So our legislators are more hesitant bailing out the auto industry than the banks?

[socialize_me]

What should that tell you all???

[Smiley Gladhands]

Besides the obvious, I think it says that they're out of money (or more specifically, they are having trouble selling all the necessary treasuries at a reasonable price).

Or that they're going to let one of the big 3 fail, so they can have more ammo to shoot at the 'free market'.

[Mort]

I wouldn't call them more hesitant yet. Remember the bank bailout failed first and then passed. Same thing could happen.

[lodge939]

I wouldn't call them more hesitant yet. Remember the bank bailout failed first and then passed. Same thing could happen.It will with 58 dems and backing from Obama

[AJ Antimony]

It tells me Reid and Pelosi bought some shit American cars that broke down within a week.

[yaz]

I'm investing $200 in GM next Tuesday just in case it gets bailed out.

[georgiaboy]

What does it tell you, socialize_me?

[Mort]

If there we a place to gamble on the Auto bailout I would do it. It will go through.

[georgiaboy]

Maybe the Asians, who stand to gain the most from a failed US auto industry, have our nuts in a vise?

[Minuteman2008]

It is my understanding that if GM files for bankruptcy it will cost the tax payers much more over the next three years than the bailout would. Not to mention all the unemployment benefits for GM and their suppliers (and these will of course be extended by the Democratic congress). The number of retirees is pretty staggering, and these people will then have their hands out too for their own personal bailout if GM goes under. Yes, they can still operate and build vehicles while "bankrupt" but the actual cost to tax payers will be enormous. Obviously this is just delaying the inevitable, it's just that it couldn't have come at a worse tim.

This is a lose lose situation for everybody. We never should have gone down this road in the first place of course, but I think if they did a cost-benefit analysis the tax payers are going to be hit that much harder if GM fails. Free market people may be absolutely right, but since we don't have one we're forced to make a terrible choice here.

And of course, all the idiotic GOP senators who voted for the Wall St. bailout who will vote against this one and look like hypocrites since they have no principle whatsoever. I'm thinking of Senator Kyl right off hand.

[Mort]

Not that it matters but the fact is a majority of Republicans voted against the bank bailout.

[georgiaboy]

And an overwhelming majority of all Congressmen who voted for the bank bailout were re-elected.

[Minuteman2008]

Not that it matters but the fact is a majority of Republicans voted against the bank bailout.

In the House, yes, but I was referring to the senate, and specifically the ones like McCain and Kyle who voted for the TARP bailout

[socialize_me]

Besides the obvious, I think it says that they're out of money (or more specifically, they are having trouble selling all the necessary treasuries at a reasonable price).

Or that they're going to let one of the big 3 fail, so they can have more ammo to shoot at the 'free market'.

Treasuries are being bought up like crazy!! Besides that, they always have the Federal Reserve to fall back on, but with the Dollar rallying like it has, investors worldwide are taking their money out of the stock market, mutual funds, and commodities, and putting it all into T-notes earning 0.5% interest and holding US Dollars. That's why our Dollar is strong now compared to two months ago.

[mrwiizrd]

Here's the response I just received from my State Senator to an e-mail I sent in opposition to the bail-out yesterday:


Thank you for contacting me. I appreciate hearing from you.

As you know, the largest American automobile manufacturer, General Motors (GM), has warned that it is quickly running out of cash reserves, and that, absent government intervention, it will likely be unable to continue operations. Ford and Chrysler are also in bad shape, and analysts fear that the collapse of GM would ultimately lead to the collapse of the American auto industry as we know it.

The causes of this predicament are plain to see: the “Big Three” have failed to adapt their business models to an evolving global market that is increasingly demanding smaller, fuel-efficient vehicles; the crisis in our credit markets and our broader economy has sharply depressed auto sales; and the costs of providing health care and pension benefits to their employees have risen at exorbitant rates.

Many raise the valid point that the “Big Three” should be held accountable for their failure to effectively address these problems. On the other hand, many argue that the costs of doing nothing to assist them are too great. The American auto industry supports some 5 million jobs and accounts for approximately twenty percent of our manufacturing Gross Domestic Product. Unemployment rates are already skyrocketing and the toxicity of our financial markets is beginning to seep into other sectors of our national economy. Many argue that if the auto industry were to collapse, it would exacerbate our nation’s economic troubles and sink us further into a recession.

Various proposals are currently circulating in Congress to help our nation’s ailing auto industry. Some of my colleagues have urged the Bush Administration to use a portion of the money authorized to them under the Emergency Economic Stabilization Act which passed earlier this year. Others are calling for separate financial assistance with conditions attached, such as requiring the companies to use the funds they receive to modernize their vehicle fleet and production facilities. As I evaluate these and other proposals, I will be sure to keep your thoughts in mind.

Again, thank you for taking the time to share your views.

[lodge939]

In the House, yes, but I was referring to the senate, and specifically the ones like McCain and Kyle who voted for the TARP bailout
The Senate is a lost cause except for a couple of them. Dudes think theyre aristocrats. The House is more down to earth.

[Minuteman2008]

I'm really trying to keep an open mind about whether or not we should give loans to General Motors and the repurcussions of each decision. I understand why we should so strongly oppose it based on free market principles, but I also understand that we don't have a free market, and that we live in the land of entitlements so it can't be a good thing to create even more people dependent upon government handouts while the economy is tanking. This is a real shit sandwich. Anyway, this article is worth reading (as well as articles staunchly against the bailout like the ones at NRO -- although mostly neocons).
I think the biggest thing I take away from this article is that we should NEVER have went down the bailout road in the first place. I knew it would open up a whole can of worms.



What’s Good For General Motors Is Still Good For America
Posted by Tom Piatak on November 11, 2008

Back in the 1950s, when Americans knew from recent experience just how important it was to have a dominant manufacturing sector, Ike’s Defense Secretary, “Engine Charlie” Wilson, formerly of General Motors, famously declared, “What’s good for America is good for General Motors, and what’s good for General Motors is good for America.” Charlie Wilson, whose former company had turned out the TBM Avengers that helped put the Imperial Japanese Navy on the bottom of the Pacific, while his competitor Henry Ford’s plants were busy turning out the B-24 Liberators that helped destroy the industry of the Third Reich, spoke the truth, even though his sentiments were ridiculed by the effete intellectuals of his day. And Wilson’s sentiments are true today, despite the ridicule of such as National Review editor Rich Lowry, who has gone from chiding House Republicans for being “irresponsible” in voting against the Wall Street bailout to essentially urging the American auto industry to drop dead, along with the many jobs dependent on it and the region of the country whose fate is especially linked to the industry.

Saying “yes” to loans to Wall Street but “no” to loans to Detroit makes little sense, especially since the loans to Wall Street now total over two trillion dollars, if the actions of the Federal Reserve are included, with AIG alone receiving $150 billion, far more than Detroit is requesting. And there can be little doubt that the demise of the Big Three would have devastating consequences, both short and long term. The Center for Automotive Research has estimated that a collapse of GM, Ford, and Chrysler would cost nearly three million jobs. (The Novemebr 3 issue of Crain’s Cleveland Business reports that in greater Cleveland, where I live, 26,800 people work in the transportation equipment sector, and 100,000 jobs depend on that sector, directly or indirectly). The government tax loss from such a catastrophe would be over $150 billion over three years. Then there are the American retirees who receive pension and medical benefits from the Big Three--some 432,000 GM retirees, 300,000 Ford retirees, and 124,900 Chrysler retirees. Should those companies fail, taxpayers would step in to assume at least some of this liability through the Pension Benefit Guaranty Corporation. Then there is the long term cost of losing so much manufacturing capacity and expertise, national assets that can be of vital importance, as we found out in World War II when the plants that used to make Chevrolets and Fords were quickly converted to making planes and tanks, using much of the same skilled, patriotic work force.

But won’t foreign car makers simply pick up the slack? Not likely. The major reason foreign car makers have plants in the United States is political, to hedge against the possibility of American protectionism. Once the threat of American protectionism is dead, because the American auto industry is dead, why would foreign car manufactuers keep building plants here, or even keep operating the plants they’ve built? Last summer, the Wall Street Journal quoted an unnamed Toyota executive as saying, “It’s much, much more profitable to produce cars in Japan and ship them all to the U. S. right now, if it wasn’t for the political problems that might cause.” Once there is no possibility of “political problems,” what would restrain Toyota from pulling all its production back to Japan, or shifting it to such low wage countries as Mexico?

Nor is the Japanese investment in the US at all comparable to the Big Three’s, even setting aside the nearly million retired Americans who depend on the Big Three for their retirement benefits and health care. General Motors alone employs more Americans than all the foreign automakers put together, and Ford runs nearly as many assembly lines in the United States as do Toyota, Honda, Nissan, Hyundai, and VW put together. The Big Three buy 80% of the car parts manufactured in the United States, and their cars average 79% domestic content, compared to 35% domestic content for foreign cars sold here. And the Big Three employ the vast bulk of their engineers, designers, and managers in the United States, unlike their foreign competitors, which keep most such work in Japan or Germany, which is also where the profits they make from selling cars here wind up. In fact, the Big Three spend more each year in America on R & D than does the pharmaceutical industry, employing 65,000 skilled workers on research and development in Michigan alone.

But doesn’t Detroit deserve to die, for making such terrible cars? Not really. The initial quality surveys conducted by J D Power show that American cars are as good as anything the Japanese and Germans have to offer. Last year, that survey saw a Ford product get the number one ranking in five different product segments, more than any other company. And the award for the best plant in terms of overall quality worldwide went to a Ford plant in Michigan. This year, JD Power rated the Chevrolet Malibu as the best car in the mid-size car category, and the Pontiac Grand Prix as the best car in the large car category. Even Consumer Reports, long a fierce critic of Detroit (and the publication of an organization that was deemed subversive by the House Un-American Activities Committee) recently admitted that, with the exception of a few truck-based designs, “Ford’s reliability is now on par with good Japanese automakers.”

Despite all this, there is no doubt the GM, Ford, and Chrysler are now in a precarious state, having been hit by rising gas prices and a collapsing credit market at the same time. But there is good reason to believe that they will be able to pay back the loans they receive and become profitable again, even as Chrysler paid back the loan it received from the federal government in 1979 and became profitable again. The new UAW contract contains substantial concessions, largely eliminating the labor cost differential between the Big Three and the Japanese, and GM and Ford are poised to introduce new fuel efficient cars such as the Chevrolet Cruze and the Ford Fiesta. But even if the attempt to save the Big Three ultimately fails, both prudence and patriotism suggest that it is worth trying.

No doubt Lowry’s arguments will find an appreciative audience among those who take delight in denigrating American industry and American workers. But I have noticed something about Lowry and most of the other vocal critics of the prospect of loans for Detroit. They don’t live in the industrial Midwest, and they don’t give a damn about those of us who do. Although David Brooks’ argument that the GOP “cannot continue to insult the sensibilities of the educated class and the entire East and West coasts” is getting a respectful hearing at NR, none of the “conservative movement’s” gurus seems particularly interested in figuring out why McCain lost every state in the industrial Midwest, even though those states are filled with social conservatives of the type who have been voting Republican since Nixon. All my life, I have seen tax dollars flow out of the industrial Midwest, to pay for water projects so people can live in the desert, agricultural subsidies, the myriad of military installations generations of Southern congressmen succeeded in spreading around the Sunbelt, not to mention the S & L bailout, which was concentrated in the Sunbelt, and now the massive Wall Street bailout, which, not coincidentally, has been especially helpful to the city National Review calls home. The notion that America can afford all that, but cannot afford a $25-50 billion dollar loan to help preserve the industry vital to the industrial Midwest, is laughable, and a cruel joke to those of us who live here. But if Republicans want the joke to be on them, they can listen to Lowry, line up to damn the American auto industry, and look forward to losing the Great Lakes states year after year after year.

http://www.takimag.com/blogs/article/whats_good_for_general_motors_is_still_good_for_am erica/

[Danke]

Don't the financial institutions donate the most money to the parties?

[mrwiizrd]

Don't the financial institutions donate the most money to the parties?

http://www.opensecrets.org/pres08/contrib.php?cycle=2008&cid=N00009638

[ihsv]

Once you get on the "Bailout Boogie" train, it's awfully hard to stop. It'll go through.

[escapinggreatly]

Once you get on the "Bailout Boogie" train, it's awfully hard to stop. It'll go through.

I pray to God that you're wrong, but I would bet on you being right.
__________________

http://www.meltingpotproject.com/photos/uncategorized/2008/10/22/libertariansig.jpg
The Melting Pot Project: Proportional Representation. New Parties. Intern Jokes. (http://www.meltingpotproject.com/)

[paulitics]

They can say they are free market by letting the auto industry go bankrupt. These globalists do not particularly care for the American auto industry. They would rather wages go down to be more on par with China. The fat cats control energy and finance. They want to see America standard of living sink. Not saying I'm for a bailout of any kind, but you know who's side the gvt is on when they spend 100 billion on one insurance company, (that would be better off failing, no intrinsic value to the company), and can't spend 1/4 of that for an industry that employs many times over a corrupt insurance company like AIG.