Bail Out Automakers ... or let 'em fall?

[Gordon Nore]

Under the Auto Pact, my country has a lot invested in the fortunes of GM, Ford and Daimler-Chrysler, so a collapse of the big three would certainly ricochet in Windsor and throughout the Province and country.

That said, how much money is going to keep this ship afloat? If they're in this much trouble, would we taxpayers be throwing good money after bad? If the feds, north or south of the fortieth, have the dollars to bail out the big three, maybe those resources should be invested in other players who can do the job better. My guess is that if a bunch of plants close in Windsor or Detroit, they'll probably be re-opened by Toyota, Hyundai, Honda, Nissan, Mazda, and all the rest.

If it comes down to keeping jobs, I'll bet the UAW would sit down with these other players and come up with something that keeps auto workers building cars.

 

[Makalakumu]

Health care. Michael Moore argued that health care was one of the major reasons american auto makers were not competitive any more. With a universal single payer system the companies no longer have to shoulder such a heavy burden. This makes sense when you consider that all of the other countries in which we compete in the auto market have universal single payer systems.

Maybe the solution isn't a bailout. Maybe its universal health care.

 

[Rich Parsons]

Under the Auto Pact, my country has a lot invested in the fortunes of GM, Ford and Daimler-Chrysler, so a collapse of the big three would certainly ricochet in Windsor and throughout the Province and country.

That said, how much money is going to keep this ship afloat? If they're in this much trouble, would we taxpayers be throwing good money after bad? If the feds, north or south of the fortieth, have the dollars to bail out the big three, maybe those resources should be invested in other players who can do the job better. My guess is that if a bunch of plants close in Windsor or Detroit, they'll probably be re-opened by Toyota, Hyundai, Honda, Nissan, Mazda, and all the rest.

If it comes down to keeping jobs, I'll bet the UAW would sit down with these other players and come up with something that keeps auto workers building cars.

Oshawa #1 #2 are always in the top for North America for Quality. Oshawa #1 just got a specific award from JD Power that they limit as it requires continued performance over time. This plant was in the top three for the last six or seven years. And number one for four or five of them. Not just Quality but for performance i.e. hours to build a vehicle - man hours.


Toyota actually looked at a Plant in Flint. GM was going to lease them the land so they would not have to worry about any liability for previous issues with the land. The area was in a federal renaisance zone. GM had agreed to pay its taxes but was not required too as of this zone. But GM did anyways as their agreement had included a percentage reduction. But the City of Flint that was bankrupt insisted that GM not only pay what the agreement was, but that it would go back to 100%. Toyota, walked away.

Toyota has a proving grounds going into the Michigan area, but that is because of the expertise in the area. I see no benefit of them to come to this area including Windsor to get trained hourly employees? The wages people would demand would get them to not consider it.



As to money and how much, I cannot say as I do not know even what the company I work for requires.

In January of 2010, all the agreements that the Union agreed to in the last contract negotiations goes 100% into place. This is the target point that the companies are targeting. If the volume goes back from 10.7 million anual units (* Octobers numbers lowest in over a decade *) to the 16 to 17 million of the last couple of years there is now problem, The issue is that at 11 to 12 million units a year, is enough to limp by on.

As I can only guess, I would expect about 12 Billion +/- 3 Billion per company would be the worst case.

These are loans, not money that does not come back. Of course there is risk if they still go under. So your questions is good and imporatant.

If they follow the 79/80 Chrysler plan of getting stock options at the low prices of today plus a percentage of interest, then the government could make money just like they did off of Chrysler in the 80's with the return.

The times that the government goes in and takes over, they have lost money as they seem to be worse that the people who got them into the trouble and also other companies bring suit that it is unfair to compete against the fed. So, if they take over one, it could be a problem for others, which could lead to a complete take over. But, I do not think it is a valid plan. I think that the loans with stock options or some other plan would be the best. As history has shown, past peformance does not guarentee success. But those invested into the company and the single largest provider for health care and pensions outside of state and federal government would be gone.

As I said, I see all sides of this, but part of would like to see them all fail, and to see how the people complain, that people they know are hurt by this and loose their house and eat poorly and or have worse health care. My sens of humor is bad in this case, as I actually volunteered to be cut, but was told I was not old enough. Only early retirements were offered. But I was serious and went up a couple of levels to make the offer. The issue I do not like threats of loss of job to work more hours for less pay. So, I decided to risk finding a new job. But as a single male I can economize for myself and get by, while others with familes would be very difficult. So my comments of failure are real. But, if they do not I will continue to work until I find a better carear opportunity.

 

[Rich Parsons]

Health care. Michael Moore argued that health care was one of the major reasons american auto makers were not competitive any more. With a universal single payer system the companies no longer have to shoulder such a heavy burden. This makes sense when you consider that all of the other countries in which we compete in the auto market have universal single payer systems.

Maybe the solution isn't a bailout. Maybe its universal health care.

It is part of the problem, and not just the cost here for companies but for the country and those who do not have coverage.

But the loans would be required to get through the period until the new agreements kick in and also until the new plan you and others propose would take effect.

It is kind of like when as you graduate college and go out get a job and then get a car and an apartment and stuff for your apartment, and then all of sudden your studnet loans kick in and you need to borrow money to get through a short period. The problem is that the Banks have extended all they can to you, or worse yet like it is now the money is just not available, including from your family or parents. They want you to try it on your own. While a company that has been in business for a long period of time should know better, but they can only move as fast as the agreements with the union allow them. They have to wait a year or two when things start to get bad just to bargain.

As we have seen the market was just short of 17 million last year for vehicles in USA. Now it is on a low 11 million units. It is also looking bad for credit as the banks are all doing bad and cannot afford what they would call a high risk. Hence the idea of loans for the short term.

 

[dungeonworks]

As a UAW line grunt for nearly 14 years (3rd generation in my family), I have never in my life seen so many experts on the auto industry come out of the woodwork over the last 4 years. Too bad most of these arm-chair automotive guru's facts and rationality are really based on some media outlets propaganda or some talk radio host's barkings.

Labor is only 8-10% of the cost of a vehicle. We have been giving back benefits and foregoing/delaying/restructuring raises through concessionary contracts for over 20 years now and the company has been cutting benefits of lower and middle management for years (Including the engineering which is an essential part of putting something new and innovative to market). I won't bring up what the corp. is doing to retirees on both sides of the Union curtain. What have the upper management given up???

Raw materials and fuel which will always fluctuate. Even Toyota and Honda have lost on this front, even if better prepared to handle such a blow. None of the big three or Japanese companies seen that coming on as it hit like a tornado....there it is, here it comes, there it goes, now look at the mess. Steel and copper are through the roof too. Anyone else have people digging through their trash come pickup day? I have 3-5 regulars that comb my 'hood on trash day looking for metal. Heck, they even took two old refrigerators for free, that I was going to take to the dump and PAY to get rid of!!!! Anyone really know how much copper and steel it takes to build even a small car???

Then we have the health care quagmire. Our biggest competitors come from companies where their government foots the bill for it's citizens. In 14 years, I have seen mine go from "great" to "okay". They are a shell of what they were, and the retiree health care is darn near gone. Upper management prolly doesn't have a copay. Heck, they get their gas paid for to get to the doctor and even have corp. subsidised cars/trucks/SUV's to get there...for their wives and kids too in some cases.

How about national security??? Without a big manufacturing base during WWII, there was a possibility we'd be speaking German and wearing swastikas. Many of the auto plants were converted to weapon and military vehicle production to feed the American war machine. The plant I hired into is one of them (they made machine guns), as is the one nearly in my backyard (they made tanks). If we were ever in full scale war with China or India, do you think they'd still offer us bargain labor and battle field quality???

We cannot let them fail unless you want to fail. 3 million jobs would toast this country. GM has 54,000 UAW employees alone and is one company. To get to 3 million, that is a MEGATONZILLION of other companies falling with the mothership as well. The government would lose BILLIONS of tax dollars right away....Read: Military, police, fire, social security and lots of other over looked government functions. Do you think the governors, senators and congressmen are gonna take the hit??? Nope, it'll be you and I. How about the whole cities (See Flint, MI for just a very small preview and watch what happens to Janesville, WI next year after closing that plant) and the family businesses that will dry up and the falling values of their homes? Where are they gonna go to and where would they get a job or set up another business? Lord knows how much us Americans cry about government aid or welfare....we'd need it on a scale not seen since the great depression, only worse. Also, before you root for us to fail, please look at your pension's investments and/or your 401k to see where that money is coming from.

This problem carries much more weight than most can comprehend...especially outside the rust belt of our country.

 

[Rich Parsons]

As a UAW line grunt for nearly 14 years (3rd generation in my family), I have never in my life seen so many experts on the auto industry come out of the woodwork over the last 4 years. Too bad most of these arm-chair automotive guru's facts and rationality are really based on some media outlets propaganda or some talk radio host's barkings.

Labor is only 8-10% of the cost of a vehicle. We have been giving back benefits and foregoing/delaying/restructuring raises through concessionary contracts for over 20 years now and the company has been cutting benefits of lower and middle management for years (Including the engineering which is an essential part of putting something new and innovative to market). I won't bring up what the corp. is doing to retirees on both sides of the Union curtain. What have the upper management given up???

Raw materials and fuel which will always fluctuate. Even Toyota and Honda have lost on this front, even if better prepared to handle such a blow. None of the big three or Japanese companies seen that coming on as it hit like a tornado....there it is, here it comes, there it goes, now look at the mess. Steel and copper are through the roof too. Anyone else have people digging through their trash come pickup day? I have 3-5 regulars that comb my 'hood on trash day looking for metal. Heck, they even took two old refrigerators for free, that I was going to take to the dump and PAY to get rid of!!!! Anyone really know how much copper and steel it takes to build even a small car???

Then we have the health care quagmire. Our biggest competitors come from companies where their government foots the bill for it's citizens. In 14 years, I have seen mine go from "great" to "okay". They are a shell of what they were, and the retiree health care is darn near gone. Upper management prolly doesn't have a copay. Heck, they get their gas paid for to get to the doctor and even have corp. subsidised cars/trucks/SUV's to get there...for their wives and kids too in some cases.

How about national security??? Without a big manufacturing base during WWII, there was a possibility we'd be speaking German and wearing swastikas. Many of the auto plants were converted to weapon and military vehicle production to feed the American war machine. The plant I hired into is one of them (they made machine guns), as is the one nearly in my backyard (they made tanks). If we were ever in full scale war with China or India, do you think they'd still offer us bargain labor and battle field quality???

We cannot let them fail unless you want to fail. 3 million jobs would toast this country. GM has 54,000 UAW employees alone and is one company. To get to 3 million, that is a MEGATONZILLION of other companies falling with the mothership as well. The government would lose BILLIONS of tax dollars right away....Read: Military, police, fire, social security and lots of other over looked government functions. Do you think the governors, senators and congressmen are gonna take the hit??? Nope, it'll be you and I. How about the whole cities (See Flint, MI for just a very small preview and watch what happens to Janesville, WI next year after closing that plant) and the family businesses that will dry up and the falling values of their homes? Where are they gonna go to and where would they get a job or set up another business? Lord knows how much us Americans cry about government aid or welfare....we'd need it on a scale not seen since the great depression, only worse. Also, before you root for us to fail, please look at your pension's investments and/or your 401k to see where that money is coming from.

This problem carries much more weight than most can comprehend...especially outside the rust belt of our country.

Very Valid points.

In my case, I know my parents might be able to survive of take enough of a loss on their house to get out of it. I know I would have to have tehm move in with me or I move in with them to assist.

As to the cascade effect, if GM falls then so does Delphi. The small businesses in the areas where offices and plants are will loss business and most likely have to shut down. This means they need buyers for their homes and their businesses. But, it might be a spiral that this country and most likely lots of areas will be minimum effected, might not get out of.

But, as I said, I am feeling dark and the humor of all the people who want a buy out for their home becuase they spent too much, but with an industry that takes a fast to market of 3 years and they need to react within less than a month to changes such as cost or the lack of buyers or the lack of credit.

 

[Gordon Nore]

...Labor is only 8-10% of the cost of a vehicle. We have been giving back benefits and foregoing/delaying/restructuring raises through concessionary contracts for over 20 years now and the company has been cutting benefits of lower and middle management for years (Including the engineering which is an essential part of putting something new and innovative to market). I won't bring up what the corp. is doing to retirees on both sides of the Union curtain. What have the upper management given up???...

dungeonworks,
Thank you for this and other insights provided in your post. I've always been suspicious of the notion that competitiveness depends upon a lowering of labour standards. You mentioned cuts to engineering, and thus innovation. My sense has been for many years, major US/Canadian car builders have done a better job at meeting the needs of large car buyers but have routinely given away the small car business to imports.

Am I wrong in that respect?

 

[Bob Hubbard]

Manufacture in the US is a dying industry. While I'm against bailing out -any- industry due to incompetence at the top, if we are unable to make our own weapons, maintain our own infastructure, this nation will fail.

My first thought is to let GM and Ford burn. But for our own national defense, they need to be rescued. I say however, don't give them a blank check. Put serious restrictions and conditions on it to force them to fix the problems, not just continue business as usual. I say that for any industry or company being bailed out.

 

[MA-Caver]

Manufacture in the US is a dying industry. While I'm against bailing out -any- industry due to incompetence at the top, if we are unable to make our own weapons, maintain our own infastructure, this nation will fail.

My first thought is to let GM and Ford burn. But for our own national defense, they need to be rescued. I say however, don't give them a blank check. Put serious restrictions and conditions on it to force them to fix the problems, not just continue business as usual. I say that for any industry or company being bailed out.

Agreed... bailing them out would be just like lottery winners... they go broke in an average of 5 years or at least back to where they were before their numbers came in...

But having restrictions, conditions and all that is well and good... but how MANY politicians are in their back pockets? How many would actually follow through... if they don't... how do we punish them? Slap on the wrist with a ruler? Charge them high interests, by making the bail out money into loans? Take over the company?
Money is power and the CEO's have money, lots of it and lots of power.
What about if they do all of the above, prevent mistakes from happening... what about other industries?

IS it really the U.S. Government and taxpayers responsibility to bail these people out?? It's almost like a millionaire bailing their kid out of jail for reckless driving... whats to stop them from doing it again? Honestly?
Agreed that we need their capability to produce but ... I dunno.

How many other companies and industries will stick their hands out, or more actually, nudge their favorite (paid-for) senators/legislators/representatives in the ribs whispering ... hey... don't forget about us, we want some of that ... we put you behind that desk remember??

 

[dungeonworks]

I agree with all of you in regards to changes are necessary in a bailout, especially at the top. Maybe I am a bit blinded at a few things and I am admittedly infantile/ignorant when it comes to business on the scale of global manufacturing since I am a 3rd generation UAW line worker. I, as were my parents, have been raised under the UAW benefit umbrella. I have a grandfather that was part of the origin of the UAW during the Sit Down Strike. I would also go as far as saying that not all of my UAW brothers and sisters have upheld and represented the initial goals and aims on our end and still to this day see some, although FAR LESS abuse of work/shop rules in the pursuit of laziness or getting away with the most possible loop holes some contractual issues afford us. I think a lot of that was addressed and rectified in our last contract, which I supported as a member (I hold no more/less power than any status quo member and hold no position other than being an active member). As Mr. Parsons mentioned, those changes will not affect the bottom line until later in 2009. Why am I saying all this? No more reason than to give everyone an idea of where I am, and maybe why I see things the way I do.

Over the last 13.6 years, I have had the honor or working with some industrial engineers on special projects such as the launch of the GMT 900 truck platform. It was awesome not only because I got to be part of the process that governed how we were going to build the GMC Sierra's and Chevy Silverado's you now see on dealership lots. I learned a lot working with the engineers in a limited capacity doing things such as trials of new tooling and signing off on tooling designed and produced at outside suppliers as well as casual conversations over lunch here and there. It was an eye opener and really cool to catch a glimpse of how they aproach things. If you ask me, we need more of them, not less if the auto industry is to regain lost footing in our industry through innovation and quality improvements. I'd rather see the guys up top take the hit for ignoring the small car segments under the arrogant belief that people (consumers) would forever be able to drive gas guzzling SUV's and pickup's for everyday transportation. While we slept, the foreign auto makers killed us both in quality and answering the call to what consumers want faster.

That brings me to another thing the foreign companies beat us at...quality. I can tell you first hand that our quality is very near or better than theirs in many cases. When I first hired in, line supervisors were under soooo much crushing pressure to get hard numbers down the line, they would okay the shipment of issues needing repair, assuming an inspector would see it and send it to our repair techs. Now, if a torque is off or missed, the line shuts down via computer and that starts a whole paper trail for accountability reasons. I wanna say this all really kicked into gear around 1999/2000. Operators are certified thoroughly on job assignments and accountability due to the compromise on work rules, sleeker job proccesses due to competent engineering of such jobs, make it easier and faster to produce such quality. The cutting of experienced American engineers only to replace them with outside companies in places such as India is a step...make that a leap backwards. Not to say India or China doesn't have good engineers, but as a worker that is sole support of a family of 5, I would rather have these guys here in town at our tech centers, and on our shop floors making crucial calls to design and improvement...and I harbor the same feelings toward my fellow assemblers still lucky enough to be working in the shop. The 3 million job loss cascade I mentioned was just in the USA alone. There will be ramifications in Mexico, China, India, and maybe some in Pakistan too, not just here.

On a side note, I also understand why some far from the rust belt are anti union too and may see us as the reason for all the negative impact. The news has for a long time focused on us as the root of the problem. Some of it may be and I will openly admit that, but from what I can see, it is more the leaves at the very top of the tree and the decisions they did and did not make that contributed far more than we have to the collapse. I feel the same thing for the financial and insurance industry too. I could have gotten a $200k+ house but KNEW I could not afford such a thing, which explains my home I have, at about 2/3's the price....and today, 1/2 the value! :barf:

 

[MA-Caver]

That brings me to another thing the foreign companies beat us at...quality. I can tell you first hand that our quality is very near or better than theirs in many cases. When I first hired in, line supervisors were under soooo much crushing pressure to get hard numbers down the line, they would okay the shipment of issues needing repair, assuming an inspector would see it and send it to our repair techs. Now, if a torque is off or missed, the line shuts down via computer and that starts a whole paper trail for accountability reasons. I wanna say this all really kicked into gear around 1999/2000. Operators are certified thoroughly on job assignments and accountability due to the compromise on work rules, sleeker job proccesses due to competent engineering of such jobs, make it easier and faster to produce such quality. The cutting of experienced American engineers only to replace them with outside companies in places such as India is a step...make that a leap backwards. Not to say India or China doesn't have good engineers, but as a worker that is sole support of a family of 5, I would rather have these guys here in town at our tech centers, and on our shop floors making crucial calls to design and improvement...and I harbor the same feelings toward my fellow assemblers still lucky enough to be working in the shop. The 3 million job loss cascade I mentioned was just in the USA alone. There will be ramifications in Mexico, China, India, and maybe some in Pakistan too, not just here.

It is true that American car quality slacked off for a while (remember those stupid K cars??) and everyone was buying foreign because they had a solid reputation, (I know of several 400,000 mile --small -- toyota/datsun trucks owned by friends) but American quality has improved and that is a good thing... it makes Americans buy American and that helps the economy.
True the loss of 3 million jobs would be quite an impact upon the nation, no question... but I believe that perhaps it's a cycle where one company peaks and then another one rises and takes the top spot and so on. Maybe that's too simplistic but it looks that way.
What would be the effect if just ONE auto maker fails? Could the country take such a hit? I like to think so.

 

[Gordon Nore]

 

[crushing]

In the global economy with the global recession, Euro automakers are asking for a $55 billion bailout from the European commission.

On Meet the Press this morning a source that I don't recall was cited saying that first year of a GM bankruptcy would cost taxpayers $175 billion and the whole bankruptcy process could take three years.

 

[Rich Parsons]

In the global economy with the global recession, Euro automakers are asking for a $55 billion bailout from the European commission.

On Meet the Press this morning a source that I don't recall was cited saying that first year of a GM bankruptcy would cost taxpayers $175 billion and the whole bankruptcy process could take three years.

Pay now (* Yes changes *) or pay later.

That is the question. Also why my wierd comments and perception on this.

 

[MA-Caver]

Whell, if we're going to bail out the Automakers we might as well shell over some billions to THESE guys too! Or are they the ones to blame??

Experts: Supplier woes put auto industry in danger

By BREE FOWLER, AP Auto Writer Bree Fowler, Ap Auto Writer – Sun Nov 16, 4:21 pm ET
NEW YORK – The financial woes of U.S. automakers have grabbed Washington's attention, but similar problems at auto suppliers have the potential to set off a cataclysmic chain of events in the industry if key parts makers run out of cash and fail.
As with the automakers, auto suppliers' sales have tumbled this year because of the steep drop in demand for new vehicles.
That has forced suppliers to burn through their cash reserves and slash their costs to stay in business, said Craig Fitzgerald, an automotive analyst with Southfield, Mich.-based Plante & Moran PLLP, which advises about 400 small and midsize auto suppliers.
Meanwhile, banks and other credit providers have become dead-set against lending to any company in the faltering automotive industry, making it difficult and expensive for suppliers to get needed financing.
But if the companies at the bottom of the supply chain don't find a way to recapitalize, Fitzgerald warned, numerous bankruptcies and liquidations among the small companies will set off a string of parts shortages that could reach all the way to the vehicle assembly line.
more: http://news.yahoo.com/s/ap/20081116/ap_on_bi_ge/meltdown_auto_suppliers

 

[Makalakumu]

Whell, if we're going to bail out the Automakers we might as well shell over some billions to THESE guys too! Or are they the ones to blame??

In a society based on consumption, if the consumer can't consume, then you've got real trouble. This problem is bigger then GM. We can't keep asking the government to pick up the tab for consumers who aren't spending money. That is what these bailouts are amounting to.

 

[MA-Caver]

And just how much does the Dept. of Energy have to bail out the industry?
At least the Bush administration knows where all the money might be laying about. Not touching the (our) 700 billion earmarked for the banks and instead drawing upon another source.

White House refines position on auto industry help


http://news.yahoo.com/s/ap/20081117...ess_returns;_ylt=AtS66LuELhIh2DDis3Q3K0DGOrgF
By STEPHEN OHLEMACHER, Associated Press Writer Stephen Ohlemacher, Associated Press Writer – 58 mins agoWASHINGTON – The Bush White House stressed Monday that it supports help for the struggling auto industry, but believes it should not be taken from the $700 billion financial system rescue program.
As lawmakers were returning to a lame duck session to focus on the troubled industry, President Bush's chief spokeswoman issued a statement saying the administration "does not want U.S. automakers to fail." Press secretary Dana Perino complained that reporting on the White House's statements on this issue has involved "attempts to shorthand the administration's position."
Perino's early morning statement also made clear, however, that the administration steadfastly opposes drawing funds from the bailout plan to help Detroit. She said the $25 billion that Democrats favor taking from the rescue plan should come, instead, from a Department of Energy program previously approved to develop fuel-efficient vehicles.

I was beginning to wonder about this too...
from same article

On Sunday top Republican senators said using any of the Wall Street bailout money to help carmakers would be a mistake. Sen. Richard Shelby of Alabama called the U.S. auto industry a "dinosaur" whose demise would simply be stalled by a bailout.

"I don't believe the $25 billion they're talking about will make them survive," said Shelby, the senior Republican on the Senate Banking, Housing and Urban Affairs Committee. "It's just postponing the inevitable."

Add on:

Americans uneasy over bailout for automakers
http://news.yahoo.com/s/nm/20081117/us_nm/us_autos_bailout_opinions
By Matthew Bigg Matthew Bigg – Mon Nov 17, 4:31 am ET
ATLANTA (Reuters) – As Congress debates legislation to help struggling automakers on Monday, many Americans said they were uneasy with the plan, arguing that while it may save jobs, it would reward companies for pursuing bad business practices.
In interviews from New York to Los Angeles, everyday Americans said the proposed $25 billion rescue plan was unfair and said it would make it harder to reform U.S. automakers.
"They need to restructure. If they get bailed out they are not going to do it," said Eric Smith, a paint contractor interviewed in Chamblee, Georgia, on the outskirts of Atlanta.
Democrats crafted the plan to help General Motors Corp, Ford Motor Co and Chrysler LLC, and hope to pass it during a post-election session of Congress starting on Monday.
The three companies, whose gas-guzzling vehicles have been losing market share to Japanese rivals for years, are lobbying for the money to help them restructure and survive the economic downturn.
The stakes rose on Friday, when Goldman Sachs suspended its rating on GM and said the automaker needs at least $22 billion in aid. Goldman also said it would be difficult for Chrysler to survive without help.
All three companies said Chapter 11 bankruptcy restructuring was not an option.

same article:

DOUBTS
In Los Angeles, which hosts the Los Angeles Auto Show this week, many people said they doubted a bailout was the best course of action. Some said it might be better for the companies to go bankrupt. Others said the industry could not survive long-term and that the bailout would be throwing good money after bad.
"I'm not sure they (the automakers) can be salvaged. Part of me says that if Honda and Toyota can make better cars in the U.S. with American workers, so be it," said Tom Reiter, who was interviewed in Los Angeles and drives a 2001 Jaguar XJ he said was a "big gas guzzler."

 

[BrandonLucas]

Ok, so, this is how I see it, and correct me if I'm wrong, since my view on this is rather simplistic and I have no numbers to back anything up with:

It seems to me that since the initial bailout for 700 billion bucks was passed, that now other companies are gonig to start coming forward and asking for gov't assistance as well. It's the Big 3 right now...who's next to ask for assistance? Maybe some broadcasting network will come out and say that the sponsors aren't paying the bills anymore, and they need to have a multi-million dollar bailout to continue to broadcast...and that it's important to the economy because America needs to receive broadcasts from this company to keep up to date in the news....and bla bla bla.

Is our economy in that bad of shape that we can't afford to let companies that fail go bankrupt? I guess I just don't understand the way these things work....

And why isn't filing chapter 11 an option for any of the 3 companies?? Don't get that either....

 

[MA-Caver]

Ok, so, this is how I see it, and correct me if I'm wrong, since my view on this is rather simplistic and I have no numbers to back anything up with:

It seems to me that since the initial bailout for 700 billion bucks was passed, that now other companies are gonig to start coming forward and asking for gov't assistance as well. It's the Big 3 right now...who's next to ask for assistance? Maybe some broadcasting network will come out and say that the sponsors aren't paying the bills anymore, and they need to have a multi-million dollar bailout to continue to broadcast...and that it's important to the economy because America needs to receive broadcasts from this company to keep up to date in the news....and bla bla bla.

Is our economy in that bad of shape that we can't afford to let companies that fail go bankrupt? I guess I just don't understand the way these things work....

And why isn't filing chapter 11 an option for any of the 3 companies?? Don't get that either....

During the great depression hundreds of companies went bankrupt, banks out of business or simply couldn't DO business because of no money.... America survived.

 

[BrandonLucas]

During the great depression hundreds of companies went bankrupt, banks out of business or simply couldn't DO business because of no money.... America survived.

Well, I can understand trying to avoid the depression...but is the answer really in the government's pockets? Our tax money can't bail out everyone...