And what do you do in 2010 when they come begging for more money?
And what do you do in 2013, when they come begging for more?
I’d like honest answers to these questions, because you’re going to need answers, because it’ll happen.
A lot of suppliers and small business will suffer? Well, how do you think other suppliers and small businesses will do when you take $25 billion in tax money from them to give it to the rich people who run GM? What about the suppliers and small businesses who serve Honda and Nissan and Hyundai at their US plants, who now will be at a disadvantage becauyse the government is taking money from them and giving it to Ford, GM, and Chrysler? What about the ordinary taxpayer, who’s going to have to fork out the money to give to Richard Wagoner so he can fly around in his private jet?
And what are you going to do in two or three years when they ask for another $25 billion?
Actually you say it will happen. Don’t confuse that with fact. Your opinion is just that. They have been around a long time. A lot of their problems are due to the financial troubles which they did not cause. If you can not get credit due to the toughened up credit ,you would have trouble buying a car. Giving them money will result in keeping people employed and businesses open. That would be good. Giving many multiples of that to financial companies that actually caused the mess is stupid. But we did.
Twenty-five billion dollars is pocket change, and your timeline is way off. I heard an analyst say that these companies are presently bleeding $25 billion per quarter. This tells me that the $25 billion they are now asking for is for management salaries and golden parachutes.
These companies need to declare bankruptcy and then set about restructuring, starting with CEO salaries, plant efficiencies and quality control. The government was complicit in the banking/financial collapse, and they needed to try to help fix it. The auto industry failures are due to years of bad corporate management; the fault and subsequent recovery rests solely upon their own shoulders, and NOT on the taxpayers.
You know, this is where the Unions loose support of those of use who aren’t union.
Years ago I was a non union white collar worker in a union company. And I happened to be “management” - as in I had some supervisory responsibilities. I was salaried. I was making $30k a year. And I had some union guy go off on me about “management” and how “we were bleeding the company dry” and “didn’t understand the needs of the workers.” He was making twice what I was making, before overtime, which he got paid for and I didn’t. His health care benefits were better than mine. He still got a pension, I didn’t - mine was a 401k.
Executive compensation is something that needs to be fixed in our society - I dislike the $30M payday as much as the next worker/shareholder/consumer. But unions do themselves no good lumping all non-union workers and non-executive management when they complain about “management.”
Learn something from the pro-life movement - define you terms in such a way that people don’t react negatively to - and you’ll find a lot more support.
As others have said - incompetence and arrogance shouldn’t be rewarded. And asking for $25 billion without have a firm plan, even if we’re talking a two-to-three thousand word outline of a plan, demonstrates either incompetence, or arrogance. (Personally, I vote: both, in vast quantities.)
The financial companies which got many billions are laying off workers. They are still not loaning. Their stock has dropped by well over 50 %. They have given us nothing for hundreds of billions. That was a waste. The thieves that really caused the crash got even richer as the stock holders went broke. Their actions hurt every business in the country except foreclosure specialists. I was against them getting the money. I could not see it helping the economy.
I can see the big 3 helping the economy if they are helped. Whining about them not bringing their knee pads is counterproductive.
I assume Ford is in a healthier position due to Ford Europe being pretty successful, or are they more or less different companies nowadays? What of the GM subsidiaries like Vauxhall/Opel?
I’m not a union member. I’m management of my own corporation. Nothing is more worthless than a middle manager. They produce paperwork, and nothing else. If we fired all the middle managers at the big three and gave their titles to their administrative assistants the job would get done better, quicker for a fraction of the pay. See, I can do stupid opinions too.
Whatever profits the European divisions have, are absorbed by the mothership back in the States. The head of Opel recently met with Merckel (she of the unwanted shoulder massage) trying to get a few billion from the German government. Merckel said she’d consider it if she could be assured that the money would not be going back to the US operations. There’s a German company which is trying to buy Opel from GM, no word if GM’s willing to sell.
You keep going back to this excuse. It’s irrelevant. If that money was wasted, it doesn’t make money given to the Big Three LESS wasted. If anything, you should be learning from experience.
This is absurd; you’re now blaming the fiscal crisis? Then why isn’t Toyota going out of business? Why is Hyundai not begging Congress for billions to stay afloat?
They’re dying, unproductive businesses. Yes, some people will lose their jobs - not as many as you would have us believe, but quite a few. But that’s the way the world works. Propping up these useless dinosaurs for another three years, putting off their bankruptcy, will cost MORE unemployment, not less.
I certainly don’t feel that Big 3 management types deserve much above minimum wage based on their recent record. But even the silly amounts they pull down are a drop in the bucket in the big picture. Top management numbers in the dozens; employees in the tens to hundreds of thousands. You could cut top management salaries to $1/week and it wouldn’t turn GM around.
Your cite notes that the big disparity comes when those UAW workers retire - as all will (or hope to). But it matters little whether current or former workers are getting the money if the amount per month can’t be borne.
Of the many problems that management has caused, none looms larger than agreeing to union contracts that can’t be supported.
In fairness, Hyundai doesn’t just build cars; it has huge civil engineering, electronics, defense contracting and financial arms too, so when its auto business is in trouble, the other bits keep it healthy.
Remember, the (then) other Korean auto giants, Daewoo and Kia, went bust in 2000 and their assets were sold off to GM/Fiat and Hyundai, respectively, after the South Korean government bailed them out a few times.
Toyota is a well-run company, but it wasn’t too long ago that it was in serious trouble thanks to the downturn in the Japanese economy and the Asiawide recessions of the late 90s and early 00s. However, it always had its global reach to fall back on; even if it loses a bunch selling city cars in Japan, it will almost certainly make it all back selling pickup trucks in the Middle East and North Africa, or minivans in the US, or family hatchbacks in Europe, etc.
The basis of GM’s problem is essentially that it has all its eggs in one basket- the US auto market. It owns plenty of overseas assets (and used to own lots more), but their annal revenues are a drop in the bucket compared to GM’s losses (and, once upon a time, profits) on its US operation.
So Toyota diversified to protect itself, and GM didn’t. Good for Toyota; they’ll survive.
GM might not. Boo hoo. Why do they deserve MY money?
The North American market is not going to buy 55% fewer cars if one or all of the Big 3 go bust; they’ll buy other kidns of cars. Or, likelier than not, their product lines will be bought by the other makers.
I’m not even certain about that. Their products aren’t really very good, generally. I’m fairly certain that other manufacturers remember well what happened to the companies that bought up the carcasses of the UK’s once-great motor industry, which was brought down by most of the same stuff which is slowly killing Detroit - mismanagement, shitty products and unions with too much influence.
Toyota diversified to increase its market share, not to protect itself. The Big Three never had to do that because the US auto market is so big. Japan’s market isn’t so big, so if you want to sell more cars you need to sell them elsewhere.
Don’t get me wrong; I’m not saying we should bail out Detroit. However, I don’t really see what we’re going to replace them with, with every other US manufacturing sector shrinking already.
GM, Ford, and Chrysler have all been diversified in the past, and GM, at least, still has some diversification. At one time, GM owned Frigidaire, Packard Electronics, Hughes Electronics, EDS (that’s how they got Ross Perot on the board, his comments about how fucked up GM was are hysterical), and dozens of other companies. Most of these were ditched years ago. In many cases GM fucked the companies over and ran them nearly into the ground before dumping them. Chrysler owned defense contractors, and made marine engines. They were forced to spin off some of the defense businesses as a condition of the bailout in the 1970s, and then dump the rest when they were bought by Daimler. Ford sold farm tractors for decades, aircraft, and no doubt other things as well. Even the independents like Studebaker, Packard, AMC, Crosley, and Tucker had their fingers in a variety of operations.
This is the crux of the issue. Even if you say that we should train the workers for jobs in other fields which pay the same or better than what they’re making now, you’ve got the issue of paying for the retraining, and keeping them employed while they’re going through the training.
It matters when you are trying to allocate blame. The decisions made on behalf of the corporation are made by management and they bear sole responsibility for those decisions. The consequences don’t fall on management (at least not upper management) because they have granted themselves such huge compensation packages that they never have to work for the rest of their lives starting the day that they stop working. If the US had national health care these companies would be quite competitive with their foreign competition. That cost is enormous.
