News > Politics > Bail The Shit Out Of Detroit

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TUESDAY NOVEMBER 18 2008 6:00 AM

Its 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 Im 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, Im 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. Thats 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 cant do that. And we cant have unions. And we cant 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 companys actions were stupid instead of criminal. And now they are getting hammered byright, 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 its the reason we cant 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 dont need those companies to produce equipment for our forces or anything.

What everyone also seems to be missing are Detroits 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 lets toss it out the window. Its 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. Lets 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. Theres your free market at work. Im 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 Americas most powerful unions, so they are against it. Youll 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 cant 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 shouldnt be able to shit down your throat. Because I dont 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

carolinacoonass

Charlotte, NC

September 2008

NOV 19, 2008 11:15 AM

FreakPirate said:

carolinacoonass said:

I had a general idea

Based on your posts in this thread I think you're mistaken.

agree to disagree

FreakPirate

Canada

November 2002

NOV 19, 2008 11:18 AM

carolinacoonass said:

here here to the booze.

Seems like you've had too much already.

but on supply side econ..grocery supply would go to other parts of the country and world where their are people working and then the people from detriot rock city will move or buy their groceries in those areas when they find their new jobs in different industries or like industries in those areas. See how brilliant and efficient that is. The groceries will already be waiting on them at their future towns and villages due to fast efficient supply side econ. And yes, the less government intervention the better, it only slows down the power of the purse.

If people can't afford to buy groceries in Detroit how do you think they're going to afford to pick up and move somewhere else? You really don't understand the way the world works do you.

Uncognitive

Brooklyn, NY

May 2003

NOV 19, 2008 11:36 AM

carolinacoonass said
but on supply side econ..grocery supply would go to other parts of the country and world where their are people working and then the people from detriot rock city will move or buy their groceries in those areas when they find their new jobs in different industries or like industries in those areas. See how brilliant and efficient that is. The groceries will already be waiting on them at their future towns and villages due to fast efficient supply side econ. And yes, the less government intervention the better, it only slows down the power of the purse.

The scenario you describe as being "brilliant and efficient" is not only neither, but so fantastically out of touch with reality that you might as well assume that legions of unemployed Motown automobile manufacturing employees will relocate to Atlantis via a convoy of unicorns.

DevilsReject

Cleveland, OH

February 2007

NOV 19, 2008 11:44 AM

carolinacoonass said:

DevilsReject said:

SuperCrunch said:

motorfirebox said:
you'd like to see less people? did you seriously just say that? wow.

and no, the groceries very well may not get to people no matter what happens in Detroit. it's simple: lots of people lose their jobs, so lots of people stop spending money on groceries, so grocery stores run out of money to restock with, so people can't buy groceries even if they have money.

and, hilariously? according to the principles of supply-side economics, you should support the Detroit bailout.

I really don't see people not buying groceries. They may very well stop buying at places like whole foods and publix and spend more of their money at Walmart. Which could foreseeably hurt those particular stores or put some of their stores out of business.

living very near to large Ford and GM Manufacturing plants, i can give you an idea of what would probably happen if GM and Ford closed.

To start, all the suppliers to the Ford and GM plants would close, since GM and Ford no longer in existence. If they filed bankruptcy, these small suppliers would probably fold, seeing as that everything they gave the two plants credit on, are not going to be paid for.

Cleveland has nothing else to offer but manufacturing at this point. A lot of the companies that manufacture things, aren't full in with GM or Ford, but they do sell a lot of items to them. Since GM and Ford aren't around, they will sell injection machines/presses that are specific to GM and Ford, also laying off the employees that operate and repair those machines. = More lost jobs in my area.

The bars, bowling alleys, shopping complexes and restaurants that surround the GM and Ford plants would close, considering their main source of revenue is the employees of the two plants. = More lost jobs in my area.

The job market in the northeast ohio area, which is already inundated with capable workers, would become even more flooded with people searching for a job. If the majority of workers can't find work, they will continue to flee Cuyahoga county, which is already experiencing a severe loss in population.

The ones that do end up sticking around are going to end up getting jobs that are well beneath their skill level and pay level. Which means things like houses must be sold, cars must be sold and other things that are luxuries in order to survive. The housing market is already overwhelmed and more people are selling than buying around here. Dealerships are closing left and right.

If GM and Ford go belly up, my area will be a ghost town and it will never recover.

it would suck but if you were in automotive or a related industry, yes you would have to leave the area. this has been going on the south for years with the demise of the textile industry and though not as large from a gdp standpoint, i feel your pain

I am not in the automotive industry and i am suffering. You fail to realize that skilled labor in the automotive industry can shift to other industries, which causes an enormous employer's market. Thousands of people applying for one job.

You are naive in believing that the only people being affected will be strictly from the automotive industry. When thousands of jobs are lost every industry is affected from the employee side.

I am also affected by the fact that no one wants to spend money right now, my very small business is taking a hit because the few commercial accounts i have are basically on a spending freeze, the personal accounts i deal with are just about the same. Computers and outsourcing labor at this point are not necessities, they are luxuries, people are dealing with what they have rather than spending money to fix it or upgrade.

Not everyone has "extra" money set aside to move across the nation or even out of state.

You have a serious case of the tunnel vision.

n8tvegrl

Bend, OR

February 2004

NOV 19, 2008 11:54 AM

I understand why those who do oppose it. These large megacorps have misused resources, put off research for more energy efficient vehicles, and have left both union workers and execs with bloated salaries (for some).

I wish there was something we could do to "teach" them but the reality is that this could bring the economy to it's knees for EVERYONE. Regardless of the trade. The reality is we will have to support the workers that would be displaced because that is what Americans do. It would seep into the retail economy which would affect even the northernmost town in Alaska because everyone will have to restructure in order to survive.

If we don't bail them out we will be cutting off our nose to spite our face. If we want to survive and rebuild then we need to do what needs to be done and then move on from there. If not, we'll just fall into a slow decay that may or may not be the downfall of our economy that could result in us being China's bitch.

I guess I'm glad I speak Mandarin.

motorfirebox

Pittsburgh, PA

March 2004

NOV 19, 2008 11:56 AM

carolinacoonass said:
but on supply side econ..grocery supply would go to other parts of the country and world where their are people working and then the people from detriot rock city will move or buy their groceries in those areas when they find their new jobs in different industries or like industries in those areas. See how brilliant and efficient that is. The groceries will already be waiting on them at their future towns and villages due to fast efficient supply side econ. And yes, the less government intervention the better, it only slows down the power of the purse.

yes! right! because a night shift manager at the McDonald's that depends on customers from the nearby automobile factory--that night manager is definitely going to have enough saved up for a cross-country move, when her restaurant has to cut employees because of the sudden lack of people coming in for their daily dose of Big Mac. for that matter, the guys making a quarter over minimum wage on the assembly lines--they're definitely going to have a fallback plan if their existing job and every other job in the region dries up.

your planet sounds like a really nice place to live.