Democrats & Liberals Archives

Bailout for GM?

This is the season for bailouts. U.S. is in a depression. Big banks are not making loans and big auto companies are not selling cars. So we’re offering bailouts to these business leviathans and nothing to workers losing their jobs. What could be more natural? Haven’t we always taken care of the powerful? Don’t worry: if we help them it will eventually trickle down to the workers

GM submitted a simple plan: it wants what would eventually be a $30 billion bailout, and in return it will make itself a viable corporation, by among other things, cutting out 47,000 jobs.

GM wants us to give them billions so they can fire 47,000 workers!

The purpose of a bailout should not be to save GM or any other company. The purpose should be to keep workers employed. Yes, I know that if we save GM we save a bunch of suppliers as well. Still, I say, we want to save the jobs that suppliers provide, not necessarily the companies involved.

Jobs are what will revive our economy. People with jobs will buy all sorts of appliances. People with jobs will pay back their debts. People with jobs will spend on entertainment. People with jobs will have confidence to buy homes. People with jobs will increase general economic confidence to the point where entrepreneurs will take chances with new enterprises - the source of the growth of more jobs.

Many will argue with me: If we don't have viable companies, there will not be any jobs at all. Of course. This is the situation we are in right now. We can't get on our feet without prosperous companies. But our overriding concern must be to build companies that provide good jobs. Emphasis on jobs!

Here's what we should tell GM: We'll give you the money. In return we expect you to find jobs for the 47,000 you intend to lay off. Act as IBM did a long time ago. Way back in the 20th century (before it was changed by "modern" management) IBM had a policy to keep all employees employed: they had R&D projects to find new products to keep everyone busy.

Can GM do this? Of course it can. For instance, it can work strenuously to quickly develop and produce cars operated by non-carbon fuels. GM can revamp its operations to produce solar panels and wind machines.

Perhaps this cannot be done with its current management. Let's change the management. After all, by bailing out GM the U.S. would be the biggest "stockholder." The U.S. should have a voice in the company's operations. This is not "socialism." This is common sense.

Bailout for GM? Only if GM is modernized in a way that increases, not decreases, employment.

Posted by Paul Siegel at February 19, 2009 7:46 PM
Comments
Comment #275804

Paul
I’m with you. They want a bailout lets see their plans to start making the best, most reliable and fuel efficient cars in the world. How about funding GMAC to start making car loans available again. How about funding a gas guzzler by -back program with the payments good for car downs.How about the Feds order about twenty years worth of Humvees.

Posted by: bills at February 19, 2009 9:18 PM
Comment #275806
Here’s what we should tell GM: We’ll give you the money. In return we expect you to find jobs for the 47,000 you intend to lay off…Can GM do this? Of course it can. For instance, it can work strenuously to quickly develop and produce cars operated by non-carbon fuels. GM can revamp its operations to produce solar panels and wind machines.

Unbelievable. A dispatch straight from La-La Land.

Why, pray tell, should an auto manufacturer produce wind machines and solar panels?

And we should give them—a car manufacturer—public money, so long as they produce something that has nothing to do with building cars, much less selling them?

This is what we’re invited to picture in the world of liberal thinking. A car with a windmill on it driving down the highway. This would be like the Edsel, except we could call it the GM Obama. 0-50 in 45 minutes, so long as you’re in the middle of a hurricane.

Posted by: Loyal Opposition at February 20, 2009 12:08 AM
Comment #275807

Paul, what leftists need to understand but never seem to is that the purpose of a company is NOT to employ workers and provide benefits to workers.

The purpose of a company is first and foremost to produce goods or services that people want at a price they are willing to pay. If you achieve that goal, then employment and benefits for workers naturally follows.

If you FAIL to achieve that goal, then there’s no reason to employ people at all and any government money pumped into the company is like infusing blood into a corpse.

Posted by: Loyal Opposition at February 20, 2009 12:22 AM
Comment #275808

LO
“The purpose of a company is first and foremost to produce goods or services that people want at a price they are willing to pay.”

Wrong. The purpose more oft stated is to make money. The goods or services are to that purpose. Another aspect of that is there have to be enough people earning money to purchase those goods or services. That means employees need to be paid fairly.
Companies or corporations are NOT natural phenomena like tribes or stalagtites. They are licensed entities. Their purpose is whatever the licensing power says it is. This is nothing new or particularly liberal( The Dutch East indies Company etc.) and can be and are required to meet certain responsibilities. This is particularly true under circumstances were the licsening agency has a financial interest in the company either as a user,awarding government contract etc., ot in this case a direct financial investor.

Posted by: bills at February 20, 2009 4:35 AM
Comment #275814

bills

“Their purpose is whatever the licensing power says it is.”

this makes no sense. i private co.s purpose is to produce goods and services for profit, and that is decided by those who run the co.

the gov’t has no business telling a private entity that they must produce wind turbines if they choose not to. that being said, the exception would be if they take money from the gov’t in a bailout. then the gov’t can stipulate this is part of the agreemnet, and that would i agree include a salary cap on executive compensation.

if they choose not to take the money then they are free to operate as they please. it may be better to file for bankrutcy, and then reorganize. i think the main reason the gov’t at this time is so interested in bailing them out is to save UAW jobs. i don’t believe they would do the same to save american jobs at honda, which is the largest employer where i live, unless honda agreed to let the UAW organize thier co.

i happen to own 3 GM vehicles, and i bought them because i like to drive big american iron. if the gov’t mandates they build only little point and steer econoboxs i will buy something else. auto manufacturers build what people buy.

the only way i see the gov’t being succesful in running the auto industry is if they run off all competition, and prohibit the purchase of large used cars. they could call it the obamamobile, i bet those would sell like hotcakes LOL!!!

Posted by: dbs at February 20, 2009 12:22 PM
Comment #275816


Paul, what non-carbon fuels do you have in mind? Most of our electricity is procuced by carbon fuels and the oil companies want to produce hydrogen from fossil fuels.

If the time to confront this to big to fail mentality is not now, when?

When the first auto bailout was given, I thought everyone knew that it was just the first of several installments. Several of us tried to make that clear then.

How many jobs were liberals going to save with the first bailout?

Posted by: jlw at February 20, 2009 12:49 PM
Comment #275818

To many dealers in BF Egypt, They are to damn big ,Hummer to the military and saturn is on it’s way out and Pontiac is about done, And no need for A GM truck it’s the same thing as a chevy truck and Sabb ha ha. A smaller GM is Better than no GM. That’s right Paul It’s almost a depression, people are not Buying and We’ve already went down that road with millions of Car repos.

Posted by: Rodney Brown at February 20, 2009 1:12 PM
Comment #275819

Time to say ‘goodbye’ to GM and Chrysler

Cal Thomas writing in Worldmag…

Some of the cars of my childhood are no more. Kaiser-Frazier was the biggest postwar challenger to the Big Three. Models included the 1949 Kaiser Custom Vagabond, the 1948 Frazer Manhattan four-door sedan, the Dragon sedans, and Henry J coupes. In 1970, Kaiser, then known as the Kaiser Jeep Corporation, was sold to American Motors Corporation.

Other auto companies either went out of business or were bought. These included Packard (“ask the man who owns one”), Studebaker (“first by far with a postwar car”), and Hudson, which began making cars in 1909 and, like other automobile companies, in early 1942 was ordered by the U.S. government to stop making passenger cars and concentrate exclusively on fulfilling war contracts. In 1954, Hudson eventually merged with Nash-Kelvinator to become American Motors, a company that lasted in one form or another until 1987 when Chrysler gobbled it up.

None of these companies (and many more before them and after with names such as Tucker, DeLorean and Duesenberg) received government bailouts. If they couldn’t sell their products at a profit, they either sold out, or went bust. People who worked for them found other jobs. No one starved to death.

Americans have benefited from capitalism. Our government should not be undermining an economic system that has produced more prosperity for its citizens than any nation on earth. It cannot forever prop up companies that make products not enough people wish to buy. If a growing number of people prefer cars not produced by GM and Chrysler, how will a government rescue plan make them more likely to buy them?

The “going out of business sale” sign should go up now. Taxpayers should not be expected to underwrite dying companies, unless we get a free car for our money. But that only happens on Oprah.

http://www.worldmag.com/webextra/15050

Posted by: Jim M at February 20, 2009 1:18 PM
Comment #275830

I’m sorry Paul, I have to agree with Jim M. on this one. If they can’t make a car people want to buy then they should be out of business. It would definitely hurt in the short term, but to keep propping up a company that can’t sell a product doesn’t make any sense.

Yes of course we need the jobs, but let the government “make work“. Don’t force industry to “make work”.

I would apply this theory to the banking system too. If they’re too big to fail then they’re too big to exist. If we keep propping up dysfunctional banks with thief CEO’s, then this down turn could last for decades.

Posted by: Mike the Cynic at February 20, 2009 5:46 PM
Comment #275835

GM is not limited to just building cars & trucks. Never has been.

Look at Honda. They build cars, motorcycles, dirt bikes & all terrain vehicles, generators and….. solar panels. And probably some other stuff too.

The big three have not been much different. No idea about today, but in the past the big three built things like huge industrial engines, marine engines (big & small) and even odd-ball stuff like tornado warning sirens. If you live in a small town in tornado ally with an older system, chances are your tornado warning siren is powered by a old Chrysler Hemi engine.

So no restrictions or reasons why GM or any other of the auto makers can’t “branch out” into manufacturing different products like solar, wind turbines or anything else.

Posted by: just watching at February 20, 2009 9:15 PM
Comment #275838

just watching

you’re right GMs EMD division has built diesel engines for railroad locomotives, and marine aplications for quite sometime. they also had a division that built heavy equipt called terex, although i don’t believe it exists anymore. i think ths automotive divisions is what all the fuss is about. if it ceases to exist i would imagine the other profitable divisions such as EMD will continue on.

Posted by: dbs at February 20, 2009 10:01 PM
Comment #275840

“”So no restrictions or reasons why GM or any other of the auto makers can’t “branch out” into manufacturing different products like solar, wind turbines or anything else. “” They branched out into china and europe and mexico and canada and india and left US rotting on the vine they like many others got caught with there pants down .

Posted by: Rodney Brown at February 20, 2009 10:31 PM
Comment #275845

The point isn’t whether or not a company can branch out. It’s the ludicrous nature of liberal thinking, this idea of “helping” a large company save jobs by mandating that they start producing something (financed with taxpayer dollars) that neither they nor their workers have any experience in.

Why should an automobile company be required to produce energy? This is utterly ridiculous. Why don’t you force the soy farmers to produce pharmaceuticals while you’re at it? Why don’t you require telecommunications companies to develop mass transit?

If liberals want us to meddle with energy production even more than we already do, then at least meddle with the companies that actually work in the sector you’re talking about.

Posted by: Loyal Opposition at February 20, 2009 11:01 PM
Comment #275847

LO-
You know there’s a such thing as a Rolls Royce jet engine, right? That Mitsubishi was the manufacturer of the Zero?

There’s no law that says that a company that makes cars must stick to just that. Conceivably, if the car companies get good at battery technology, they could branch into businesses related to that.

As for Soy Farmers producing Pharmaceuticals? Something like that is plausible with genetic engineering. After all, patents exist for producing proteins in goat’s milk, if I’m not mistaken.

As for getting a telecommunications company to develop mass transit? One already does. But if a European Company isn’t your cup of tea, Try General Electric on for size.

Would it do the big car companies in this country harm to diversify, to add additional revenue streams, to cross-pollinate and innovate technology, instead of resting on the laurels of past glory?

Posted by: Stephen Daugherty at February 21, 2009 1:04 AM
Comment #275848

“It’s the ludicrous nature of liberal thinking, this idea of “helping” a large company save jobs by mandating that they start producing something (financed with taxpayer dollars) that neither they nor their workers have any experience in.”

Saving jobs equals ludicrous thinking if you are conservative LO? Creating jobs is foolish also I suppose. To think that a jobless recovery is acceptable to those with conservative viewpoints is just plain wrong thinking IMHO LO.

Why is it ok for private banks to set requirements for those they lend to, yet when the government considers doing the same thing it is ludicrous thinking? With the huge disparity in wealth we have in this country today it is appropriate for the government to be concerned with creating good paying jobs. Other conservatives whine with the mention of government jobs yet you consider it ludicrous for the government to attach these conditions to the private sector when they come begging for money the banks because won’t lend to them. Without decent jobs how will the taxpayers of this country ever pay back the deficit? You certainly do expect the top 1% to foot the bill do you?

As a side note, I would think if the big 3 automakers fail then NASCAR will be left begging foreign carmakers for parts and such as well as more than a few teams looking for work. How will that set with your conservative friends?

Posted by: j2t2 at February 21, 2009 2:04 AM
Comment #275850

Toyota and company cannot sell cars either. Toyota just posted their first loss ever. People are scared and saving their money and financing is hard to get.


dbs
Again,corporations are licensed legal entities. They are not natural structures in human affairs like nuclear families or tribes etc. They are ONLY legal entities. They exist ONLY because they have been allowed to exist by the licensing government. Their appearence is antrpologically a recent developement. The licensing agency places requirments on the corporations, so much for the crown,what type of corporate governance will take place, areas of operation etc.

Posted by: bills at February 21, 2009 4:40 AM
Comment #275852

stephen

even if GM automotive is allowed to fail, they will still exist, and will continue to employ people in thier other divisions.

http://www.emdiesels.com/emdweb/emd_index.jsp

http://www.generalmotorsengines.com/

Posted by: dbs at February 21, 2009 9:10 AM
Comment #275853

bills

“They exist ONLY because they have been allowed to exist by the licensing government.”

this is a scary statement. this indicates to me that you believe that our freedom, and all things that come with it are derived from gov’t. nothing could be farther from the truth. this is why many of us fear liberal policy. is it your belief that the gov’t can revoke any of our rights, and freedoms at any time?

Posted by: dbs at February 21, 2009 9:18 AM
Comment #275854

Corporations are NOT citizens…corporations are NOT citizens…corporations are NOT citizens!!!!! Corporate citizenship is one of the main reasons for this latest, greatest fiasco. Corporations are NOT citizens…corporations cannot be citizens, with citizenship rights, or our founders’ work was in vain, and America will never be again. Folks on the right worship corporations and god, and in that order…

Posted by: Marysdude at February 21, 2009 9:31 AM
Comment #275855
“It’s the ludicrous nature of liberal thinking, this idea of “helping” a large company save jobs by mandating that they start producing something (financed with taxpayer dollars) that neither they nor their workers have any experience in.”

Saving jobs equals ludicrous thinking if you are conservative LO?

Yes, it is absolutely ludicrous to give a company gobs of taxpayer money to enter an industry in which that company and its workers don’t have experience. It’s downright absurd and inefficient—which means, I have no doubt, that it will soon be number 1 on the liberals’ agenda.

Here’s a little hint.

If you want to save those jobs and have these windmills and solar panels (and you want to throw public money at it), then give the money to the companies who are already working on windmills and solar panels. The workers at the GM plant can be HIRED away by these companies. Wow, what an amazing thought. Having a company do what it actually does instead of letting liberals dictate to companies not only who they hire but what they produce. The absolute hubris of liberal thinking—that they know better than entire industries, its workers, and consumers—never ceases to amaze.

Posted by: Loyal Opposition at February 21, 2009 10:00 AM
Comment #275857

Marysdude is right
Corporations are NOT citizens!!!!! Corporate citizenship is one of the main reasons for this latest, greatest fiasco.

And Bills is right
“They exist ONLY because they have been allowed to exist by the licensing government.”

But if we want them to be successful, we have to be realistic in what we expect from them.

Posted by: Mike the Cynic at February 21, 2009 10:09 AM
Comment #275858

“corporations are NOT citizens”

no, they are made up of citizens. citizens have the right to engage in commerce, alone or collectively. we do not exist to serve gov’t. it is the other way around. it is the mentality of entitlement that has allowed the federal gov’t to become the overbearing behemoth it is. no one has a right to anything other than what they can produce for themselves. you have no right to a job, healthcare, shelter, food, or anything else. what you have a right to is the freedom to persue the things in life you want and need, and that make you happy. charity exists because as humans we believe in taking care of each other, or those who need help. this is not the function of gov’t.

I predict future happiness for Americans if they can prevent the government
from wasting the labors of the people under the pretense of taking care of
them.”
> Thomas Jefferson


Posted by: dbs at February 21, 2009 10:11 AM
Comment #275859

SD, It looks Like China Placed a Big order for 300 GE Trains that was before the Global crisis Hit, It’s nice to see they got the contract it would have been nicer if our Train System was Overhauled . http://www.treehugger.com/files/2008/08/chinas_new_emission_killing_trains.php Read down farther there working on a new hybrid that is 15% more fuel Efficient and Much Cleaner.

Posted by: Rodney Brown at February 21, 2009 10:13 AM
Comment #275860

And Forget About Human Rights now, were in a Global Recession.

Posted by: Rodney Brown at February 21, 2009 10:20 AM
Comment #275861

Rodney

the hybrids are already out there, and working. i’ve seen them in the LA area. i also worked on the BNSF triple track project on the cajon pass. i saw many locomotives, and the majority were new.

http://www.getransportation.com/na/en/locomotives.html

Posted by: dbs at February 21, 2009 10:24 AM
Comment #275862

””“”GE unveiled a prototype hybrid locomotive at its Ecomagination event in Los Angeles last week. The 4,000 hp locomotive uses a set of sodium nickel chloride (Na-NiCl2) batteries to capture and store energy dissipated during dynamic braking, as well as an on-board fuel optimizer system.”“” I see that DBS Thanks Prototype’s Anyways that’s very Good For Us! Biodiesel anyone WOW!

Posted by: Rodney Brown at February 21, 2009 10:32 AM
Comment #275863

rodney

the energy generated through dynamic braking, (that is turning the traction motors into generators to create resistence)was always disapated as heat through a cooling grid. i’m suprised they didn’t think of capturing it sooner. the only downside i could see to hybrids is the need to deal with the battery waste as they age and wearout.

Posted by: dbs at February 21, 2009 10:43 AM
Comment #275866

It looks like they are rebuildable and the life cycle is within the range of the electric motors And they are rebuildable to. Rebuilding is big Business in that Industry. I’m sure they have the technology for the waste.

Posted by: Rodney Brown at February 21, 2009 12:20 PM
Comment #275871

dbs, It sure will be nice seeing them New Locos climbing the Cajon Pass and not seeing black smoke amazing they hook up a extra three Mule locos to climb the pass and descend it those Railroaders earn their money their, They lost one going down in the 1989 not a proper hook up, I get to California a few times a year dbs i lived their over forty some years .

Posted by: Rodney Brown at February 21, 2009 1:48 PM
Comment #275873

Rodney

i too lived there all my life up until @ 6 months ago.

when i worked out there for ames const. most of the locos were dash 9s, and sd 70s, although there were some older ones here and there. as time goes on the older equipt is phased out and is relagated to the scrap yard or a museum. actually i have a friend that works at the one in perris ca. it’s pretty cool if you’re ever get out there you should check it out, if that kind of stuff is of interest to you. they have a lot of old equipt there from inter-urban stuff to old first generation diesel electrics. a good protion is in operating condition, and others are being restored.

Posted by: dbs at February 21, 2009 2:03 PM
Comment #275875

I’ve been their dbs, Awesome you know they had a all electric system in southern ca for many years they scrapped it when the freeways came in. Railroads run in my family here in upsate Ny one of them worked his way to the Top.

Posted by: Rodney Brown at February 21, 2009 2:29 PM
Comment #275879

Rodney

they do have some cool stuff there. my friend gave me the deluxe tour so to speak as he wrenches on the trains there. they were testing one of the generators on the old UP EMD E-8 they have there. i was able to walk through it and check it out. i also got into a lot of the equipt sitting waiting for restoration thats normaly of limits. they were runnig an alco RSD that day, got a free ride in that. if i ever get back there i’ll probably be able to talk my way into running one of the locos. my buddy told he’d let me run the E-8 if it was ready. that would be cool.

Posted by: dbs at February 21, 2009 3:08 PM
Comment #275894

Paul,
You stated in exactly what I was thinking
there is definitely no reason to bailout GM if they are going to lay off 47,000 workers.
I read an interesting article by a former autoworker. I forgot what site it was on but he states…” why would we bailout companies, that have for a couple of decades, been closing factories in the US, laying off auto workers and building the cars in other countries. They have been in cahoots with big oil, building gas guzzlers and have done nothing to help our country free itself from the grip of foreign oil. Why would we bailout companies who have forsaken the principles of Henry Ford to build a car that every average American can afford, and pay them a wage so they can afford it. When I was a kid you could buy a corvette at the average price of any automobile. Now the only thing a kid can do nowadays is look at the picture of one and drool. They are twice the price of the highest priced Cadillac. The other thing is that these automakers may find it impossible to overcome their history. Why would an American who has bought one of their lemons, all of a sudden go back and buy another one. They have also lost their most faithful customers their employees. Why would we bailout these companies, it just doesn’t make sense” some of this is paraphrased, but this guy offers some very different perspective on the issue, that
I felt hit home on a personal level. In my view
it it time to stop the train, let the GM and Chrysler file bankruptcy, reorganization. Put Citigroup and bank of America into receivership and stop this taxpayer bailout baloney. It has gotten way out of hand.

Posted by: bob henry at February 22, 2009 4:01 AM
Comment #275895

Citizens of corporations have Constitutional rights…corporations cannot have the same Constitutional rights, else those who work for corporations hae duel citizenship. We have to separate corporations from the amendments to the Constitution or we will have this stupidity built in to our historical fabric, and will cycle into trouble every ‘X’ number of years. Why in the world would we want to build failure into our economic or political construct?

The greatest mistake made today is pretending that the free market is somehow welded to the American Democratic Republic…Economy:Republic, Oil:Water. A republic can select ANY economy it wants. Politics and business are not inseparable. Politics assists in forming governments for the purpose of administration and defense, commerce comes along for the ride. Free Market is a false idol, and not necessary for the purpose of maintaining or defending the republic.

Posted by: Marysdude at February 22, 2009 5:26 AM
Comment #275902

DBS
That corporations are only legal entities is a simple indisputable fact. They are not “endowed by our creator with certain, inalienable rights”,to throw a bit more Jefferson out there.

Posted by: bills at February 22, 2009 11:11 AM
Comment #275908

EMD E-8 was a passenger loco it had that art deco retro look the Erie Lackawanna retrofitted them into freight locos and ran them into the 1980s A simple two stroke diesel design My one uncle worked on the erie for many years He’d go from Elmira to Ny city I went with him a few times and I found out why they put those screen bars on the windows ! when we’d get into the city those kids threw bricks and anything they could get a hold of at the train.!

Posted by: Rodney Brown at February 22, 2009 12:58 PM
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