Auto Bail Out Debacle

I am not an expert on the in and outs of the auto industry, however I can read and understand what I read and also, I have a certain amount of common sense.  The subject today is whether or not to bail out the Big 3.

I understand – the auto industry is much to blame for their own problems – for one, in their refusal to develop fuel efficient cars, rather, bowing to the greed-ridden oil companies to build cars bigger and more fuel dependent.  The unions, with their demands of more concessions from the industry, share in the problem along with upper management and their perks that bordered on obscene including huge bonuses, golden parachutes and unlimited fringe benefits. I am not in favor of across the board bailouts, however, I believe the experts realize that to let the auto industry collapse will cause a domino effect that will be devastating to our economy. I suggest Exxon provide the bailout money: after all they encouraged the auto makers to make bigger cars and to make them heavy gas guzzlers.

But, although the greed and ignorance of all involved make us very angry, it is not in the country’s best interest at this given time to let the auto industry go belly up.  It means over 30 million jobs will be lost, and thousands of small businesses that provide parts and assistance to the industry will close and those workers may all lose their jobs.  Add this – if each worker has to cut their grocery allowance for their family by 50% supermarkets will lose at least 10 million dollars. Then, factor in all the other normal beneficiaries from a paycheck and the ripple effect is enormous.

So all you decision makers take note:  do the bailout but with very definite guidelines of expectations – of the types of vehicles they must begin to make by a certain time, of the rate of pay for workers, and of a scaled down pay scale for the CEO’s and other management types.

Sometimes bailouts are absolutely necessary for the greater good.  If you did not live during the last depression of the 1930’s you really have no idea how sad and depressing it was. I did live through it and I would not want any provider to experience what my mother went through raising my brother and me. These bailouts are loans – or should be.

I have so much faith in our incoming President, Barack Obama, and those who will be his support team. We will survive this, we must have faith, because these are times of challenge but also times of opportunity. Let us not fail; there is more at stake then most of us realize.  We all are going to have to share in the solutions just as we have shared in the gifts we have been given living in this great country.  Take heart, yes we can!

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5 thoughts on “Auto Bail Out Debacle

  1. I understand how you feel. As I stated, I abhor bail outs. However if it is not approved, there is a chance that it will cost hundreds of thousands of workers jobs and many small businesses to go out of business. I do believe the Big 3 should produce a plan – although AIG and numerous banks did not have to supply a plan and I don’t think ANYONE has a plan yet on how that money must be used.

    My concern is we have so few manufacturing plants left, we don’t need to lose three more that are so vital to our economy. Thanks for your response.

  2. That is great stuff, June. Your reaction to the election after all the work you’ve done in your life, really made me well up!
    As for the bailout, I have one observation. From here in NY, I hear people from the left and right saying let ’em fail. The people on the right usually blame the bloated union contract, which pays the workers, counting in benefits, some 70 odd dollars an hour, while those at Toyota and Honda make something in the 30s.
    The people on the left blame the management for not having the foresight to make the kind of cars people want to buy from Toyota and Honda.
    Interestingly, both of these issues have been dealt with in some sense, albeit not in time to save the company right now. The union contract has been renegotiated and by 2010, the workers will make something more in line with Toyota and Honda.
    Meanwhile, GM will roll out a hybrid car to compete with the Prius, but not for a year or two.
    So in some sense, labor and management have thought of the right moves, but not made them in time. And to give them some kind of support, a bridge loan, seems to make sense.

  3. Tim,thanks for reading my blog. I know how busy you are but your response to anything I write validates my efforts, as does Tara’s opinion. Thanks again and have a really great Thanksgiving in the Catskills. June

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