This debate over whether or not to bail out the auto industry has gotten ridiculous. Congress blithely approved a 700 billion dollar giveaway to Wall Street giants and AIG with virtually no accountability or demands that they modify their business practices, but is making the automotive manufacturers grovel for a measly $25 billion to tide them over until the credit crunch eases up and people start buying cars again. The point here is that if the automakers go under, America will have lost a huge manufacturing base and will be outsourcing the making of cars to other countries (along with all the rest of the stuff we now outsource). It will cost millions of jobs and untold anguish to every person and business that has anything to do with the manufacture of automobiles: autoworkers, suppliers, dealers and who knows how many other businesses and industries that depend on auto manufacturing for a living.
The Detroit CEOs who came to Washington this week are appropriately contrite and willing to deliver corporate survival plans that include a focus on higher efficiency vehicles and management restructuring. The unions are promising to cooperate and make wage concessions to keep the companies afloat.
The latest talk this morning is that the Senate wants to reclaim part of the original 700 billion Wall St. bailout and give part of it to Detroit. The hitch is the current administration won’t agree to that. Surprise, surprise.
I think Jon says it all pretty succinctly:
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This is a tough one. I agree whole-heartedly at the oddness of essentially giving blank checks to Citi, AIG and the rest from the finance sector children bloated from the last 4+ years alone in the candy store. Where is that money we gave them - has anyone seen it? I checked the cushions in my couch and it's not there either. What have we gotten in return for it?
However, these auto guys are on their own little planet of obnoxioiusness as well. We need to save them, but the cost cuts should start at the top and work their way down. Every executive that wants to stay on should agree to the same $30/hour wage that the workers get. Sell the private jets, and then let's really start sharpening our pencils and making some decisions. Maybe morphing the Big 3, into the Big 2 is the idea.
And then there's the "workers" - and that term, for many, is used loosely. The unions have a whole spare tire of fat hanging over their belts as well. As Miss Birdy said so well in "The Rainmaker"; "cut, cut, cut!"
Good points. I think the airplane fleet is to be sold. I don't know about the $30/hr. executive pay, but that's brilliant. The unions have to make some big concessions as well. But the idea that they just threw all that money at Wall St. and AIG seriously gripes me. We need a strong manufacturing base in this country.
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