^I will let the people decide.....folks - who's more correct here: 1. somebody who claims that german autoworkers don't have to deal with unions 2. somebody who claims the opposite 3. a korean guy in germany with an industrial-sized internet hard-on which I can't really trace... Should I post a poll?
Most of the European countryies such as Germany, England, France, Norway, Denmark, Swden, etc. are pretty close to what you could call socilist country. US is not that far behind actually, certainly much more so than countries people like to call communist such as China, Vietnam, etc.
The auto industry has been under the same spell as the real estate business. There are vehicles so wildly priced and absurdly equipped that only an insane economy could support such ridiculousness. Remember when Ford came out with the Expedition? I was dumbstruck when I read one would cost $40,000 and Ford was targeting people below my income bracket. Nobody in my income bracket had/has any business buying a $40,000 rig and that certainly goes for people who makes less. In addition, the whole luxury car thing is simply absurd... as if a nameplate and leather seats are what define you as a person or get you from point A to point B. Also, if you're fat and ugly and don't brush your teeth, it doesn't matter what kind of car you drive, the chicks aren't going to be begging for a ride. I can't imagine the billions (trillions?) of dollars we've wasted on Toyotas and Hondas with a different name and gold trim. 99% of Americans should be driving cars that cost less than $20k, yet so many want that $60k car for their self esteem and to remind themselves and others that they are better off than they really are. I don't think P.T. Barnum could have imagined such a scam and now, once again, we'll have to pay for it one way or another.
Well said Rimrocker. Well said. Some over-indulgence enabled reckoning is due - sucks that those of us who are not idiots with our money/credit are getting reamed too.
I'm not saying that people haven't made ridiculous decisions financially. The evidence surrounds us: however, have you considered the effects of what you advocate. The consumerist attitude you are bemoaning is the engine for research and development dollars that have significant effects on all of our lives. Also, if the US were to take the same approach to healthcare as the rest of the world, the effects on the entire world healthcare system could be catastrophic. Like it or not, the US basically is already providing healthcare to the rest of the world. The pharmecutical and health equipment industry provides products to socialist healthcare systems at prices that would otherwise not be profitable. The difference is made up by selling the same products to American firms at a much higher price. If America stopped participating in this system, these companies would be forced to increase prices on the socialist healthcare systems. This could bankrupt those systems.
Unions caused part of the problem but they are not only reason who the auto industry is in big trouble. Unions need to reform just like all the other organizations.
While I think it's unfortunate that unions monolithically support the dems, they can actually serve a conservative purpose. If collective bargaining can put in place certain restrictions on management, that negates the demand for government to do so. I would much rather union leadership that were elected by the workers negotiating with management than I had the beuracracies in Washington. Did unions go overboard with contract demands to the big three? Sure, but those contracts were signed by management as well.
yeah. why would i want bureacracies in 'washington' (why is washington a bad word by the way. is it american to use our capitol as an insult?) when i rather have presses printing money in washington and giving blank checks to new york. once the bailout starts, which was necessary, regulations must go hand in hand. this notion that we still want no regulation is stupid, and dead. obviously regulations shouldn't stunt growth, but regulations are necessary.
don't you love lexus christmas commercials. i mean i know they have to sell cars, but there is something inherently wrong with promoting a luxury car for christmas but my favorite was I swear, about 8 years ago lexus had a commercial with a father giving his daughter a lexus for her freshman year in college. plain wrong
The reason the vast majority of people think the word Washington is "bad" is that most of the regulation that comes out of Washington is "bad." Not because the people or their motivation is bad, but because the US economy is too big and too diverse for central control. That is why I am not idealogically against unions (or trial lawyers, btw). They tend to serve the local interests better than the one size fits all "solutions" coming from Washington. Additionally, I do not agree with the "obvious" notion that the bailouts were necessary. First, the results are in, and it didn't work. The bailout was supposed to thaw the credit market. The banks simply took the money and refused to invest it into to additional credit for the economy. Second, I find the notion that the profit motive would die without the bailout to be ridiculous. These institutions exist to make loans. They may temporarily stop loaning money, but in the long run, they would cease to exist if they didn't eventually start loosening the credit restrictions. Finally, I have a theory that just as sports teams tank mediocre seasons in the hopes of a higher draft pick, certain companies are tanking their balance sheets purposely to qualify for the free money Uncle Sam is handing out on our behalf. I predict this will be uncovered in the future.
I think this is probably the best short piece on the problems facing the automotive industry. http://online.wsj.com/article_email/SB122783248646663009-lMyQjAxMDI4MjI3ODgyMzgyWj.html#printMode Detroit Needs a Selloff, Not a Bailout Government can help get the Big Three's assets into more productive hands. By ROBERT W. CRANDALL and CLIFFORD WINSTON Congress was decidedly unimpressed by the three domestic auto makers' plea for a bailout last week and responded by asking them to do the impossible: conjure up plans by Dec. 2 detailing how a bailout would revive them. After more than three decades of denial about their long-term decline, Detroit's car companies must now face the facts. A bailout will not revive them. Moreover, the leading alternative that has been proposed by others -- bankruptcy -- will not re-energize these companies sufficiently to reverse their decline. In our judgment, based on experience elsewhere in American industry, the most constructive role the government can play at this point is to provide a short-term infusion of capital with strict repayment rules that will essentially require the auto makers to sell off their assets to other, successful companies. Why is such a dramatic step necessary? For the unavoidable reality that the fundamental problem the auto makers face is not their pension, health-care or other legacy costs. It is that they are not making cars and trucks that enough Americans want to buy. And this has been true to some degree since the first energy shock hit the U.S. in the early 1970s. In 1970, General Motors, Ford and Chrysler made about 90% of the new cars sold in the U.S. Today their share is closer to 40%. Their market share of light trucks has also declined, but less precipitously thanks to a 25% tariff on many imported light trucks. How could a federal bailout or a bankruptcy reorganization change that? Pension and health-care liabilities have been a hindrance, but they haven't blocked product innovation. Bankruptcy has allowed some industries to turn themselves around. A decade ago more than 40% of the steel industry's capacity was reorganized in bankruptcy. The result was the rationalization of capacity and new labor agreements that allowed three large players -- U.S. Steel, Severstal and Mittal -- to create a more efficient steel industry. But this change occurred only after a dramatic restructuring of the industry in the face of fierce competition from new "minimills." By the time the larger companies -- Bethlehem, LTV, Weirton and others -- collapsed into bankruptcy, they had already shed a vast amount of uneconomic capacity and ceded the production of certain types of products to the minimills. Thus, the operations that Mittal, U.S. Steel and Severstal bought out of bankruptcy were the most efficient remnants and were devoted principally to making products used in motor vehicles, appliances and (to a lesser extent) construction. They did not have to build new blast or steel furnaces or revamp product lines. They simply had to rewrite labor agreements. Similarly, the airline industry weathered a round of bankruptcies following 9/11. The problem then was overcapacity relative to what the changing market would bear. But economic recovery and lower labor costs negotiated in bankruptcy allowed most airlines to rebound because they did not have to face multiple carriers that offered better service and cheaper fares. Detroit faces very different problems. It has had a persistent product-line problem that may be even more severe than its labor problems, and in any event will not be solved by getting UAW wage rates in line with those at the U.S. plants of Toyota, Honda, BMW and Nissan by 2010. The gaps between U.S. and foreign competitors simply have become too large to make up by reducing labor costs or rationalizing capacity. Even if the overall economy rebounds and gives Detroit auto makers some breathing room to emerge from bankruptcy, they will likely face similar -- if not more severe -- problems in the next recession. In the end, the capital and labor of these companies need to be reallocated into better hands. To this end, we suggest that assistance of some form -- short-term financing or government purchase of equity -- be granted under the condition that the Detroit Three restructure their labor relations so as to be able to sell some or all of their major assets. There are a number of potential buyers for these assets. Toyota's market cap is $100 billion and Volkswagen's market cap is $110 billion. Either could bid for these assets. Honda, Nissan and even U.S. companies in related sectors, such as Caterpillar or John Deere, are possible buyers. Members of Congress need to accept that the best possible outcome is a fundamental change in direction for the American automotive industry -- a change that includes making Detroit's facilities more attractive to successful companies. A joint venture between GM and Renault-Nissan was briefly discussed last year, and Daimler-Benz's majority ownership of Chrysler was abandoned this year. Both failed because the Detroit-based operations could not improve their labor relations measurably and otherwise restructure sufficiently to be competitive. By establishing firm mileposts for asset divestitures from which the companies could repay government funds, taxpayers could be reasonably assured that their money is well spent. But if Congress enacts a bailout without our conditions, the U.S. taxpayer will likely be on the line not only for additional support in the next recession, but likely on a regular basis for the foreseeable future. We do not generally support government assistance to failing companies. But we think that our proposal will cost taxpayers less and, in the long run, be more beneficial to labor and the overall economy than either a straight bailout or bankruptcy. Messrs. Crandall and Winston are senior fellows at the Brookings Institution.
Agree with everything except this part: "Also, if you're fat and ugly and don't brush your teeth, it doesn't matter what kind of car you drive, the chicks aren't going to be begging for a ride." Unfortunately there are plenty of chicks who are impressed by a guy driving a Hummer, Expedition, etc. Probably not the kind of chick that you or me might wanna attract. Then again the kind of guy who drives a hummer is most likely looking to attract that type of chick.
