I hate to say this but I'm calling BS on Debbie Stabenow.

[Skidmore]

I watched Hardball yesterday and its repeat this morning. Stabenow was on giving a gazillion ways to Sunday as to why we need to yet again bail out the automobile industry. Among these was enumerated that component suppliers would be affected--the same suppliers who supply anyone from the aerospace industries to the computer and defense industries. I'm sorry, but that is just a bogus argument. Component supply sources could continue to supply those industries. They definitely would be operating at smaller volume.

I really do think that the automobile industry hasn't volunteered that it is willing to undergo drastic changes in how it conducts business and the products it puts out. I'm not very sympathetic to a bail out and I do think that Congress needs to pull funds back from Paulson. I'm not real happy with what is going on now and think that really noone in government does more than get together in the back rooms and divines from sheep entrails.

It's time to tighten the belt and for all of us to step forward to solve problems. I'm hoping that Obama can oversee such an effort after he steps up, but I fear that we need to do it sooner--like yesterday.

[LaurenG]

1. I don't think she's 100% wrong

She's the senator from Michigan and IF the big car makers go under what will happen to Michigan?

What will happen to all of us as we know that once the big three go under the domino effect may not stop before we're all down for the count.

I don't have a clue how to get them back on their feet but something has to be done.

[ColbertWatcher]

53. You are correct. Even the OP agrees ...

"... Stabenow was on giving a gazillion ways to Sunday as to why we need to yet again bail out the automobile industry. Among these was enumerated that component suppliers would be affected ...

(...)

They definitely would be operating at smaller volume.

--"I hate to say this but I'm calling BS on Debbie Stabenow."

OP paraphrases Stabenow

"...component suppliers would be affected..."

Then, agrees with her,

"They definitely would be operating at smaller volume."

I'm not sure what this thread is about, if it's not agreeing with Senator Stabenow.

[RoyGBiv]

2. Here's some reality ...

Sorry to put it that way, but, well, there ya go.

Regarding component suppliers, she's simply correct. You even say it yourself. Yeah, they'll stay in business ... at a drastically smaller volume, which means people get laid off. So, that argument doesn't really work.

Another reality is that some want the auto manufacturers to fail in order to bust the unions.

Yet another is that the auto industry executives are morons who *themselves* deserve nothing more than losing their jobs.

Still another, unlike the financial industry, when a manufacturer of a tangible product files for bankruptcy, they still operate, so it's not like "bankrupt" means "going out of business" in all cases. It does mean closures and lost jobs.

These realities are hard to reconcile and swallow, no matter what side you fall on.

I'm still torn on the matter. It's not a clear yes/no question in my mind, although I am coming around to siding with those argue the auto makers should be forced to use the bankruptcy provisions and survive or not under those rules. People are going to get laid off either way, and if that's the case, the taxpayer shouldn't pay the bill just so corporate execs who refused to re-think a failing business model get to keep their jobs.

[madrchsod]

3. good idea...

throw several hundred thousands out of decent paying jobs across the country and some how absorb the tens of billions in lost wages.

i`m sure my 23 year old daughter that makes 13+ ,has really good benefits,and is in training to become osha certified will agree with you.

[lapfog_1]

4. While many might dispute the 20M job loss

I don't think anyone disputes the 3M jobs lost.

That would be 2 times as many jobs lost by when, March of next year, as we have lost since the beginning of 2008.

The ripple effect on retailers of such a staggering number would be huge. Anyone out of work right now would be lucky to get a burger flipping job for minimum wage next year. Anyone.

Given what these clowns have done with the first $300B of the bailout for Wall Street, I have no problem taking $25B to $50B from the remaining bailout money (OK, we all know it's funny money) and giving it to the auto makers with a whole lot of strings attached (it's a loan not a gift, you have to quit making gas guzzlers, you need the plug in hybrids like right now, you need smaller, lighter cars, you need greener building material, and you need to keep the jobs HERE and union, and, yeah, we will get universal health care so you can compete with imports on a more level playing field, and oh yeah, do more flexfuels and biodiesel options, and oh, last but not least, you "three" will become at least "five" so that none of you is too big to fail in the future).

I don't want to see the last of our manufacturing jobs go away. Even if it takes a huge bailout.

[Skidmore]

5. What you have outlined is exactly what I would support.

I am extremely distrustful of the automobile industry's intentions right now and have yet to see a proposal for a new business plan/restructuring submitted to the American people for review. Anything other than drastic overhauling and demands such as those you outlined would be throwing money into a whirlwind.

[lapfog_1]

8. Cross posting my thoughts from another thread.

Here is a more complete list (and readable!) of strings:

1. CAFE standards are going up, rapidly, adapt or die.

2. Those standards will include plug-in electric hybrids, and not just on a few select models. Fleet wide.

3. The jobs will stay here and will be union (and the union will have to play along too!)

4. We will get you universal health care so you can compete with foreign car makers on a level playing field.

5. The materials used to build the next gen cars will be much more "green" (recyclable or biodegradable)

6. There won't be the big three (well, medium two and a small one), you guys are going to be at least 5. That way, if in the future one of you is boneheaded again... too bad. Figure out which brands become companies and transfer assets to match.

7. Some of the money will be used to buy stock, for repurchase at cost over time by employees. GM has a market cap of under $2B yesterday, so this isn't a huge amount of money. (Credit this one to Ravi Batra, a brilliant economist who frequents the Thom Hartmann program).

8. All of this needs to be done by Christmas 2009 with a spring roll out of new, hybrid, green cars in 2010. If you can't design that fast, we will offer you thousands of college students to help out with the concepts. Great class projects.

9. NO MORE NIH! If some smart and small companies have good technology, use some of the money to buy them out, bring their engineers on board and start mass production of those designs.

10. $25B to $50B will be carved out of the $700B bailout already authorized. Too bad Wall Street - you guys screwed the pooch with the first $300B... the credit markets are still frozen, time to try a different approach!

[Skidmore]

10. Send these suggestions to the Obama team at change.gov.

Sounds reasonable and forwardlooking to me. Stabenow would have made a better impression on me if she had brought something with her of this nature rather than just a hand extended asking for cash--especially after this bank bailout. I'd also add to the list that all current management teams for these companies should be required to step down immediately and replaced with people interested in change that benefits the nation.

[lapfog_1]

12. Done.

But the only place I could find to provide feedback was the "share my vision" link.

Is there a more appropriate link?

I credited folks here at DU for helping to shape my "strings" message, and included my kudos to Ravi Batra for his idea on a new ESOP (government assisted). Which, if implemented, would bring about the management changes needed as well.

Right now, if GM held a shareholders meeting, I don't think anyone from the management team would leave the room with all of their limbs. I don't think that any shareholder wants to see things "stay the course" as W. would say.

The problem is that I don't think that Bush or the repukes are going to do anything about the automakers. I honestly think they wanted to rob the Treasury of the last $1 T on their way out... and WANT the economy to be in smoking ruins for Obama when he becomes President (so that they can blame him for this 4 years from now). And the last robbery is to tie his hands so that he cannot forestall a depression by government bailouts and spending (the usual way that a government reacts to a recession is to spend money and hire people... ala New Deal).

Anyway, I don't know if GM can survive in the current crisis until the end of January.

[Skidmore]

13. I think that you probably got the best link there. We were told

to send our ideas.

IJ agree with you that * intends to do nothing more beyond drain the treasury. I don't think Dems should help him do it.

[lapfog_1]

15. I'm sorry to say that I was taken in

I should know better, I was never in the belief that Saddam had WMDs, even when Powell was showing off his test tube at the UN. I didn't think we should go to war.

But I was in favor of the bailout.

The plan made sense to me. Even though I wondered at the time "why not just open the Fed credit window to corporations for their short term 'paper' they need to keep going". But I thought that the bailout would work and that the plan as passed by congress would have safeguards to prevent out and out theft. And I thought it was needed. And I was wrong.

I still think it's needed. And had they done what they said they were going to do, and done it about 4 weeks earlier, it might have worked.

But not now. Now it's exposed as a giant FU to the American taxpayer on their way to Paraguay.

Assholes.

Fool me once, shame on you, fool me and you can't get fooled again. I'm pretty sure I've heard that before.

[MiniMe]

16. Stabenow is a Michigan Senator, she is doing what she needs to do for her State

and it's workers. In other words, her constituents. I think the bailout money is much better spent keeping people employed in good jobs. However, I agree that there should be conditions. The arrogance of these companies is just astounding, give us the money but don't put conditions on how we can spend it.

[CTyankee]

29. IT sounds like you know a lot about this.

Under the scenario you have posed, what about GM's debt? I am essentially a creditor to GM, having purchased preferred stock back in 2004 that is partially funding my retirement (paying 7.5%). At the time it was a way of sustaining my mother in Assisted Living but I have since inherited it...

[lapfog_1]

34. I haven't looked into the complete financials.

But if they adopted a plan like this one and broke up the big three into the medium five, your current preferred shares would be distributed to the likely two or three smaller companies that are formed from GM, so you would be issued new shares in 3 companies or so. I'm guessing that current shareholders would be allowed to keep preferred shares in the new entities. As for the government purchasing shares for part of the bailout money to hold in an escrow pool for the new ESOP or stock option plan, this really isn't a bailout since it would be using the stock market to effect the transfer, probably paying a premium over current share price to buy up the stock. You could sell or not, as is your right. Or, another way is to have the 5 new companies issue more shares (now diluting your equity in those companies). Either way, current shareholders can hang on for the ride. Remember that your stock is VERY likely to rise, both in the short term (an injection of something like $45B (let's say) is going to the bottom line of these corporations, with either a set of warrants or stock issued to the government. And here is the big bet. The government would be betting that the future share price (say in 5 years) is much much higher than todays price. Recovering economy and increased sales of new technology automobiles plus a restructuring of management doing the trick. The government (by which I mean all of us) is looking to make a killing, holds either warrants or shares worth only $5B to $10B in present value. In 5 years or so, those shares (or warrants indexed to share price) would be worth $50B as the companies get back on their feet. At which point the warrants can be retired or the shares sold (over a period of time), recouping the investment for the taxpayer.

Your investment, should you hold on for the ride, goes up from todays value to something like 10 X (these companies are now STARTUPS and will act like STARTUPS). Sure, it's riskier in some ways, startups always are... but you have a decent chance of getting your money back if you bought in some number of years ago. Right now, your preferred shares aren't worth all that much. If GM goes bankrupt, you won't be first in line for the breakup value... you'll be lucky to get a few crumbs, the only folks in line behind you are the common shareholders. Banks and some other people holding loans and what not are in front of you.

[CTyankee]

36. That's interesting. Today the NYT editorialized that "any restructuring would mean

that creditors would have to swallow a loss or accept equity as under a regular bankruptcy filing." I took "creditor" to mean me. Am I wrong?

Actually, the preferred stock is a stock that acts like a bond. I understand the bond is "callable" next July. Hmm, I wonder what that means?

[lapfog_1]

45. Are you a creditor?

Not really. Creditors hold some sort of obligation, either a note or redeemable bond. I'm sure that GM has a number of large creditors. In a bankruptcy (not a reorganization, but a dissolution) the loan makers would be first in line for any assets held by the corporation, then I believe, bond holders (and perhaps your preferred shares have some sort of bond component), then would be the suppliers, people who sold GM stuff on credit and haven't been payed, then would be the obligations to union pensions, etc, then the preferred shareholders... and last in line would be the common shareholders.

I have a few hundred thousand shares of companies that went belly up, some of them are actual share certificates, common shares as part of my stock option plan. They make OK scratch paper... if they were a bit softer, I could use then in the bathroom. That's about it.

I've never heard of preferred stock that is callable (i.e. redeemable). I suppose anything is possible.

I would ask your stock broker about it. Mostly I've heard of preferred stock which is convertible (usually at a fairly high multiple) to common stock, useful in a buyout situation.

Edit to add: The first in line in any dissolution is the IRS, I believe.

[CTyankee]

47. Well, I'm calling my broker/dealer on Monday morning because

if this thing is callable next July I want to know what they would pay me in redemption...

[lapfog_1]

50. Always good to know what your options are in this market.

Try to be as informed as possible... and good luck.

[amandabeech]

37. Your list is very interesting, and I have a couple of suggestions.

First, universal health care will help enormously, and not just with the Big 3, of course.

Shoring up the Pension Benefit Guarantee Corporation would also make a lot of sense, or sweetening social security more at the lower benefit end. On the outside chance that you aren't familiar with them, they take over pension plans of bankrupt or nearly bankrupt companies. Now, they pay only about 1/2 of what had been promised to folks who used to work in companies that went through bankruptcy, like some steel and airline companies. If the autoworkers plans are taken over by PBGC instead of working something out with the UAW, as GM has done with funding a UAW trust fund, then everyone suffers absent cash infusion. Why should the FDIC get favored treatment and not the PBGC?

To design and produce plug-ins by Christmas 2009 is simply not enough time. I'd say design by Christmas and roll them off the assembly line 1.5 years later. Ford may need even longer because it is currently planning a massive retool of some of its truck, van and SUV plants to produce two of the smaller Ford European offerings here. I've seen the brochure on the vehicles, and I think that they will sell provided that gasoline prices go back up. If Ford has to design and retool for a plug-in Escape Hybrid and Fusion at the same, I think even that timetable will not be adequate, even with lots of student engineers working on it. Retooling a big plant is a huge undertaking, and just the coordination with suppliers is a major headache. What I'm saying is that there needs to be oversight and goals, but with flexibility.

Right now, the Big 3 has a huge amount of competition from overseas automakers, particularly the Japanese, but the Germans might be back in the U.S. if the dollar drops against the Euro. Pulling Buick out of GM and merging it with Jeep from Chrysler won't help much against Honda, IMHO. GM might be better off dropping one of its lines, like Pontiac and consolidating Chevy and Buick, plus combining Chevy Trucks with GMC Trucks. The multiple lines often share basic platforms, so why not just have higher trim lines or maybe a different engine and suspension system on the same platform in the same line? That'd probably reduce some overhead and free up some money to concentrate on new propulsion systems.

Right now, the metal in autos is recycled. The problems are everything else, which is mostly plastic and other petroleum products, particularly in the interior of the vehicles. Recycling used plastic is a world-wide problem, and there are ongoing attempts to find a way to do so. I think that the Big 3 can find some substitutes, but I think that this issue is a general societal problem, and that the Big 3 should stick to fixing the problems with the more metallic parts of the car for now, which is a problem particular to them.

Otherwise, thanks for putting together your thoughtful plan.

[lapfog_1]

48. I thought I said design by Christmas 2009

with production sometime in 2010. If it takes another 6 months to summer 2011... that's fine, but that means the bailout tab is going to be significantly higher as we are basically subsidizing the auto industry for the next 2.5 to 3 years. $50B probably isn't going to cut it. However, I think they can go much faster than they have in the past. We ramped up in WWII quite a bit faster than that. The first designs might be very similar to the current after market plug in hybrid and modification of current models to be hybrid in the first place. Or maybe just Flex fuel engine modifications. I know it CAN be done, but they need to get rid of their "process" to make things happen. Have the EPA and the NTSB send people to camp out in the offices, working with the designers so that environmental and safety regulations can be integrated on a daily basis. Possibly even making modifications to the regulations to get the new generation of vehicles done faster.

There are plastics that can be broken down with enzymes and such, higher use of those types of plastics could be environmentally friendlier than dumping the non-metallic parts into a landfill. But I guess that my first idea would be to design cars that "come apart" in much more uniform material parts, with little effort. Sort of like the fuel cell "sled car" design where the wheels, motors and fuel storage (fuel cells are not likely to win at this point) are all in one component, and the cabin, seats, and controls are an interchangeable block (likely with the plastics and electronics... but now with more natural materials and carbon fiber for the safety cage). I'm not the automotive design expert, but I think such a design is possible, and not too hard to retool the current lines if they sort of just quit making cars for a year. (that year not being 2009 but 2010 once the designs are coming to completion).

[amandabeech]

51. Actually, you wrote "design and produce" by Christmas 2009.

It is unclear to me how long we will have to continue to loan the auto companies money. If the liquidity crisis eases up, there will be more buyers. Even if GMAC, which is owned 49% by GM and 51% by Chrysler's owners, can turn itself into a bank holding company and get some cash from the existing pools, it might be able to finance more vehicle sales, provided that the greedy you-know-whats who own Chrysler will go along. If the economy actually gets better, same thing. Fuel prices are down significantly, and that will probably help the Big 3 more than Toyota or Honda due to product mix. Also, GM will need more help than Ford, which is in much better shape and has an actual plan to produce more fuel efficient vehicles here. Chrysler is small and privately held. It will be a lesser factor.

In a real war, things happen very, very quickly. This isn't war, and although the everyone at the Big 3 is fighting for his or her life, I don't think that things will go as fast as they did in WWII when the WHOLE COUNTRY was moving in the same direction, not just vehicle production, and most people knew young men who really had skin in the game. The mentality in many quarters today feels to me like Viet Nam rather than WWII. Working closely with the EPA and NTSB is a good idea.

As I pointed out in my earlier post, flex fuel is not an issue so long as the Cafe standard for counting the ethanol remains the same and so long as people will buy the things. I think that they cost a little more, and the fuel is not widely available in many parts of the country.

Plug-in hybrids are a little ways away, but really, improving the small car lineup would help each of the Big 3 even without a lot of new technology. The non-hybrid Civic, the Corolla and the even smaller Toyota sell well. Why not give Ford credit under your plan for bringing in quite small cars that sell well in Europe?

As to recycling plastics, thermal depolymerization and gassifying would probably very good technologies to try on some of the plastics. One of the Big 3 actually hired Changing World Technologies to try TDP on the stuffing from the dashboard and, I think, the seats. Unfortunately, there was a little problem with PCBs or something equally noxious that was found in the liquid hydrocarbon made from the stuffing. More work is needed, but I don't think that the Big 3 can push this at the same time that they transform their car technology. They can, however, do better with design as you point out, and can seek out available materials that will recycle more easily.

As to fuel cell vehicles, I think that's a lot longer off than plug-in hybrids.

I have the feeling that we're going to have to agree to disagree on these points.

[lapfog_1]

55. not quite, I think I agree with pretty much all of your points.

I loved fuel cells about 5 years ago. Not so much anymore. It's always been too expensive and the storage and transport and production of hydrogen has always been problematic. What I was trying to elude to was the concept car which "came apart" that GM (I believe) started working on some years back. A "sled" base, with drive train, fuel cells, frame, wheels, etc, was the "basic car", and then you put a body on it, married by very few connections (strong ones), plus drive by wire controls. You (or a dealer) could "snap on" the SUV, light pickup, coupe or whatever body style the owner wanted.

Subtract the fuel cell, replace with maybe a ultra capacitors or next gen LiOn battery, and you have a basis for the next gen car electric car.

I agree that IF Ford and even, I believe, GM started selling small fuel efficient cars here like they do in Europe, which they should be able to do right away, that could bridge them to the follow on cars. This would be a great help.

If I wrote "design and produce by Christmas next year"... it was late, I was tired. I meant to say design and produce concept vehicles by Xmas next year... heck, they have already done a lot of concept vehicles. One, the Chevy Volt, is slated for production. But I want a concept "Volt" SUV or pickup or cheaper "around town" errand runner, not just the Volt.

I'm convinced that one of the reasons the "big 3" persist in marketing big full body SUVs and 8 or 10 cylinder pickups is that they both believe than no one wants a small, efficient vehicle AND they want to sell a more expensive, and therefore higher margin vehicle. They don't want to sell us a $12K vehicle because they don't make as much money (notice how the terms for buying vehicles went from 36 months when I was in high school, to 48 months, to 60 months, and now even 72 months... that's because they know that we a) can't pay more than $250 to $350 a month, and b) they sold us on that $32K monster truck or overblown SUV... and the longer the payment, the more money they make on each vehicle).

Anyway, I think I agree with your points.

I know that the plastic thing can be solved, I'm surprised that the hemp people haven't jumped on this to explain how the entire interior can be made from hemp. Maybe it can. I really have no idea about that, I just know that we can use this opportunity to insist that they do a better job with recycling, whatever the solution(s).

[amandabeech]

56. The Big 3 are business people.

They will offer what they think will sell and make money. Those big vehicles did that for them for quite some time. That doesn't work any more so its back to the '70s and early '80s. I hope that they do better now than they did then.

Ford has the plan, but I'm not sure that they have the money now. I discussed the whole shebang with a dealer a few weeks ago when I purchased a gently used Taurus. The dealer was excited about the prospect of selling some small, quality vehicles. That's why he showed me the materials that he had been sent by Ford explaining the plan.

You might like the smallish Escape hybrid while you wait for the Volt utility vehicle, which I assume will be offered if the Volt sedan does reasonable well and quite a few people ask about a SUV/crossover variation.

[lapfog_1]

57. I actually test drove the Escape Hybrid.

more than a year ago... maybe close to two years ago (I think it had just come out). My impression was that the inside was way too "cheap" feeling, the car was too heavy for the battery/regenerative power component. And they wanted too much for it. Not to mention that the factory claimed MPG was only slightly better than a standard small SUV.

Anyway, ended up not getting it.

I read since then that some owners (with careful MPG max driving) can get 45 MPG out of the thing.. or even better.

If I start driving a lot, and have the funds, I'll look into it again.

My favorite idea right now is a VW Jetta with Turbo diesel. Converted to run on biodiesel. 45 MPG AND very green. Sadly, not American made. But no funds to do that now either.

[amandabeech]

58. Perhaps VW can get a loan guarantee from the German government.

I've known people who really like their Escapes. Perhaps the Mercury Mariner or the Mazda twins satisfy your tastes in interiors.

[lapfog_1]

59. Does VW need a bailout?

I hadn't heard that before.

Anyway, nice chatting with you, but we are getting far afield from the OP of this thread. Since I was laid off 6 weeks ago, I'm not in any car market right now. Hope to get more employment soon (better) so then I'll look around again.

[amandabeech]

61. I work on a project basis, and I'm looking for a new project.

Not much out there. Sorry to hear you're looking, too.

Nice talking with you, and good luck on your job search.

[POAS]

6. As a worker for a supplier to the auto industry

I call bullshit on your argument.

First, second and third tier suppliers to the auto industry will go out of business and more jobs will be lost from those closures than from the industry itself. Will many survive, of course they will but the capacities of the various industries will be greatly reduced. This will diminish our ability to meet the demands of the new "green" economy we need to build.

I don't advocate for a simple money drop into the laps of the inept leaders in the auto industry but something of a targeted and "carrot and stick" approach is needed.

Smartly, my employer has over the last 5 years reduced our exposure in the auto industry to roughly 60% from a high of about 75%. That still leaves us extremely vulnerable but it is hard to reduce those numbers significantly lower because demand from outside the "Big Three" is just nor there and domestic producers are under stiff competitive (and in many cases unfair) pressures from overseas.

I'm sure you aren't convinced, I'm not for a blanket bailout like we see for the banks either but a strong manufacturing base is and essential component of any recovery and we cannot afford to see further damage in that sector without risking a prolonged depression as in the 1930's.

[WCGreen]

7. I have a client that was just recently let go because GM switched

to a foreign source for the material used to produce Air Bags...

People are going to lose jobs in this economy.

BTW, what is the difference between say "this" economy vs. "that" economy...

People on CNBC and Bloomberg are always talking about "this" economy. Since the economy is a dynamic entity that changes second by second, wouldn't referring to this economy be constantly in the past tense...

[POAS]

9. Hey WC

glad to see another buckeye represent.

That is an interesting point about our language. The moment passes so quickly that in reality nothing is in the present, I suppose. I think it is just easier to try to lump things into categories than to make sense of shifting sands beneath our feet. Kind of like watching the dunes on a beach. We know they move but our only real sense of that movement may only come from comparing then vs. now pictures.

Ohio is in a unique position with respect to the auto industry because we have so many suppliers to the auto industry but only a handful of "Big-3" manufacturing facilities in our state. In some ways we have more to lose than Michigan with a failure of the auto industry.

People think of the auto industry as a monolith when in reality it is intertwined throughout our economy and the fate of the "Big-3" and the foreign builders of autos in the US cause big ripples throughout this/that economy!

[KharmaTrain]

11. She's Doing Her Job

She's elected to do what she believes is best for her state...one where the Auto industry reigns supreme. Just look at Roger & Me to see what happens when a major auto plant closes. The current fiasco has destroyed that state's economy and if she wasn't trying to save those companies and jobs, I would think Michiganders would be calling for her head.

That said, I'm not in favor of this bail-out. I'd rather see that large sum used to creating new forms of transportation...rebuilding a bigger and better marketplace rather than throwing billions at the same old name plates that have had 30 years to design and build more fuel-efficient and environmentally friendly vehicles, but choose to go for the greed by cranking out SUVs and other gas hogs that put short term profits over long term company welfare. And you're gonna throw money at the same people who created the mess to fix things?

Cheers...

[sendero]

14. All I can say is...

.. if you were FOR the 700 billion dollar bank bailout, and against this, you are some kind of moron. Not that I think there is anyone that stupid here :)

Seriously, I'm against bailouts in general and was certainly against the 700 billion blank check given to a "former" investment banker to dole out.

And as far as I'm concerned my opinion has been thoroughly vindicated.

But, the case for bailing out the last bastion of manufacturing in this country is a lot easier to make.

Have the automakers been thoroughly mismanaged? Yes. Are union workers going to have to get used to a lesser compensation package? Yes. But I would rather try to save the automakers than the banks, any day. And it will only take 10% of the money to do so.

[moondust]

17. Red state opposition.

Not to forget that several of the Asian automakers have built their U.S. production facilities in red states: Kentucky, Tennessee, Alabama, now Mississippi, etc. I don't think it's a coincidence that red-state Republicans seem to be leading the opposition to loans for the Big 3 automakers (and suppliers) which are located largely in northern blue states.

[Skidmore]

21. Good point.

[Mudoria]

23. Red state Republican's also led the charge against

the bailout of the financial sector. Can't call them out for opposing a bailout of the Big 3 when they also opposed the 700 billion giveaway.

For my part, I'm for bailing out the auto makers with many strings attached to get their asses in gear to innovate and produce better greener vehicles. Not to mention save all those jobs for Americans.

[moondust]

25. Except that

the Big 3 are asking for LOANS which are nowhere near the size of the $700 billion mystery giveaway and the loans may save millions of jobs. I see a pretty strong case for opposing the $700 billion but a pretty weak case against the Big 3 loans, suggesting there may be an ulterior motive behind the opposition.

[JNelson6563]

18. how nice for you

Yes my friend, stand back and look dow n your nose at MI from your safe (everyone wants ethanol) perch there in Iowa & tell the desperate souls in MI about how we have to "tighten our belts" during these "tough times".

BTW, got any extra cake?

Julie

[Skidmore]

20. I'm going to give you a pass on this

because I know that you are having a tough time. However, we have lost industry here too. I, for one, have been unemployed for a better portion of the past 3 years. Jobs are draining out of our economy too. There is not safe place now and there hasn't been any for some time. There comes a time when you stop throwing money into a hole and start doing something constructive though.

[JNelson6563]

30. Let us look at the two states

I am on my phone now but will compare the conditions of the two states. I believe it is not me who is getting a pass.

to be continued.

Julie

[JNelson6563]

60. Some info

Iowa

http://www.bls.gov/eag/eag.ia.htm

Michigan

http://www.bls.gov/eag/eag.mi.htm

If you do nothing else you can learn all you need in regard to my original point just check out the unemployment rates (MI 8.7%, IA 4.2).

Sorry you are having tough times personally but trust me, Michigan has been bleeding for years and it sickens me how easily many DUers call for the finishing of this once mighty state. As I have stated previously, yep, the Dems have our 17 electoral votes in the blue column, commence the "who cares about them?" bullshit.

Thankfully PE Obama has a different view.

Julie

[annabanana]

19. I would rather prop up ANY manufacturing than "derivatives". .

At least there's something real there.

[proud2BlibKansan]

22. I haven't bought a US made car in 15 years

but I hate to see this industry go down.

[Mudoria]

24. Got a 1989 Camaro RS I bought new..

still running as well as the day I bought it and with under $600 worth of repairs in 19 years. Hard to imagine a rice burner doing any better than that.

[proud2BlibKansan]

27. 85 Toyota truck with 300,000 miles

still running with no maintenance except oil changes.

84 Honda Accord 250,000 miles. Still runs great with only minor repairs.

One is sitting in my driveway right now. The other one belongs to a good friend.

On the other hand, I bought a brand new 93 Blazer in 93. The heater went out at 500 miles. The radio stopped working at 20,000 miles, both electric windows went out at 50,000 miles and the 'check engine' light started flashing at around 25,000 miles and they never could figure out what was causing it to come on or how to make it stop. Finally sold it for $200 at 100,000 miles. It needed a new exhaust system.

Hubby had an 89 Lumina with much the same history. It also was out of our driveway (towed away) at around 100,000 miles.

We now buy only Hondas or Toyotas. And we keep hoping the American car makers will make a better quality product. We are both union members and would much rather spend our money on American cars.

I loved what Michael Moore said a couple years ago. He asked if any of the top dogs at the big 3 American car makers ever went to a Honda or Toyota dealership and took a test drive around the block to see what the big deal was, why are so many of us buying Japanese cars. Instead of condemning them, find out why they were so appealing.

[amandabeech]

35. Things have changed some since '93 with quality.

Pick up a 2008 Consumer Reports Buying Guide and check out the used car section.

Honda does very well, Toyota is slipping a bit, but each of the Big 3 are making a selection of vehicles that rival the other Asian and European models.

My '03 Taurus (with 42,000 miles) is doing great and has had a good rating from CR all its life, and deservedly so. Ford is doing quite well, and Buick of all things builds a very reliable auto. You might check it out if you're in the hunt for a mid-size sedan. Some of the Buick mid-sized get 30 highway. Not bad at all for the class.

[proud2BlibKansan]

41. I get 38 on the highway

and as soon as I can afford it I plan on buying a Prius that gets 45 to 50. :)

[amandabeech]

42. Are you driving a four-banger or a modified hybrid? nt

[proud2BlibKansan]

43. Scion

[amandabeech]

44. I've rented one a few times.

They're not to my taste.

I'm not surprised at your gas mileage with that vehicle, but it is not comparable to a mid-sized sedan, almost all of which now are sold with a 6.

[proud2BlibKansan]

46. It works fine for me

Plenty of power and lots roomier on the inside than it appears. The only problem is I miss having a trunk. But I will sacrifice that for the great gas mileage.

[amandabeech]

52. To each his or her own.

I needed the room for projects, but I would never buy one.

If I were in need of an subcompact right now, I'd look elsewhere.

[gollygee]

26. Michigan is already having terrible problems

and we can't afford to lose that many more jobs. And she's our senator and it's her job to advocate for us.

Having said that, I do think that they should have to meet some requirements as far as producing cars that meet reasonable environmental standards in order to get bailed out.

[CTyankee]

28. Wasn't she talking about a "bridge loan?"

I remember the infamous "Ford to city. Drop dead." statement by Gerald Ford to New York City. Once he got word of the international ramifications of NOT bailing out NYC he changed his mind. The loan was repaid and NYC got stronger.

I'm not for a bailout. I am for a bridge loan. We have to have an auto industry. GM should be held to strict standards by the terms of the loan and that means more fuel efficient cars and the loan must be repaid. Just closing it all down is counterproductive.

[suston96]

31. If the "bailout" is simply US guaranteed loans......

...then I am all for such US guarantees to save all those jobs.

I am getting tired of reminding people that this has happened before. Google 'Chrysler bailout 1980'. Sure, it wasn't this much cash but the point is that Chrysler paid back the loan WITH interest.

http://uspolitics.about.com/od/economy/ig/Financial-Bailouts---A-History/1979--The-Chrysler-Bailout.htm

Net Cost: None (loan guarantees)

Background: The year was 1979. Jimmy Carter was in the White House. G. William Miller was Treasury Secretary. And Chrysler was in trouble. Would the federal government help save he nation's number three automaker?

In 1979, Chrysler was the nation's 17th largest manufacturing company in the country, with 134,000 employees, mostly in Detroit. It needed money to invest in tooling a fuel-efficient car that would compete with Japanese cars. On 7 January 1980, Carter signed the Chrysler Loan Guarantee Act (Public Law 86-185), a $1.5 billion loan package . The package provided for loan guarantees (like co-signing a loan) but the U.S. government also had warrants to buy 14.4 million shares of stock. In 1983, the U.S. government sold the warrants back to Chrysler for $311 million.

[amandabeech]

38. In today's banking climate, I'm not sure that they could get a loan,

even if the U.S. gov. guaranteed it.

They also can't get financing by accessing the commercial paper market, because that market is not moving, their paper is low grade, can't be insured and doesn't fit into the program to provide liquidity for high grade commercial paper.

GM really is in a bad, bad place.

[trudyco]

32. Well, if they give them a low interest loan it should at least be higher than the Treasury bonds

So the government isn't losing money. Also, there should be a business model that shows an upper management austerity plan until the loan is paid off.

[DU GrovelBot]

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[fascisthunter]

39. Why are the Most Conservative Least Effective Democrats Always in the Media

speaking for us all... nevermind. I agree with you in that We do need to say more, not less. Uh uh... not this time.

[blue_onyx]

49. Can I ask, what's your issue with Sen. Stabenow?

[TWiley]

40. The problem also lies in outsourcing.

GM buys their parts from many of the same manufacturers that the other domestic auto companies do including foriegn owned ones like toyota that are built here.

If someone as large as GM goes under, it could cause suppliers to go under. This can impact the remaining domestic automobile manufacturers. nearly 4 million jobs could be threatened.

Now think of this ....... $800 Billion to bail out white collar workers (republican base) and $0 to bail out Blue Collar Workers (middle class Deocratic base)?

Why should bush bail out republicans and not democrats? It will have that effect.

[Atman]

54. How many MILLIONS of GM and Ford cars are on the road?

They aren't just going to disappear. They'll need to be maintained, upgraded, repaired. These are called "markets." Where there is a viable market, there will be businesses there to fill the need and make a buck. They're talking like it's going to be a Twilight Zone episode where all the American cars just suddenly come to a halt on the day GM files for chapter 11.

This is nothing but a union busting scheme, to be sure. But even if GM shut down US ops, they're still building factories in China, and ironically, GM and Ford cars and trucks and heavy equipment sell pretty well worldwide. I don't buy into the "GM builds shitty cars no one wants to buy" crap. Check out the surrounding traffic next time you're out for a drive. A lot of people buy those shitty cars no one supposedly wants to buy.

It's an issue of horrible management and, of course, politics. (Psst...something fun to consider, too...Remember all those terrible DiTech loan commercials during the Bush years? The ones which sucked in any jamoke with a pay stub and checking accounting in refinancing their homes at 120% of their value? I bet they're holding a lot of bad paper now, huh? They're owned by GM. Just sayin').