Just in case some of you think that what’s good for General Motors (or Chrysler) is always good for America: (From National Review On Line)
Bailout Goes Down [Stephen Spruiell]
It appears that the auto bailout just went down in flames on the Senate floor. GOP leader Mitch McConnell had this to say:
“The sticking point that we are left with is the question of whether the UAW is willing to agree to a parity pay structure with other manufacturers in this country by a date certain. And I understand their reluctance to do that. And so far in the discussions that Sen. Corker and Sen. Dodd and others have had, they have not been willing to give a date specific by which parity could be achieved. It is upon that issue that we’ve reached an impasse for the moment.”
This means no congressional bailout for now. But the fight goes on. The automakers will now turn to the White House, which urged the Senate to pass this bill. The Detroit three will ask Bush to allow Paulson to use some of the bank-bailout money to save the car companies. It’s possible that Bush will cave, but one hopes he won’t want to go out on that note.
The Audacity of Hope: Chrysler Won’t Invest Its Money But Expects Congress To Pony Up Your Money [Andy McCarthy]
From the WSJ story this morning on the collapse of the auto bailout:
“The collapse of the deal raises the stakes for Chrysler and its majority owner, Cerberus Capital Management LP. Lawmakers had called for Cerberus to put more money into the company, but Cerberus maintains it can’t because the bylaw of its investment funds prevents it from putting more than a small percentage of its investors’ funds into any single investment…. Chrysler Chief Executive Robert Nardelli told Congress the company would be unable to pay suppliers and employees if it doesn’t get loans by the end of the month.”
So Chrysler’s owners say, “You’re nuts if you think we’re going to throw our money at our loser business model” — they sit on their own wallets, play chicken with their workers and creditors, and expect the idiot taxpayers to say, “No prob — we’ll pony up for you.”
All praise to Mitch McConnell for leading the charge that beat back this lunacy. Can someone explain why the White House thought this was a good idea?
I watched the Chrysler and GM chairmen on TV–both are wonderful liars, and awful liars at the same time. In other words, they wove tall tales of impending doom, but neither were very believable.
Why don’t private investors support these car companies? Hmm. Bill Gates was on the same show with these guys–and I don’t see Billionaire Bill opening any of his many checkbooks to help the ailgng auto industry.
By: logiopsychoambrosiaivorytowerpath on December 13, 2008
at 6:58 pm
Make that ailing auto industry.
By: logiopsychoambrosiaivorytowerpath on December 13, 2008
at 6:58 pm
The power of people. Rock stars and celebrities for buying American cars. There I said it. We the people can bailout the big three with a focused effort. If the state and local governments want to help the effort they can reduce the sales tax for each sale in 2009. And how about 0 percent financing backed by the government. If the banks will not help the automotive credit market with the money they where given take some back and start a federal financing program to approved buyers. Stimulate and escalate sales.
By: Auto mechanic Mark on December 14, 2008
at 2:09 pm
Because the “Bloated Three” believe they are entitled. Maybe GM-but Ford is not claiming bankruptcy, and Chrysler is owned by a Billionaire-Boys-Club hedge fund, and does not deserve squat.
No wonder Mercedes Benz parent, Daimler, dumped Chrysler last year. They read the writing on the wall.
By: logiopsychoambrosiaivorytowerpath on December 14, 2008
at 2:57 pm
Their troubles began long before the current financial crunch.
By: Christian Beyer on December 14, 2008
at 5:35 pm
Yes.
3 problems
1. Lack of value-priced models, like the Cavalier and Escort (replaced by slightly more upscale models such as the Cobalt)
2. Bloated business model.
3. Dishonest dealers (you say Saturn was different, but it was Saturn that smashed the entire inventory of their electric car).
By: logiopsychoambrosiaivorytowerpath on December 14, 2008
at 9:12 pm
Saturn is no different. I used to work for them, I bought three cars from them and I also wrote about how they have hidden the fact that many of their engines incorporate a design flaw that results in blown motors. http://sharpiron.wordpress.com/?s=saturn
Why aren’t Toyota, Honda and Nissan crying the blues (to such an extent)? Good sound management practices and solid engineering have a lot to do with it. Unions are probably the biggest factor, though. The typical UAW employee makes over $70.00 and hour in wages and benefits. No wonder the typical teacher drives Japanese cars made in Tennessee, Ohio and North Carolina (or Korean cars, like I do). The poor schmucks working for the Japanese have to get by on a measly 45 dollars an hour. http://www.heritage.org/research/economy/images/wm2135_chart1.gif
If the White House bails these companies out I can’t wait until the next time a Republican calls a Democrat a fan of socialism.
By: Christian Beyer on December 15, 2008
at 4:50 pm
I left Saturn off the list to suck up to you–I thought you emphasized their difference.
The most offensive thing Saturn did was to destroy all of their electric cars. I saw this like on the History or Discover Channel or one of those edu-mercial stations.
Shrewd move, GM. Spend millions developing a viable electric car, get cities and other entities to shell out the dough for electric charging stations, refuse to sell, only lease the cars, then take them to crushers, and the rest is history.
No wonder GM is in the midst of a corporate flush.
I saw on a program or read in an article that Japanese executives make a fraction of the money of their U. S. counterparts. This was at least 15 years ago. I believe the chairman of a Japanese corporation–let’s say it was Toyota–was making around $225,000 rather than the
$10-30 Million American CEOs were making during the mid 1990s.
By: logiopsychoambrosiaivorytowerpath on December 16, 2008
at 9:24 pm
Bush has outspent liberals exponentially–oh well, Reagan grew government by leaps and bounds, installing bureaucracies only F. D. R. could exceed.
I have also heard the Nixon was also quite liberal, compared to others of his day.
The next earthquake in Phoenix will be Barry Goldwater rolling over in his grave.
By: logiopsychoambrosiaivorytowerpath on December 16, 2008
at 9:26 pm
I read the Saturn thing.
We had an 85 Ford Crown Victoria. The engine had a nylon timing gear, rather than steel. A mechanic (who did not like me because I was poor at the time) told me that replacing the gear was not worth it, and that the teeth on the gear had been stripped off.
By: logiopsychoambrosiaivorytowerpath on December 16, 2008
at 9:29 pm
Let GM, Ford, and Chrysler go the way of the competitors they worked so hard to acquire or destroy–American Motors, Studebaker, Kaiser, Cord, and don’t forget Tucker
(remember “Tucker, A Man and His Car”?)
If ya’ can’t compete with ‘em, get out of the kitchen.
Wait a minute, I smell a rat. Doesn’t Chrysler own as much of Mitsubishi as Japanese law allows? And isn’t Mazda a subsidiary of Ford? And isn’t GM heavily invested in Toyota?
Hmm. Something’s not right here. Something’s not right at all.
By: logiopsychoambrosiaivorytowerpath on December 16, 2008
at 9:34 pm