http://www.cnbc.com/id/28183485
Shame really, this was discussed in my previous article and it was believed that this would pass but I guess not.
However, "GM, Ford and Chrysler employ nearly 250,000 people directly, and 100,000 more jobs at parts suppliers could hang on their survival. The companies say 1-in-10 U.S. jobs are related to the auto sector. " so if that is true and the companies really do start collapsing I wonder what Congress will do then
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7 comments:
Although I'm not familiar with the details of the plan, I'm not disappointed with its failure. I must admit to having taken a rather Republican stance on this issue.
If we were to examine the American auto industry's collective business plan, we would discover the adherence to antiquated and obsolete ideas for which there is little demand. An industry that produces such a staple commodity should have no problem selling its product unless said product were inferior. Toyota, Honda, BMW, VW AG, etc. are doing very well. Perhaps that is a result of producing cars that people actually want to buy–cars that are well-designed, well-engineered, and fuel-efficient.
If the government were to send money to the auto industry, it would only perpetuate that which will inevitably fail. Subsidizing something that cannot survive independently is not good policy.
An alternative? I read a great suggestion for the government to swap old clunker cars that have low emission and efficiency standards for American-made super-efficient cars (i.e. the next generation of hybrids and electric cars). Not only would this scrap the worst offending cars on our streets, but it would also provide demand for the cars that need to be innovated, all while saving the industry, all jobs associated with it, and the environment. Every cloud has a silver lining.
One thing for sure, GM is not going to last long, our modern vehicle transportations has been a major roll in our daily lives, and taking away a huge company such as General Motors will definitely have a huge impact in the vehicle catagory. It will be a huge lost for car lovers as well.
I recently read an article about the US piano industry, which was booming in the early 1900s but is almost nonexistant now.
That was a huge loss for piano lovers.
But no one seems to care now.
(Yeah i realize cars are more important than pianos)
haha pianos are an absolute asset to american life, what are you talking about?
thank god this didnt get passed, i think it is a terrible idea and i agree with jason that keeping a dying company alive only drags out the inevitable and makes the economy worse. but i say that in every post on the economy.
oh and about jason's idea of the government to exchange gas guzzlers for efficient vehicles, i think maybe our autoindustries should think of that themselves and save their own business. its not the governments responsibility (well maybe the environment is but if the want to improve that, just pass stronger regulations on efficiency). the autoindustries have the responsibility of saving themselves and could do it without government intervention anyway. and then maybe they should start making better cars
From a business standpoint, yes not passing the bailout was a wise decision. But what about the people? Thousands of Americans who have worked in the auto industry for years will all be jobless at the same time. Unemployment rates haven't been this high in thirty years and allowing the auto industry to self destruct would only increase these unemployment rates. Allowing thousands of people to lose their jobs isn't good policy either.
I am in agreement with Jason Bade on this issue. The only reason that the auto industries would not be doing well is because they cannot sell their cars, and the only reason for that would be that their cars are not the kind of cars people want to buy. that being said, I do think there is something to be said for the argument that thousands of jobs hang on to the survival of these auto companies, so maybe the bailout plan is not all bad.
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