Thursday, November 20, 2008

The Big Three

The current problem of “The Big Three” is not one of their own making – it is a problem of the media. Until we fix the current messaging of the media (including the Left) we cannot win this one.

By “winning” I mean saving American manufacturing.

(Yep, there's more. Click 'read more' for the rest of it.)

Pelosi just came out and said, of the Auto Companies, that “until they show us the plan, we won’t show them the money.”

The auto makers have, in fact, fucked themselves over the years. They have lied to the Congress, they have lied to the people, they married themselves to the oil companies, they have not put forward the products that the people need and in some cases they have pulled products off the market that the people wanted (see: “Who Killed the Electric Car.”) Yes, they have fucked themselves – and yes, they caused a lot of this – but that is not the current problem.

I am so frustrated with the reporting over this $25 Billion dollar Bridge Loan. [It is a loan, not a bailout. The auto makers have already promised to pay interest and have come up with terms, etc.] It has been just absolute bullshit. The media did not spend 1/10 of the time discussing the Trillion Dollar Bailout (that already happened,) that they have spent arguing about how horrible this Bridge Loan would be.

I am glad that people are discussing this (the other bailout should have been discussed as well,) but the myths that are being floated, just suck. Take a look at some of the crap written.

Chrysler is not publicly owned – so ‘fuck em.’

GOP suddenly care about being fiscally responsible.

And gawd-dammit it is not about the executives.

And, for christsakes, enough of the whole corporate jet BS. These executives could have ridden together, but their jets are not just for “comfort and convenience” – they also serve as offices so that the CEOs can continue to work, while traveling.

Enough about the Executives. Enough about the jets. Enough about how filing for bankruptcy. (Filing for bankruptcy will not work with “The Big Three.” Referring to the automotive industry as “The Big Three” ought to be the first clue as to why bankruptcy is not an option. If one fails, the others go. In addition, they will not be able to restructure, because they cannot get loans: see: the Credit Crisis in the US. Also, people tend to not buy vehicles from auto companies that are in bankruptcy because people would like to know that their warranties will be honored and they cannot be honored by a company that might not be there when you need to use your warranty. The people who think bankruptcy is an option (like Romney,) are Dumb asses.)

Enough about the unions and legacy costs being the problem. The legacy costs and the unions are not the problem. Killing the unions has long been the goal of these assholes and the BS reporting of the media helps to serve this beast. The real motivation of the Right is to destroy the unions. (This is probably the real motivation behind the media corps crappy 'reporting' as well.)

In addition, I have heard the GOP talking points about how “small business is the backbone of America” and that the government should invest in “small business.” What is the great benefit of “small business” and why might the Right Wing wish to promote it so: no benefits, no retirement, that explains the GOP's love of small business. I like small businesses too - I work for one, but small businesses do not have the ability to pay for healthcare or retirement and in many cases cannot pay the best wages either. The greatest benefit to small business - the greatest investment that government could make - would be Universal Healthcare and a restructuring of our retirement system. (This would also be the greatest benefit to the auto makers...more on that later.)

The GOP care only about the wealthy, they do not care about the middle class. They have proven this repeatedly and I have a hard time believing that they still have any constituency at all.

Meanwhile, the Dow is down, down, down under 8,000. That is a 50% drop.

In other grim financial news, the Feds are guarding against deflation. Deflation is a really bad thing.

There are some great charts here on the history of job losses. The article goes on to say:
“The best read on total establishment job creation during the latest expansion is 7.2 million jobs. So far the economy has lost 1,179,000 jobs or 16.66%. So let's assume we see a rate of job destruction on parallel with the worst rate in the last 60 years. That would bring total job destruction to 3.6 million.

Now -- remember that we've already lost 1.2 million jobs. This means we have an addition 2.4 million to go. At a 240,000/month job loss clip (the rate we saw last month) we've got 10 months of heavy job losses left. That places the end of the news of terrible job losses somewhere next summer. And that assumes we'll see a rate of job destruction on par with the worst rate of the last 60 years.”

Looking at the above situation, it only makes the auto industry situation more dire. If we lose the, minimum of, 3,000,000 jobs that the auto industry will take down with it we are looking at a serious, serious financial situation. The idea that any lawmakers would even toy with the notion of not helping the auto industry is unfathomable to me.

We have to save manufacturing in the United States of America. It is a National Security issue. It is a moral issue – we are talking about the very survival of millions and millions of people and their families.

I am so disgusted that the GOP thinks that the jobs of bankers are more valuable to the US than the jobs of auto workers and their suppliers. The GOP also thinks that employees of “The Big Three” earn too much money. In addition, they do not like the competition of the union workers wages with their non-union constituency. Many of the Republican Senators speaking out against this bridge loan represent non-American automobile manufacturers who employ non-union auto workers in their non-union states. (Free Market my ass.)

The greatest untold story in all of this is that the auto manufacturers do have new business plans. The problem is that the media has not reported it that way so the Dems have to play the game and put off the vote until December 2nd.

So, now it is up to the auto makers, us, and the media, to report the truth. Two out of the three companies (Ford and Chrysler) have CEOs who are new to them and new to the auto industry. They were all turning a profit 1st quarter this year – the credit crunch has killed them. Auto sales have dropped some 30-45%. It is just a horrible situation for them. The Big Three has also renegotiated all of the contracts with UAW, the workers have offered a ton of concessions and they have begun to retool for more environmentally sound vehicles. In addition, GM is introducing to the marketplace some fabulous new battery technology.

I have also not heard but a few small blips that some of the real problems with the auto companies and their contracts is that we do not have Universal Healthcare and we have really shitty structuring of retirement costs. The media also will not report on this and God Bless Senator Debbie Stabenow (D-MI) for saying it when they give her a mike.

I know that the auto companies have, in the past, made horrible decisions. But that was then and this is now. We must save American manufacturing, unions, good wages and the American Dream. This is really what it is all about. It is time that we reframe it in this way.


Seven of Six said...

Randi Rhodes made a good comment today, something to the effect, "We already have a foreign dependence on energy, look where that got us. Do we really want to have foreign dependence on manufacturing as well!"

I have to agree, we have to save the Big 3. But I really have to say fuck the executives. Too many people are being rewarded for piss poor work. That shit has to stop.

I really think all this stuff should be nationalized for a period of time, then once it's stable let it back to being private. We need the Big 3 for the military as well. It is an issue of national security.

I heard that because of the piss poor economy that recruitment is up for the military. Some shit ain't it, so poor they'll risk lives for work. All part of the GOP plan. And we know those fuckers will sabotage the Dems anyway they can.

muckdog said...

Well, the foreign auto companies build cars here and pay $29 less per hour on "total compensation." Isn't that "American manufacturing" if foreign companies are building cars here? If one or more of the Big Three went bankrupt, wouldn't those foreign companies pick up many of those workers and expand?

The big three have been poorly managed. Maybe the best thing to happen is to ctrl-alt-delete on those suckers. Yes, it'd suck for the workers. But if the unions won't renegotiate the contracts, then there's little room to do much else.

Seven of Six said...

Isn't that "American manufacturing" if foreign companies are building cars here?

That's just it muck, they can pull out anytime they want and go home... we are dependent on foreign companies for our survival... it has not worked out so well for us on energy why would we so gullible to believe it would work in the manufacturing sector. Let's use it as an example.

Hey, Michael Moore warned 20 years ago of this problem. They need a quick turn around and fast.

People's pensions should be protected. With Obama's new healthcare plan and the right to Unionize it will only help us in the long run.

Anjha said...

Crap, look who woke up. Sleeping dogs lie.

The problem, Muck, is that America already does not make very much. Look at all of the shit that we import. Look at our trade deficit.

America has some great R&D. So, we invent shit and then it is built elsewhere. This is bad. This is very bad for America.

We are talking about American Manufacturing. Not just automobiles.

Think about foreign oil, look at how dependent we are on other countries good will for our National Security. What would happen if OPEC decided that they just will not ship us anymore oil? We'd be fucked. Now, transfer that to other Ntl Security products.

We do not make anything here anymore.

So much of our weaponry - not that I advocate using it, but if we needed much of our weaponry or major components of it are made in other countries? We cannot even build a fucking bomb or a tank or a gun anymore without importing the chips or the steel or some part of it. American manufacturing dying is not good for America.

What if the country that makes the chips for our bombs were suddenly the country that we had to go to war with...again, not that I advocate war at all, but it is really fucking stupid that we are dependent on so many foreign nations for products that we need.

Now, transfer that to all other industries. Transfer it to all other Manufacturing industries. We are screwed already. Losing the auto companies and their suppliers endangers us even more.

The auto industry and the defense industry are all tied together. It would be a dumb move.

Well, the foreign auto companies build cars here and pay $29 less per hour on "total compensation."

OK, so they do not pay adequate healthcare or adequate retirement - who do you think does pay those things? Instead of the employees being able to rely on a pension when they retire, they have to rely on SS. Instead of the employees being able to rely on healthcare when they retire, they have to rely on Medicaid. So - the foreign auto companies might pay a salary but the American people - all of us - pay those other costs.

Isn't that "American manufacturing" if foreign companies are building cars here?

Uh, no. Again, if we went to war with Japan do you think that an American Honda or Toyota plant will manufacture bombs or planes or tanks for that endeavor or do you think that the factory would be shut down? No, I am not advocating war I am speaking in realistic terms that we should not base our future - any of it - on relationships that might not be there.

If one or more of the Big Three went bankrupt, wouldn't those foreign companies pick up many of those workers and expand?

Damn you are really not that dumb are you?

If one goes bankrupt all of them will go. No, those workers will not be "picked up." If they go bankrupt millions and millions of people will lose pensions and healthcare and we the people will end up paying for it.

Not to mention that bankruptcy will not work with the auto industry. First of all bankruptcy will not work because the auto industry cannot get loans to restructure because the fucking credit market is frozen.

Also, people do not buy cars from bankrupt companies.

But if the unions won't renegotiate the contracts, then there's little room to do much else.

Hey - dumb ass - you are speaking out of your ass.

UAW renegotiated contracts. The wages are going down. By 2010 new hires will make 1/2 of what they do now. It is being phased in. UAW has made more concessions than any union ever should have. They did so in a good faith effort to save the industry.

All of the auto companies were turning a profit Q1 of this year. The credit crunch hit them extremely hard because consumers cannot get loans and people are not buying vehicles. Sales have decreased almost 50%.

This is why this is an emergency. It is a global economic crisis that our country caused with our piss poor oversight and BS lack of regulations that killed the markets.

The auto industry had already restructured and they were doing better until the market collapsed. Their problem right now is no different than what the other industries went through and is exactly what happened in the financial svcs industry with GMAC and Chrysler Finanancial who are both lending companies. Dumb ass.

muckdog said...

Well, Seven, I'd say foreign countries are also dependent on us for their survival.

And people's pensions are protected via the PBGC. If the big three go bankrupt, the PBGC takes over.

Anjha, I've been awake! I was banned over at the left coaster! I went there after the election to see how you guys were reacting. I knew you'd be happy, but I thought you'd (collectively) would be more optimistic with Total Democrat Domination in Washington DC.

You sound a little like Ross Perot. If we want to get off of oil, the answer is more fuel efficient and electric vehicles. But we need electricity to plug those batteries into the grid. Massive nuclear power plants is the only way if we want clean air.

I was reading over at the left coaster how paradox wanted massive build out of electric cars. What the hell are we going to plug those into, coal-fired electric plants? That'd be worse than burning oil for fuel.

The US auto makers are losing about $1500 per car. Toyota, Honda, et al make about $2000 per car. Seems to me that if you have a hole in your pocket, putting more change in your pocket is a bad idea. We already have up to $50B authorized for US auto companies for alternative fuel cars. Now another $25B they want.

And losing $1500 per car, how long will that $25B last before they come back and ask for more?

At a $6B per month burn rate, not very long.

iamcoyote said...

I was banned over at the left coaster!

You're welcome, everyone.

Anjha said...

If the big three go bankrupt, the PBGC takes over.

And the PBGC pulls money out of the sky along with the cotton candy that drips from the clouds. You really are stupid.

I knew you'd be happy, but I thought you'd (collectively) would be more optimistic with Total Democrat Domination in Washington DC.

Oh, I am very happy. However, Bush is working more efficiently than he has in the last 8 years to ram through BS regs (or lack of regs), BS rules and to fuck up things even worse than he already has. We need an emergency session that moves up the turn-over to tomorrow instead of Jan 20th.

Unfortunately they can really screw us in this 2 months that are left.

Massive nuclear power plants is the only way if we want clean air.

Nuclear power plants are the only way to go if we want a US Chernobyl and a great big stockpile of nuclear waste.

Hey, you ever heard of biomimicry? That is what we need.

WE have all of the technology available to us to have a totally green, self-sufficient, self-renewing energy system. It is all there.

We do not need to invest in nuclear power plants - which we the people insure because no private insurance company will and that will take 30 years to build. That is a waste of time and money for a product that causes more trouble than it is worth.

The technology is available right now, we need only political will.

What the hell are we going to plug those into, coal-fired electric plants? That'd be worse than burning oil for fuel.

Nope - wind and solar power plants. We also have tide energy, geothermal, and hydro-power (hydro-power where the environment is not harmed). We have the technology.

CA already has the infrastructure to plug in the all EV. It was built in the 90s - for the EV1 and other cars, until the Bush Admin got involved and changed the CA laws that mandated a percentage of clean burning vehicles and GM pulled the EV1. Dumb asses.

Building the infrastructure is also a jobs program which we dearly need.

The US auto makers are losing about $1500 per car.

They are losing that money due to healthcare and pensions - and your numbers are wrong - they are not losing it per car, healthcare and pensions cost them that amount per vehicle. Every other civilized Nation has Universal Healthcare and a National Pension Program. They do not have to pay those costs.

The greatest thing for business in the US would be Universal Healthcare and a restructuring of our pension programs.

Our US Auto companies are not competing with Asian auto companies or German auto companies...they are competing with Countries. We cannot expect them to be able to compete with Nations.