AIG, a friggin’ insurance company, has gotten over $100 billion in federal (our) money.
What’s the problem exactly with aiding the auto companies?
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AIG, a friggin’ insurance company, has gotten over $100 billion in federal (our) money.
What’s the problem exactly with aiding the auto companies?
Comments are closed.
They need to restructure. Bankruptcy does not help an insurance company. It may help a manufacturing company with significant outstanding labor issues. It appears to have helped the airline industry (which had significant labor issues).
You have not been advocating saving Circuit City. Why should our tax dollars go to saving the job of someone who works for one of the big three, but not someone who works for Circuit City (or Lehman Brothers, or any of the other many, many companies that have gone bankrupt recently, for that matter)?
As a NewMexiKen reader pointed out to me in an email, “I thought you didn’t agree with bailing out the auto industry. Have you changed your mind?”
No, I don’t think I had changed my mind so much as I’m not sure what should be done. Writing about it helps coalesce my thoughts. Getting reactions helps even more. I don’t think I like arguing, but do like learning, and I sometimes learn by arguing — even with myself.
See the Timothy Egan link posted Thursday morning for yet another point of view.
Outstanding labor issues are not the problem in Detroit. Detroit’s labor costs are not any worse than those of the other automakers.
The problems are legacy health care and pension costs and building cars that the public doesn’t want to buy.
The UAW is in the process of taking over the health care benefit, and that should help once it is complete. The retiree health care benefit was a really bad idea, and the Big 3 should never have agreed to it. Fix that, and you knock 20% off the cost of every vehicle.
Look at what GM, Ford, and Chrysler are selling in Europe and Japan. They already have models that get excellent gas milage in their product lineup; they just don’t offer them in North America. How much do you think it would take to retool American factories to make those cars? Would American’s buy them?
They had to make only high-profit vehicles, because they needed that profit to pay for the legacy overhead. They will lose money on each small car without fixing that part of the problm. The immediate labor costs are not, themselves to blame, since GM’s are no worse than those of Honda or Toyota, and their factory productivity is about as good.
Can we have a functional national health care system, now? Please?