporarily AND to void all union contracts, and then force renegotiation.

Either way, something involving both sides has to happen.

The amount of money spent by the Big 3 in lobbyists is alarming. What do you think they're trying to accomplish in Washington (hint: it's not make more hybrids).

I think the Oil Companies should take their record billions in profits and loan it to the automakers

Sure, since the automakers are part of the reason for the record profits :p

First of all GM began the Insight program because California had legislated that by 2002 2% of all vehicles sold by a manufacturer be emission free. Ultimately the technology simply was not ready to make a no compromises vehicle that could be sold at a price point consumers could afford. Even now the battery technology isn't ready yet. By the late 90's when it became evident no manufacturer, not even Toyota, could meet the mandate California rescinded it.

As far as ethanol the reason that so many GM vehicles can run on is that they get a credit on meeting CAFE standards on every vehicle that is E85 capable. The CAFE credit was something the corn industry lobbied for. Building in E85 capability costs virtually nothing, just some changes in fuel tank , fuel line and injector materials so they are not corroded by the ethanol, and software changes. GM started building in the capability in around '01 or '02 but didn't give a shit about it until a couple of years ago when Toyota starting winning the PR war with the Prius and E85 was all GM had to fight back with. It was simply done so it would be easier to meet government standards, not out of any benevolence towards the farming industry.

Certainly the Big 3 have made some mistakes in the past but they have made progress. The last UAW contract was a big improvement in improving their cost structure. I don't know what the answer is, if they declare bankruptcy the taxpayers will still be left holding the bag in the form of pensions being transferred to the PBGC. Plus the ripple effect of suppliers going under would mean that even the import brands would have a difficult, if not impossible job of building cars here.
-----Added 24/11/2008 at 02 : 09 : 23-----
The only Toyota plant that is unionized is the NUMMI plant they operate with GM in Northern California. I'm not aware of any Honda, Subaru, Nissan, or any other import manufacturer plants in the U.S. that are unionized. Part of the reason the imports built their plants in the south was to keep the unions out. I don't have the time right now to link to all the sources, but it would be false to say union representation at the import brands is a fraction of what it is at the domestics.

I agree, bailing them out now will only make the situation worse in a couple years down the road. Plus we are potentially facing a total economic collapse if we continue to spend money we dont have.

I say goto Chapter 11 Bankruptcy, I don't know everything about it, but the part I know lets them reorganize their company to allow it another shot at profitability, as opposed to shutting the whole thing down permanently. If the economy was strong and stable and jobs were plentiful I'd say let them burn, but thats a lot of people out of work at the wrong time. Never argue with Wikipedia laconic1.

The US auto industry does not need to be fixed, I am simply reminded of the classic scene in Blade Runner - "...time to die."


Let new more efficient auto manufacturers grow and evolve, too bad the government has made it impossible for a new domestic auto company to develop.

Not according to the leasing rates. The market was more than ready for electric cars, as was demonstrated clearly by the waiting list for EV1s. People fought tooth and nail to keep their leased EV1s when the lease was up. Consumer demand was very high, of that there is no doubt.
The EV1 had a range of 160 miles as of 1996, and that didn't even represent the best battery technology at the time. Home-made electric vehicles have been on the road since the 1970s, and some of them have ranges that exceed most fossil fuel-burning vehicles.
Who said anything about benevolence? The oil industry has great influence both in government and in the market, and they throw their weight around often. The reason that big oil has been so successful, though, is an unwillingness to stand up to them. Ethanol is the same phenomena, only it's the corn industry that's throwing it's weight around. And once again, GM folds under pressure instead of investing in hybrid technology, which even then was obviously the better investment.

I know it seems like only recently that the truth about corn ethanol has come out, but the information has been out there since day one. It only takes one person to ask, "Does it put out more energy than we have to put in to produce it?" For hybrids, that's a yes. For ethanol, that's a no by a factor of 6.

GM lost the PR war because they are still, today, making 9MPG behemoths. I can go and buy a brand new H2 around the corner this afternoon. This is something they should have phased out 4 or 5 years ago in favor of hybrid diesels.
I used to feel really bad for auto industry workers in the US. At some point, though, you have to ask, "We've all known for years that your entire industry was on the edge of collapse, did you even put your resume on Monster.com?" There should be at least some personal responsibility. I've been feeling bad for them for like 15 years now.
I may have been misinformed about unionization at foreign auto manufacturing plants here in the US.

Regardless, there's no reason at all to assume that unions caused the demise of the big three. The unions have made a great deal of concessions recently, including pay decreases ($25.65 an hour really is a small salary for an auto worker).

Maybe I should ask this: did AIG have an union? Did Bear Sterns?

The US automotive industry killed themselves 10-20 years ago when they refused to reinvest their profits into better technologies allowing foreign cars to surpass them in both reliability and mileage.

Let them drown in their own greed.

I wouldn't mind seeing a grassroots auto manufacturer have a chance at the domestic auto spotlight after a collapse of the big three.

Another question to ask? If the money planned to bail out the auto industry was used for public transportation infrastructure instead how much would that improve our public transportation programs?

I believe the new bullet train planned here in California will cost about the same as the proposed auto industry bailout. Imagine a bullet train from New York through Boston, Philly, DC, and going all the way to Raleigh.

Fix it? Why the fuck should *we* fix it? let the market do it's job and everything will work out the way it should.

FWIW, there have been waaaaay more car makers throughout history than most people realize. They get bought out, go under, get asorbed, or just flat out die. I see what is happening now as a continuance of the regularly scheduled program.

PS, it sucks that now that car dealers are willing to deal just to sell a car, I'm not in a position to take advantage of it at this moment.

People in the US have a odd reaction to public transportation. Like it's some sort of evil that they must resist at all costs. Hell most people won't even car pool. You get outside of the US and nearly everywhere you go public transport is the norm. Gas prices in the US are falling, I thinks thats going to turn out to be a short lived fad. Part of me is happy it's come down. I think it provides some relief for families that are in serious pain do to economic pressures. At the same time I'm hoping they shoot back up and cause people to take a serious look at alternate ways of getting around. The US doesn't seem to do anything until forced. Eventually I think they're going to be forced to find better ways to get from point A to point B. Ways that don't include one person hoping in the family SUV and driving 40-50 miles or more to work each day.

Has to the OP I really have no idea. I think they've screwed themselves into a corner by years of mismanagement and poor planning. How to unscrew them or whether we even should is beyond me. I really have a problem forcing the average tax payer, who apparently makes significantly less per hour, pony up billions of dollars in what very well may be a lost cause. At the same time we're spending (or throwing depending on your point of view) billions of dollars into failing banks and financial institutions.

To me the whole thing (the economy) seems like the very definition of "clusterfuck" and I don't think unfucking ourselves is going to be quick nor easy. I see this as an historic time of change. All change is not bad, nor is it good... nor is it pain free.

Auto workers do not make significantly more than the average tax payer. Also, keep in mind that while working in an auto factory, if your co-worker screws up, you could lose a limb or your life. The biggest physical risk a lot of other people have in their job is stapling their finger while at the desk.

Overall, though, I agree with your sentiment, especially regarding public transportation and gas prices. I have no idea why it's so hard for people to use their brains, like most of the rest of the world, and realize that it's good to have a strong mass transit infrastructure.

That article asserts "The average GM assembly-line worker makes about $28 per hour."

I'm not disputing that, I do contend that's still more then the average wage for the average worker.

http://billinman.files.wordpress.com...if?w=520&h=203

From the sources I've found the average wage is significantly less then $28 an hour. If the above is correct the average US worker earns close to half that of the average GM assembly-line worker earns. It doesn't seem right to me that people making less bail out workers making more.

seems to me that the relatively good production wages are a strong argument FOR union representation and not, as you've no doubt been hearing from every remaining reactionary supply-sider on every available "news" outlet, an argument against it. one of the great ideological campaigns of the neoliberal period has consisted in repeating over and over that unions are somehow against the rules and atomized work/lowest possible wages are the norm---this despite the history of actually existing capitalism since the middle 19th century, which the reactionary set would replace with cheesy images of some entrepreneurial idyll...

the problems with the big 3 are structural. on the one hand, they seem to have opted for the classic american trajectory of taking short-term profits and acting as though the Invisible Hand will stroke appropriately in the longer run and "things will take care of themselves"....think about us steel after world war 2 exporting continuous casting along with the marshall plan and choosing to take short-term profits while that technological arrangement was being perfected elsewhere. by the early 80s, us steel was us-x its workforce vaporized and the reagan period in place which worked and worked to convince us all that this sort of shit was normal and not the result of something between short-sightedness and idiocy.

i think the only way to salvage these corporations is through an *aggressive* take-over and a form of economic planning. there are alot of ways this could happen. i also thing that in this context a purge of executives and upper management would be productive for everyone. there's more, but i gotta go.

If the issues that plague the American auto industry were placed in a vacuum separate from everything else in our economic system, perhaps it would make sense to let them take a tumble. But having witnessed what our mortgage mess has done to the global financial market, I think it's foolish to adhere to this type of economic decoupling.

We assume that Chapter 11 is the way out of this mess. I don't see it. Sure it gives them the chance to shed dealers and rip up union contracts (assuming the UAW is just going to lie there and get kicked on), but if major lending institutions are unwilling to extend money to individuals with a decent credit history, what makes you think they'll extend it to a company under bankruptcy? Restructuring is necessary, but it'll be all for nothing if they can't make any money.

I'm loathe to make the UAW a scapegoat out of all of this. The UAW isn't the reason GM stuck with two vehicle platforms for over 20 years, both of them being vastly inferior to anything the competition, both domestic and otherwise offered. The UAW isn't the reason Mercedes-Benz fed Chrysler nothing but scraps from their engineering table, leaving them with two outdated platforms and a diesel engine that's not even available in the U.S. The UAW didn't go on a buying spree, buying up Jaguar, Aston-Martin, Land Rover, and Volvo instead of turning Lincoln and Mercury into marques that could compete with those companies. When sales of the Tahoe, Explorer, and Ram were generating hefty profits for these companies, nobody complained about UAW health care benefits and wages, so why should we complain about them now? It's fallacious to assume that Detroit can't compete with these unions holding them down, when their past performance has shown otherwise.

To turn things around, I think GM would need both the bailout AND a Chapter 11 filing. The bailout would give them the capital necessary to perform the aggressive restructuring the Chapter 11 filing would allow them to do. Buick would have to bow out of the U.S. market, but continue to operate in China where they are a very strong brand. Pontiac would have to be dropped. None of their vehicles are exclusive to their brand, and any performance vehicles they make can be sold by other marques. Hummer, as much as everybody hates them, is a strong competitor to Jeep. They can keep it, but don't expect to sell in huge numbers. GMC should focus exclusively on heavy-duty vehicles, so that means no Yukon or half-ton pickups.

Ford just needs a bailout. Alan Mulally has done a good job of turning that ship around, with plans on bringing many of their successful European models to the U.S., including the Fiesta and euro Focus. The only question is whether he can do it before the clock runs out, that bailout will give them a chance.

Chrysler needs real leadership, which they haven't had since they were decimated by the DCX merger. Cerberus has no interest in the carmaking business and only acquired them to turn a quick profit, which as backfired horribly on them. They need to be separated from Cerberus, and that needs to come before any discussion of a bailout can occur.

Of course, what I find most interesting in all of this bailout talk is the song and dance that the CEO's of all three companies had to go through just to walk out of DC empty handed, while the CEO of CitiGroup can just pick up the batphone to Henry Paulson and get a second bailout, along with another $800B he's throwing into banks to encourage lending. I suppose it's more important to keep people in debt than it is to keep them employed so they can pay off those debts.

The auto industry in the US is already having trouble marketing their product. I believe if they file anything that even smalls (I mean smells, don't you love spell check?) like Chapter 11 they're toast.

As for...

What are the options for them? As I see it laying there and getting kicked around a little beats the shit out of trying to pick the bones of a dead dinosaur. They're going to have to make concessions, IMO. Either that or start practicing the phrases "did you want fries with that" and whatever a Wal-Mart is trained to say.

This is the argument I was attempting to make. Very well put.

The auto industry failing is a problem for the UAW and people with auto-industry pensions.

By squeezing their own bottom line and tossing money at dividends and other 'get the cash out while the cash is good' plans, they can leverage their own worker base into lobbying for bailouts. Because it aligns their worker base with their own interests.

Similarly, when the going is bad, the UAW either capitulates and gives a better contract, or the company goes out of business and UAW members are out on the street.

If the auto industry built a long-term viable reinvestment plan, the UAW could continue to hold profits for ransom with strikes, and continue to drive up wages, until the reinvestment proved fruitless: the dividends of the reinvestment would go to the workers, not the owners. So -- get the cash out, keep the industry lean, beg for money in concert with the UAW when times are bad, and use bad times to push back against the UAW.

Think about it -- if you had 100$, and knew you could either reinvest it to produce future profits. But if you did, that future profit would be stripped by your workers demanding a raise equal to the increase in profits... would you take the money and run, or reinvest it?

Labor union power is proportional to the amount of _damage_ they can cause by ceasing work. The amount of damage you can cause is based off of the operating profits of that work-chain. Increasing the operating profits of the given work chain thus increases labor union power: and if it stays uniformly high, then the temptation to do a strike grows.

Yakk, honestly it's not the unions. Most UAW barely make a living wage, so if salaries drop further you'll see the companies either hire undocumented guest workers or simply leave to find a country with cheaper wages.

And have you ever compared the injury rates between union and non-union auto manufacturers?

Agreed Will. What's sad is the UAW workers are likely going to take a hit when they're probably the least culpable. The union leaders who negotiated for 2 1/2 hour lunches and pay for not working etc... And management that ran these company into the pit the currently reside are probably sitting on enough in the bank that they'll be fine. it's the average guy working that's going to be rear ended here, well him and the tax payers. But all that aside really instead of looking at the average UWA salery and screaming it's too high, shouldn't we be trying to get well paying jobs and benefits for everyone?

I also liked this-

Seems to me this is one of the biggest problems with the bailout as a whole from my perspective. Nothing seems aimed at getting unemployed employed or keeping those employed still employed. It's all been aimed at credit and maintaining peoples ability to keep digging themselves into debt. All this does, for what I can see is encourage people to live in debt. It doesn't help make any real jobs available for real people. Hell even JJ knew easy credit was a rip off... Dyn-o-mite! Indeed.
-----Added 25/11/2008 at 02 : 43 : 29-----
Really? $28 an hour with benefits, with some 28 days off a year sounds pretty livable to me. Last I saw it was around 60K a year with full benefits. 60K a year in the upper mid-west is like 100K or more in places like NY or LA.

No, have some numbers you'd like to share?

How does $28/hr translate to $60k? It's closer to $45k + benefits, which for a family is just about comfortable, but it just qualifies as middle class.
This article sticks out in my mind, but I don't know for sure if it's reflective of the whole situation:
Auto Union and Honda Dispute Safety Record at Plants in Ohio - New York Times

Well lets see...

28X40=1120

1120 a week

52 weeks a years

1120X52=58240

Seems a lot closer to 60K then 45K

I shall go read.

http://www.tfproject.org/tfp/tilted-...ml#post2563501

this is a good post to keep in mind as you dive into the comparative game honda/detroit.

gotta go.

28$ an hour with retirement and health benefits is barely a living wage? And overtime?

At a 2000 hour-a-year number, that is 56k. Plus quite good benefits.

Heck, I think GM is at close to 3 retired workers per active worker. Think about that for a second -- that is a huge liability, especially if the markets aren't being friendly to your pension plan.

Ah, I am in the habit of doing (X)40hours x 4weeks x 12months. Fuzzy maths. Yours is closer.

Of course the $58k is before taxes. Having never made $60k a year before I'm just guessing, but wouldn't that end up somewhere around $51-52k a year?

I have know way of even beginning to approach that without knowing if we're talking about single, married, married filed jointly and the spouse is employed ... gez the list is endless.

I always assumed we were discussing gross income. But even if we're talking about 50k + benefits I'd say that's a livable wage.

Now some of the stuff in the article you previously linked...

I'm not sure what to make of some of it. Some of it sounds like they earn every damn dime, which could be true. But I've worked with people who bitch about every little thing. I swear I worked with a guy who got pissed at management and started filing union grievances for everything. He got dust in his eye one day. Someone stressed him out another, had to go home due to high BP. He filed one because the grass was too green, wish I were making that up. Made everyone else's life awful. I've also worked with people who will continue on with broken bones for days, even weeks, without uttering a peep.

Without more info I don't know what to make of the work situation at a plant, union or not. I do know given the current employment climate I think I'd be inclined lean toward continuing to working with the broken bone.

The UAW is willing to make concessions. We've seen that with the last round of negotiations with the creation of VEBA, the union-managed health care fund which will take a lot of money off of the books of the carmakers.

But you have to play it smart. If they file for Ch11 and then come in the next day and just rip up their collective bargaining agreement they will strike. Sure, they run the risk of being made the bad guy out of all of this, but I don't think they'll hesitate throwing a monkeywrench in their recovery efforts if it means the lose out big time.

I don't think they'll like it either if their agreement is voided out while the board of directors gives the men up top another seven figure paycheck.

I'd offer a $5000 tax credit for every $15,000 spent on a US made car. The tax credit can be taken all at once and applied to the 1040, taken as part of the loan, or taken in part over 3 years. Then, I''d tell the auto industry that ALL parts and labor MUST be made and done in the USA to which the government will give credit to the industry and absorb some of the pension plans. T

For housing, I'd offer a $20,000 tax credit for every $50,000 spent on housing. The same here, taken at once, applied to the loan or taken over a period of 10 years.

Then, I'd tell the banks and auto industry that's the best and ONLY thing we'll do.

I have a suggestion. Let's have the UAW buy GM and Chrysler, fire white collar people and run the company from perspective of doing what is right for their union members. What do you think they would do different? People have assumed existing management is incompetent so the UAW can't do any worse, or can they? They could use the value of their pension fund, perhaps with some government backing. I would love to see it. For far too long the attitude has been "us vs. them" when the reality is that "they" competed on a global stage against, Toyota, Nissan, BMW, Mercedes, etc. The goose that lays the golden eggs is near death, they should have been willing to make concessions decades ago.

No shit. I'm sick of reading about people who have done nothing but ill for the companies they've manged. I'm using managed here in it's loosest term. Run AIG into the ground? Here's 8 million will you please go away now? Driven an auto company into the ditch? Can we pay you a few million and get you a private jet so you can go beg the tax payers for several billion buck for a tow? Asinine.
-----Added 25/11/2008 at 08 : 40 : 18-----
Interesting ideas but I have no idea if that adds up to recovery. My guess is it's going to take thinking like this on several levels instead of "that's all we can do."

The domestic auto makers are paying for their collective lack of planning and innovation. I remember in the mid to late 1990's when they were giving out huge bonus checks to everyone from the CEO down to the guy who operated the torque wrench. Everyone that worked for the auto companies were strutting around throwing money away. The companies would have been far better served to invest in new technologies and equipment. I read that Honda has its plants set up that any Honda plant in the world can build a Honda Civic. None of the domestic auto makers can do something similar. The plants are old and inflexible, the labor force is much the same and management can't see past their own greed.

I remember about twenty years ago when I was in college and I managed to buy a new Honda CRX, one of the guys I worked with whose dad was employed by GM asked me why I bought the Honda and I told him it was the most reliable car I could get for the money. He responded that GM could build cars that lasted far longer than the current models but then people wouldn't have to buy cars as often. I was left dumbfounded by this line of thinking. Considering that other than a home a car will most likely be the most expensive thing I buy, I want the best I can get.

In negotiations, you never give your best offer.

Well, people would buy for the tax credits. Other countries such as China subsidize their industries why should we not?

If you demand ALL parts and assembly be made in the US on US vehicles receiving ANY tax deferments or credits or help in ANY way, you open a manufacturing base again. This puts workers to work, this increases tax revenues in the communities, states and federally. This also helps people make money that they can invest with, helps build disposable income and in essence helps businesses around the new manufacturing jobs start to thrive.

I would also, freeze utilities, gas, and oil prices for the year. Every quarter they can increase their price by 10%.

This allows for stability.

Those ingredients and we would have a booming economy again.

I agree in principle. However, that also relieves them of any outstanding liabilities. Which would also bankrupt several other companies as well as drive many employees and retirees into personal bankruptcy.

What about a government assisted restructuring? Essentially go through the bankruptcy proceedings in order to renegotiate a better labor contract. But government subsidies for retires, warranties and relief to their creditors. The warranties on recently purchased American cars can not be ignored and terminated in bankruptcy. Those have to continue forward. Let's face it, we're not going to get out of this without sending several billion to Detroit. Put the money to the victims, put the Big 3 on a solid footing and then see if they can survive.

I have driven GM products for several years. No complaints. Also have a Mazda in the garage. No complaints either. Both are great for what they are. For much of rural America, there isn't a Toyota dealer in their town. But there's usually a GM or Ford dealer around. The closest Honda, Toyota or Nissan is at least 15 miles from me. And I live in a very well populated area. Picked a Mazda because it was local. Not everyone has the convenience of a Honda dealer a few miles away.

Do you still drive that car?

I drive my Saturn car from 15 years ago. But they made cars that were different back then. I could easily get another 15 years out of it.

He is right though, it's that business model that they have stuck with. Toyota/Lexus implemented the Certified Used car program to be able to resell the used cars instead of letting some random used car dealer do it. They can guarantee the quality and still make a profit buy reselling the car again.

If people kept their cars and ran them into the ground, no current auto company could survive.

are the american car manufacturers still churning out the big, poorly built suvs? if that´s the case they´re digging their own grave. they should focus on making the quality of their cars less of a worldwide joke and move towards more competitive cars. there is a reason dinosaurs are extinct.

From the NYT today-

http://www.nytimes.com/2008/11/29/bu...r.html?_r=1&em


So it's seems we have some numbers on buy out for white collar workers. My first couple thoughts after reading this is I'm kind of surprised it's not more money. Plus I'm a little shocked to read it's not more graduated. Seems you're either in one group or the other. People that were employed 10yrs or more and 10 yrs or less. This stood out to me-

Sounds to me like she, Ms. Krul, worked there for two years and got 50k cash and 25K for a new vehicle. What if you worked 9 yrs and 11 1/2 months? You'd get the same deal she got? Don't get me wrong if I were in her shoes I'd take it too. But i bet it's a along time before she sees that kind of money again.

Sounds screwy to me, but much of what the auto industry does sounds screwy to me.

If white collar workers are getting 75-100K wonder what the blue collar people will get? I mean when this first started I read a news story about guys making $70 an hour. I think we all know that was BS now. The average worker's making roughly $28. So what was the average wage for these white collar people? And the most they could get on the buy out was 75k cash and a vehicle? 75K really isn't very much money. If you lived in the states it might keep you a float for what? 3-5 years. Then what? Hope the economy turns around I guess.

No one wants to see 2 million people out of work, certainly won't help the already ailing economy. However, giving these three companies money only so they can turn around in 3 - 6 months and have the same issue is ridiculous. The problem isn't UAW, the problem is these companies make an inferior product to Toyota, Honda, and a slew of other foreign car manufacturers out there. Even if they made a wonderful product, public perception is that they don't. Ford is now getting some good crash test ratings and they seem to be gaining a shred of consumer confidence and trade publication interest. We'll see. IIHS just came out with their crash test ratings, Chrylser didn't score 5 stars one one car, not one. Are the majority of people going to buy a Chrylser, no. Congress will have to see what these companies come back with for a plan and hopefully at least one of them won't suck.

This is a HUGE problem for the industry. I was raised to buy American. I was the first in my immediate family to see the light. My Ram got 12 mpg and had a reputation for transmission problems (I did not have any for the 55,000 miles I drove it). I traded for a toyota pickup that was rock solid, but sure did not have the power of the Ram. My dad continued to buy American and got a fully loaded Dakota. Went through 4 sets of rotors before I convinced him to get a Tacoma. Not a lick of a problem with the Tacoma. My girlfriend got a 2000 Neon. 3 sets of rotors and 23 mpg (in a 4 cylinder manual), she got rid of it for a '99 chevy blazer. I convinced her to get a service contract. Over $4,500 worth of repair went on that contract. Repairs were mostly to get the damn thing to stop leaking. Got rid of that for a 4runner. No problems with it.

My point is that I still want to buy american, I really do. However I can no longer trust them. I got a 2008 Corolla. 36 mpg and my dealership also included a lifetime powertrain warranty. They can offer that because they know that it will most likely never be used. None of the big 3 would even dream of doing that.

I really think the big 3 are screwed. I hate to see them go bust, but I believe that their failure will leave a void that will be filled by other manufacturers.

Let it die. All of it.

Assemble one viable, strong company from the rest.

Hopefully, the pensioning volk will get healthcare from obamaniam if not a decent pension.

i watched some of the hearings last night on c-span and was struck by bremmer's intervention in which he outlined what is actually at stake here---whether the united states is to begin catching up to most other industrialized nations and have an industrial policy. he kept alluding to miti...the problem here is organizational first, competences second---what mechanisms will be responsible for formulating such policy, how will information be gathered which is required for that activity, who will do the gathering, what objectives are being pursued, what powers will be granted to accomplish them.

this is obviously a problem situationally---the automobile manufacturers are in a total short-term liquidity crisis--the go to washington and say give me 30 billion. we'll do something good with it, don't worry. you'll do this because if you don't, we collapse.

what is notable in this seems to me to be the realization that what detroit is asking for is beyond the limit of the present conservative "policy" of ad hoc, reactive measures.

what seems to follow from this is a deferral of action from congress and a series of ad hoc, reactive measures behind which will follow some kind of basic alteration in the public/private relationship at the level of co-ordination.

among the consequences of this will probably be, judging from the way the hearings went (until i fell asleep) is a merger between chrysler and gm. what appears to be a driver for this follows from (a) previous negociations on such a merger based on the famous "synergies" that would result among which would be (b) increased flexibility at the level of production through the consolidation of existing platforms from which would follow (c) very considerable job loss. now what was odd about this in the hearing was the way these job losses were pitched as affecting management first and primarily. there was an oddly inarticulate gentleman from the uaw present who functioned mostly to prompt this emphasis on middle-to-upper management being a primary "victim"....

i write all this because i think we're seeing a change in outlook at the level of the senate anyway. moving away from the context of the bailing out of the financial sector to something more structural. so i think the debate is changing. i think it has to change, because the financial sector as a context guarantees continued incoherence.

what i didn't really see emerging yet is a coherent stand relative to employment as a political question. if the american states gets involved in industrial policy without a politics that ties it to employment levels, the involvement will be nothing more than an accelerator of the fragmentation and deterritorialization of production that is already well under way. what will matter in that context is the activity of capital and jobs will be understood as a secondary consequence. if employment is a primary consideration, then a quite different logic of state action would follow.

one of the possibilities that comes out of the pulverization of the neo-liberal world is a re-regionalization of production--a rethinking of scale--a shift in the understanding of the linkages which connect capital flows to the socio-economic systems which enable it. the multiplication of centers is a multiplication of nodes of power. in that kind of context, i think the options for the american automobile industry look interesting. so it is hard to say what "should happen" at this point because the logic that will shape what's possible is changing very quickly.

for example, there is obvious consternation about "outsourcing" which gets treated as some kind of alien phenomenon and not as the extension of a model of capital accumulation that subordinates *all* social contexts and implications to the movement of capital flows. the greater the recognition that the problems detroit faces result from *both* the model itself *and* the decisions made in the context of that model by the american manufacturers, the more possibilities open up for changing the model itself.

so another factor that seems at play here is the ending of the political consensus around flex accumulation/neo-liberal globalization. but this ending has not yet acquired an adequately sharp expression, so operates like a haze around discussions.

so what looks to be happening within this discussion about detroit/the auto industry is:
a) the beginnings of a serious break with neo-liberal assumptions that is at least now being framed for what it is.
b) the posing of a real Problem for the american state: how to proceed, which mechanisms to create, what objectives to put into place, etc.
c) FINALLY there is at least the start of a recognition of the Problems that neoliberalism has generated for decent=paying employment in the production of actual stuff.

that's what i think is going on, based on a non-representative sample of the hearings yesterday.

the question of what should happen is tied up with these shifts, in whether and how they issue into something new. the fate of the auto industry is out of its hands now.

Let it die,and your Honda/Toyota/BMW is suddenly a hell of a lot more expensive.

That said, I'm unconvinced that there actually is a way to save the American auto industry. America's attitudes are finally catching up to it. We've never, with the exception of a few, isolated organizations, been interested in exacting quality standards and good engineering. We prefer to come up with the idea, and then try to make whatever we produce from it look good, without necessarily being good. Sort of a "Fuck it, it's good enough" attitude.

Rather than fix the severe quality problems that GM has had since the 1970's, instead they stuck bits of ribbed plastic, or wings, or fender holes on their crap-mobiles and expected America to just buy them, not picking up on the fact that it was a holey plastic turd with wings.

It didn't work.

It didn't work so spectacularly that GM a few years back sent out a letter to former customers. Paraphrased, the letter said "We know we built crap in the 70's and 80's. Please give us another chance and buy a GM car now."

Might have worked, except that instead of a true committment to quality, they instead had a true committment to sticking more plastic, holes, and wings on the cars.


GM's cars have been like old western buildings. From a distance the building would look like a really nice 2 story building. Get up close and you find out it's dirty, rat infested, and the 2nd story is fake.

You can only put gold dust on a turd and sell it as solid gold for so long before people start seeing beneath the shine to the offal beneath.

To fix things, GM has to turn themselves into the American version of Honda. It doesn't have to be fancy. It doesn't have to be the sleekest looking thing on the road. But it'd better be damned high quality.

Even if GM can overcome American laziness enough to find the workers to do it on a mass scale (They already did it in their Corvette program, but can they replicate that on large-scale assembly? Dunno. Doubt it), they have a nearly 4 decade reputation now for making crap. People are not going to assume they're suddenly making great stuff. So I'm not sure that even if GM started making decent cars, that they'd be able to convince the public that they were, in time for it to make any difference.

so overnight the senate deal on a short-term bailout/loan for the "big 3" collapsed.
it seems there are a few main explanations, but the main one is: the senate republicans are playing chicken with the automobile industry because they want to use this to fuck over the uaw.

i find this to be a shocking development to wake up to this friday morning.

what do you see as happening next?

there's little doubt that the central problem has been at least stated outright by members of congress over the past week or so--what detroit is actually asking for is a coherent federal-level industrial policy---but the way in which this has been managed, and its timing, seems to have also been an attempt to use the context created by october/november's ad hoc reactions to collapse in the financial sector to get help with fewer rather than more restrictions. given that one cannot simply conjure an industrial policy--rather it really needs to be thought out--and given the situation, i actually thought that the only real alternative was the alternative that seems to have been done in by the senate republicans---split the immediate from the shorter term, and add this to the transition tasks--to develop such a policy and propose an administrative arm. the
"car czar" seemed a really stupid idea, a stop-gap....


what now?

i expect the administration will act unilaterally as the consequences of a collapse of the automobile industry are too high.

but i am amazed that the right's desire to use this to fuck over the uaw would result in this...

Hell if I know what happens next. I know it seems completely fucked up that the Wall St. guys can show up with little or no plan and get 700 billion. The auto makers show up and nada. Were they asking for 700 billion? No they wanted to 15-35 billion to keep the doors open. This seems to me to be the GOP trying to break the UAW. Look at the GOP senators who fought this the hardest, they all have large foreign, non-union, auto makers with plants in their states. Gee no conflict of interest there. or maybe they're fighting it and it's just a coincidence those guy were the one fighting it the hardest. Personally I rarely believe in coincidences.

We sent billions to Wall St. What do they make on Wall St? What have the tax payers gotten for those billions? Seems to me guys actually making stuff in this country just got told they don't matter. I think they matter. They end up losing their jobs and everyone in the area or related to the industry will have massive loses. The reports I'm reading this morning have the market tanking and the dollar falling off a cliff.

I think the resulting actions by the UAW might make the recent events at the Republic Windows and Doors plant look like a family picnic.

Someone *cough* Bush *cough, cough* needs to step up to the plate and tell these fellow GOP members this is not an option. We need someone driving this bus. Unfortunately the current man in the drivers seat is Bush and he's got a record of putting buses in the ditch, not getting them out of the ditch.

I doubt the UAW is a primary motivating factor in the minds of the "right", one way or the other. I think most on the "right simply recognize that the big three auto makers in the US simply can not be saved without major fundamental restructure.

Most on the "right" also recognize that existing management in these companies are not up for the job. Here is what we are being asked to believe: A) these companies did not anticipate current market conditions; B) they anticipated current market conditions but had no workable plan; or C) they anticipated current market conditions and their plan was to go to Washington for a bailout. I tend to accept A or B, but if C is true perhaps they are smarter than I would give them credit for, and it is actually their plan to use Washington liberals to "fuck over UAW", that would be brilliant.

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.

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.

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.

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.

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.

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.

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.

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.

How about looking at the UAW? The number one rule of a symbiotic relationship is not to kill your host.

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.

i numbered the following to refer them to the quote/response segments above.

1. not in this climate. in another context, at another time, maybe i'd agree with you regarding bankruptcy.

2. on the history of this crisis. i've said this before, i'll say it one more time.

the actions of the bush administration have engendered a political crisis that is being expressed through economic crisis.
it could have happened another way, but this is how it's happened.
what is being taken down is much bigger than the reactionary politics of the bush people, however. it is the entire ideology for which they stand. while it is possible that this melt-down could have happened another way, it didn't...it happened this way. so while it is possible that there could in an alternative scenario be no particular connection between the political implosion of the bush administration and economic crisis, in this situation, which is the real world situation, there is one.
no amount of denial will change that.


i see this as a massive, wholesale implosion of neoliberalism, of cowboy capitalism, of the washington consensus, and of the lunatic "globalization" that neoliberalism has enabled. so this is obviously much bigger than the bush administration---neoliberalism runs back into the early 1970s. it's conditions of possibility include the various transnationalizations of transactions put into place by the nixon administration, whose importance in setting all this in motion is still underestimated. ideologically, neoliberalism took shape across the thatcher-reagan period. the political modus operandus domestically, the screen discourse, took shape during the reagan period....but i digress, moving from the ideology of contemporary capitalist incoherence--neoliberalism---which is intimately associated with american political and economic domination--and the earlier claim that the current economic crisis is a political crisis and a political crisis directly brought on my the staggering incompetence of the bush administration.

3. i agree with your assessment of the particular individuals who presented themselves to congress looking to get salvation, but not about the simplistic "analysis" that follows.

you want to eliminate complexity when you think about this, it seems.
i think that if you eliminate complexity, you eliminate thinking, so i don't see the point of heading down that route.

despite the fact that this is a messageboard, we can still maintain a certain minimal relation to what is happening in the world by refusing to boil it down to small-business level bromides.

4. this milton friedman horseshit is a significant element of the washington consensus that got us into this trainwreck. you cannot possibly expect me to take it seriously now. i have always argued that this position made no sense, even when it had some credibility. now it doesn't have that. time to retool your mind, ace. you can do it.

The perspective on this is kind of funny. This morning on my regular rounds of the gym, walk etc... I stopped in at my friends hotel. Fresh watermelon juice, good stuff. Anyway he was reading the local paper. I could see it was about the auto situation in the US but my Spanish isn't quite to the point where I can really read something. Sometimes I read something and find out it actually means the opposite of what I thought it said. I asked him what the article said and he said it basically said the US government turned down the auto industry's request for a loan and that the paper was suggesting people buy as many US vehicles as they could. I asked why would they suggest that? The cars may not have any warranty or parts available of the companies fail. He said yes, but the paper says if the companies fail people will loose their jobs and that can start a ball rolling down a hill and that will cause everyone pain. He said the paper is reporting several government agencies in Mexico have placed large orders with American auto makers recently. Those orders were set to happen right after the first of the year but they're moving to place those orders now in an effort to help save those companies.

Granted this is in part due to the fact that there are several factories here in Mexico that either make or help make vehicles and or parts, so that's part of it. But I think there's a real concern for those US workers and their families.

I doubt you could find a consensus on the Bush "ideology". In fact I believe his actions on fiscal issues in particular has been very inconsistent with his stated ideology regarding fiscal policy. And in the past few months it seems Bush has taken the "lame duck" role to heart and his willing to support even the most extreme bailout schemes coming from Congress.


Speaking as an individual who happens to be conservative - none of the above comes into play when I formulate my views. My view of capitalism has been mainly formed from by being a consumer and a provider of goods and services in the market. Since I have never gotten much help from government and large domestic/international institutions and in-fact believe they have mis-used power my core belief is with the individual and the independent regardless of boarders. I am very libertarian in that regard. And what you call "neoliberalism" perhaps I consider libertarianism.

Like Einstein's theory of relativity, the most complex concepts are often the simplest. The paradox of complexity is simplification. I believe I recall that many of Einstein's peers did not see the point of heading down the route he was on when he came to his conclusions. Truth is not a popularity contest.

What is happening is a company like Toyota can make a profit for every car is sells and GM can not. That is the 800 pound gorilla in the room. Profit is the cornerstone of the issue. It is unfortunate that the term or concept is considered something bad in the liberal mind.

I don't control what you take seriously, but at the most basic level any progress requires excess (or profit in the economic context). We can ignore this truism at our own risk.

ace--do you know what makes toyota's production system interesting as a system?
if not, no problem--but i can tell you...

I'm interested, do tell.

well, toyota has at least 3 main innovations---at the level of technology, they worked out a far more effective and efficient way of transitioning the assembly line from one model to another---the older school american auto model was centered on long production runs of a single basic type of car. switching this basic type was complicated, time-consuming and expensive---remember that early on the switch from the model t to the model a nearly bankrupted ford. toyota benefitted from the japanese "developmental state" in the workign out and implementing not only a vastly improved technology at the center of assembly line production, but also an alternative work organization for assembly workers, who operate in a short production run context as teams. this is an enormous advantage. [[btw in the 70s a parallel system waqs developed at volvo's uddavalla factory---this had a different political conception built into it which involves types of power-sharing between workers and management that were not present in the toyota model---so for a while there was a "good guy/bad guy in debates about flex accumulation...

the second area is in the adaptation of just in time to supply chain development, which accelerated the fragmentation of the manufacturing process. in general, where the old american model relied on economies of scale linked to long production runs for profit, toyota opts for flexibility in production linked to tight controls on pricing and quality and timing of suppliers and the products that they deliver---so suppliers end up absorbing costs that would otherwise have been associated with production.

it seems to me that the american auto industry knew this model was a problem for them pretty early in the game and opted to retain it's production model and focus on types of automobiles that toyota etc were not producing--which looks to me like a decision to cede defeat to toyota etc in the longer run and seal themselves into it by not adapting the technology at the center of the assembly process. i would imagine that had there been a state industrial policy and funding parallel to that which the japanese ad in place that they would have been able to consider retooling when it was still relatively straightforward to do it. now they are basically hoisted by the consequences of these decisions--if that's the case, then the problems the big 3 now face cannot simply be connected to management--it is a function of the entire american business culture as well (the emphasis on short-term profits over long-term thinking, the substitution of the movement of capital for production as a form of industrial and social organization) and the disadvantage that the american refusal to implement an industrial policy created within that context.

this is a short version of why i see the trouble detriot is now in as yet another expression of the incoherences of neoliberalism.

Very interesting.

Here's basically my view of the problem and situation

http://gas2.org/files/2008/12/youwouldntbuyour.jpg

I'm hoping the auto industry and it's workers survive this and I'm willing to have some of my taxes go to help them. But they have to start making cars that aren't crap and cars people want. Maybe it's too late. They showed up in DC in Nov(?) and basically said "give us a huge loan right now or we'll fail." That foresight and planning is pretty much how they've been doing business now for years, IMO.

I want to buy American, I bought American. I think it's good for everyone if manufacturing jobs thrive. But the POS Ford I have in my driveway makes me wonder if it's even possible to save them at this point.

After watching Frontline (on PBS) episode about retirement, I think that they want to do the same thing that United Airlines did in 2003.

FRONTLINE: can you afford to retire? | PBS

Have the big 3 declare bankruptcy, make them spend hundreds of millions in legal fees and restructuring management, cut or eliminate pensions and benefits, have the workers work for 30% less (because if they don't then the company will die), and switch the cost of benefits from the employer to the worker (401k/health). The private banks would provide the loans, but get superpriority in recouping their losses if they did fail, and would get fees and interest as well. United Airlines is still around today, but they were forced to trim down in order to compete with the smaller low-cost upstarts, instead of regulating that the low cost upstart airlines had to have pensions, healthcare, and other worker compensation. I'm sure there are a few retail stores (K-Mart, Target, Sears) that would want to get bailouted too because of what Wal-Mart's worker compensation policies are.

Why isn't it an expression of a failing US industry? If you use the auto industry as an expression of the incoherences of neoliberalism why not use for example the heavy equipment manufacturing industry to support the opposite, i.e. Caterpillar, John Deer, Terex, etc. These companies are assembly line producers, have unions, international competition, and can be profitable.

The auto industry has been sheltered from domestic competition party due to the liberal obsession with unionism and the guise of protecting American workers. In the end this liberal obsession has killed the industry. If the real economic value of torquing bolts on an assembly line is less than a gross cost of $70 an hour, it is simply insanity to pay that amount. The true focus of liberals should have been to educate that worker so his true economic value as a worker is in line with his pay, which could end up being more than a gross cost of $70 an hour. New domestic auto companies have not been allowed to form and develop in this country because of the union issue and liberals support of the union cause. If new domestic auto companies were allowed to form and develop, these new companies would have grown based on a sound economic model, as has been the case in other industries in this nation.

I just don't understand. Today Chrysler came out and said we're going to shutter everything for at least a month. Ok, I guess I kind of get that one. No ones buying so why produce? But GM came out and said they're going to shelve, at least for now, the factory that makes the engine for the new Volt. Isn't this the car and the kind of technology that was going to save them?

I wonder if their doing this to save cash or to bluff the Feds into coughing up cash.

Story here

The issue is bigger than the Big 3.

Toyota is delaying "indefinitely" an assembly plant in Mississippi for the Prius.

Toyota Delays Mississippi Plant Launch; Slashes Forecast, Details Cost Cuts Next week - Auto Observer

When folks are losing their jobs or uncertain about their job stability, stretching every penny so that they can meet the next mortgage payment or facing foreclosure, or cant get credit because banks arent lending....they wont be buying new cars.

I read something about that recently. Wonder if all these southern senator's will be looking for tax breaks or other back door bails out for the transplants?

You're absolutely right. If John and a few 1000 co-workers loose jobs at WAMU they're not buying lunch at the corner deli anymore, which causes Stan to close up his deli business, which causes a slow down with all of Stan's suppliers so they lay people off and now most these people are at risk of losing their home and none of them are going to go car shopping anytime soon. At this point I really see it as a ball rolling down a hill. I wish I knew how big that hill is and where on it the ball is currently.

I woke up this morning and as I sit here drinking my coffee "Morning Joe" is telling me today's jobs report is likely to show another 1/2 million job loses last month. That's two months in a row. I don't know exactly how these numbers are done but given it's the Christmas, err I mean Holiday season (Damn almost forgot all about our war on Christmas, sorry lack of coffee,) I wonder if season work is included in those numbers. I always thought unemployment went down every holiday season because so many people hire tempts to cover increased business.

Also what do you make of GM closing down the Volt engine plants? Does that make any sense? Why not close out plants that are making cars no one buying?

given the moves that you gentlemen are tracking, it's probably not surprising to find this in this morning's ny times:

http://www.nytimes.com/2008/12/18/bu...18auto.html?hp

i believe this article is what we would call "public diplomacy"...the gist of it is:

"the negociations aren't over so don't worry so much about these closures and so forth.

and o yeah, sorry about that madoff thing. don't know how that slipped by us."

They normally shut down plant operations during the holidays, the typical duration is 2 weeks, so going to four weeks is meaningful but we are in a recession and this shutdown should not be used as a reason to rush through some il conceived bail-out plan. There is also general shut downs during the summer months of up to two weeks, in the past this time was generally used to re-tool for new production runs. I knew a few people who would use these shut-down periods to file unemployment claims even though they knew in advance and knew they would return to work in two weeks.

toyota plants can retool in a matter of a few hours.
that's one of the problems---long production runs lock you into particular types of car--if demand changes, you cannot adapt in an effective manner. this is a technological constraint of considerable importance. it has little to do with the particular management in place at present, unless you want to say about them that they failed by not undertaking the capital reinvestment required to adapt more thoroughly to the technological arrangement that is increasingly the norm in transnational production in this sector.

o yeah--about this "liberal obsession" that you outlined above, ace (sorry, but i only just saw the post)....if you're talking about the car industry prior to the 1980s, you're confusing things---while it's formally correct that the american car industry was protected before that time, the rationale had nothing to do with what you claim it did---what changed is the geography of capitalist production, the logistical systems that underpin it, and the ideological rules of the game. before the early 1980s, it was GENERALLY understood that production was a social relation, that profit was tied to social stability, that deriving profit came with a social responsibility that was tied to particular geographical spaces, typically framed by nation-states. it was the rise of neoliberalism that reversed this---replacing the movement of capital for any particular geographical relationship, shareholder profits became a simple-minded substitute for broader forms of social responsibility, etc.

so far as i can see, there's no way around it: the primary explanation (even though it's an general-to-abstract one) for what's happening now is neoliberalism--which (again) is coded as conservative economic ideology in the states. "market fundamentalism" or "the washington consensus" etc etc etc.

They're saying at least 4 weeks. All this "Nothing to see here, move along folks. Just the normal course of business cycles" is complete and utter bull shit. Another 1/2 a million people lost their jobs last months. This is not normal.

What is normal during a recession?
-----Added 18/12/2008 at 03 : 18 : 43-----
Entry into the automotive manufacturing industry in this country is virtually impossible for a domestic company. The cost, regulatory issues, and special interests needing protection make it so we will never see a new company start in this country under current conditions. Certainly there are union obstacles, but there are also environmentalist, existing dealership networks and also the existing companies that just won't let it happen. And, they use Washington to do their bidding. Real innovation is being stifled due to the difficulties for new companies to enter the market. If I were in Washington my focus would be on new innovative companies wanting to enter the market.

ace--i would think that you fancy yourself in the position to answer that, given that you've been trying to argue here and elsewhere that there's nothing curious or extraordinary happening at present---which transposes (and nothing else) the claim "the fundamentals of the economy are strong"---whatever that means---which implies that everything is normal, yes?

so you tell us what's normal.

Recessions are normal, this recession shows every sign of possibly being a depression and it's global. The employment rate is falling like a rock, the dollars leaning hard, the credit market is all but frozen, the Dow's lost some 40% in a few short weeks. These are all things I'd say we haven't seen in the post WWII era. I'd call that not normal.

I'd call it bad things happening during a cyclical bear. A bad combination.

I just read here that Canada stands to lose up to 600,000 jobs as a result of the U.S. auto industry woes (i.e. the collapse of the Big Three). Over half of that immediately if/when the bailout doesn't happen for certain.

Do the scaling of the math here. Our population is 33.4 million.

this just posted to the ny times a few minutes ago. the administration has rolled the dice.

http://www.nytimes.com/2008/12/20/bu...20auto.html?hp

so this is the second move by the bush people that i've agreed with in 8 years. the other was the declaration that they supported an autonomous, viable palestine. that's it.

i'm pleased that the bush people resisted the whackjob approach advocated by the senate republicans, which seems to have been little more than an attempt to use the appearance of sticking by neoliberal principles as a tool to screw the uaw. bankruptcy at this juncture would have been the height of irresponsibility, a wholesale substitution of the financially oriented worldview of the neoliberals for any sense of social responsibility.

i don't agree with the writer of the article about the position this places obama's team in, though---what i see this as doing is more forcing the new administration's hand in terms of figuring out some kind of industrial policy at the level of goals and administrative apparatus that will enable a coherent direction of resources across the economy in order to both move through this implosion of the neoliberal world order and begin the process of seeding something viable (and a way of managing it) into the future.

i should say that i support this despite my political views: if revolution were to come at this point, it would come from the extreme right. fascism is a response to socio-economic crisis.

i'm sure that the details will fall like snow from the media apparatus over the coming hours...

what do you think of this move?

I'm a bit relieved that there are conditions on the bailout. I'm not sure what the specifics are, but the article mentions that the companies must reorganize and return to profitability. I"m not sure what they'd need to do, but my guess is it will have much to do with catering more directly to the market with a long-term view. There's a reason why I see far more Japanese cars on the roads than I do American cars. It has to do with trends leaning towards fuel efficiency in a car that will last for more than a few of years before it starts to fall apart. Japanese cars are generally more efficient and higher quality. American manufacturers need to compete with that directly, or they'll continue to get smoked.

The hit these companies took with the tumbling of SUV sales should serve as a lesson. I think some of these companies had too many eggs in that basket.

agreed..but i see the problems as being as much technological/organizational as i do mangerial/financial. and socio-political as well. on the latter--this amounts to the imposition of limits on the extent to which focus on capital flows can correspond to a deterritorialized view of capitalism. what's a bit alarming about the arrangement just announced is that its logic can head in several directions--for example, were mc=cain the incoming el jeffe, i would expect that it would have resulted in setting a framework for the making-explicit that the worlds occupied by working-class americans could be understood as the new third world. with obama, there are more alternatives in principle---i just hope that he is not in fact *such* a centrist that he allows his administration to get sucked down that pipeline--because it'd be easy to do.

everyone who thinks about it has known for a long time that there has been a contradiction between the way neoliberalism operates--to the exclusion of all interests that are not constituted by holders of capital--and social coherence over even the medium run in the states. but the collective fixation on capital flows---a function of the dominance of neoliberalism in the states, it's status as lingua franca from the early 80s onward, repeated endlessly via the "free" american press etc etc---had enabled the avoidance of this contradiction. it's implications unfolded at that register of silent anxiety motor...what's strange is the extent to which the folk directly impacted by these deterritorializing processes bought into the same ideology that justified them in the first place. otherwise, you'd have seen what you're starting to see all around now---strikes.

taken from shrinking gm means pain for factory families

GM vs. Toyota
GM and Toyota are the two biggest car companies in the world. We compare them side-by-side:

Average assembly line wage
GM: $31.35 per hour
Toyota: $27 per hour


Health Care Costs per Vehicle (2004)
GM: $1,525
Toyota: $201

-----------------------------------------------------

OK, just using this information the average GM assembly line worker makes 31.35 per hour. Now take into account how much of that goes to the Union, and then take into account the plant closures annually for retooling and updating of the equipment, so line workers only get 70% or so of their base salaries durring the retooling period as part of the agreement with the manufacturers.

This means that after you figure everything into it, most workers at the plants are making more like $18-20 an hour when compared to what the average US employed blue-collar worker gets. So annual salaries are more along the lines of $36,500 per year.

I see alot of people talking about how the plants are being shut down and all with the low economy.....the truth is that EVERY year the plants are shut down around X-mas, and are closed for up to 4 weeks for equipment retooling, etc. The manufacturers are adding an extra week or two to the already SCHEDULED plant shut downs due to the economic slump to help curb costs.

All the Japanese auto makers are cutting jobs. For example, Nissan is letting go of all it's contract (= temporary/seasonal) employees. That's Nissan in Japan. I don't know what they're doing in the US and elsewhere, but in general, they are cutting more in the US because for the moment, the depression is worse in the West.
-----Added 20/12/2008 at 12 : 08 : 13-----
Right. So for the economy as a whole, there is in fact a net loss. It's just that those costs are held at arm's length from the big guy. It's a net loss because just-in-time is pretty wasteful when you get down to it, particularly in transportation/energy expenditures. But it could be worse than it is in Japan, where industries are spatially located in a semi-rational manner and where the transportation infrastructure is much more efficient than in it is in the US.

Company A: makes makes people work for 1200 units of work to build 1200 coconuts in January. Then shuts down production for 11 months of coconuts, and works on other stuff. 5 people are, however, employed each month after the first to deal with the inventory management of coconuts.

Company B: makes people work for 100 units of work to build 100 units a month for the entire year.


Differences in available labor, B-A:
-1100 in January, 95 each month afterwards.

Now, lets suppose there are other productive things people could do. Let's suppose these things have a 0.5% monthly return on investment -- ie, doing the work 1 month earlier is 0.5% better than doing it now, and now is 0.5% better than doing it next month.

At the end of the year, both companies have 1200 coconuts they consumed.

There is a difference in the 'unused labor' of both companies. We will presume that people went off and made something useful when not employed.

1100 more free people in January under B. They produce 1100 units of work somewhere.

By the end of the year, this grows to 1.005^11 * 1100 =~ 1162 "units of usefulness".

In Febuary, A has 95 more people free to work on other projects. They produce 95 units of work somewhere.

By the end of the year, this grows to 1.005^10 * 95.

March is the same, which grows to 1.005^9 * 95.

Etc all the way to december, with A accumultating an advantage of:

(1.005^10 + ... + 1.005^0) * 95
= 95 * (1 - 1.005^11) / (1 - 1.005) =~ 1071.5 "units of usefulness" over those 11 months.

Which means that B is about 90.5 man-months of labor output ahead of company A. By implementing JIT delivery. (Note that the 55 man-months of manning the warehouse do not account for the entire gap)

The basic idea is that if you can do something efficiently, then _you can use the resources involved on other things_. And there are lots of useful places to spend resources.

And if you can defer your use of resources until it is needed, it means that things which have a time-pressing need for resources have more free resources to be used _now_.

This results in higher efficiency -- higher output per unit labor -- which makes society as a whole richer.

Yakk: You're only looking at one employer. There is a whole raft of workers that is off of MegaKorp's books, but which is nevertheless employed by someone. The parts aren't made by elves. Moreover, i do not buy the assumption that MegaKorp's workers produce something capitalistically quantifiable during layoffs. Toyota isn't based in Toyota for nothing.

JIT is imposed on suppliers and workers because MegaKorp can. GM & Furd probably would if they could, but they can't. It's a question of political power.

a couple more general comments:

you can think about the detriot manufacturers as having done more or less the same thing as the american steel industry after world war 2, at the point they had exported continuous casting technologies in the context of the marshall plan---short term profits--in the long term, you go away. the technology puts you under, once logistics and trade rules and--particularly--reactionary politics relative to labor change the rules of the economic game away from the social and toward the movement of capital understood as autonomous.

the regulation school folk characteried the united states in a general sense as being trapped in a nostalgia for fordism, unable to come to terms with flex accumulation even as they became the main driver for globalizing capitalism/cowboy capitalism...one way of thinking about this is through the shift from the type of dominance the united states exercised under bretton woods to a different type, the conditions of possibility/outline of the project for which was put unto place by the nixon administration--the states shifted from a more socially oriented regulatory function to that of a governor for a system which gradually took shape that substituted capital flows for social consequences...

this second model was never sustainable--it was not even about sustainability.
you can see initiatives like the bush people's "ownership society" as attempts to use debt as political coercion explicitly...if the socio-economic consequences of cowboy capitalism were increased economic instability within the united states, the reconfiguration of manufacturing in many sectors whcih soon gave way to an logic of concentration concentration concentration, you'd think people would react politically to this politics of the economy--but they didn't---primarily i think because of the extension of debt as a device to enable folk to sublimate their politics into consumption.

the automakers are an almost perfect symptom of all this.

that you can run out this type of narrative while drinking a cup o joe in the morning is in a circular relation with how you see what's happening--i keep arguing here and elsewhere that the current economic and social problems--crises--that the americans face are the direct result of the model of capital accumulation that was put into place across the 1970s and 80s, and so is the result of the history of the united states since that period. so contrary to what you read in the american corporate press, the problem is not only a few sectors or individuals (madoff) who come to symbolize excess, but rather the entire model within which they operated.

it is interesting in this regard to notice the extent to which the mainstream press, particularly the newspapers (television seems to have a medium-specific form of ADD in this respect) are already focused on obama's economic agenda as if all that we need do is stumble from here to there and thigns will be hunky dory. but what i think is going on beneath that is a discourse shift. this is what the pulverization of neoliberalism looks like---a change in discursive weather.

i am surprised by the lack of reaction on the part of the people to this--you know, out in the streets kind of reaction. i think this passivity does not bode well. i think this passivity is a real problem.

Goes back farther than that. Once we changed our laws to view corporations as legally individual people, we were on the road to disaster because once they are individuals in the eyes of the law, they suddenly have rights, instead of privileges. It should be a privilege to operate a business in this country - a privilege granted to everyone provided they follow certain rules, but a privilege nonetheless. The rules are simple. Pay your people a living wage, make their workplace as safe as possible, and don't screw over the customer. As it is, should a corporation do any of these misdeeds, their right to remain in business remains unchallenged. At most they'll have to pay a fine which, stacked up against corporate bankrolls, is a pittance. And since the fine comes from corporate coffers rather than the pockets of the bastards who committed the violation, there's no real incentive to be a decent "corporate citizen," a phrase which in itself should be abolished.

Because the media is owned by corporations and is therefore part of the shell game to distract the American people from the real problem, which is that corporations have been allowed to take over the government. Who has more influence over the politicians - you, or a megabillion dollar corporation which can donate to campaigns and hire lobbyists and exert all sorts of other influence over every aspect of government. I won't even dignify that question with a question mark because the answer is obvious.

Yes, it is, but you shouldn't be surprised. No one reacted to Hitler either until it was far too late, and Hitler started off by declaring a war against a nebulous and intangible enemy (specifically, terrorists - this was before he unveiled his Jewish eradication desires), and corporatized the government (btw a corporatocracy is also known as a fascist government) and thereby locked up power for himself and kept the people from being able to stop it.

I'm not saying the US government is getting ready to go kill Jews, but the other aspects of the Nazi party's domination of German politics have frightening parallels to our current state of affairs. Both governments 1) declared a war on terror following a catastrophic attack on a landmark building, 2) established a Department of Homeland Security (in Germany it was the department of Security for the Homeland, or the Schutzstaffel, better known to us as the SS), 3) declared that opposition to the government was unpatriotic, 4) used private corporations to achieve governmental goals, and 5) evoked extreme nationalism and "patriotism" - "You're either with us, or you're against us.

The very concept of a war on terror would make Orwell quake in his boots. Terrorism is not an enemy - it is a tactic. You can't declare war on a tactic, because that war by definition can never end. This is why real wars are one nation against another nation. But wars are excellent things to distract people with, and they're also excellent re-election strategies, and so a war that can never end in the "victory" W and his cronies supposedly seek is a very good strategic move, as long as you don't really care about the long-term fate of your democracy.

There's more to be said here, but it's Christmas so I'll give y'all a break ;)

Some characteristics of a "normal recession" includes:

Contracting employment.
Increased unemployment.
Decline in demand for goods and services.
Decline in Corporate profits.
Decline in consumer confidence.
Decreased capital investment.
Increasing inventories.
Price discounting to reduce inventories.
Lower inflation or possible deflation.
Increased government borrowing.
Falling demand for imports.

So given we are in a recession, the question becomes how do the numbers for this recession compare to historical norms. I think those saying that this recession is abnormal have an obligation to show what they mean by the statement. Without being too simplistic I would think if those who really believe our current recession is abnormal, they would be calling it a depression. I would think by definition that would be true.

What I really think is that we have had strong economic growth over the past several decades with relatively short minor recessions here and there and we forgot or never knew (for the younglings) what a normal recession feels like.

It is the UAW, heck when they were in front of the senate commitee they had a UAW rep next to them, and was asked point blank "Why are you profitable in Europe but not here" they hesitated and answered politically correct by saying they have other obligations. They have paid over 100 billion to the union over the past 15 years in benefits, that is insane!

I'm sorry - I've been out of the loop for awhile. I have to ask - is this really about the UAW or the big three? Seriously? I'm just a simple man from SoFla, so I have no vested interest in this. But my homework tells me the average starting rate for UAW is $14/hr compared to imports (non-union) @ $12/hr. What is wrong w/the union? Someone watching out for your back? So you work for more than minnimum wage and have some benefits? Concessions? Like the UAW paying medical? Matching pension funds? Why should the UAW pay DOWN, and the imports not pay up? In Alabama, the average cost per worker to build a plant was over $250,000 an employee - why not invest that in "Made in the U.S.A."?
The real question should be why do banks NOT have to answer where the money is going (or not - for the bonuses[Thank you Mr. Bush for that provision]), but why Congress is so set on union busting!

Part of the problem is the union. The latter half of the problem consists of a poor business model and being located in a state that has been in a lone recession for years.


I hate to say this, but a big step to helping out the poor union..err...car companies would be to move to a state that is more open for business and will not tax the fuck out of you to stay alive. If any of those idiots had any balls, they'd declare bankruptcy and instantly nullify the union contracts, then uproot and leave.

Sadly, they look like they're going to get a bailout, so since they already got some of my tax money, they won't need me to buy a new car any time soon. I'll be supporting a southern state car manufacturer by buying a new Nissan this year.

Call it reactionary if you want, but this isn't free market capitalism. This is corporate welfare. I'm already paying for it, so that's the extent of the money they're going to get from me.

Get rid of the unions and you get rid of any incentive to pay auto workers any more than Walmart wages. That's great for GM and the other corporate fatcats, but not so hot for the American middle class, which has already endured nearly 3 decades of egregious attacks. Unions are one of the few things standing between an absolute divide between the "have mores" as Bush calls them and the rest of us, who would be doomed to an existence of poverty while we toiled for the ruling elite.

It seems a common solution among more conservative elements in the US is to destroy something completely if it's malfunctioning in any way, be it anything from a multitude of government programs to unions. Some unions in the US do have problems, I'll give you that. Shoot, I'd even say that some auto unions have problems (though it would be wrong to say those problems contributed to the state which required a bailout). Some unions don't work, but most do, and more importantly most are necessary in order to prevent abuse of workers by management. As Shakran said, without unions many, many people would be living in poverty. Unions are an instrument of protection.

All I'm saying is if you see a problem with something, try to fix it first.

Wrong. A new business model and the complete and utter nullification of union contracts would be a great first step. Businesses can come back, but no business should be getting controlled to the point of collapse by government and a union.

Did you know that the UAW is legally the only union allowed to exist in Michigan and a few other states? That's not a free market solution. Unions should also have competition, but they don't. Since they don't, they "protected" the workers to the point of their jobs going under. How much is the head of the UAW suffering? I'll bet not a lot. Did anyone call for him to have his salary cut off? hell no.

and worker protection does not explain why right-to-work states are seeing steady business. Sure there is some belt tightening going on, but any smart business is going to do that when the half of politics who are not pro-business takes office.

Most of us conservative people don't see it as cutting something off, we see things as inefficient and top heavy and in need of removal or being streamlined. The liberal solution is to throw other peoples money at it so you feel better even if you get nothing done.

For the corporations, yes. For the workers, no. Or did I miss the announcement that Walmart workers were suddenly flush with cash?

Since when was business getting controlled by government. It's the other way around.

First you say kill the unions, then you complain that there's only one. Which is it?

Bull. Misguided idiot management and penny-pinching beancounters insisting on mediocre, not to say downright crappy, product is what got the workers to the point of their jobs going under. The workers are told to put bolt A into hole B. It's not their fault that the accountants insist on shitty parts in a shitty design.

Nowhere is seeing steady business right now. People are getting laid off left and right. Union, non union, at-will, and right-to-work. Doesn't matter. What are you talking about?


And the conservative solution is to kill off the middle class, enrich only the already rich, and then expect the rest of us to be content taking the leftovers that the wealthy choose to bestow upon us. To allow corporations to rule unfettered, and to have vast and far reaching influence upon government. That's not free market either. It's a corporatocracy and it's custom-designed to increase the financial gap between the wealthy and everyone else.

conceptual and historical problems aside--i don't have the energy to go through all of them which attend conservative pseudo-theory on labor questions--and besides, shakran has outlined some of them already (i just think they're problems of a more fundamental level with the whole of conservative or neoliberal thinking)--what's obvious is that the right is looking to use this to destroy the uaw because the uaw has opposed the right politically.

nothing more, nothing less.

Agreed. I just didn't have time to go into it. . Still don't, unfortunately, but this is something that's been going on since before the USA was a country.



Not quite broad-scope enough. The UAW is in the business of ensuring that people who are not the wealthy ruling class get a piece of the pie. The conservative philosophy is completely opposed to this, because only with a large wealth gap can their purchasing power be sent to meteoric heights. Yes, it's a political opposition, but it's not like the UAW is for gay marriage and therefore must be destroyed.

The interesting thing is to see how many middle class and lower middle class conservatives are fighting tooth and nail to kill the middle class. And the even more odd thing is that the purchasing power of these people, as well as everyone else, is already being changed by their own policies. You'd think that the obvious outcome we're currently sinking into like a ship that sailed right into a whirlpool. It turns out the sirens are just old, rich, white men...

They bought the rhetoric started by Reagan and furthered by every president since, including Clinton. Give the rich everything, and they'll take care of the rest of us. If that theory were actually true, we'd be just fine.

But then if Communism worked as it should have, the USSR would be fine, too.

Economic theories almost never take into account the greedy bastard effect - namely, if you give a billionaire a million dollars, he's gonna stuff it under a mattress. He's not gonna let it trickle down out of his bank account to help the masses.

The difference between communism and our own corporatism is that communism really was conceived by a guy who thought it would be good for everyone. It just had the misfortune of getting ruined by the greedy bastards. Corporatism was conceived by the greedy bastards themselves, who then said anything they could think of to convince the masses that they were enriching them, all while they took money out of our pockets.

From massive deregulation of industries in the reagan/both bushes administrations (thereby giving lie to the absurd statement that government controls business, btw) to Clinton's signing NAFTA and GATT, it's all been a targeted plan to transfer money from your pocket to the treasure vaults of the very wealthy.

But just as it has every time in the past, the plan worked too well. Now regular people can't buy stuff from the rich guys, and so the economy is stagnating for everyone. Added to that is the fact that the lower and middle classes are finally starting to figure out that the last 3 decades worth of economic policies has lead to personal and national financial disaster. They are therefore rather pissed off about it, hence this last election.

Obama has a hell of a task ahead of him. He literally needs to be FDR 2.0. He needs to singlehandedly recreate and strengthen the middle clas, and unlike FDR, he's got a max of 8 years in which to do it. It's going to be a damn hard job. I hope he's up to it.

Are you simply blind or just that ignorant? Seriously, i'm asking the question not as an insult, but as an inquiry.

Government gets involved through "standards" the manufacturers will have to meet by certain deadlines.

Nice deflect on the "kill the unions" thing, which incidentally, I never said. You always put words in peoples text to try to win an argument on the internet or is it something new? The key here is following the money. The UAW and ...cough...it's monetary benefactors...cough... have helped run these companies into the ground. By not answering with anything other than a deflection means you either are willfully ignorant and a hypocrite, or just one of those people who argue for the sake of argument without much to back it up.


3. Not bull. First, you guys always throw that class envy shit around like it's a marx rally and Stalin is making the first speech. lol. No one on the right is destroying or wanting to destroy the middle class. (who was it that said the right consists of a bunch of fear mongers...really...with stuff like that going around? ). No one here hates the workers. Businesses exist for the people that run them to create wealth for themselves. period. No one starts a business to create jobs. Jobs are a by-product of business growth. Economics 101.

Unions were a great idea back in the 20's, when there were monopolies and such to deal with. Today, they are leeches and criminals stealing money without a gun. Since they donate a lot of money to not-right (get it?) politicians, they get to be the monopoly and can exert a whole bunch of strain on a company until you get things like having to pay workers 90% of their salary until retirement because you were cutting the fat and closing a plant and this prick didn't want to find a new job. Seriously though, who, but the insane or really honest would find a new job over taking 90% of his 56k a year for no work?

4. Sure, companies are cutting some fat because the non-pro-business side is in charge. People are slowing down, but you don't see issues like this in the southern car manufacturing states because of the right to work laws.

5. Finally... More class warfare rhetoric? Please. I will refer you to the first paragraph in part 3 regarding Economics 101. Simply because you enjoy suckling the government teet and hate the fact that capitalism works better than communism doesn't mean you're right. I know, I know...libs do what makes them feel good vs what is actually right.... hence the condition of public schools, but that's another story for another day.



I really decided to go out there on the anti-lib wing because socialism has failed everywhere it's been tried, everytime it's been tried. You folks need reminding of that from time to time.

This doesn't strike me as a productive or friendly question.
That's how I also interpreted "complete and utter nullification of union contracts". Maybe you can elaborate on how this would not kill unions?
Most experts are not blaming the unions for the failures of the auto industry. Why? You can see the sales numbers going back years. It's poor design and an unwillingness to stay modern and competitive with foreign cars. If you don't believe me, go test drive a Cavalier late today and then a Civic. You'll get it immediately.
Seriously, this isn't necessary.
Jobs, yes, but not necessarily high paying jobs. Those all center around the very, very top, and those rest upon the very low salaries and wages of the workers towards the bottom. That's Corporations 101.
You don't seem to be familiar with modern unions. Can you demonstrate that the average union is criminal? Or that they create monopolies?
What are worker incomes in the right to work states? How about injury rates? Why would an ethical free market company need to shield itself from wrongful termination suits?
This is an interesting primer on class warfare, you may want to read it:
http://www.nytimes.com/2006/11/26/bu...y/26every.html
That's not really true. If you mean 100% pure socialism, it's never been tried on a national scale. If you mean socialist (government run and funded) programs, many, many have been successful (even here in the US).

If you mean no insult, how about we sweeten the tone. Especially the sarcasm in your "quote."


What standards? MPG standards? Hell, that's easy. The Japanese have been meeting them for years. So has Europe. Why can't we? And for what it's worth, if the government does not impose standards on businesses, then they won't have any. A business's job is to maximize income and minimize expenditures. Such does not necessarily result in good things for society as a whole. We've tried the "businesses have absurd amounts of power and little to no government regulation" thing before. Mussolini was a big advocate of that. We saw where that went.


Well, without a contract, the union has no power whatsoever, and is therefore dead. So yes, you did say that.


You are wrong. If GM/Ford/Chrysler made a decent product that people actually wanted to buy, the auto industry could afford the union wage packages.

I'm about ready for you to stop deflecting from the issue in favor of personal attacks. I myself am deflecting nothing. The fact that I happen to think that you are wrong, because you are, is not a deflection. It's a refutation of your argument.



Again, bull. Prove me wrong. Every economic policy instituted since Reagan has been designed to erode labor and therefore the middle class. Trickle down economics is custom designed to give lots of money to people who already have lots of money in the theory that they will "take care" of the rest of us. 3 decades later, and it simply doesn't work. Your party's economic theories have been in play for nearly 30 years. Our debt is staggeringly high, our economy is in the toilet, our workers are getting laid off, our citizens are losing their homes, their jobs, their savings, their livelihoods, their retirements, and their future. Your way Doesn't. Work.




They are. That's why they declared war on a tactic, rather than a nation. A "war on terror" is like the "war on drugs." Neverending. Only the terror "war" is designed to keep us afraid so that we will keep electing the people who are fighting to "keep us safe." In both of the last 2 presidential elections we were told that electing a democrat would make us unsafe. How is that not fearmongering?



Correct.

Again correct. And businesses will seek to pay as little to the people doing those jobs as they possibly can. That means that, if permitted, they will go to a 3rd world country where the wages are a fraction of what they are here. And that's exactly what they have done. It still creates jobs, but employing a bunch of sweatshop workers in Asia does not put food on the tables of our workers. Also Economics 101.


Ironic that you call me willfully ignorant when you put forth false and misleading statements like that with nothing to back them up.

Yes, I get it. The right wants to kill the unions. Would you give a guy money so that he could buy a gun and shoot you?

Show me that contract. Assuming you can, tell me how that's worse than a 25 million dollar golden parachute for a CEO that's kicked out for failure to perform. Or worse yet, why Richard Wagoner still has an 8.5 million dollar a year job after piloting GM straight into the ground. and you complain about 50 grand going to workers who are laid off through no fault of their own?

Since when were Bush and Cheney non-pro-business?

Again, you seem to have forgotten who has been in charge of the public schools for the last 30 years. I find it amazing that the conservatives have run them for 3 decades, and yet you blame the liberals for their failings.



When did I advocate socialism? And by the way, no it hasn't. We are the only 1st world nation without socialized medicine. The others are doing just fine. Better than us, in fact, for while we do have the best medical care on the planet, 50 million people cannot get access to it.

And we have socialism right here, or do you drive to work on only private roads?