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At 11/16/08 06:54 PM, Al6200 wrote: This is what I think we should do:

1. Have the US government buy a majority stake in all of the failing US automakers.

2. Create a US Department of Industrial and Commercial Planning..

you forgot;

3. Consign a government agency to make even stonger patriotic "Big-car is gawd-damn American" propaganda.

..I'm almost ready to break out in nationalistic song, comrade. Salut!

If, we let GM go under and 3% of Michigans population becomes unemployed all at once what would that do to the rest of the state, even if it is just Chapter 11 there will still be massive firings and Chapter 11 is no guarantee that the company will get out of the red.

When I look at that and then see that Michigan's fishing industry could also be in jeapordy (Associated Press) I'm left wondering whether this is just a perfect storm aimed at destabilizing Michigan entirely. It looks to be worse than PA loosing it's steel mills.

At 11/16/08 06:17 PM, Garthredbunlove wrote:

At 11/16/08 12:55 AM, JMHX wrote:

So explain to me again how not bailing them out is smart. It seems like we're damned if we do, and we're damned if we don't, but at least if we do there is a chance it will get paid back.

I would be happy to in two words: Chapter 11. Chapter 11 allows for GM to fix the problems that currently hold it down without involving government money and without involving the collapse of the company. Sure it will be painful - reform of a failed company always is - but it will certainly be a lot less painful than involving the Federal Government at a time when the Fed certainly doesn't have the money available.

Now if one of my ideas is followed - breaking down the Big 3 into the Medium 16 - the new companies would be able to absorb most of the employees affected by the fall of the Big 3.

If you're so confident in your idea, why don't you offer to buy one of the 16? In fact, why hasn't this already been done?

The same question can be asked of Sovereign Wealth Funds: If they're obviously questionable, why hasn't anything been done to regulate them? The answer is simple: Sometimes the solution has to wait until the problem has fully matured itself, where the cost of leaving the problem unsolved is greater than solving it. Just because something isn't done at the immediate moment of efficacy doesn't mean it's not the best solution.

GM is the backbone of American industry? If that's the case, we're in deep trouble,

The stock market IS down 40%.

Down 35% for the past year to date. But the DJIA is more than GM.

Not to mention, GM can be given loans. I don't see banks getting loans, they're getting bailouts. There is no logic to bailing out banks, while leaving GM to die, when GM creates far more jobs.

Regardless, what does this have to do with the fact that GM can be given loans?

GM can be given loans, and I am glad you agree with me on this - private loans, from private companies. Not government grants of $50 billion. In fact, Chapter 11 protection will allow GM to do just this by soliciting capital from private companies as they retool their uncompetitive company.

At 11/16/08 06:54 PM, Al6200 wrote: This is what I think we should do:

1. Have the US government buy a majority stake in all of the failing US automakers.

If US Government control of its own agencies is any evidence, the auto makers will fail even faster.

2. Create a US Department of Industrial and Commercial Planning (we should do this whether or not we bail out GM), and have them appoint a group to oversee GM. The government should then either decide to eliminate the plants and companies that will never turn a profit, and pump money into the areas that have real potential.

Centrally planned economies have been proven failures for at least thirty years now. Just look at what the government managed to bungle when it was in charge of setting airline rates and routes: Expensive flight, limited options, and an overall burdensome experience for the consumer. Deregulation of the airline industry in the late 1970s resulted in a dramatic decline in airline ticket prices and a huge expansion in routes available. If anything, government tends to limit the ability of companies to quickly adapt.

3. Break up the United Auto Workers Union, so that each company has its own union. Unions are important because they give workers a say in how the company is run, but giving the union a monopoly on labor in an entire industry is incredibly destructive, because it means that there is no counterbalance to their power.

No disagreement on breaking up unions to reflect their decreasing share of power.

At 11/16/08 10:08 PM, JMHX wrote: GM can be given loans, and I am glad you agree with me on this - private loans, from private companies. Not government grants of $50 billion. In fact, Chapter 11 protection will allow GM to do just this by soliciting capital from private companies as they retool their uncompetitive company.

What makes you think bankruptcy will solve the problem?

At 11/16/08 11:05 PM, Garthredbunlove wrote:

At 11/16/08 10:08 PM, JMHX wrote:

What makes you think bankruptcy will solve the problem?

What makes you think a bailout will solve the problem, when previous bailouts have proven ineffective?

At 11/16/08 09:35 PM, Brian wrote: If, we let GM go under and 3% of Michigans population becomes unemployed all at once what would that do to the rest of the state, even if it is just Chapter 11 there will still be massive firings and Chapter 11 is no guarantee that the company will get out of the red.

Not a damn thing that isn't already being done, and hasn't been done for the past 20 years.
Flint is a former shell of what it once was, and that didn't happen overnight. This has been a long time coming.

And the Michigan economy is already so beyond fucked it's ridiculous. We had two big industries: Cars, and tourism.

High gas pretty much drove the wooden stake into both at once.
(The one advantage was upscale golf courses up north were quite cheap and empty the past year or so......)

When I look at that and then see that Michigan's fishing industry could also be in jeapordy (Associated Press) I'm left wondering whether this is just a perfect storm aimed at destabilizing Michigan entirely. It looks to be worse than PA loosing it's steel mills.

Good GOD! Not our fishing industry!!!

Wakeup call:
Michigan is beyond destabilized. What's left of the auto industry is moving to Mexico in bits and pieces, the gas has turned our tourism into pure crap, and everyone under 30 seeing this is making the Exodus en masse to places like California.

And I'm not exagerating number wise; I think the last report I heard said something like 46% of college grads leave Michigan.

Guess who will be becoming a statistic next year?
(I'm gettin my degree and gettin the FUCK outta Dodge.......cheap pun.....)

At 11/16/08 07:18 PM, Garthredbunlove wrote: You're right, my logic would make no sense, IF the company never turned a profit again. But they will if given the chance.

I just want to respond to this statement real fast because man, how the FUCK can you possibly know that? What's that based on? If the company is failing so badly they're gonna get government cash in the form of like when your friends, or your parents hand you a present or cash for Christmas how are they gonna turn a profit? It doesn't address the WHY of them getting into this situation in the first place.

I also don't see how it gives them the impetus to fix the problem. That's been my biggest problem with the idea of "let's hand out money and not have any restriction on getting it paid back directly. Let's just assume they'll do the right things with it to fix the problem" just on the face of it the idea seems ludicrous to me. Unless there's oversight, unless these guys get this gift with a bunch of strings attached (and other bailouts have suggested they won't) what stops us from coming right back here when the money runs out? Businesses fail, that's what happens in capitalist countries, and people go unemployed. Those people will be able to turn that situation around and get new jobs, and most likely get unemployment in the meantime. They won't immediately be out on the streets. I think we just need to let GM go bankrupt, be absorbed or the bones picked by other competitors (that's the beauty of something like say Chapter 7, you run your company into the ground, your competitors get to pick up anything valuable and run with it) and those people who get screwed in the process will pick up work elsewhere.

At 11/16/08 09:35 PM, Brian wrote: If, we let GM go under and 3% of Michigans population becomes unemployed all at once what would that do to the rest of the state, even if it is just Chapter 11 there will still be massive firings and Chapter 11 is no guarantee that the company will get out of the red.

No, but it gives 'em a damn good shot if they do the right things with it. K-Mart used chapter 11 to help stay in business, and an even BETTER story of success after Chapter 11 is Marvel Entertainment, as they went from being basically about ready for the corporate boneyard due to horrible mismanagement to now an undisputed power in the entertainment industry. Not the same kind of company, nope, but both examples (especially Marvel) speak to the power of using the existing legal avenues to re-organize, change management and come back without somebody needing to give them a hand out to do it.

When I look at that and then see that Michigan's fishing industry could also be in jeapordy (Associated Press) I'm left wondering whether this is just a perfect storm aimed at destabilizing Michigan entirely. It looks to be worse than PA loosing it's steel mills.

It could be, but the state will recover. Hey, my home state is awash in corruption, mismanagement, and debt. Should we get a bail out because of bad government we keep electing? Do you think if we go bankrupt (and that is possible if we continue on the road we're on) we won't be able to pull out? I believe in the power of American, and moreover human ingenuity and spirit when faced with a crisis. When the world knocks you down, you smarten up, get mad, and you fight right the hell on back and you win.

At 11/16/08 07:18 PM, Garthredbunlove wrote: You're right, my logic would make no sense, IF the company never turned a profit again. But they will if given the chance.

Oh Christ, I missed this one.....

Ok, short answer no.

Long answer Noooooooooooooooooooooooooooooooooooooo.
........and never say that again, or burn in my almighty contempt.

The State of Michigan, eg the taxpayers therein, have been handing out freebies to GM for decades. They've had 3 strikes, in fact they've had 20. They're OUT already!

Part of the problem we have is based on the fact they've been getting "indulgences" from the state government.

They've had their chance, and if I find out you're working for GM I'm gonna shove my shoe up your ass and then outperform your car with my Honda so it really sinks in.

At 11/16/08 11:22 PM, JMHX wrote:

At 11/16/08 11:05 PM, Garthredbunlove wrote:

At 11/16/08 10:08 PM, JMHX wrote:

What makes you think bankruptcy will solve the problem?

What makes you think a bailout will solve the problem, when previous bailouts have proven ineffective?

Ha! I knew you were all words.

Part of the problem we have is based on the fact they've been getting "indulgences" from the state government.

Lol, am I working for GM? No. I just live here. I'd say the major problems are: the governor, the bad rap GM cars get, the former problem of gas prices, pensions and unions, and the fact that nobody is loaning money now when they need it.

GM cars aren't bad. Their business strategy is sound. They need better management and a good advertising campaign.

Perhaps bankruptcy would solve the problem of pension funds and costly union workers. I some how don't see that solving the problem, and, not to mention, the topic of this thread was not whether or not GM would go under, but whether or not GM should get money. I think bankruptcy would be a good move for GM (if they had any type of leadership), but I still don't think it would save the government any money. Who do you think will pay those pensions? Who do you think will pay for the moronic people over 50 who've made a union wage with out saving? Not to mention that people are sure to go unemployed for at least a little while.

So I stand by my initial statement: this is the wrong time for it, and loans could save more money for the federal government.

At 11/18/08 01:43 AM, Garthredbunlove wrote: So I stand by my initial statement: this is the wrong time for it, and loans could save more money for the federal government.

Last I checked, bailouts aren't loans. It's basically gifting the recipient with taxpayer funds in the hope that the cash infusion turns their business around and they don't have to pay it back.

So if your saying you'd prefer them to get a government loan, well, then you're actually not in favor of a bailout and you've actually been arguing in favor of something you don't believe in.

At 11/18/08 02:57 AM, aviewaskewed wrote:

Last I checked, bailouts aren't loans. It's basically gifting the recipient with taxpayer funds in the hope that the cash infusion turns their business around and they don't have to pay it back.

A bailout is a loan that the the debtor doesn't think will get paid back.

If this wasn't a bailout than anyone could have provided the loan: stockholders, or Chinese/Arabian companies.

At 11/18/08 07:46 AM, Al6200 wrote: A bailout is a loan that the the debtor doesn't think will get paid back.

Still a bad idea from where I sit. Throwing out money you don't expect to ever see again don't make good sense to me.

If this wasn't a bailout than anyone could have provided the loan: stockholders, or Chinese/Arabian companies.

Well then maybe they should. Or again, let 'em go bankrupt. It's gonna be pretty hard for these guys to have thier way if the opening round of coverage on this is accurate.

I don't think anyone deserves a bailout... It's against the very laws of nature. If a company is on the brink of collapse, it's because it wasn't managed correctly - why should the government use our tax money to pay for poor management just to keep some company alive?
Is the government going to help-out all the struggling small businesses out there? I don't think so - it seems like the government has a nasty case of favoritism; it's absolutely unfair. It's a complete waste of money.

The government should be using the money to encourage new businesses as opposed to supporting old ones that don't work.

At 11/18/08 02:57 AM, aviewaskewed wrote:

At 11/18/08 01:43 AM, Garthredbunlove wrote: So I stand by my initial statement: this is the wrong time for it, and loans could save more money for the federal government.

Last I checked, bailouts aren't loans.

It's obvious that you don't read the news, and Fox doesn't count.

At 11/18/08 06:29 PM, aviewaskewed wrote:

At 11/18/08 07:46 AM, Al6200 wrote: A bailout is a loan that the the debtor doesn't think will get paid back.

Still a bad idea from where I sit. Throwing out money you don't expect to ever see again don't make good sense to me.

Kinda like schools, right? Or hospitals. Regardless, if its a loan, which is what was asked for in the first place, it will be paid back.

At 11/21/08 03:15 AM, Garthredbunlove wrote: Kinda like schools, right? Or hospitals. Regardless, if its a loan, which is what was asked for in the first place, it will be paid back.

Oh sure, if it actually works and they don't go out of business. Because there's still that possibility. Even if we give them all the money they'll need to turn things around they could still misuse that money and go into chapter 7 and even though the government is the biggest debtor and their the federal freakin government they'd still only be able to make back whatever selling off the assets is worth. That usually tends to be much lower then whatever the size of the debt is.

At 11/18/08 01:43 AM, Garthredbunlove wrote: Ha! I knew you were all words.

And those words make a pretty convincing point. Which you ignore.

Lol, am I working for GM? No. I just live here. I'd say the major problems are: the governor, the bad rap GM cars get, the former problem of gas prices, pensions and unions, and the fact that nobody is loaning money now when they need it.

GM cars aren't bad. Their business strategy is sound. They need better management and a good advertising campaign.

One CANNOT have poor management and sound strategy. It's simply not possible.

You're saying that "but for the people who run the company and make all the decisions...the company is fine"?

I move cars as a part time job for supplimental income and have gotten a chance to see all of the 08 GM cars in action. They suck.

They're designed to be hard to work on. That way, people have to go to the dealers. They're completely computerized. Do you REALLY need computer chips in the wheels so that they can tell you if the tire is 1 pound of pressure low? They have these idiotic ideas like "pretty engine" which is a series of covers that take 10 minutes to remove, and need special tools...just so you can look at the engine.

In short, you have a lot of poorly designed cars that are being pushed by a clueless management to a public that aint buying.

what are they like to drive?

GM ruined its chances of getting a bail out when they showed up in a private jet.

thats like asking your friend for money, then comings to pick it up in a limo.

At 11/21/08 03:15 AM, Garthredbunlove wrote:

At 11/18/08 06:29 PM, aviewaskewed wrote:

At 11/18/08 07:46 AM, Al6200 wrote: A bailout is a loan that the the debtor doesn't think will get paid back.

Still a bad idea from where I sit. Throwing out money you don't expect to ever see again don't make good sense to me.

Kinda like schools, right? Or hospitals. Regardless, if its a loan, which is what was asked for in the first place, it will be paid back.

There's a difference between giving out money to schools and giving out money to private sector industry.

Public schools need money to operate because they're publicly funded. Schools are necessary to have, and if that's not obvious to you, you're a moron. Schools aren't for profit, they're for educating the youth. The government has an obligation to provide education. It has no obligation to bail out independent capitalist endeavors with taxpayer money.

At 11/21/08 05:38 AM, WolvenBear wrote:

At 11/18/08 01:43 AM, Garthredbunlove wrote: GM cars aren't bad. Their business strategy is sound. They need better management and a good advertising campaign.

One CANNOT have poor management and sound strategy. It's simply not possible.

You're saying that "but for the people who run the company and make all the decisions...the company is fine"?

I move cars as a part time job for supplimental income and have gotten a chance to see all of the 08 GM cars in action. They suck.

I'd like to build on this point, actually.

There are reasons why people buy foreign cars, and gas efficiency isn't the only one. Many foreign cars are quite well built, have excellent warranties, good depreciation rates, etc. Management isn't the only reason GM is going under. Part of the reason is what they are producing for sale in the first place. Clearly, their products did not meet the consumer's needs well enough, so the consumer went for substitute products. It's business and economics.

They're designed to be hard to work on. That way, people have to go to the dealers. They're completely computerized. Do you REALLY need computer chips in the wheels so that they can tell you if the tire is 1 pound of pressure low? They have these idiotic ideas like "pretty engine" which is a series of covers that take 10 minutes to remove, and need special tools...just so you can look at the engine.

Here's where poor management meets poor products. Not only has the financial management of GM been doing poorly, their decisions have spilled over into production. Instead of just making better products in general, they have been trying to tack on little goodies and treats and bells and whistles to crank up costs to try to make a better profit off of their sales. This approach is backfiring.

In short, you have a lot of poorly designed cars that are being pushed by a clueless management to a public that aint buying.

Also, Garthred mentioned how GM specialized in heavy duty vehicles and work cars in a previous post.

At 11/16/08 07:33 PM, Garthredbunlove wrote:

You see, GM specializes in larger SUVs and trucks. They do this to, hypothetically, make more profit because the Japanese are far less competitive in those areas, and those types of vehicles also make more profit. However, due to GM's lazy past, they've gotten a reputation for having crappy cars, which is something that has significantly changed over the years. American cars are much higher quality now, and they certainly match up well with Japanese cars, which are smaller and liter (not always a good thing for cars).

Here's where a problem arises: Japanese firms have begun to enter those markets- see the Toyota Tundra and Honda Ridgeline. Hyundai and Kia also are in the large vehicle market with SUVs and minivans and crossover vehicles. Competition in the large auto market has gone up, and GM has been losing much of it's market share in that area, whereas they used to command it in the past. In addition, these new entrants in the market are apparently at least par with many GM vehicles for the most part, and some models are arguably superior. This is a bit of a deathstroke for GM.

Maybe if GM made cars worth a damn this wouldn't be a problem.

How can they expect to privatize profits but at the same time want socialized bail outs...

I'm from Michigan, I grew up around Detroit my whole life. My grandpa worked for GM back in the seventies, and the town I love in, Sterling Heights, has three huge manufacturing plants by both for and GM. On November 4th I went and voted for Obama. But still, if you ask me whether GM deserves a bailout, I'd have to say HELL NO.

GM has had over thirty years to adjust its outdated business plan, and even after the 70s oil embargo you'd think they would have learned something. The greed of the Big 3 and the UAW have consistently fought tooth and nail against high fuel economy standards, and should have expected that increasing fuel prices would have killed their fleet of SUV's which are killing the planet and making us dependent on foreign oil.

Are alot of innocent people going to suffer because of the greed and shortsightedness of the execs and union bosses? Of course, and my heart goes out to them. Hell, I probably even know some of them. But the US economy survived the decline of US Steel. It can survive the loss of a substandard company that's been putting out inferior products for more than two decades. And the UAW bosses deserve their share of the blame too; getting paid thirty dollars an hour plus health benefits to pull a lever is fucking ridiculous.

What we need is a universal health care system to make our companies more competitive on the world market, and not drive up the operating cost of our companies who are forced to provide expensive health care for our companies. We need high fuel economy standards not just for the good of the planet but for the good of our own car companies to force them to get in tune with the market and compete with Toyata.