Thursday, November 20, 2008

This Post Will Not Make Me A Lot Of Friends

I don't think that the U.S. government should bail out U.S. automakers. I will happily read your thoughts on this; I just don't think it's right to bail out companies who have not been astute enough to realize that the world is changing and they have to change too. I am a life-long Democrat so don't accuse me of going over to the dark side.

I blame the management, the board of directors and the unions for this. Everyone has been greedy and the employees will pay the price of that greed. I had my own consulting business for 13 years. I loved being my own boss. There were times when I was worried I wouldn't be able to pay my bills. Clients dropped off the radar; Enron file for bankruptcy when they owed me $13,000. But I got through those times by realizing what I had to do to bring in money. I never thought about anyone bailing me out.

None of the car makers outside of the U.S. is asking anyone for anything. The one thing they all have in common is that they are located in countries with universal health care. The big three car makers are paying large sums of money for health care for employees and retirees. Also, those non-U.S. car makers are building cars that people want to buy. Duh!

So, I'll get off my soapbox now. Do let me know how you feel. I promise not to delete your comments.


Oklahoma Farmgirl said...

Amen, amen, & amen!! As the head honchos were asked at yesterdays hearing "Couldn't you have downgraded to at least first class airfare rather than flying in on your private jets?" (I paraphrased but it is an accurate depiction). I am against bailouts period. We have to figure out our budgets & live within our means, if not we sink. And I have sunk several times. It is time for big business to do the same. The small manufacturing company I moved to work for shutdown in July & left me out of work for 6 wks. But I found another job & moved on. It is time for union workers with huge salaries & benefit pkgs to do the same & learn to live on less also. I am one of the uninsured & have been for most of my adult life. Oh my, looks like I got on my soapbox also.

Thanks for letting me vent.

Blessed be...

Rondi said...

I think the situation is more serious – scarily serious – than your post suggests.

We won't be happy if any one of the auto companies goes out of business. The cascading impact will make the Lehman Bros. demise look like a nice day. This is how we get 30% unemployment in the country or worse.

There are tens of thousands of small businesses that supply the auto companies and those small businesses do not have the financial ability to withstand losing a major customer. This is not a business-as-usual situation where they can go to the bank to borrow money to tide them over. Banks aren’t lending and especially not to an industry that is declining rapidly. This then means the viable US auto manufacturers will be buying more of their parts from Asia; how’s that going to help the US economy.

All of which is not to say I disagree with your anti-bailout position. You’ve got all the reasons why the American auto companies are not to be trusted. But consider that tax $ is the one thing that we, as a society, have to make them change. The challenge is how to do that. I saw a Hummer commercial yesterday morning.

blogauthor said...

I saw stood second hand watching the automakers for all my life. They are wasteful, arrogant and even flew to Capitol Hill in private jets with their hands out. Maybe they oughta drive in one of their cars they can't sell!?!?!

I know there are massive downstream consequences of not bailing them out, but there are also massive consequences of bailing them out, including adding many many more businesses knocking on Congress' door for handouts.

Its complex, and I'll admit I don't know the best course - but I am highly skeptical of bailing them out. It just ticks me off to no end.

dykewife said...

corporate welfare...gladly paid out and yet they cut to the bone welfare for families who are in desperate need, call them lazy for not working (because of the greedy corporations who are more than happy to move jobs out of the country).

you'll find no disagreement here.

Rondi said...

I commend to you this commentary piece from Newsweek: How to Bail Out General Motors - by Robert Samuelson.

A key point: The objective is not to rescue the companies or workers; it is to shore up the economy and improve the U.S. industry's competitiveness.

penni said...

This is the domino effect -- we bailed out insurance companies and we bailed out banks, so now we're expected to bailout auto makers. I'm still thinking we need to cap credit card interest rates and the adjustable rate mortgages. If we save the regular person, everything else will be cured (eventually). We should never reward big companies for bad behavior, but that's what we're doing.

There's no question that we must shore up the economy, but I think we need to use the "trickle up" rather than the "trickle down" process.