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  • TUESDAY NOVEMBER 18 2008 6:00 AM

Bail The Shit Out Of Detroit

It’s time for America to get its bailout on again. Detroit has turned into a giant bag of ass and we need to do something about it. They want 25 billion. I say we give it to them. Why? Because I’m a socialist? Nope. Because we are heading toward a deep, deep recession and the last thing we need is to lose 3 million jobs.

A study just published by the Michigan-based Center for Automotive Research (CAR) predicted that three million people would lose their jobs in the first year after such a Big Three meltdown, swelling the ranks of the unemployed by nearly one-third nationally and leading to hundreds of billions of dollars in lost income.



So, we can pay for it with a bailout, or pay for it in unemployment insurance, welfare and an increase in crime.

Oh, I know. The car companies are complete fuck ups. No argument here. While the right wing continues its rant that this is the fault of unions, I’m going to actually go with the facts. The mistakes of the auto companies were made at the top. They were made by throwing their weight behind cars like the Hummer, while Toyota was going with the Prius. While Detroit was cranking out Explorers and Escalades, Japan was whipping out the Civic Hybrid. Most of us crazy liberals just sat back watching the retarded actions of both government and the auto companies with depressed amusement. Yeah, I wrote “government.” Bush is very responsible for the current state of the auto industry because he gave massive tax breaks to people buying Hummers and refused to up standards. What we are seeing now is the result of a fantastically shortsighted and heinous energy policy. But, then, what has Bush touched that has not turned into a flaming pile of shit?

Our retarded Republican friends would like everyone to think the auto companies are in this position because of unions. Uh huh. Right. The workers are at fault for the collapse of the company. That’s usually how it works. Please ignore the facts.

In its contract last year, the UAW made painful concessions, adopting a two-tier wage structure, such that new employees make just $12 to $15 an hour. The move is projected to bring the American manufacturers in line with their Japanese rivals' non-union labor costs in the near future.

In addition, the union has taken responsibility for providing retiree healthcare, thereby eliminating one of the last remaining competitive disadvantages for the American manufacturers' unionized workforce as compared to their Japanese rivals.



The horrible, horrible union has done its part to save the company, so shut the fuck up, you incredible idiots. The estimated cost of health care for each GM car is $1,500. Considering most other countries have universal health care, our auto industry is starting in a hole, which just happens to coincide with the profit difference.



But, the right wing is against health care, so we can’t do that. And we can’t have unions. And we can’t save the car companies with a bail out. Sorry, we just have to let ‘em fold and put 3 million Americans out of work. Then we will not pass an extension for unemployment and they will have to become criminals to survive. Then we will put them in jail where they belong. Fucking criminal assholes.

Automobile companies are in bad shape because they made bad choices. They went for the short sighted big buck, the one that would make them the most in the moment, you know, like all those financial companies we just bailed out. Except, the car company’s actions were stupid instead of criminal. And now they are getting hammered by…right, the credit problem – which was created by a lack of regulation on Wall Street. Companies like GM survive on credit. They need it to pay the companies that produce the parts they use to make cars. With no credit, the whole thing collapses. And it’s the reason we can’t allow GM to declare bankruptcy.

GM won't be able to file Chapter 11.

But GM can't build cars without parts, and it can't get parts without credit. Chapter 11 companies typically get that sort of credit from something called Debtor-in-Possession (DIP) loans. But the same Wall Street meltdown that has dragged down the economy and GM sales has also dried up the DIP money GM would need to operate.

That's why many analysts and scholars believe GM would likely end up in Chapter 7 bankruptcy, which would entail total liquidation.



Sweet. Total liquidation. That should be awesome for any future wars we have to fight. We don’t need those companies to produce equipment for our forces or anything.

What everyone also seems to be missing are Detroit’s advances. The companies are actually turning the corner, and in some cases possibly moving ahead of Japan.

So far, the results are promising. According to the most recent Harbour Report, the benchmark guide for manufacturing prowess, Chrysler's factories now match Toyota's for the most productive, while both Ford's and GM's are improving. (A Toledo Jeep factory was actually named the nation's most efficient.) Consumer Reports now says Ford's reliability is approaching that of perennial leaders Honda and Toyota, whose ratings actually slipped last year. In late 2010, GM will introduce the Chevrolet Volt, a plug-in hybrid that can go 40 miles without gas, and the Chevrolet Cruze, a compact that relies solely on gas but that gets 45 miles to the gallon. The Volt would represent a rare leap ahead of the Japanese, who never embraced plug-in technology with the same enthusiasm.

No bailout means kissing the Volt and possibly its technology good bye.



"Maybe those engineers get rehired, maybe not," says Case Western's Susan Helper. "But you lose those working relationships; you lose all the time invested. ... [People] don't really have a sense of the things that have to get put in motion, when you have ten-year planning horizons for new engines. When you disrupt that, it's very costly."



Sounds awesome. The Volt has been in development for a decade, so let’s toss it out the window. It’s totally what we need with peak oil staring us in the face and companies like Tesla falling apart because of the credit crunch.

Or, you know, we could go with the “free market” plan. Let’s see how that would play out.

1. GM files for Chapter 7 bankruptcy
2. GM's Chinese partner, SAIC, buys much of GM (Buick, Chevy, Cadillac)
3. GM/SAIC starts importing Chinese-made Buicks and Chevys, undercutting Toyota's cost advantages
4. GM/SAIC owns the Volt technology, requiring US firms to lease it if they wanted to use it.



Sweet. There’s your free market at work. I’m sure the right wing would love our car companies and their technology being owned by the Chinese. Right? Hello?

The bailout needs to happen, but unlike the idiotic one we just gave to Wall Street, it should come with strings. First, fire every asshole working at the top of these companies. Get ‘em out. They are idiots and have been fighting against regulation and EPA standards that would have pushed them in the direction of profitability today. Fuck ‘em. Bring in someone who is innovative and has actually made a lot of money, like a Bill Gates or a Steve Jobs. Make standards and new regulations part of the bailout deal. We have been at a political standstill for years because of the many lawmakers beholden to automakers and their employees. Now it is time to get what should have been done years ago done.

Of course, the right sees this as a way to destroy one of America’s most powerful unions, so they are against it. You’ll see a lot of the assholes who voted for the Wall Street bailout saying this is a bad idea because they want to kill the union. They are okay losing 3 million jobs for ideology. Meanwhile, they can’t handle the idea of universal healthcare and love spending shitloads of money in Iraq. They are amazing idiots. If you support the Iraq War and all it has cost, yet argue against a bailout, please explain to me why I shouldn’t be able to shit down your throat. Because I don’t see any difference between you and a toilet.

FearTheReaper is a writer, actor and stand up comedian. Check back each Tuesday, Thursday and Saturday for more from FearTheReaper and read his blog, Stop All Monsters.

 

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Comments
punk

punk

Phoenix, AZ
January 2004

NOV 18, 2008 04:41 PM

Chris Dodd should read the Newswire. He tore the shit out of some auto industry executives today.

punk

punk

Phoenix, AZ
January 2004

NOV 18, 2008 04:42 PM

Innocent_Sid said:
On NPR (yes, I am a left-wing tree hugging vegetarian type) I heard a very reasoned rationale for letting the car companies go into bankruptcy. This would not put people out of a job, but the car companies could restructured their obligations in a manner that could allow them to compete.

If we do bail them out., ALL of their top management must be replaced with people that can run a business and not a bunch of morons that let the Toyota's of the world eat their lunch.



Like the assholes who figured it'd be a swell idea to develop, build and market three different types of puffy-looking, gas-guzzling, piece-of-shit Hummers?

Moxy

Moxy

SUICIDEGIRL

Michigan, USA

NOV 18, 2008 04:51 PM

this whole thing depresses me. i remember how powerful and beautiful michigan began to be in the early 90's when i was growing up.... and then it was just lost. my grandpa slaved away for 34 years in the GM plants as well as my grandma who had to retire early from working on the production lines it eventually took a toll on her. if they go under they no longer recieve their retirement bennefits. they already lost thier asses in the stocks. it really would break my heart to see them lose all they have worked for.

i hope they do something. its is the cornerstone of failure for this country if these companies go under. america cant afford not to bail this state out.

please.

SuperCrunch

SuperCrunch

Birmingham, AL
January 2007

NOV 18, 2008 05:05 PM

erratic_prophet said:
Damn it, as much as I hate the idea of bailing out more of these assholes, I don't think there's an alternative. Although the temptation of the "Mad Max" scenario is strong.



Lets put the CEO's in the Thunderdome.

sick

sick

Minneapolis, MN
June 2003

NOV 18, 2008 05:08 PM

I don't even know where to start; it's all more or less been said. If it were just the car companies that would suffer, I'd say, "Fuck 'em." They didn't even have to predict market trends to see where the market was going. It was obvious to anyone with even limited brain function. The big three's stupidity should result in their failure.

However, when you're talking about three million jobs, there are other things to worry about. As much as I hate it, we have to support the auto companies in order to minimize the effects of their idiocy on society as a whole.

It's not a good situation either way.

Tiger_Fodder

Tiger_Fodder

Braintree, MA
June 2007

NOV 18, 2008 05:08 PM

punk said:

Innocent_Sid said:
On NPR (yes, I am a left-wing tree hugging vegetarian type) I heard a very reasoned rationale for letting the car companies go into bankruptcy. This would not put people out of a job, but the car companies could restructured their obligations in a manner that could allow them to compete.

If we do bail them out., ALL of their top management must be replaced with people that can run a business and not a bunch of morons that let the Toyota's of the world eat their lunch.



Like the assholes who figured it'd be a swell idea to develop, build and market three different types of puffy-looking, gas-guzzling, piece-of-shit Hummers?



Exactly!

Stiles

Stiles

Oakland, CA
November 2002

NOV 18, 2008 05:09 PM

Innocent_Sid said:
On NPR (yes, I am a left-wing tree hugging vegetarian type) I heard a very reasoned rationale for letting the car companies go into bankruptcy. This would not put people out of a job, but the car companies could restructured their obligations in a manner that could allow them to compete.

If we do bail them out., ALL of their top management must be replaced with people that can run a business and not a bunch of morons that let the Toyota's of the world eat their lunch.



If you read the first post, you will see that bankruptcy-process/debtor-in-possession financing will be virtually impossible to arrange for GM or the other automakers due to our current financial meltdown. That rules out chapter 11 reorganization completely. That leaves chapter 7 liquidation, where assets are sold to pay off debts, and GM assets would very likely be sold to China, and most manufacturing and supplier jobs sent overseas. That would be a disaster.

As far as management goes, Mulally has been at Ford for only a year, the guy running Chrysler less than that. They haven't has enough time to catch their breaths, let alone do anything meaningful. That leaves Wagoner at GM, who should definitely go ASAP.

Tiger_Fodder

Tiger_Fodder

Braintree, MA
June 2007

NOV 18, 2008 05:11 PM

phrogg said:

Jace said:

carolinacoonass said:
Fuck the bailout. Let the automotive industry go up in flames and see what phoenix (ie China,Korea) arises. Does anybody believe in standing on their fucking own two anymore? This is fucking America god damn it! The home of the brave. The Feds cant even manage to buy a fucking toilet seat under budget let alone manage another multi-billion dollar bailout. McCain/Obama - they are all the same- tax and spend socialists disguised as self reliant Americans. Fuck them all. We should line them all up like Bobby Dylan said (including the union leaders and corporate execs) and shoot their ass for allowing what has happened to happen. Oh yeah, by the way,I could be arrested for saying that because of the anti-constitutional "Patriot" act. Well Fuck Congress. They don't represent anyone in my neck of the woods anymore and they'll have to pry my guns from my cold dead hands to get me to shut up. It's time they fear us, and fear the working man for the retribution that we will bring if they keep fucking up our pension funds and mothers bank accounts. Congress,corporate america, unions and executives all need a swift kick in the ass to realize how bad they truly have fucked up! I'm ready to do it! I've had enough of this class war bullshit!


Every time I hear a completely nonsensical rant like this I wish I had a time machine that could teleport the person to the alternate universe they're wishing for, in the hope that maybe it would rectify their retarded short-sightedness.



I'm still trying to figure out when Bob Dylan said "line them up against the wall and shoot their ass..." surreal



It was in Newport when he went electric. I think he was talking about the people booing him though.

SuperCrunch

SuperCrunch

Birmingham, AL
January 2007

NOV 18, 2008 05:18 PM

After thinking on it a bit longer, I've come to the conclusion that we should just let the motherfuckers drown and spend that bailout money on something far more constructive and needed. For instance we could rebuild mass transit systems that the auto corps bought out and removed, in order to profit off of our current automobile dependency.

Think of all the jobs that having widespread, efficient mass transit would restore. And these are jobs that cannot be shipped overseas. I know my city would be a lot better off it it still had the trolley system that was systematically gutted years ago by auto corps.

http://www.huffingtonpost.com/harvey-wasserman/gm-must-re-make-the-mass_b_144154.html

Tiger_Fodder

Tiger_Fodder

Braintree, MA
June 2007

NOV 18, 2008 05:31 PM

Stiles said:

Innocent_Sid said:
On NPR (yes, I am a left-wing tree hugging vegetarian type) I heard a very reasoned rationale for letting the car companies go into bankruptcy. This would not put people out of a job, but the car companies could restructured their obligations in a manner that could allow them to compete.

If we do bail them out., ALL of their top management must be replaced with people that can run a business and not a bunch of morons that let the Toyota's of the world eat their lunch.



If you read the first post, you will see that bankruptcy-process/debtor-in-possession financing will be virtually impossible to arrange for GM or the other automakers due to our current financial meltdown. That rules out chapter 11 reorganization completely. That leaves chapter 7 liquidation, where assets are sold to pay off debts, and GM assets would very likely be sold to China, and most manufacturing and supplier jobs sent overseas. That would be a disaster.

As far as management goes, Mulally has been at Ford for only a year, the guy running Chrysler less than that. They haven't has enough time to catch their breaths, let alone do anything meaningful. That leaves Wagoner at GM, who should definitely go ASAP.



I disagree that a workable bankruptcy is virtually impossible. Certainly part of the bailout can be changing certain rules under chapter 11 that could allow even GM to emerge. Then again I am no lawyer or accountant.

bean

bean

STAFF

Los Angeles, CA

NOV 18, 2008 05:43 PM

Innocent_Sid said:
I disagree that a workable bankruptcy is virtually impossible. Certainly part of the bailout can be changing certain rules under chapter 11 that could allow even GM to emerge. Then again I am no lawyer or accountant.


I guess by the same token, unicorns flying out of my ass isn't "virtually impossible" either. I mean, I'm not a biologist or any sort of scientist, so I don't know if they're actually real (and tiny, and living in my colon).

Tiger_Fodder

Tiger_Fodder

Braintree, MA
June 2007

NOV 18, 2008 05:59 PM

bean said:

Innocent_Sid said:
I disagree that a workable bankruptcy is virtually impossible. Certainly part of the bailout can be changing certain rules under chapter 11 that could allow even GM to emerge. Then again I am no lawyer or accountant.


I guess by the same token, unicorns flying out of my ass isn't "virtually impossible" either. I mean, I'm not a biologist or any sort of scientist, so I don't know if they're actually real (and tiny, and living in my colon).



I'd like to see that.

And for your information, I do know what I am talking about, but unlike a formerly zotted friend of ours, I don't go around telling everyone my qualifications.

bean

bean

STAFF

Los Angeles, CA

NOV 18, 2008 06:07 PM

Innocent_Sid said:

bean said:

Innocent_Sid said:
I disagree that a workable bankruptcy is virtually impossible. Certainly part of the bailout can be changing certain rules under chapter 11 that could allow even GM to emerge. Then again I am no lawyer or accountant.


I guess by the same token, unicorns flying out of my ass isn't "virtually impossible" either. I mean, I'm not a biologist or any sort of scientist, so I don't know if they're actually real (and tiny, and living in my colon).



I'd like to see that.

And for your information, I do know what I am talking about, but unlike a formerly zotted friend of ours, I don't go around telling everyone my qualifications.


I'm just saying, the odds of them actually changing the rules in any way that would allow GM to magically emerge from bankruptcy without securing massive lines of credit and without being liquidated and sold (most likely to the Chinese) are about the same as the odds of unicorns flying out of my ass.

Fixer

Fixer

Los Angeles, CA
October 2002

NOV 18, 2008 06:09 PM

SuperCrunch said:
For instance we could rebuild mass transit systems that the auto corps bought out and removed, in order to profit off of our current automobile dependency.



California's High Speed Rail is being expected to cost $65B and take 22 years to be fully operational. Los Angeles' 4 basic light rail lines came in at a cost of about $3B.

I've seen assumptions that light rail costs upwards of $118M/mile, so you'd get 210 miles for the proposed $25B package.

adam_vincent

adam_vincent

Austin, TX
November 2002

NOV 18, 2008 06:16 PM

They can start by changing their business model.

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