What to do w/Detroit?

[racecar]

So. . .Detroit and the Big Three are doing not so-well, to put it mildly:

Quote:In the deserted streets of a city in decline, a burst of graffiti near the once mighty General Motors plant sums up the mood. HELP, a vandal declares in red ink. IT DOESN'T EXIST, answers another, in bright green.

Quote:It is a dismal picture that starts with the plants in central Detroit and fans out through the suburbs that depend on the industry. A GM collapse would threaten 2.5m jobs in the region and decimate the local economy. Even those who do not earn a paycheck from the carmaker depend on its presence, from parts suppliers to shopkeepers and bar staff.

Quote:In Detroit, as in America, GM, Ford and Chrysler are known as the Big Three. But these days they are big only in terms of their losses; and they may not be three for much longer. Preventing the collapse of one or all of them looms as one of the most formidable early challenges facing president-elect Barack Obama. Yesterday, Chrysler's chief executive, Bob Nardelli, said it would be very difficult for the company to survive without government support.

Whose fault is this?
A Detroit worker has the answer:

Quote:Cliff Fatt, who manages the finances of his local United Auto Workers (UAW) union, knows who to blame. "The situation we're in is the fault of Washington," he said. "There's a big black cloud hanging over the midwest states, and I'm frustrated because the rest of the country doesn't see how the core of manufacturing supports the overall economy."

My first response is a LOL.
But I sat on it for a bit. . .does the federal government deserve blame for encouraging a short-sighted reliance on big trucks? Should government policy be driving (pun intended, I suppose) the operation of big businesses like GM? Does Washington deserve blame for forcing American cars to operate against what some might call an unequal playing field against foreign competition (less labor costs)?

Quote:Despite the local fixation on GM's $25bn loan request, its second in two months, Summers and other workers admit that a cash infusion is unlikely to cure the company. GM is burning through more than $2bn a month, struggling to honour its benefits pact with the union while selling cars at a loss to consumers with no more money to spend. A third plea to the government could come before Obama's inauguration.

Anger at the Bush administration is one thing, but many are equally irritated with the media. The D-Ham plant is to be the jewel in GM's crown, groomed to start producing the electric Chevrolet Volt model by 2010, but customers at the local pubs only hear the news reports about US carmakers refusing to let go of their gas-guzzling marques.

Y'all can see that was my reaction. . .maybe unfair, but seems to me that cars, as a (hopefully) very long-lasting durable consumer good, are going to be slower in allowing brand identification/brand assumptions to swing. . .American cars now have a reputation for being overpowered, poorly-made behemoths, fair or not - I'm now a Toyota man, ya know (b/c we are, after all, the brands we consume).

Anyway - should GM be bailed out?
What is the proper role of the government in this sort of thing?
Would this be protectionism?

Here's one blogger dude offering reasons to bail out:

Quote: 1. As Andrew Leonard notes, it's what Barack Obama was elected to do. "If evangelical supporters of George Bush had the right to expect conservative judge appointments and restrictions on stem cell research, then working class Midwesterners are equally justified in expecting delivery on Democratic economic promises. That's how a democracy works." If Obama didn't intend to bail out Detroit, he was being very slippery during his election campaign.
2. It's an efficient way of directing fiscal stimulus towards the rust-belt states which need it most. Up until now, Treasury's been careful to separate the idea of bailouts as distinct from fiscal stimulus: we're "investing" rather than "spending" the money going into the banks and AIG. But that's a silly distinction. As Steve Waldman says, most government spending, outside of entitlement transfers, is investment.
3. It might be cheaper than the alternative of letting GM fail and throwing its employees, and its suppliers' employees, and its dealerships' employees, and so on and so forth, onto the unemployment rolls at a time when it's harder to find a new job than it has been in a very long time.
4. It's a great way of being able to implement the long-term strategic goals of the Obama administration when it comes to things like energy independence. Leonard, again:

A Manhattan Project-scale plan to move the U.S. into an energy-sustainable future should start with a complete restructuring of the automotive industry. It's time to think big.

Of course, he also offers a reason NOT to bail out:

Quote:Ryan Avent says that since the long-term future of the rust belt does not lie with the automakers, a bailout would simply stand in the way of the rust belt's reinvention. "Political energy in the Rust Belt is geared toward maintaining the status quo at the expense of other priorities," he notes, and a bailout is much more likely to reinforce those tendencies than it is to shake them up.

Here's a rather spare assessment of the bailout from the National Review:

Quote:A bailout of GM would be a pure exercise of political power to deliver taxpayer funds to one organized group of citizens at the expense of the country as a whole. It should be avoided.

Is that fair? Could a GM collapse hurt the country to the point that a bailout (or whatever help is offered) would be preferable?

Another commentator:

Quote:We stress that, in recommending the bankruptcy option, we are not suggesting that the government abandon GM's workers: We'd rather the government spend billions on retraining and job placement than on propping up perpetually weak companies that can't fix themselves. We also don't buy the argument that bankuptcy would be a death-blow for GM. The only folks it would be a death-blow for would be shareholders and many bondholders.

Is there any point for job training in parts of the midwest with no American auto industry?
Should we just abandon Detroit like Russia did with Chernobyl?

The article ends with what seems to be a quintessential American sentiment:

Quote:Greenfield avowed with a grin that "automobile people are tough people" - and that the 100-year-old General Motors name would live on. "We're not recyclers," he said of his countrymen. "We're consumers of products."

Thoughts?
Snarky comments?

[blueterp]

No easy answers here.

I hope (and I have confidence that Obama will), make the best policy decision rather than one simply driven by politics or ideology. But even there, the best policy is probably unknown and unknowable.

[TimTerpT]

I think that the situation, right now, is hopeless, but the timing couldn't be worse for this major part of the economy to go bankrupt.

[rickheel]

Barry owes the unions. Conundrum.

[blueterp]

(11-14-2008 11:11 AM)rickheel Wrote:  Barry owes the unions. Conundrum.

Are you so juvenile that you cant type the word "Barack"? Yes, I know he himself used "Barry" when he was a kid, but he has, since college, asked that people call him by his given name, Barack.

http://www.newsweek.com/id/128633

[don bosco]

Are the unions really more inflexible than the companies?

And who owes the companies (in the same context)?

[The Bomber]

First of all, there's no such thing as overpowered!

[DeaconPeach]

(11-14-2008 11:16 AM)blueterp Wrote:  

(11-14-2008 11:11 AM)rickheel Wrote:  Barry owes the unions. Conundrum.

Are you so juvenile that you cant type the word "Barack"? Yes, I know he himself used "Barry" when he was a kid, but he has, since college, asked that people call him by his given name, Barack.

http://www.newsweek.com/id/128633

Then by the same logic, use of the term "Shrub" should cease as well on this board when used in reference to George W. Bush. Hurrah!

[sunnyheel]

Of course, there are no easy answers, but the one thing that occurs to me is that each of the Big Three is in a unique situation.

Ford is doing pretty well considering the state of our economy. Their cars are consistently rated highest of the three, the new lineup is pretty appealing, and their finances are on sounder footing.

GM is the behemoth with the deepest trouble while Chrysler barely qualifies as a carmaker, imo.

I say, ease the burden across the board by removing the health care requirement (current and retired workers) and provide some tax incentives for increasing fuel efficiency. With GM, buy into the company and really take over the joint, appointing a green BOD assigned to reinvent the company. Once the economy turns around and the internal and output improvements are achieved, cash out the government's investment.

Chrysler should sell its autmotive assets to GM and convert into a green industry, manufacturing wind turbines, solar panels, whatever.

One more thing: we should broaden the mission of NASA making it responsible for directing the growth and development of alternative energy and green technology. Maybe Chrysler could fit into their footprint.

[blueterp]

(11-14-2008 11:52 AM)DeaconPeach Wrote:  

(11-14-2008 11:16 AM)blueterp Wrote:  

(11-14-2008 11:11 AM)rickheel Wrote:  Barry owes the unions. Conundrum.

Are you so juvenile that you cant type the word "Barack"? Yes, I know he himself used "Barry" when he was a kid, but he has, since college, asked that people call him by his given name, Barack.

http://www.newsweek.com/id/128633

Then by the same logic, use of the term "Shrub" should cease as well on this board when used in reference to George W. Bush. Hurrah!

Yes, I dont think its necessary or adds anything. Plus, if you're going to give Obama a derogatory nickname, at least wait until he screws up something as President.

[Supersport]

I don't see how either the companies or the unions make it in their current forms. They have tremendous liabilities for retirement and health care based on assumptions that were made when they were successful, and they will never return to those conditions again. They could come out of this much smaller but they cannot compete with the foreign makers who have proven how to a.) build good, marketable cars in the US b.) without unions.

Obama will do all he can reasonably be expected to do by just about anybody but bascially they cannot make it no matter what anybody does. It will proabby cost the US several billion to get to that point, but nowhere near what it cost for the banking robbery.

[oldpack69]

The UAW needs to go on strike.
That'll teach those mean ol auto companies.

[rickheel]

(11-14-2008 11:16 AM)blueterp Wrote:  

(11-14-2008 11:11 AM)rickheel Wrote:  Barry owes the unions. Conundrum.

Are you so juvenile that you cant type the word "Barack"? Yes, I know he himself used "Barry" when he was a kid, but he has, since college, asked that people call him by his given name, Barack.

http://www.newsweek.com/id/128633

Are you freakin kidding me???????? At least I did not call him barrythewonderboy. Dems fussing about calling barrythewonderboy anything other than his given name takes the cake!!!!!!!!!!!!!

[rickheel]

(11-14-2008 11:31 AM)don bosco Wrote:  Are the unions really more inflexible than the companies?

And who owes the companies (in the same context)?

Padre, which way have the unions traditionally voted? Will barry lose face if he allows the companies to fail, thereby allowing all of those union workers to lose their jobs? Where will they go find those $28 per hour jobs?

[The Bomber]

I think Barry Goldwater's real name was Barack.

[blueterp]

(11-14-2008 03:07 PM)rickheel Wrote:  

(11-14-2008 11:16 AM)blueterp Wrote:  

(11-14-2008 11:11 AM)rickheel Wrote:  Barry owes the unions. Conundrum.

Are you so juvenile that you cant type the word "Barack"? Yes, I know he himself used "Barry" when he was a kid, but he has, since college, asked that people call him by his given name, Barack.

http://www.newsweek.com/id/128633

Are you freakin kidding me???????? At least I did not call him barrythewonderboy. Dems fussing about calling barrythewonderboy anything other than his given name takes the cake!!!!!!!!!!!!!

I guess you are that juvenile.

[psychot]

^ You're waaaay out of line, chief.

I was never inclined to refer to Obama as "barry," but I think I'll start now, just to pi$$ you off...

[prodeac]

Huge problem. I don't think anyone knows yet whether GM could successfully reorganize in bankruptcy. If they could, and thereby relieve themselves of the UAW contract, that seems like a better solution than a bailout because, even if it were capable of making saleable vehicles for the coming decades, GM can not compete with the non-union shops. If GM is, however, forced into liquidation, Detroit will sink and all the parts manufacturers will also go out of business. The proposed bailout might be cheaper than the disaster that would create.

If you don't pay for a bailout, you may end up paying additional unemployment benefits to horde of people. The federal government would also have to step in and save Michigan's social programs.

Good luck.

[blueterp]

(11-14-2008 05:43 PM)psychot Wrote:  ^ You're waaaay out of line, chief.

I was never inclined to refer to Obama as "barry," but I think I'll start now, just to pi$$ you off...

Nothing you say is really going to piss me off, one way or the other, and, in any event, says more about you than anything else.

And it is juvenile, its not even a proper derrogatory nickname like 'shrub.'

[DeaconPeach]

(11-14-2008 05:57 PM)blueterp Wrote:  

(11-14-2008 05:43 PM)psychot Wrote:  ^ You're waaaay out of line, chief.

I was never inclined to refer to Obama as "barry," but I think I'll start now, just to pi$$ you off...

Nothing you say is really going to piss me off, one way or the other, and, in any event, says more about you than anything else.

And it is juvenile, its not even a proper derrogatory nickname like 'shrub.'

You've got it backwards. Barry is a proper nickname...Shrub is simply disrespectful & definitely derogatory. Barry would be acceptable, Shrub would not & never has been acceptable.

[BornAJacket]

(11-14-2008 11:52 AM)DeaconPeach Wrote:  

(11-14-2008 11:16 AM)blueterp Wrote:  

(11-14-2008 11:11 AM)rickheel Wrote:  Barry owes the unions. Conundrum.

Are you so juvenile that you cant type the word "Barack"? Yes, I know he himself used "Barry" when he was a kid, but he has, since college, asked that people call him by his given name, Barack.

http://www.newsweek.com/id/128633

Then by the same logic, use of the term "Shrub" should cease as well on this board when used in reference to George W. Bush. Hurrah!

I was about to post a very similar statement

[BornAJacket]

(11-14-2008 03:15 PM)The Bomber Wrote:  I think Barry Goldwater's real name was Barack.

Interesting that Goldwater came up... Wasn't he from Arizona too? He didn't win with a name like Barry, no wonder Barack doesn't use it anymore.

[Peapod]

Presidents get less than flattering nicknames. It's what happens. "Barry" just happens to be one of those (in your eyes). I'm sure, if asked, W wouldn't care too much about Shrub. Barry is not derogatory in any way, shape or form. Barry happens to be what Obama, himself, preferred to be called at a time in his life. I saw video from Indonesia where his old classmates called him Barry. Are you going to castigate them, too?

Seriously dude. You're going after one of the most respected posters here because he's calling Obama (who I happen to support and voted for) Barry?! And of that, only because Obama doesn't prefer it? Get over yourself.

You owe Rick an apology, IMO. I won't demand or expect one, though. I will request that you redirect the thread back on topic or drop the issue altogether.

[blueterp]

Quote: I will request that you redirect the thread back on topic or drop the issue altogether.

[TimTerpT]

I agree that using Barry is intended to be insulting, but so was using shrub. These kind of names are to be expected on a board like this one.