I do not like this, Uncle Sam I Am (bailouts)

[drwex]

Unlike, it seems, most liberal types, I'm not in favor of a bailout for the auto industry - at least not as currently conceived.

- I do think the auto industry is almost wholly to blame for its current mess. I don't see why the US taxpayer should be required to step in and fix problems that the Big 3 made.

- I see absolutely NO possible way that automobile manufacturing policy and production strategy can be run from Washington. The whole idea of a "Car Czar" is an attempt by people to imagine an heroic rescuer who will somehow have miraculous powers and save us all. I roll to disbelieve.

- I do think that Chapter 11 is the proper mechanism for large-scale restructuring of companies in trouble.

- I do not like the fact that the Dems caved and let this bailout money be taken away from fuel-efficiency programs. WTF guys? Did you not read the memo from angry drivers back this summer when gas hit $4/gallon? Do you continue to fantasize that it won't hit $4 again?

- I do not like the fact that the Big 3 will be allowed to continue to sue the EPA over fuel efficiency mandates, safety mandates, etc. If we (the government) own these fukkers, why are we letting them spend millions to sue us so we have to spend more millions defending those lawsuits? This is an utter farce.


On the other hand:

- the lack of a bailout is being used as a sledgehammer to smash the unions. Excuse me, but last I looked the union contracts were negotiated in good faith. If the Big 3 couldn't project the future costs of pension and health plans whose fault is that, exactly? We laud companies for negotiating the best bargain they can get but when unions do that it's somehow evil? No, I don't think so. It's sure as hell not the union's fault that GM recalled and pulped its entire fleet of electric cars from CA a few years ago. Unions don't control product strategy and blaming them for the Big 3's shortsightedness is a crock and it doth stink.

- why the hell are auto dealers being scapegoated? It takes about 1 minute of research to learn that dealerships are a source of REVENUE for car companies. They pay franchise fees and licensing fees, for example. For the most part, consumers don't buy the autos that come off assembly lines - dealers buy those. They're also a major source of revenue for their local markets (newspapers and radio in particular) and you know what - if there's an oversupply of dealerships I'm reasonably sure the market will deal with that. (I'm not one to believe that market forces are solutions to every problem, but this is one where I really believe traditional supply/demand forces apply.)

Currently it's being made to seem as if a government bailout is the only way to avoid a huge amount of collateral damage to the little guys. This sticks in my craw, severely.

Comments

[awfief.livejournal.com]

Um......I'm not sure what liberal opinions you've been reading...the ones I have been reading basically say that the automakers should go bankrupt, period.

[qwrrty.livejournal.com]

Is there widespread liberal support for an auto industry bailout? It seems to be pretty widely despised across the board. As far as I can tell, panic is the chief thing that is driving this in Congress.

[drwex]

Well, I'd have to admit I haven't done a ton of research. But those lobbying for the bailout include all the traditional libdems in Congress.

[keyne.livejournal.com]

Well, there was Jon Stewart pointing out that we spent $700B on nothing, and at least with a measly $35B we'd get cars out of it :)

[rednikki.livejournal.com]

You're not the only person who feels this way. I personally think we ought to let the auto makers hang.

[hammercock.livejournal.com]

the lack of a bailout is being used as a sledgehammer to smash the unions. Excuse me, but last I looked the union contracts were negotiated in good faith.

I agree...I am hearing a number of people say that the workers are just as much to blame for this situation as the management, politicians, and lobbyists, and I just don't think that's true. The UAW as a group may be powerful, but not as powerful as the rest of them. Besides, how can we ask the workers to accept less pay for actually making the product when the executives keep making millions of dollars in salary and bonuses even when the corporations lose money? How can we blame them for wanting a fair share and a living wage?

[imvfd.livejournal.com]

Personally, I'm not sure that I approve of the financial market's bailout. An individual or a family making poor decisions about finances because they don't know any better? OK, not great, but I can see bailing folks out, having them take some workshops on how not to get fucked in the future. Having some strings attached to the help. All good.

Bailouts for huge businesses? Where there are whole departments filled with people with advanced degrees who's only job is to figure out how to make sure that the company's finances are managed sensibly? No, I'm sorry, they should not be getting a dime. No how, no way. Yes, it'll cause a crisis in the short run. But maybe, just maybe, in the long run people won't be such putzes.

[drwex]

I'm relatively certain I do not approve of the TAP as it was passed, nor as it has been used. I do believe that the financial system needed some form of intervention, and I'm not opposed to nationalization (a la Freddie/Fannie).

[intuition-ist.livejournal.com]

hm, i think the collateral damage due to a bailout is not going to fall on dealers; it will fall first on the factory workers at all the factories that will be forced to shut down if a large auto-maker goes out of business.

[drwex]

Normally I'd agree with you, but GM (in testimony to Congress) has specifically proposed shuttering 40% of its dealerships as a "cost savings" measure.

They haven't said how they think they'd save money by doing this, nor what they'd do with the inventory of the showrooms they plan to shut down.

[hammercock.livejournal.com]

BTW, have you read this? While Detroit Slept (http://www.nytimes.com/2008/12/10/opinion/10friedman.html), by Thomas Friedman.

[drwex]

No, I hadn't seen that. Thanks for the link - I'll give it a read.

[drwex]

OK, read it. Not too bad, though he has the story with iTunes totally wrong. There were lots of music services before iTunes. What Apple did was come in and make it EASY to do what others had made hard. By forcing a uniform price and integrating with a popular music device they made iTunes nearly universal. But they certainly weren't the first and at the beginning not even the most popular - remember back when everyone was bitching about iTunes not running on PCs?

[papertigers.livejournal.com]

I know an awful lot of liberals/progressives, and I don't know anyone who supports a bailout of the auto industry. they may think it's inevitable, but they don't WANT it.

[stevie-stever.livejournal.com]

Well, let's not call it inevitable. It just failed in the Senate. We may yet get to see the results of letting the big 3 die a hideous death.

[drwex]

I'm glad it failed, but I'm even more glad that the odious Republican replacement proposal failed.

(The replacement proposal was "cut workers' wages, but leave suppliers free to charge whatever")

[c1.livejournal.com]

I'm just going to say "amen, brother" and thank you for articulating my thoughts on this pretty much conclusively.
But I find it amazing that unions, with about 12% of the US population as members, have the attention of about 60% of the representatives and about 35% of the senators. Somehow, every time I read what a congress critter has said, it seems the undercurrent isn't "we need to save jobs" but "we need to save *union* jobs".
I think it's not so inevitable that a bailout of the auto industry happens so much as a bailout of the unions.
I wish they'd been paying that kind of attention when I got laid off.

[drwex]

I'm sorry you got laid off.

As for unions - they're like any other big organization, with good and bad parts. I think unions, as a concept, serve a valuable purpose. The UAW has had its ups and downs, too. I think the current formation of the union is pretty good.

One of the benefits of the union is that it's able to grab attention. The people who work at car dealerships, for example, should have such a voice.