1. Welcome! Please take a few seconds to create your free account to post threads, make some friends, remove a few ads while surfing and much more. ClutchFans has been bringing fans together to talk Houston Sports since 1996. Join us!

Does the U.S. government allow GM to go bankrupt?

Discussion in 'BBS Hangout: Debate & Discussion' started by robbie380, Nov 7, 2008.

?

Select 2...Will the U.S. allow GM to go bankrupt? and should they allow it?

  1. Yes, they will ALLOW a GM bankruptcy

    24 vote(s)
    17.1%
  2. No, they will NOT ALLOW a GM bankruptcy

    74 vote(s)
    52.9%
  3. Yes, they should ALLOW a GM bankruptcy

    83 vote(s)
    59.3%
  4. Yes, they should NOT ALLOW a GM bankruptcy

    12 vote(s)
    8.6%
Multiple votes are allowed.
  1. ArtV

    ArtV Member

    Joined:
    Jun 25, 2002
    Messages:
    7,008
    Likes Received:
    1,716
    You can't keep paying 460,000 in benefits when your company is going under. And no I don't believe in confiscating 401k accounts. And yes I do have a 401k which is about 1/2 what it was and I was 10 years from retiring myself. But if you want to continue paying money you don't have to retirees, how bad do you think the 460,000 will feel when they have 0 coming in a year or so because their company has gone under? Would that be more kind? Or maybe the govt should keep paying indefinately to a company that is bloated and is poorly run?
     
  2. ArtV

    ArtV Member

    Joined:
    Jun 25, 2002
    Messages:
    7,008
    Likes Received:
    1,716
    Skewed? I'm not sure I see that. I'd lay off 1/2 of GM workers (white and blue colllar) by mostly merging redundant lines. But you still can't survive paying 4 times as many peoples benefits and pensions - I just don't think you can - at least not at 100%.

    Fault? Both UAW and GM Exes are at fault but there is only 1 way to fix a solution of spending more than you make - spend less. You could make a flying car and in this ecomony it won't sell unless you can get the price down to less than 10k. I must have missed the solution on how to magically turn a company like this around with no layoffs so that all 500,000+ employees (past, present and future) can have a Merry Christmas! There better be 1 more wish left in that lamp Aladdin.
     
  3. rhadamanthus

    rhadamanthus Member

    Joined:
    Nov 20, 2002
    Messages:
    14,304
    Likes Received:
    596
    Ah, I see. I interpreted your post as "blue collar only". My bad.

    I have no problem with your idea anymore - in fact, that's basically what a chapter 11 would entail anyway.

    I will amend your commentary in one facet though: Every upper manager should be fired. No parachute. No severance. No nothing. Just good bye.
     
  4. Dr of Dunk

    Dr of Dunk Clutch Crew

    Joined:
    Aug 27, 1999
    Messages:
    46,648
    Likes Received:
    33,664
    I just watched the grilling of the Big 3's CEO's and it was funny because after those few hours of testimony, it sounded like the best and most concrete reason for aid they came up with was "just to give us a chance - we think we can!" lol. Sad. I doubt they convinced many they had any concrete proof they'd succeed with a "bailout".
     
  5. B-Bob

    B-Bob "94-year-old self-described dreamer"
    Supporting Member

    Joined:
    Jul 26, 2002
    Messages:
    35,986
    Likes Received:
    36,841
    (agreeing with Dr. of D)

    American Cars: Where not Even Necessity Can Mother Invention
     
  6. ChrisBosh

    ChrisBosh Member

    Joined:
    Mar 29, 2006
    Messages:
    4,326
    Likes Received:
    301
    They need a bailout with certain rules:

    - reduction in product lines
    - reduction in salary/benefits for all
    - required change in lower/upper mgm team... in key positions
    - consolidation of some type
    - place a tax on foreign cars (for 3 years)
     
  7. fmullegun

    fmullegun Contributing Member

    Joined:
    Oct 24, 2008
    Messages:
    3,279
    Likes Received:
    23
    tax would not work, that is why japan moved production here.

    reduction in benefits would require cooperation of the UAW who seem to be intent on riding the boat all the way down.
     
  8. Baqui99

    Baqui99 Member

    Joined:
    Jul 11, 2000
    Messages:
    11,495
    Likes Received:
    1,231
    Other than the Escape Hybrid, I can't thing of a single leading product that Detroit has released over the last few years.
     
  9. ArtV

    ArtV Member

    Joined:
    Jun 25, 2002
    Messages:
    7,008
    Likes Received:
    1,716
    And the sad thing is that costs $33,000...for a Ford Escape...

    You can get a Toyota Prius for $22,000. I know it's a different mode of transportation, but I think the resale and reliablility and price make that a much better deal.
     
  10. ArtV

    ArtV Member

    Joined:
    Jun 25, 2002
    Messages:
    7,008
    Likes Received:
    1,716
    I think the UAW has lost most of their power and if they want to strike, I think the line to replace them would be around the corner. Personally, I'd let the ones who stay keep their same pay - you just need fewer workers - a lot fewer workers. And the ones who walk, well, that is a HUGE gamble that I think they'd regret and with the economy, I doubt you'd have that many takers. If you worked for GM today would you go on strike tomorrow because they want to cutback personal, pay or benefits? Walk out? Right before Christmas? With the nightly news running stories and newspapers printing every plant layoff? And your company begging for money to make it through year-end. And they say this will get worse? Union pay during a strike is not that much. But before I'd do that, I would announce HUGE white collar cutbacks so they know it's not a 1-way street and that they are seriously hurting. Then bring the UAW to the table and don't make threats, just give them the hard facts and give them your best take-it-or-leave-it offer.

    I'm for govt help but if there are no changes, what good would an endless supply of money do except backrupt the country. $25B is just a drop in the bucket for these 3 and they'd be back at the door Jan 20th.

    Bottom line...No changes...No money.
     
  11. fmullegun

    fmullegun Contributing Member

    Joined:
    Oct 24, 2008
    Messages:
    3,279
    Likes Received:
    23
    1. How are you going to replace tens of thousands of skilled labor? Scabs? Doubt it.

    2. The ones who walk still cost the company money, to really "walk" GM has to buy them out of their retirement.

    3. GM cannot cut the benefits or anything because they have contracts with the UAW so the worker will never face that decision.

    4. Giving them a take it or leave it offer would get you laughed at when they tell you they would see you in court.
     
  12. rocketsjudoka

    rocketsjudoka Member

    Joined:
    Jul 24, 2007
    Messages:
    58,170
    Likes Received:
    48,346
    To a certain extent I agree with ArtV's point.

    The biggest problem I have with this bailout is that there are deep structural problems to the big 3 and according to some reports they could burn through the $25 billion in a few months and still be in the same boat. The argument regarding that we have to bail them out to save jobs given their structural problems it whether we bail them out or not they will continue to have problems and we are just deferring the problems until later.

    I still think we should let them fail and take any bailout money and put that into social services to address the people who will lose their jobs. To me that makes much more sense than propping up GM to save jobs, which is indirectly creating a social service since its still highly questionable whether they will be able to pay any of that money back.

    As for the UAW I'm not against unions but they have to recognize that if the industry fails they get no benefits. They might not like to sacrifice the concessions they have wrestled from the US auto industry but if the industry can't compete due to union contracts those concessions are meaningless.
     
  13. ArtV

    ArtV Member

    Joined:
    Jun 25, 2002
    Messages:
    7,008
    Likes Received:
    1,716
    Mergers and plant closings, that would be step 1. You don't need all your people if you close half the plants.

    Personally if 10's of thousands walk out, that is a good thing since I'd cut about 50k anyway. 1/2 that would be my goal. Even if you did need to hire, we are heading for 10% unemployment. You think there would be a problem hiring at the current pay? I wouldn't cut the pay, just the people. And I think you could hire 10s of thousands of scabs at that pay. Bottom line - would you strike today if you were a GM worker? Some would, but I bet you have plenty that would not because there is a very good chance that you'd be walking away for good.

    No CEO wants to shrink a company, in fact that is just the opposite. And that's why they all stood there yesterday saying they were prepared for the future. I wouldn't have been able to keep a straight face. They are spending billions more than they are making. There are only 2 solutions: Make billions more (not likely) or spend billions less (the only real solution). But no CEO of the big 3 wants to make the necessary cuts. Which by the way, I'd cut all manager's pay and the CEO should have a $250,000 limit. If they think they can make more somewhere else (unlikely to ever work again) or would like to step down, I'd welcome that.

    If you walk out on a strike, you don't cost the company anything but possible lost revenue. If you get canned, you get 0 in retirement benefits. You might get some unemployment but that is covered by insurance.

    But retirees are something that has to be addressed but I'm not sure what you could do legally. If there was any way to cut the benefits to a managable level, I would. Not to be mean, but to survive and to keep paying them until they die.

    The reason GM is unable to secure financing is because what bank wants to lend a company billions in this ecomony with a balance sheet and strategy like that? If they thought there was some way they'd get paid back, banks would be more than happy to lend you money.

    BK may be the best way to reorganize as it did work for the airlines, but they also made the necessary cuts.
     
  14. DaDakota

    DaDakota Balance wins
    Supporting Member

    Joined:
    Mar 14, 1999
    Messages:
    129,441
    Likes Received:
    40,015
    I think a bailout would be a band aid....let them reorg through bankruptcy.

    The unions and the management are both culpable they need to feel the pain of their dealings.

    DD
     
  15. rhester

    rhester Member

    Joined:
    Jun 14, 2001
    Messages:
    6,600
    Likes Received:
    104
    Let it be duly noted in the official records, we agree :)
     
  16. DaDakota

    DaDakota Balance wins
    Supporting Member

    Joined:
    Mar 14, 1999
    Messages:
    129,441
    Likes Received:
    40,015

    We agree a lot my man, it is when we disagree, that the posts fly.

    :D

    DD
     
  17. fmullegun

    fmullegun Contributing Member

    Joined:
    Oct 24, 2008
    Messages:
    3,279
    Likes Received:
    23
    bottom line is you think you can break the Union without government help.

    You live in a fantasy world.
     
  18. tinman

    tinman 999999999
    Supporting Member

    Joined:
    May 9, 1999
    Messages:
    104,472
    Likes Received:
    47,389
    Let's not forget Chrysler wants money too. Daimler dropped when they realized they picked up the people who made the Neon and the PT Cruiser.
     
  19. fmullegun

    fmullegun Contributing Member

    Joined:
    Oct 24, 2008
    Messages:
    3,279
    Likes Received:
    23
    actually they dropped it once they transferred all their debt and garbage over.
     
  20. glynch

    glynch Member

    Joined:
    Dec 1, 2000
    Messages:
    18,096
    Likes Received:
    3,609
    Well it is battle to see if the conservative economic theories that have led to the crisis will continue to prevail.

    The cons would like to bust the unions and so would many Texans that have never been in a union as we see from the posts on this board.

    Laying off another million in this crisis will not help at all right now. (A minimal estimate if the Big Three crash and burn).It will be at least as bad as the Lehman fiasco. It is a really stupid thing to do with the economy so bad.
     

Share This Page

  • About ClutchFans

    Since 1996, ClutchFans has been loud and proud covering the Houston Rockets, helping set an industry standard for team fan sites. The forums have been a home for Houston sports fans as well as basketball fanatics around the globe.

  • Support ClutchFans!

    If you find that ClutchFans is a valuable resource for you, please consider becoming a Supporting Member. Supporting Members can upload photos and attachments directly to their posts, customize their user title and more. Gold Supporters see zero ads!


    Upgrade Now