Im sorry, but all this media blah blah blah about the proposed bailout for the Big Three auto companies has clouded the entire situation for me to the point where the whole things seems like absolute hurricane of misinformation. It seems that just about every article or story I find about it has a completely different account of events.
However!
It seems that every writer thus far has begun to notice one thing, the UAW (United Auto Workers) are starting to get very concerned about the future of their beloved industry, so much so that they are willing to allow the cutback of the "jobs bank" program.
Stephen Spruiell describes the UAW and auto industry approach to receiving a bailout.
First and foremost, I am decidedly very glad that the big three have finally started to cut some of these totally ridiculous programs. The "jobs bank" program was a total pit of money that basically paid laid-off workers to do absolutely nothing. What then is the incentive of that laid off worker to find another job? Well thats a good question, there really isn't one. On top of that the big three offer a health care till death program under which retired workers received health care from the company even after they are no longer employed. Im all for providing health benefits while a worker is employed at a company, but why should a company hold itself responsible for the health care costs of an employee long after they leave? Its hard to look at these programs and not gawk at the sheer fiscal irresponsibility of these companies, and these are the people we are going to bailout?
Why!?
This bailout in my opinion is a total slap in the face to auto companies such as Honda, Toyota, Mercedes, BMW that run american factories without falling over their own feet. Why should we reward people who make stupid moves with their money while overlooking those that keep the industry alive? I just dont think that GM, Ford and Chrysler are very deserving of the tax payer's money. I would rather see these companies go bankrupt and try to reorganize without the burden of irresponsible Union contracts that continue to siphon money away. (GM owes in excess of 9 billion dollars by spring '09 to fund their retiree pension alone).
The results however are yet to be seen, Chrysler and GM will appear before congress on thursday and friday to explain what they plan to do with all this bailout money.
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6 comments:
I do agree that the media has been making this whole thing very confusing. I am also glad to see that "the Big 3" are willing to give in order to receive.
It is important that we bail them out though...GM,Ford,and Chrysler directly and indirectly employ about 3 million people, and if they were to declare bankruptcy that would be a lot of people without a job. Not to mention that the American auto industry would be practically dead. Sure, Honda, Toyota, and BMW employ Americans, but they aren't American companies (plus I highly doubt that they will declare bankruptcy).
I think that this whole bailout plan is just to keep the American Auto industry alive (even if American cars suck).
Sure they employ 3 million people... but they dont have the money to PAY those 3 million people. Why is it our job to pick up the debt for companies that cannot even afford to pay their employees without dropping a tab off at congress.
Jobs are not the be all end all of the economy. Some people had to lose their jobs as horse carriage drivers when cars were invented. Jobs that are unproductive and unprofitable hurt the economy.
These are bad companies, that destroy wealth by using up resources making cars no one wants (stunting economic growth because those resources could have been used more efficiently).
The point is that these bad companies should fail, and that regardless a bailout would only be delaying the inevitable. If people really believed that they could be made profitable, private investors would seize the opportunity and invest in the company. Since no one will do that, they have to come begging to the government. Also, if they go bankrupt, it's possible that investors could buy their factories and make a profitable business (this would almost certainly involve lowering wages, but people could get jobs, jobs that actually help the economy).
Regarless of whether the jobs are effective or not, they are still jobs. 3 million people are going to be pissed once they lose them.The job market sucks, and I don't think that they want to be out looking for a job. I think that the whole bailout plan is a glimpse of hope for them. I was just thinking about the workers.
Plus their bankruptcy is only going to make the economy worse. Do I think that they should have managed their company better?Sure, but they didn't, and they are seeing the consequences right now. Is the bailout plan really going to work? I have no clue, but I don't think that they are going to let these companies go bankrupt.
Bankruptcy will not make the economy worse. Bailouts will. Bad companies going bankrupt is natural and should be encouraged, so their resources can be better allocated.
Like I said, unproductive and unprofitable jobs hurt the economy. They don't want to have to find a new job, but that's the way of life. They are unprofitable. You shouldn't hurt the entire economy to help a few people (and only temporarily!)
I'm basically just saying again what I already said.
whoever ballin4life is, you know your shit man. (teach me multi-variable calculus). stupid buisness management is a horrible reason to give a big buisness a bunch of money. they are bad at allocating their funds and selling cars. THEN THEY DONT GET MONEY. seems pretty straight forward to me. dont complain about the people losing their jobs because the governments responsibility is to run the government, not run big buisness. the government can produce three million jobs in their own auto-industry if they want to. but they dont because that is socialism and we live in the United States of America.
giving the "big three" a bunch of money is like patching up a damn that is leaking in a thousand places. its just a waste of time, tax dollars, and effort. let the damn fall cause its going to anyway and allow some entrepenuir to build a new one in its place with his own money, not mine (or yours, or the average taxpayer's).
when a new, more effective buisness rises, the 3 million jobs will mean nothing because 3 million jobs will be created. plus the new buisness will generate revenue instead of taking the governments money and actually help the economy out of the recession instead of dragging it downward.
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