$25B Now Up To $34B

[Col Hogan]

Hell, what's $9 Billion more among friends???

The Big 3 (we gotta come up with something else to call these weiners) now say they need up to $34B in loans to stay afloat...

http://www.wtopnews.com/?nid=111&sid=1506000

Glad I own a Ford...at least they say they can continue operations if they get nothing...but are asking for a few billion "as a fall back" safety net...

[dbackjon]

Serious question - after handing about $700Billion no strings/reforms attached for the white-collar, non-union Financial industry, why is there so much concern over handing over $35 to the blue-collar, union Auto Industry?

[Col Hogan]

Serious question - after handing about $700Billion no strings/reforms attached for the white-collar, non-union Financial industry, why is there so much concern over handing over $35 to the blue-collar, union Auto Industry?

First, I think we need to install massive controls on the banking/credit industry that got the bailout $$$...another huge blunder by the outgoing administration...

Second...just because a mistake was made with the first bailout doesn't mean we should make the same mistake with the auto industry...has nothing to do with white collar/blue collar IMHO...because the white collar execs in Detroit need to be controlled just as much as the blue collar unions...

[dbackjon]

Serious question - after handing about $700Billion no strings/reforms attached for the white-collar, non-union Financial industry, why is there so much concern over handing over $35 to the blue-collar, union Auto Industry?

First, I think we need to install massive controls on the banking/credit industry that got the bailout $$$...another huge blunder by the outgoing administration...

Second...just because a mistake was made with the first bailout doesn't mean we should make the same mistake with the auto industry...has nothing to do with white collar/blue collar IMHO...because the white collar execs in Detroit need to be controlled just as much as the blue collar unions...

But if the financial industry was too important to fail, wouldn't the auto industry be even more crucial?

[Col Hogan]

First, I think we need to install massive controls on the banking/credit industry that got the bailout $$$...another huge blunder by the outgoing administration...

Second...just because a mistake was made with the first bailout doesn't mean we should make the same mistake with the auto industry...has nothing to do with white collar/blue collar IMHO...because the white collar execs in Detroit need to be controlled just as much as the blue collar unions...

But if the financial industry was too important to fail, wouldn't the auto industry be even more crucial?

Honestly, I don't know. One contributing factor to the auto industry crisis is the credit crisis, where people with good credit can't borrow the money to purchase a new car...so by fixing one, it should ease the problems on the auto industry...

Also, the Big 3 can't borrow the money they need because confidence has fallen off the table taking their stock prices with them...

I'm not a lawyer (and don't play one on TV)...but from what I've read, Chapter 11 would not mean the demise of any of the companies...it would mean a reorganization...elimination of a bad business model...with the opportunity to regroup...

It's worked for some airlines...they declared Chapter 11, reorganized, and came back...other businesses have done the same...

So, since we are SO credit oriented, fixing/rescuing the credit/banking industry seems necessary...too bad the Bush Administration missed the mark by not putting controls/conditions on the $$$...

Bailing out other industries...I don't know...

[dbackjon]

Why don't we just pressure the banking industry to use $30 billion of the bailout to offer low-interest loans to the auto-industry, and pressure the banking industry to start loaning for AMERICAN MADE cars to people with good payment histories?

[Col Hogan]

Why don't we just pressure the banking industry to use $30 billion of the bailout to offer low-interest loans to the auto-industry, and pressure the banking industry to start loaning for AMERICAN MADE cars to people with good payment histories?

I can live with that...it's a start to putting some controls on the $700B bailout of the credit/banking industry...

[AZGrizFan]

Serious question - after handing about $700Billion no strings/reforms attached for the white-collar, non-union Financial industry, why is there so much concern over handing over $35 to the blue-collar, union Auto Industry?

Because I didn't want the FIRST bailout to happen. Screw me once, shame on you. Screw me twice, shame on me.


Well....you know what I mean...

[Col Hogan]

Great commentary on CNN.com...

Basically, is the cure more dangerous than the disease???

So what are the implications of this history lesson? The first takeaway is that a portion of the woes the domestic Big Three are suffering today are the result of current and past federal government policies, so it seems fair that they be accorded government assistance now in time of dire need.

But equally important, while the Big Three automakers might well be accused of not correctly gauging the needs and desires of the American buying public, one group that is demonstrably much worse in that endeavor is Congress. If the U.S. government were a car company, it would not only be deep in the red, but also have miserable customer satisfaction scores

http://www.cnn.com/2008/POLITICS/12/02/ ... index.html

[UNI88]

First, I think we need to install massive controls on the banking/credit industry that got the bailout $$$...another huge blunder by the outgoing administration...

Second...just because a mistake was made with the first bailout doesn't mean we should make the same mistake with the auto industry...has nothing to do with white collar/blue collar IMHO...because the white collar execs in Detroit need to be controlled just as much as the blue collar unions...

But if the financial industry was too important to fail, wouldn't the auto industry be even more crucial?

Giving $25 or 34 Billion to the auto industry will likely just prolong their agony. They need to reorganize in order to compete in today's global economy. By reorganize I mean trimming and replacing management and rewriting their contracts to get out from under the costs, work rules and liabilities (pension and health) that are keeping them from competing with other manufacturers. Bankruptcy might be the best way to achieve this reorganization. It's not a matter of if they need to do it, it's a matter of when they do it if they want to compete.

[dbackjon]

Decent commentary, but places too much blame on the Governmental Regulations, not enough on the recalcitrance of the big three to adapt and NOT fight enviromental laws.

[lifesapuntreturn]

Serious question - after handing about $700Billion no strings/reforms attached for the white-collar, non-union Financial industry, why is there so much concern over handing over $35 to the blue-collar, union Auto Industry?

The financial industry problems are systemic world wide - one big banks fails in the U.S. and they all go because of the derivitive contracts and the way they were sliced and sold and re-sold and re-sliced and so on. Once the U.S. system went, the world system would go as well. As a result, the U.S. government had no choice and continues to have no choice but to throw trillions of dollars at the problem until it is overcome.

The U.S. auto industry can fail today and it will hurt the U.S. economy badly in the short term while all of those 350,000 auto industry lost jobs plus whatever the number of associated jobs (reportedly 3.5 million, depending on who you want to believe) get absorbed. Meanwhile, Toyota, Honda, Nissan, etc. continue to make vehicles and sell them. Since vehicle sales are in the tank now anyway, producing enough new vehicles to meet demand would not be a problem for the next couple of years and by then those foreign nameplates can either expand their existing facilities or buy the Big 3 plants for pennies on the dollar, re-tool them, and re-hire former Big 3 employees for much less than the Big 3 were paying them, without union contracts.

Bottom line, the feds had no choice but to rescue the banks and continue to do so. The Big 3 are expendable.

[AZGrizFan]

Serious question - after handing about $700Billion no strings/reforms attached for the white-collar, non-union Financial industry, why is there so much concern over handing over $35 to the blue-collar, union Auto Industry?

The financial industry problems are systemic world wide - one big banks fails in the U.S. and they all go because of the derivitive contracts and the way they were sliced and sold and re-sold and re-sliced and so on. Once the U.S. system went, the world system would go as well. As a result, the U.S. government had no choice and continues to have no choice but to throw trillions of dollars at the problem until it is overcome.

The U.S. auto industry can fail today and it will hurt the U.S. economy badly in the short term while all of those 350,000 auto industry lost jobs plus whatever the number of associated jobs (reportedly 3.5 million, depending on who you want to believe) get absorbed. Meanwhile, Toyota, Honda, Nissan, etc. continue to make vehicles and sell them. Since vehicle sales are in the tank now anyway, producing enough new vehicles to meet demand would not be a problem for the next couple of years and by then those foreign nameplates can either expand their existing facilities or buy the Big 3 plants for pennies on the dollar, re-tool them, and re-hire former Big 3 employees for much less than the Big 3 were paying them, without union contracts.

Bottom line, the feds had no choice but to rescue the banks and continue to do so. The Big 3 are expendable.

I agree. I wasn't for ANY bailout, but do understand the reasoning behind the bank bailout. And as jon as so eloquently stated, until the Big 3 show a willingness to change their spots, they shouldn't be given a dime.

[Cap'n Cat]

I agree. I wasn't for ANY bailout, but do understand the reasoning behind the bank bailout. And as jon as so eloquently stated, until the Big 3 show a willingness to change their spots, they shouldn't be given a dime.

We agree.