Interesting global development (GM)
11-19-2008, 11:34 AM
#31
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Join Date: Jul 2001
Location: FL/MI
Posts: 1,808
For many people, the issue isn't whether the U.S. would look "stupid" for not helping.
Talk/listen to any constitutional lawyer who believes the constitution says what it means (and intentionally doesn't say what it didn't want to say) and you'll hear that there is simply nothing in the constitution that allows the Federal government to step in and take over/give money/loan money to a privately owned company (don't misunderstand; I don't for a moment expect the courts to step into this mess).
But perhaps more importantly, the U.S. is supposed to believe in and support free market capitalism...not "private business" run in whole or in part by a central government.
Conversely, it shouldn't come as a surprise (in fact it should be expected) that socialistic democracies like Germany, Sweden, Great Britten, France, etc. would step in and involve themselves because their form of government not only allows it but to a great extent, expects it.
Talk/listen to any constitutional lawyer who believes the constitution says what it means (and intentionally doesn't say what it didn't want to say) and you'll hear that there is simply nothing in the constitution that allows the Federal government to step in and take over/give money/loan money to a privately owned company (don't misunderstand; I don't for a moment expect the courts to step into this mess).
But perhaps more importantly, the U.S. is supposed to believe in and support free market capitalism...not "private business" run in whole or in part by a central government.
Conversely, it shouldn't come as a surprise (in fact it should be expected) that socialistic democracies like Germany, Sweden, Great Britten, France, etc. would step in and involve themselves because their form of government not only allows it but to a great extent, expects it.
Someone will cover the pensions. The recent elections make that more than clear to me. Whatever folks think about the big three continuation with UAW labor, the legacy costs are an issue for Ford, Chrysler, and GM. The legacy costs will not disappear with one, two, or all three going under. Constitutional questions aside, the taxpayer will pick up the bill. One need not have listened any closer to the hearings yesterday to fully know that congress will pass a $6 billion package for unemployment benefits, and likely no immediate loans to the big three.
I think the UAW has come to a revalation on the realities. I also believe that the worst of this whole situation is that the economy went down faster than the downsizing and concessions could turn things around.
Ford is "solvent" but mortgaged to the hilt. GM is on the ropes, Chrysler is likely the most desperate yet their private ownership masks that.
11-19-2008, 11:42 AM
#32
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Join Date: Feb 2005
Location: Columbia, SC
Posts: 506
*IF* the credit markets werent hosed, could GM have mortgaged itself some if not to the extent that ford did to generate capital? (i assume so, but this agian, means that if the credit markets werent frozen, we'd most likely not be in this situation at all) funny how i think i just answered my own question.
But after reading your post, I assume that what your saying is that you dont think Congress / senate will pass the loans for GM, but will pass a "unemployment bill" for those displaced when the ship sinks?
But after reading your post, I assume that what your saying is that you dont think Congress / senate will pass the loans for GM, but will pass a "unemployment bill" for those displaced when the ship sinks?
11-19-2008, 11:52 AM
#33
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Join Date: Mar 2001
Posts: 1,943
There is still some hope that focus is key. There is no political groundswell for dismantling organized labor in this country. Whatever one thinks about the UAW is somewhat clouded, IMO, by what's been boilerplate in the past.
Someone will cover the pensions. The recent elections make that more than clear to me. Whatever folks think about the big three continuation with UAW labor, the legacy costs are an issue for Ford, Chrysler, and GM. The legacy costs will not disappear with one, two, or all three going under. Constitutional questions aside, the taxpayer will pick up the bill. One need not have listened any closer to the hearings yesterday to fully know that congress will pass a $6 billion package for unemployment benefits, and likely no immediate loans to the big three.
I think the UAW has come to a revalation on the realities. I also believe that the worst of this whole situation is that the economy went down faster than the downsizing and concessions could turn things around.
Ford is "solvent" but mortgaged to the hilt. GM is on the ropes, Chrysler is likely the most desperate yet their private ownership masks that.
Someone will cover the pensions. The recent elections make that more than clear to me. Whatever folks think about the big three continuation with UAW labor, the legacy costs are an issue for Ford, Chrysler, and GM. The legacy costs will not disappear with one, two, or all three going under. Constitutional questions aside, the taxpayer will pick up the bill. One need not have listened any closer to the hearings yesterday to fully know that congress will pass a $6 billion package for unemployment benefits, and likely no immediate loans to the big three.
I think the UAW has come to a revalation on the realities. I also believe that the worst of this whole situation is that the economy went down faster than the downsizing and concessions could turn things around.
Ford is "solvent" but mortgaged to the hilt. GM is on the ropes, Chrysler is likely the most desperate yet their private ownership masks that.
Yes...for those who loose their jobs, unemployment has to kick in but unemployment benefits, while they may be extended many times, don't last forever...$25B can pay a lot of unemployment benefits but to even compare the two, you would likely need to assume that everyone who might loose a job would be forever unemployed; not a valid assumption IMHO nor is it valid based on history.
Pensions are another issue...no one really knows what would happen for sure because the quasi-governmental agency is essentially in over its head...if/how/how much the Feds would step in and what it would cost is at best, unclear but even were it crystal clear; to assume going that route would cost more than what the Detroit Three need to survive is an assumption without much fact to go on.
Everybody seems to forget that there is a new vehicle market out there...that people are buying cars...that even GM/Ford/Chrysler are selling cars...just because one or all three of the domestic nameplates leave the scene doesn't mean the market suddenly goes totally away as well...someone/something will step in to fill the void and will probably have to run plants/hire folks displaced by the absence of the ones who have left.
Tremendous upheaval to be certain but that doesn't mean the adversity can't or won't be overcome.
11-19-2008, 11:55 AM
#34
Banned
Join Date: Mar 2001
Posts: 1,943
*IF* the credit markets werent hosed, could GM have mortgaged itself some if not to the extent that ford did to generate capital? (i assume so, but this agian, means that if the credit markets werent frozen, we'd most likely not be in this situation at all) funny how i think i just answered my own question.
But after reading your post, I assume that what your saying is that you dont think Congress / senate will pass the loans for GM, but will pass a "unemployment bill" for those displaced when the ship sinks?
But after reading your post, I assume that what your saying is that you dont think Congress / senate will pass the loans for GM, but will pass a "unemployment bill" for those displaced when the ship sinks?
It's possible they could have borrowed but they are and have been already so upside down that I'd say it would have been doubtful at best.
11-19-2008, 11:58 AM
#35
Registered User
Join Date: Feb 2005
Location: Columbia, SC
Posts: 506
Everybody seems to forget that there is a new vehicle market out there...that people are buying cars...that even GM/Ford/Chrysler are selling cars...just because one or all three of the domestic nameplates leave the scene doesn't mean the market suddenly goes totally away as well...someone/something will step in to fill the void and will probably have to run plants/hire folks displaced by the absence of the ones who have left.
Tremendous upheaval to be certain but that doesn't mean the adversity can't or won't be overcome.
Tremendous upheaval to be certain but that doesn't mean the adversity can't or won't be overcome.
Will the adversity be overcome? yes, most likely.. but I ask you, at what cost?
11-19-2008, 12:07 PM
#36
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Thread Starter
Join Date: Sep 2002
Location: Oakland, California
Posts: 9,710
The talk about the taxpayer will pick up the bill one way or the other is a read hearing I believe.
Yes...for those who loose their jobs, unemployment has to kick in but unemployment benefits, while they may be extended many times, don't last forever...$25B can pay a lot of unemployment benefits but to even compare the two, you would likely need to assume that everyone who might loose a job would be forever unemployed; not a valid assumption IMHO nor is it valid based on history.
Pensions are another issue...no one really knows what would happen for sure because the quasi-governmental agency is essentially in over its head...if/how/how much the Feds would step in and what it would cost is at best, unclear but even were it crystal clear; to assume going that route would cost more than what the Detroit Three need to survive is an assumption without much fact to go on.
Everybody seems to forget that there is a new vehicle market out there...that people are buying cars...that even GM/Ford/Chrysler are selling cars...just because one or all three of the domestic nameplates leave the scene doesn't mean the market suddenly goes totally away as well...someone/something will step in to fill the void and will probably have to run plants/hire folks displaced by the absence of the ones who have left.
Tremendous upheaval to be certain but that doesn't mean the adversity can't or won't be overcome.
Yes...for those who loose their jobs, unemployment has to kick in but unemployment benefits, while they may be extended many times, don't last forever...$25B can pay a lot of unemployment benefits but to even compare the two, you would likely need to assume that everyone who might loose a job would be forever unemployed; not a valid assumption IMHO nor is it valid based on history.
Pensions are another issue...no one really knows what would happen for sure because the quasi-governmental agency is essentially in over its head...if/how/how much the Feds would step in and what it would cost is at best, unclear but even were it crystal clear; to assume going that route would cost more than what the Detroit Three need to survive is an assumption without much fact to go on.
Everybody seems to forget that there is a new vehicle market out there...that people are buying cars...that even GM/Ford/Chrysler are selling cars...just because one or all three of the domestic nameplates leave the scene doesn't mean the market suddenly goes totally away as well...someone/something will step in to fill the void and will probably have to run plants/hire folks displaced by the absence of the ones who have left.
Tremendous upheaval to be certain but that doesn't mean the adversity can't or won't be overcome.
The majority of the politicians that are against providing loans to Detroit want to use the money to buy up bad mortgages. To me that's a much riskier proposition for the US taxpayer. Rather than investing in an industry that provides jobs and consumer goods for millions, we'd be helping out individuals who were just as greedy and irresponsible with purchasing homes they could never afford. As a taxpayer who is responsible on my own mortgage and who would not qualify for a government bailout, why should I allow my tax dollars to go to those individuals all of who were irresponsible when it can be used to save a vital domestic industry and help millions, most of which who weren't greedy and irresponsible and didn't create this problem? (i.e. the US autoworkers, suppliers and dealers.)
11-19-2008, 12:28 PM
#37
Banned
Join Date: Mar 2001
Posts: 1,943
...Robert, I understand where you're coming from, but considering the alternative...
The majority of the politicians that are against providing loans to Detroit want to use the money to buy up bad mortgages. To me that's a much riskier proposition for the US taxpayer. Rather than investing in an industry that provides jobs and consumer goods for millions, we'd be helping out individuals who were just as greedy and irresponsible with purchasing homes they could never afford. As a taxpayer who is responsible on my own mortgage and who would not qualify for a government bailout, why should I allow my tax dollars to go to those individuals all of who were irresponsible when it can be used to save a vital domestic industry and help millions, most of which who weren't greedy and irresponsible and didn't create this problem? (i.e. the US autoworkers, suppliers and dealers.)
The majority of the politicians that are against providing loans to Detroit want to use the money to buy up bad mortgages. To me that's a much riskier proposition for the US taxpayer. Rather than investing in an industry that provides jobs and consumer goods for millions, we'd be helping out individuals who were just as greedy and irresponsible with purchasing homes they could never afford. As a taxpayer who is responsible on my own mortgage and who would not qualify for a government bailout, why should I allow my tax dollars to go to those individuals all of who were irresponsible when it can be used to save a vital domestic industry and help millions, most of which who weren't greedy and irresponsible and didn't create this problem? (i.e. the US autoworkers, suppliers and dealers.)
I was wholly against the $700B bailout package; the earlier "stimulus package" and any other form of the Federal Government thursting itself into private industry...that fact that the Federal Government wants/is willing to step in and inject itself into some areas doesn't make me think that the auto industry should get money just because some others have/will.
It's all a bunch of hogwash in my always humble opinion!
11-19-2008, 12:29 PM
#38
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Join Date: Mar 2001
Posts: 1,943
Yes, but i believe what concerns most folks, is what happens in between the time that say the big three fall, and the return to balance of "import" manufacturers stepping in and making a stable job market? How many folks will loose their homes, their insurance, their very lives because of no food, no roof, no medical assistance, no medication, etc.. not to mention the social impact of having hundreds of thousands if not millions unemployed, and thus being on the "welfare" system, which is finite... i dont know about you but here in SC, unemployment benifits only last 6 months... and i'd wager it'd take a lot longer than 6 months to restore balance to the economy, and the auto manufacturing markets.
Will the adversity be overcome? yes, most likely.. but I ask you, at what cost?
Will the adversity be overcome? yes, most likely.. but I ask you, at what cost?
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