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After watching 6 hours of C-SPAN and listening to countless pundits, I am absolutely no closer to consensus than when this whole mess started.
I have been following the story of the Big 3 bailout for the last couple of days, trying to come to some sort of decision on where I stand.
After watching 6 hours of C-SPAN, listening to countless pundits tug of war, and reading a dozen articles both for a bailout and against, I am absolutely no closer to consensus than whe
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Comments
11.21.08
Tim, I am absolutely with you on not knowing what the least-worst option is in this situation. I grew up in the Detroit area, in a GM town, and pretty much every family worked for the Big 3 in some way, including my family. The jobs of those we hold most dear are on the line, many have lost their jobs already, and there's nothing to fill the void in Detroit.
However...as far back as I can remember, everyone knew exactly what was wrong with the auto companies - too big, bad decisions, bad designs, lack of flexibility in product as well as in working with the unions. My husband worked at GM in summers while we were in school, and all he could say about it was that he didn't want to work there - too much stands in the way for you to actually make a difference there, or improve processes. As soon as we had our degrees, we left Michigan. That was 11 years ago, and the writing was already on the wall that Michigan was not a promising economy. We came to Chicago, and are very glad that we did. Not only do we love our new hometown - there is plenty of diversity in the job market here.
I'll be watching the Big 3 bailout proceedings closely, but I don't think there really is a good solution for any of us with this one, unless the companies find the courage for radical change. I need some "Change we can believe in" from the Big 3 before I'll believe that any bailout has a chance of success.
11.21.08
I agree with you on the damned if you do, damned if you don't. That the Big Three leaders took private jets to DC to beg for money demonstrates how out of touch they are with reality.
If there is a bailout, it should be focused on the workers. How can we help the workers transition. They should be first in line for the new green sector jobs, so perhaps we can keep the auto industry afloat just long enough to start transitioning.
It's decisions like these that make me glad that I'm not a politician.
11.21.08
I'm also a former Detroiter. The thing is, the same thing happened 100 years ago as we transitioned from the Agrarian Age into the Information Age. Shoot, jobs in the buggy-making industry never did return to the U.S.
If you read The Nine Shift by Draves & Coates you will see that what's really happening here is that trains are going to replace cars as our primary means of transportation. If the Big Three wants to make money, they need to start making trains.
By the way, Gen Y is leading this transition. You guys drive less, get your drivers licenses later and less, and a large percentage of you live in urban areas with good transit systems.
11.21.08
I don't think that people are going to stop using cars and start taking trains.
Not if everyone wan't to stop living in single-family dwellings in the suburbs and start moving into high-density housing in urban areas. That's NOT going to happen.
Besides, you don't hear about Toyata and Honda and Subaru and other car makers going bankrupt. What do they know that the big 3 don't?
No, cars are going to be around for a looooooong time. The big 3 just:
1. bet on the wrong type of vehicle, getting quick profits over long-term viability.
2. Got caught with high labor costs because of unionized work forces.
3. Just managed theior businesses badly.
I say, let them go bankrupt, take the job losses, let the country go into a deeper recession or depression, and we'll get ourselves out of it eventually and have a stronger economy.
11.21.08
I know I should spell-check my posts... but PLEASE can we add some ability to edit our posts??? Sorry for the bad spelling in the previous post.
11.21.08
Well, if you were against the initial $700 billion bailout, you should be against this one too. It's from that pot the money would be coming. It's not like if the government doesn't bailout the big 3, taxpayers get their money back - it'll just go to some other failing industry.
11.21.08
I simply do not understand the reason for giving $25B to the Big 3. The whole point of Chapter 11 bankruptcy is to allow a safe haven for companies to restructure operations and even bring new management if necessary to return the company to solvency. Several of the major airlines have been through the process and come out relatively unscathed. Giving them money without any real power to change their clearly incompetent business practices just rewards bad behavior. After all, how many millions of dollars have they spent thus far lobbying Congress for this bailout?
11.21.08
@Vanessa - Exactly.
Do you think that same logic have been applied to the rest of the bailout funds??
11.22.08
@Scott - I read your posts a lot and know that you and I agree an awful lot of the time, so I don't want you to take this the wrong way - but do you know how many people said there is no way the car would replace the horse-and-buggy?
I think cars will be around, but we won't all have two in each family and we won't be dependent on them to get everywhere. And I love my surburban lifestyle in my 1978 tri-level (very Brady), so I'll probably be like one of those farmers who opted out of entering into the industrial age. I cringe at the idea of giving up square footage. But the fact of the matter is that even metro Detroit is working on getting light rail down Woodward Ave. - and high speed rail to Ann Arbor.
Oh, and I think that the companies that will continue to be profitable car makers will be Toyota, Honda, and Subaru.
11.22.08
The only difference that I had heard about the overall bailout and the Big 3 bailout is that while both were caused by incompetent business practices, the first bailout was meant to correct a lack of liquidity in financial markets that caused the instability we see now. I don't think that was the best course of action by giving money directly to the institutions that caused the mess. I almost wonder if we would be better served if each tax paying individual received another stimulus check.
11.24.08
@Suzanne: Don't worry , I didn't take it the wrong way. I can understand your point completely. I often take the same position on other topics.
But this time I have to disagree. The rise of the car gave us more freedom and more choice and more convenience. People do NOT like to give that up once they have it.
Market forces will push us to find more effecient automobiles. Future automobiles may be powered by batteries, or fuel cells, or hydrogen, or natural gas, or ethanol, or hell... even nuclear reactors. We might have automated roadways where cars drive themselves at highway speeds so we have, essentially, automobile trains made up of hundreds of individual vehicles.
But it will take a LOT for people to give up the freedom that automobiles have given them. I just don't see it happening, if ever.
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