no bailout

[Maxximus Redneckus]

No bailout for chevy or chrysler hmm wnder what happens to stock at dealerships do they sell um half price ????

[roadwarrior]

The Treasury is going to backdoor Congress:

http://www.foxnews.com/politics/2008/12/12/white-house-considers-tapping-b-fund-auto-industry/

[Siebert Outdoors]

Thats what I dont understand about this whole thing

they give the banks 700 bil.  but wont give the others 15.  Whats another 15 when your 700 in the hole.

[Maxximus Redneckus]

Thats what I dont understand about this whole thing

they give the banks 700 bil. but wont give the others 15. Whats another 15 when your 700 in the hole.

Yup so true thing is the USA hass been goin in dept the last 50 yrs when we started to depend on other countries for food, oil , home goods .and joe public sits and watches his mortgage run out and becomes homeless over 2 gran .its a shame. All of our forefathers are rollin in there graves at this point all they did,,, all the paths they made to make the USA prosper has went to shyt

[tyrius.]

Thats what I dont understand about this whole thing

they give the banks 700 bil. but wont give the others 15. Whats another 15 when your 700 in the hole.

Well at least the bank's have a chance of surviving with their current structure.  The auto companies do not.  I heard a good quote on a Bloomberg podcast that the big three are basically pension funds with a small manufacturing company attached to it.  Any bailout money given to the auto companies will be wasted if they do not go through bankruptcy.

One quick note.  The fed hasn't even spent the first half of the 700 billion.  So far they've spent just over 300 billion.  They are considering using the remainder of the first 350 billion to bailout out the car companies.  In order to spend the second 350 billion the fed has to get congress' approval again.

[Siebert Outdoors]

I dont know enough about this whole deal but I know your right on the bottom line from a company view.  This whole circus just frustrates me.

[atx_newbie]

I don't understand why not to do it.  The car companies are stuck in a catch-22.  If people don't buy the cars, they will need the bail out.  But no one is going to buy a car from a company that may not exist in 2-3 years; so much for warranties and maintenance and parts.

Sure, I hate seeing all that money go to private companies as much as anyone else, but one way or another it's going to get spent.  If the 5 million people who are employed by the big-3 lose their jobs, the government will end up paying them unemployment benefits and everything else, which will probably cost more in the long run.

Besides, every other country with an auto industry is at least partially invested in the industry.  The federal bank of Japan actually decides how many Hondas and Toyotas get made every year.  How can we expect our own companies to compete without help?

[tyrius.]

I don't understand why not to do it.

Because without drastic changes in their business models the bailout will be a complete waste of money.  If GM and Chrysler get the money that they want then what happens in 3 or 4 months after they've spent that money (their cash burn rate is multiple billion dollars a month!!)?  Do we bail them out again?  How far do we go down this path before we demand radical changes?

I, for one, am for a bailout.  However, that bailout should be structured as guaranteeing warraties and providing debtor in possession financing while they go through a bankruptcy filing.  A bankruptcy filing will allow the car manufacturers to emerge as more efficient businesses that should be capable of competing with Toyota, Honda, etc.

[fathom]

toyota sold just under 10 million cars last year and made a $17 billion profit.

g.m. sold just under 10 million cars last year and lost $28 billion.

you do the math.

[BucketmouthAngler13]

Buy a farm. Buy a gun. Get a wife.  

Your set!

Let the stock market crash. And if you want to make a killing, start selling stock market parachutes! Theres alot of people on board

[grimlin]

Want my opinion on the whole thing?

This is what happens when you try to cut out the middle class.

Pure Chaos.....

[burleytog]

This is what happens when you try to cut out the middle class.

Please elaborate.

[Tin]

I just like how they flew in on their private jets, then drove back... ;D

[grimlin]

This is what happens when you try to cut out the middle class.

Please elaborate.

Everything...It stables out the country.

[burleytog]

This is what happens when you try to cut out the middle class.

Please elaborate.

Everything...It stables out the country.

I'll try another way...

What does your phrase 'cut out the middle class' mean?

[Muddy]

Grimilin has felt the effects first hand Burley: He is currently and recently laid off in Michigan, and he is seeing the senators blaming the workers instead of the corporate mooks who made all these bad product decisions and have seen the demise of their industry in a 35 year decline do nothing but continue to make bad decisions and still walk away fat.

This is my take, I hope RW chimes in here, he really understands this stuff and explains it better than most.

3 months ago GM started approaching the government saying they had stock ( Large ,gas guzzling stock) that was not moving and they had only 16 billion left in assets and that the operation was sucking up 2 billion a month. So that would put them at 4 billion now, at the brink of collapse

What good will another 15 billion do? In three more months we are back where we started from. It's like going to the track and loosing the first 5 races hard and staying for the last 4, still gonna leave broke

[cart7t]

Giving them money is meaningless unless they and the unions can get costs under control.  To be fair, I've seen where the average hourly pay for a UAW worker at the big 3 is around $30 an hour.  For Toyota, it's the same.  It's the other costs (healthcare and legacy costs to the retirees) that are killing them.

Economists in Michigan, the long-time home of the auto industry, say they don't support the proposed multi-billion dollar bailout of Big Three automakers Chrysler, GM and Ford.

One reason why, they say, is the ultra-high labor costs for union workers employed by the Big Three. It costs over $73 per hour on average to employ a union auto worker, according to University of Michigan at Flint economist Mark J. Perry.

Is it right to tax the average worker making $28.50 to bailout workers whose labor cost is over $73 an hour? Perry asked.

He explained that in 2006, widely available industry and Labor Department statistics placed the average labor cost for UAW-represented workers at the former DaimlerChrysler at $75.86 per hour. For Ford it was $70.51, he said, and for General Motors it was $73.26.

That includes the hourly pay, plus the benefits they're receiving and all the other costs to General Motors, Ford and Chrysler, including legacy costs retirement costs, pensions, and so on so it's looking at the total labor costs per hour worked for workers, Perry said.

For U.S. workers at Toyota, however, the per hour labor cost is around $47.60, around $43 for Honda and around $42 for Nissan, Perry added, for an average of around $44.

So we're looking at somewhere around a $29 per hour pay gap between the Big Three and the foreign transplants that are producing cars in the United States, Perry, chairman of the economics department, told CNSNews.com.

The average union worker at Chrysler, meanwhile, received 150 percent more in compensation than U.S. workers generally.

Using Bureau of Labor Statistics numbers, the average compensation for manufacturing workers is around $31.50, and the average hourly compensation, including benefits, for the average worker in the U.S. economy is around $28.50, Perry told CNSNews.com.

http://www.cnsnews.com/public/content/article.aspx?RsrcID=39499

and here's just one example of the abuse to the bottom line

Ken Pool is making good money. On weekdays, he shows up at 7 a.m. at Ford Motor Co.'s Michigan Truck Plant in Wayne, signs in, and then starts working -- on a crossword puzzle. Pool hates the monotony, but the pay is good: more than $31 an hour, plus benefits.

"We just go in and play crossword puzzles, watch videos that someone brings in or read the newspaper," he says. "Otherwise, I've just sat."

Pool is one of more than 12,000 American autoworkers who, instead of installing windshields or bending sheet metal, spend their days counting the hours in a jobs bank set up by Detroit automakers and Delphi Corp. as part of an extraordinary job security agreement with the United Auto Workers union.

The jobs bank programs were the price the industry paid in the 1980s to win UAW support for controversial efforts to boost productivity through increased automation and more flexible manufacturing.

As part of its restructuring under bankruptcy, Delphi is actively pressing the union to give up the program.

With Wall Street wondering how automakers can afford to pay thousands of workers to do nothing as their market share withers, the union is likely to hear a similar message from the Big Three when their contracts with the UAW expire in 2007 -- if not sooner.

"It's an albatross around their necks," said Steven Szakaly, an economist with the Center for Automotive Research in Ann Arbor. "It's a huge number of workers doing nothing. That has a very large effect on their future earnings outlook."

General Motors Corp. has roughly 5,000 workers in its jobs bank. Delphi has about 4,000 in its version of the same program. Some 2,100 workers are in DaimlerChrysler AG's Chrysler Group's job security program. Ford had 1,275 in its jobs bank as of Sept. 25. The pending closure of Ford's assembly plant in Loraine, Ohio, could add significantly to that total. Those numbers could swell in coming years as GM and Ford prepare to close more plants.

Detroit automakers declined to discuss the programs in detail or say exactly how much they are spending, but the four-year labor contracts they signed with the UAW in 2003 established contribution caps that give a good idea of the size of the expense.

According to those documents, GM agreed to contribute up to $2.1 billion over four years. DaimlerChrysler set aside $451 million for its program, along with another $50 million for salaried employees covered under the contract. Ford, which also maintained responsibility for Visteon Corp.'s UAW employees, agreed to contribute $944 million.

GM is currently burning through $2 billion a month in loss.  $15 billion, if it all went to them, would last 7 1/2 months.  The UAW doesn't want to budge from their contract until 2011.  As a taxpayer I have no intention of paying to support the auto workers unless the workers at said companies start making radical changes to their pay and benefit structure making those companies more competitive.  NOW not 2-3 years from now.  The parties over fella's.    

[Muddy]

Thanks Cart

[Root beer]

Get rid of the union and let the market speaks for itself.

[Muddy]

Get rid of the union and let the market speaks for itself.

I am currently in management but I was raised in a strong Union enviroment, belonged to several myself. To blame the unions is totally ridiculous, why don't we just phase out your job and see how you like it.

There has to be compromise, it is to the point where the Union is betting that Management has to blink, and visa versa. Attacking unions is ridiculous.

[grimlin]

Get rid of the union and let the market speaks for itself.

I am currently in management but I was raised in a strong Union enviroment, belonged to several myself. To blame the unions is totally ridiculous, why don't we just phase out your job and see how you like it.

There has to be compromise, it is to the point where the Union is betting that Management has to blink, and visa versa. Attacking unions is ridiculous.

Muddy is correct.Without unions Companies can do what they want and pay what they want.That won't help anybody.Might as well just let all the illegals take our jobs for $7.00 an hour.One of the reasons why i didn't mind leaving Texas at the time.It ain't just the unions...if anything unions are trying to save jobs.

We were making half of what the big 3 were paying their workers per hour.If i can survive on what i made,they can too.

But people are too dang greedy....Unfortunately something's gotta give and break.

We all feeling the effect of it.

[tyrius.]

Muddy is correct.Without unions Companies can do what they want and pay what they want.

That's not necessarily true.  Many non-union jobs exist that are pay very well.  I don't think Toyota's plants are unionized, but they have no shortage of well paid workers.

[grimlin]

Muddy is correct.Without unions Companies can do what they want and pay what they want.

That's not necessarily true. Many non-union jobs exist that are pay very well. I don't think Toyota's plants are unionized, but they have no shortage of well paid workers.

It does depend on the company.I honestly don't remember ever being treated or paid what i should have gotten when i wasn't in a union compared to now.Unions do watch out for the workers.But they can take it too far sometimes too.

I was at the union website today and this is the kind of offer every guy in office would do if he could get away with it.

This is to inform all of our members that Reilly Plating located at (17760 Clarann, Melvindale, MI 48122) has Locked Out our UAW members!

The company's final offer was unacceptable!  They wanted to take away seniority rights, impose employee health care contributions up to 30%, and are unwilling to negotiate with the UAW at this time.

This is wrong...somebody who has 20 yrs of experience can get booted because somebody of 2 yrs experience and is currently taking less pay can take his job from out and under him.Where would the loyalty in that be?

My Dad experience that 10 times in 17 yrs down in Texas....That can hurt a person's pride and everything he did for his job and company.

There really isn't any big unions down there.

[cart7t]

A typical person hired at GM or Ford at 20 years old can work for 30 years and then retire at age 50.  He's eligible for around $1500 month pension payment along with paid health insurance for that person and their spouse.  They get this until age 62 when SS and medicare kick in.

If some company offered me a job with that kind of benefit I'd have to think they were crazy or I was in some never-never land dream.

It was a backward pyramid scheme basically.  The sucking sound you hear is the money leaving the big 3 and going towards retirees.  

If they're forced to go to bankruptcy, those UAW contracts get tossed out the door.  The workers will wind up getting far less in pay, will have to pay for part of their health insurance and the retiree health benefits will probably be frozen or partially eliminated.  

It would be better off to settle now vs later.  A bankruptcy judge won't be so kind.  

[cart7t]

This is wrong...somebody who has 20 yrs of experience can get booted because somebody of 2 yrs experience and is currently taking less pay can take his job from out and under him.Where would the loyalty in that be?

My Dad experience that 10 times in 17 yrs down in Texas....That can hurt a person's pride and everything he did for his job and company.

There really isn't any big unions down there.

I've also worked in a union at one time. The IAM when I worked at McDonnell Douglas, now Boeing.

I saw those ranking, high seniority guys sitting on their back sides sleeping far too often. They were some of the least productive workers in the plant. Mostly because they knew they couldn't be touched. In fact, the seniority system is probably one of the worst things that came out of unionizing. Pay raises should be earned by merit, not how long you've been hanging around a place of work. Monetary raises provide incentive to increase productivity, guaranteed raises via unions do nothing to help a company become more efficient nor make more money.