How do you feel about bailing out GM?

Nancy - 2008-11-16 20:51:29 - Politics

Apparently, there are pros and cons to bailing out this industry; what do you think about bailing out GM? Do you think it is necessary [should we enable them in this way?], or should they suffer the consequences of their own actions [go bankrupt, and restructure themselves]? I heard today that the average auto worker earns approximately $75 per hour... do they deserve our sympathy? What effects could this have on our economy or will it make a difference?

Best Answer:

Wherever you heard that an auto worker earns $75 an hour is an unreliable source and should never be listened to for facts again. At it's most, the auto worker used to make nearly $27 an hour. It has been cut back in the past few deals with the UAW. The problem is with health care, which they have a plan which if they put money into sort of an account right now, they won't have to pay for it down the road. Unfortunately, they are still paying for that until 2010. Another problem is the job bank that all the Big 3 have, which I think needs to just be rid of. What happens is that a blue collar union employee who doesn't work can still get paid. You might think that the CEO's could have stopped the unions from having that but people outside of Michigan don't really know is just how powerful the UAW is. If the Big 3 fail, we are talking about another Great Depression. I know this was thrown around before but this time it will happen. If the Big 3 go down, here's what happens, probably in this order: -their suppliers go down with them -the retail stores and restaurants in the area of a factory or place where a majority of residents are factory workers will close -tax revenue will go down, causing cuts in services that are already being cut -people whose salaries are dependent on tax dollars (such as teachers) will start getting laid off -repeat the last two steps over and over and over

Answer:

I'm against the bailout. It's sink or swim time for everyone, and I find these bailouts really disgusting. If I cannot pay my debt, I go bankrupt.

I am against any bailout of any kind to any company. Capitalism without failure is like religion without sin.

I don't like it, but there is little when can do.

GM is a rusted out clunker, and the government wants to duct tape it up, and put some primer paint on it... supposing it will be good as new. It's time to take that lemon, and part it out to America, so other businesses can make something out of what's left.

manufacturing is very important during a war. If we do not have companies to guild tanks and trucks and jeeps then we will be in a mess.

Personally, I consider all bailouts to be immoral, regardless of the reason. If it is funded through tax revenue, then the money is still acquired from people, with or without their consent, by another people through the threat of fines, imprisonment, and/or violence. If it's acquired through more deficit spending, then there's the situation of one group of people pledging the future earnings of another group of people plus interest while under duress. I don't see the major car manufacturers simply going away after filing bankruptcy. They'll probably be bought up and put under new and hopefully better management. The bailout itself is pointless because these car companies are asking for loans even though there isn't adequate consumer demand for cars to repay the loan. If anything, the loan will only keep them afloat with negative earnings and put them into further and further debt that may not ever be repaid.

They spent million lobbying to keep lousy gas guzzlers on the road. They fought improved safety standards and features for years, since unsafe at any speed. The Japanese car companies come here and build better cars but they can't? The company is a zombie, meaning it is dead, and giving it cash will just keep the zombie alive. let it die already. But I think if they go Ch 11 there would be an opportunity to build a responsible company. If done properly I think the gov could then offer some assistance.

I personally don't approve of all these bailing out things. 400B has gone down the drain last time I checked on cnbc.

I don't know who is telling people the average auto worker is making $75.00 an hour..I just retired from 30+ years working for Ford Motor and I know of no one making that kind of money..and this is the average assembly worker? Heck even Skilled trades don't make this kind of money If you figure that for every one Auto worker loses his job...five more workers will also lose their jobs..so from 3 million auto workers you get another 15 millions people who will be out of a job... I don't think you understand how badly this would effect our economy But forget the nonsense about $ 75.00 an hour is the average wage

I say do it, but only if they do away with the unions that keep asking for ridiculous wage increases just to up the union dues. This is what drives companies over seas, and out of business. Instead, just change the labor laws for the employees and keep the jobs in the U.S

the oil companies should bail out GM, not the american taxpayers. it is not toyotas fault that they: 1-sell cars much cheaper 2-you get MUCH MORE bang for ur buck ( you could buy an american car for 30,000, but a japanese care with the same features for 20,000) 3-have much better gas mileage 4-keep their value for much more than american cars. 5-arent under the pressure of OIL COMPANIES, and dont make SUVs that have 4 miles per gallon. 6-Pay thier workings the regular amount a factory worker should make. the bottom line: American cars suck, Cost More, Eat More Gas, Are less stylish and unattractive.... therefore nobody buys them. The car companies have been bailout b4, nothing has changed, and nothing will change if we bail them out again.

i myself personally would let GM and the rest drop, some investment group or other car company overseas will pick em up, the unions killed em let them make there own bed. the american auto industry going down is bad, for us and the Canadians, we make alot of cars there on the other side of the border, and it also effects there parts suppliers, glass, steel, paint, plastics, bumpers, brakes, you name it, its not just the auto jobs going its everyone connected to cars/trucks to the local dealers. so its alot bigger then most can imagine. you gota learn from your mistakes and fix it, pumping money into a losing investment is most likely not going to do nothing but loss money still. you got no idea what a nightmare the unions made for the big 3 all i will say is, american cars could be 3+k cheaper in price then now if the unions were not as hard core with there denamds. and others make cars in america in the non union states and do find and make nice cars. bmw, honda, acuara, hyndaie, mercedec benz

It's just an elaborate hoax so that the government can get its tentacles in the private sector and have more power and control than it already does. Does giving a terrible manager a raise make him do better? They need to get to the root of the problem, let the company's fail and rebuild a better company. This bailout will only work for the short term, eventually they will fail again, and then what?

I think it is necessary to keep the industry afloat as if it goes into bankruptcy sales are expected to drop 80%, which would cause the companies to fail, costing about 200,000 jobs directly and roughly 1 million indirectly, according to estimates by most experts. The costs to the government if that happens far exceed the $25 billion to keep them afloat during their transitional period of 2009. Now as for the method, I am of the opinion that the government should first set conditions: Changes in management. They need to send the message that this isn't something that companies should want to do, it is a last resort. If managers need a government bailout it is because they have failed and they will lose their jobs. Next, and more importantly, they should use this negative as an opportunity for something positive. Instead of just handing over cash or even the slightly better option of buying a steak in the company, they should place a large order for new high efficiency vehicles. The sort of vehicles that the government has been wanting the industry to make for years, plug-in hybrid running on flex-fuels or CNG vehicles. They should order $25 billion dollars worth and use them to replace all government cars. The currently existing government cars should be further returned to the industry to recycle parts. (Some could be put in the used car market, but you don't want to flood the market because it will hurt the industry making new cars, they could do a study of how many is appropriate to sell and how many to recycle.) It would take several years for the auto industry to fill that order, but it would be paid in advance so they have the cash to keep afloat until their current restructuring plan (which will be complete by the end of next year and will solve many of the problems with the expensive union benefits, though more has to be done with government support) is finished. When they are done, the government's vehicles will be cleaner for the environment, which will have a impact (not earth shattering, but worth doing). Perhaps more importantly, the car makers would then have these vehicles designed and built and ready to be sold in massive quantities to the public. In the mean-time, of course, the industry would be employing a great many people at every level.

Not in favor of either choice. What happens if we put that many millions MORE out of work? That seems like the worse case scenario. But you are correct - they are WAY over paid. And that's one BIG reason why they are out of money.

I am for the bailout,not to save the car companies,but to save all of the millions of jobs that could be lost.If this bailout takes place,there must be an audit done by an independent company on all the auto companies. Every dime must be monitored and how it was spent.The old management must be replaced.There must be no bonuses given to ceos.They failed and do not deserve them.The important thing is the workers,retirement,401k,insurance and job stability.

We should not bail out the auto industry. Poor management and bad union contracts have put them in the position they are in. Handing them money will not change either of these two problems. Also the suppliers to the auto industry are in the same position as the big three. Without a bailout they will go bankrupt. If the suppliers go bankrupt no amount of bailout money will save the big three.

We have too! I think there should be alot of strings attached however. Labor costs have killed The Big-3. The UAW are the ones that need to be parted out. Toyota's USA workers are not any part of the UAW and make much less but are online with what the wages should be. Sorry I can't find the link, but I read an article that Toyota and Honda is worried GM will go bankrupt because it will actually hurt them too because alot of mutual suppliers will go under if GM does and drive cost's up for Toyota and Honda aquiring new, limited vendors etc etc..

With the Big 3 U.S. Automakers circling the drain, here are 10 solutions to the current crisis and none of them involve sticking your head between your legs and kissing your rear goodbye. http://fastandloud.com/how-to-save-the-us-automotive-industry-in-10-not-so-simple-steps/

Wherever you heard that an auto worker earns $75 an hour is an unreliable source and should never be listened to for facts again. At it's most, the auto worker used to make nearly $27 an hour. It has been cut back in the past few deals with the UAW. The problem is with health care, which they have a plan which if they put money into sort of an account right now, they won't have to pay for it down the road. Unfortunately, they are still paying for that until 2010. Another problem is the job bank that all the Big 3 have, which I think needs to just be rid of. What happens is that a blue collar union employee who doesn't work can still get paid. You might think that the CEO's could have stopped the unions from having that but people outside of Michigan don't really know is just how powerful the UAW is. If the Big 3 fail, we are talking about another Great Depression. I know this was thrown around before but this time it will happen. If the Big 3 go down, here's what happens, probably in this order: -their suppliers go down with them -the retail stores and restaurants in the area of a factory or place where a majority of residents are factory workers will close -tax revenue will go down, causing cuts in services that are already being cut -people whose salaries are dependent on tax dollars (such as teachers) will start getting laid off -repeat the last two steps over and over and over

For someone who is part of General Motors family and has worked at GM myself I can tell you that the amount the employee's make is like change in the pocket to them. It is one of their cheapest expense when everything is added up. Where the problem lies is with the executives, unions, and the legacy debt.

LOL average auto worker earns 150,000 a year. Have you been to Michigan lately? ITS A HELL HOLE BECAUSE PEOPLE DO NOT MAKE THAT KINDA CASH. The Ford Plant in my hometown starts at about $19/hr plus benefits. Which is roughly 39,000 a year. Get a clue!!!

let the go bankrupt under chapter 11, and restructure themselves. The executives have hidden motives, and are misleading the public. Chapter 11 would cause a rally on Wallstreet in this case, and that is casue is does not shut them down it only eliminates all debt current expenses over the amount agreed in court. The CEO's do not want this a new stock means new owners, and this means their fired for gross incompetence. You know how much a GM President gets in retirement? Try eight figures?