I’m Convincedon November 17, 2008 at 4:14 pm
General Motors has had a horrible business plan. Ford and Chrysler aren’t much better. I don’t think anyone would disagree with this.
Having said that, however, there have definitely been some really bright spots, especially in GM and Ford; the experiments with “flex fuel” and hybrid technologies are well on their way to making solid products available from American automakers. I believe that Ford and GM, especially, will continue to be viable and will reinvent themselves, if they find a way to crawl through The Bush Economic Miracle. The viability of a whole lot of suppliers also depends on the survival of American automakers. And on top of all that, people should remember that the Chrysler bailout turned out to be a pretty good deal for American taxpayers. How much does anyone think we’ll ever see as a return for bailing out AIG?
I am, reluctantly, in favor of helping American automakers through these tough times, because (1.) the commons don’t need any more gutting than they’ve already had in the Reign of Error, and (2.) if we can afford to hand out billions to billionaires for NOTHING, it makes absolutely no sense at all to argue that we should just let a big chunk of our industrial base fail. But one reason is even more important to me than the 2 I just mentioned. I am in favor of a bailout because of WHO opposes a bailout, and WHY they oppose it.
See the reasons for yourselves. I think you’ll see it my way.
Senators from southern states with factories owned by Asian and European car manufacturers oppose a bailout of U.S. automakers, saying the industry can thrive without General Motors Corp., Ford Motor Co. and Chrysler LLC.
Republican Senators Richard Shelby and Jeff Sessions of Alabama, and James DeMint of South Carolina, are among lawmakers trying to derail Democratic plans, supported by President-elect Barack Obama, to provide at least $25 billion in loans to the three U.S. companies.
“We have a very large and vibrant automobile sector in Alabama,” Sessions told Bloomberg Television on Nov. 11. “I don’t feel like this is the end of the world.”
Alabama has two assembly plants owned by Stuttgart, Germany- based Daimler AG, one operated by Tokyo-based Honda Motor Co. and one by Seoul-based Hyundai Motor Co. Munich-based Bayerische Motoren Werke AG employs about 4,500 people at a Spartanburg, South Carolina, assembly plant.
The proposal to loan automakers $25 billion from October’s $700 billion financial rescue package will be debated during a post-election lame-duck session of Congress this week.
Senate Banking Committee Chairman Christopher Dodd plans to hold a hearing tomorrow on the legislation, which he supports. House Financial Services Committee Chairman Barney Frank, who is drafting the legislation with Michigan Senator Carl Levin, plans a hearing the following day. GM Chief Executive Officer Rick Wagoner and Ford CEO Alan Mulally are scheduled to testify before the committees.
The bill will likely be a tough sell with many Republicans who, in principle, oppose government intervention in the private sector.
“Companies fail every day and others take their place,” Shelby said on CBS’s “Face the Nation” yesterday.
Bush said he opposes using money from the $700 billion fund designed to ease a global credit crisis. Instead he called on Congress Nov. 14 to use money from a previously approved proposal for auto-industry loans originally intended to aid development of more fuel-efficient vehicles.
“Taxpayers should not have to subsidize private companies that are unwilling to show they can be viable,” White House spokeswoman Dana Perino said today in an e-mailed statement. “It is clear that U.S. automakers must restructure in order to be viable.”
House Speaker Nancy Pelosi said Nov. 15 that diverting money from the earlier plan to ease a current cash crisis would be “a step backward” in promoting long-term auto-industry competitiveness. Democratic leaders want to use some of the money from the $700 billion financial-rescue package to meet automakers’ emergency needs.
The outcome may depend on action by the Senate, where Democrats’ narrow 51-49 working majority gives Republican opponents a better opportunity to block a bailout. While the party will pick up at least a half-dozen seats as a result of Nov. 4′s elections, those changes won’t take effect until January.
Senate Majority Leader Harry Reid on Nov. 14 urged his Republican counterpart Mitch McConnell of Kentucky to allow a vote. McConnell made no such promise.
“Senator Reid has not yet provided us with the text of his proposed spending bill, or the cost to the taxpayer, or its impact on the deficit,” McConnell said. “So it would be a real challenge to promise any level of support or opposition sight unseen.” Kentucky has Ford, GM and Toyota Motor Corp. assembly plants, and a Toyota engine factory.
The U.S.-based automakers are seeking a cash infusion as industrywide sales have plummeted to a 17-year low as the economy slides into a recession. GM this month said it lost $4.2 billion in the third quarter, and almost $73 billion since the end of 2004. The largest U.S. automaker said it may not have enough cash to get through the year. Ford lost $2.98 billion in the third quarter as sales fell 22 percent
Job losses would total 2.5 million from an automaker failure in 2009, including 1.4 million people in industries not directly tied to manufacturing, according to a Nov. 4 study by the Center for Automotive Research in Ann Arbor, Michigan. A collapse of General Motors would cost the government $200 billion in aid to states and extended unemployment benefits, said Nariman Behravesh, chief economist at IHS Global Insight in Lexington, Massachusetts.
While sales are also falling for Asian and European manufacturers, their financial conditions aren’t as bleak.
“We have a number of profitable automakers in America, and they shouldn’t be disadvantaged for making wise business decisions while failure is rewarded,” DeMint said. “If the Big Three can’t make it with their current structure, they can protect jobs by reorganizing under bankruptcy protection.”
Cornyn Also Opposes
Wesley Denton, a DeMint spokesman, said the senator plans to offer amendments to any bailout legislation approved by the House, which could make it more difficult to quickly get a bill to Bush’s desk. Senator John Cornyn of Texas said Nov. 14 that he also opposes the plan. Texas is home to assembly plants for GM and Toyota.
“The financial straits that the Big Three find themselves in is not the product of our current economic downturn, but instead is the legacy of the uncompetitive structure of its manufacturing and labor force,” Shelby said. The Big Three’s current crisis is “not a national problem, but their problem,” Shelby said.
There you have it. The usual wingtard “patriots” not only don’t give a damn if GM or Ford fail, they WANT them to. Why? Because UAW workers are compensated fairly and American-manufactured vehicles are competitors to the foreign-owned entities that they have in their states. They hate a living wage that much. They hate American-owned manufacturers that much. Unless, of course, the American-owned manufacturer in question keeps a slave colony in Micronesia, in which case the business owner(s) can rest assured of the support of the Klanservative wingtard assholes.
If Chimpy, Shelby, DeMint, and Cornyn oppose bailing out the American automakers, how could it possibly NOT be the thing to do? We know how often these inbred assholes get something right, don’t we?