Democratic Leaders Want Bush to Aid Automakers

[admin]

WASHINGTON – Democratic leaders in Congress asked the Bush administration on Saturday to provide more aid to the struggling auto industry, which is bleeding cash and jobs as sales have dropped to their lowest level in a quarter-century.

House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid said in a letter to Treasury Secretary Henry Paulson that the administration should consider expanding the $700 billion bailout to include car companies.

"A healthy automobile manufacturing sector is essential to the restoration of financial market stability, the overall health of our economy, and the livelihood of the automobile sector's work force," they wrote. "The economic downturn and the crisis in our financial markets further imperiled our domestic automobile industry and its work force."

There was no immediate comment from the Bush administration about the request to broaden the $700 billion financial industry bailout so automakers could get a share.

Automakers already want an additional $50 billion in loans from Congress to help them survive tough economic conditions and pay for health care obligations for retirees. The companies are seeking the loans as part of an economic aid plan that is now more likely to come together early next year rather than in a postelection session of Congress this month.

Top executives of General Motors, Ford, Chrysler LLC and the president of the United Auto Workers met with congressional leaders Thursday to discuss the loans. The money would be on top of the $25 billion in loans that Congress passed in September to help retool auto plants to build more fuel-efficient vehicles.

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[2008]

The auto industry definitely needs some assistance, in some states like Indiana where it was originally booming, it's slowing collapsing and will continue to do so if action is not taken. There have been a lot of downsizing going on and many were left unemployed.

This then costs the government more money, and if the American auto industry continues to struggle then the foreign companies might take over as people will turn to them for their needs.

[Right]

As we have already seen......if the trouble in a particular sector is not nipped right in the bud...it quickly spreads to other sectors of the economy.

If financial sector would have been looked after well....we would not have this compounding problem. Hence the auto industry should also be quickly supported to limit its negative fall out.

Regards,

Right

[Rich LaHaye]

Millions of Americans Job are directly or indirectly affected by the health our our domestic automotive marketplace.Of course we should help this industry survive and transition into the future.

IDEA:

FIRST: Offer the Automotive industry assistance DIRECTLY through the consumer. Let's encourage sales of autos NOW within the next 30 -90 days allow the industry to offer 5000.00 (suggested amount) tax credit or government funded rebate on ANY domestically produced car that achieves 30 MPG or more. (Obviously this kind of incentive could be stair stepped to larger amounts for vehicles that achieve higher MPG efficiency.)

HELPS THE CONSUMER
Encourage sales from the bottom up through out the automotive industry as well as allowing consumers assistance in replacing autos presently on the road that have poor fuel efficiency and leave high carbon output.

HELPS THE AUTOMOTIVE MARKETPLACE
This kind of industry assistance will help drive consumers into the showrooms to purchase efficient vehicles, leading to increased sales and profits to the automotive dealerships, saving jobs, businesses and driving demand for more efficient vehicles to be produced domestically. Increased sales gives the domestic automotive producer more capital to invest in infrastructure to produce more and more efficient autos.

HELPS THE ENVIRONMENT
Rewards the industry for producing and delivering vehicles that are more energy efficient and environmentally friendly. Rewards the consumer for replacing old carbon emitting and fuel inefficient vehicles. Over time will drive down volume of foreign oil imports. ETC.

If WE must - through our government - must assist industries or businesses in trouble due to this the present economic meltdown - then why can't it be done in a way that encourages behaviors, business practices and market conditions that in the end positively effect the MOST citizen investors directly?

THINK - WIN, WIN, WIN and it will work.

[USA1]

When we enterd WW2 the Big 3 stopped everything and went to work for our country and help build the biggest and best war machine ever seen. They produced more planes, tanks, bombs and supplies for our troops then our enimies could nock down. With that being said we could not have won that war with out the Big 3's know how and work force.

Now they need our help and we should not turn our backs on them. We need a strong manufacturing base in this country. If we should have to need there help to fight in the future and they are not there, what are we going to do? Got to China and have them make are weapons for us!

Let us not forget those who helped fight for our counrty!

Let us return the favor. We do take care of our own don't we?

[sam]

Hasn't GM been bailed out once or twice before? Seems I read that Clinton bailed them out with the condition that they would develop cars with better gas mileage; and then once Bush took office, that promise was forgotten.

As for Ford, I'd always driven Fords until my current car. My boss talked me into test driving a Toyota. I was astounded at the difference in quality for about the same price. I don't think that it is surprising that Ford is having problems.

I have always paid for my own mistakes. Isn't that the way it is supposed to work?

[Rich LaHaye]

Your right.
But have any of your mistakes - cost 2.5 million in job loss in an economy like this one is in?

In a sea of bad ideas - helping the Auto industry is one of the least bad ones.

This could be a brilliant opportunity to launch Obamas energy initiative - to reducing imported oil while also reducing harmful effects on the planet.

It all rest on the "STRINGS" the applied to the "rescue funds".
How we require the STRINGS are pulled -
And weather they run as expected once they are cut loose from the STRINGS.

These are difficult times that need not be allowed to get more difficult.

Lets use this as an opportunity to TRICK the domestic automotive producers into doing the RIGHT thing after all is said and done.

[ksat]

The best thing the little shrub can do for the auto industry is to volunteer to become a crash-test dummy.
ksat

[Rich LaHaye]

unfortunately that's the role he's played for the eight years ...
That's what got us into this mess!

Our turn to do better
Our turn to dominate
Our chance for change

[Sandyk1954]

Maybe we should propose to the automakers, who want to sell their products to the American people, they must have their manufacturing plants physically located in the United States. Bring these manufacturing jobs back to the American people. I would love for someone to take a poll to determine if the American people would vote to pay a little more for a product that they new was benefiting their country, versus loosing jobs and tax revenue for the American people. Instead of using the American people?s money to just bail out the automakers failures, we should only provide money if they agree to relocate their plants in the United States and allocate funds to develop energy efficient vehicles (as was promised years ago). This would create jobs for the American people and begin to help our economy.

[asestra]

it is really our credit system what needs help. That's what offsets everything else. Our economy rellys too heavely on credit.

[oo1987]

I think this would be a good move, as long as it was addressed with other issues as well. But, considering how many people automakers have been laying off, they do need some assistance.

However, they have to address people's ability to buy the cars they are making. It does no good if they keep jobs to mass produce vehicles no one can afford to own.

[puffin]

What got the BIG 3 into the mess they are in is the fault of the UAW and incompetent auto executives. A AUW with high school is paid, note I did not say 'earns' over $75.00 an hour not including full family benefits. The Toyota and Honda factories in the US are putting on extra shifts to supply the demand for their cars. The employees earn half of what a UAW worker gets. Guess which employee has job security.
The Big 3 have been sitting with their collective thumbs in their bums for decades watching Toyota and Honda and others quietly remove the Big 3s market share. The local Ford dealership has casually taken all their big gas guzzlers to a lot behind the dealership. They can't afford to purchase new stock from Ford because they haven't paid for the three hundred 2007 SUVs they bought from Ford. The guy who polishes the showroom floors at night had his last two paychecks bounce. There's more good used foreign made economy cars on the front lot than new Fords. They are buying them off the internet.

[Rich LaHaye]

Good observations...
However, the BIG THREE for the last decade have been providing what the market wanted. not until 20 months ago (or 6 1/2 quarters ago) they held 2 our of the top three positions.

With the historic spike in oil prices (Until the last two months) Detroit has found itself in the midst of a once in a lifetime market shift that has left it in the condition that we find it in today.

YES they have made mistakes.
YES they have produced the vehicles that the US public wanted to purchase.
remember up until this year the ford truck was the number one vehicle sold in America.
Yes their products were inferior to the Asian imports until the last decade.
YES they have had a host of issues to deal with in regards to its union and legend employees.

They have not however had their R&D, medical costs and retooling costs supplemented by the government as have Hyundai, Honda, Toyota, Nessian and in the case of the Chinese even some of their payroll costs. Not to mention Japan has funded most of the development of it's domestic automotive alternative fuel fleets.

These are difficult and transformational moments in our national economic environment. Its far easier to rattle off the mantra about letting GM suffer the realities of the marketplace - etc.

Hey - let them suffer the realities of the market place - they should pay for their bad business dicissions...

Statements like that are remiss about the rest of the facts. The retail automotive market place is the largest retail business in this consumer driven economy of ours. 70% of our GNP is derived from consumer spending.
Automotive spending accounts for the largest piece of that retail driven economy.

So saying let Detroit go is like saying..."Who cares - let the profits and revenues from those operations go overseas." Our national automotive manufacturing base is the largest manufacturing operations that exist in our country today.

Should we be in a hurry to ship the largest portion of our manfacturing base overseas? - With unemployment and our economy in the state its in today - is that REALLY our response?

Take a breath.

Lets take ADVANTAGE of the moment and save the biggest piece of our manufacturing base. Save 2.5 million jobs both directly and indirectly within the supporting suppliers from across the country.

Lets turn our wounded domestic automotive industry's tragic realities into the first REAL step towards freeing ourselves from foreign oil dependence.

We assist our automotive to bring to market the first generation of domestic energy driven vehicles - electric and compressed gas - in the fall of 2009.
We'll begin to see a kind of economic expansion unseen since the 1960's.

We should assist Detroit with finical underwriting - along with plenty of strings and stipulations.

We did that with Chrysler in the late 70's and it worked we got our investment back and ahead of schedule and in the process saved a third of the then domestic automotive manufacturing and the associated jobs as well as assisted all of the associated municipalities. Which BTW had Chrysler failed at the time the federal goverment would have had to bail out all of the affected communties that supported Chrysler and its opperations. Something that would happen today if we let GM, FORD & CHRYSLER spiral into the abyss that is bankruptcy.

If you think the Banks are crying now - let the domestic automotive industry and all of its associated suppliers and retail operations fail and you'll REALLY see the finical markets blow like never before.

Its like your mother always said: "When life gives you lemons - make lemonade." - otherwise its one sour ending - no one wants to taste.

[puffin]

Obviously the BIG 3 were making autos the public wanted. So, apparently were/are the 'foreign' manufacturers. Somebody has been buying their autos. The point is the UAW/Mafia grew so powerful they got 'concessions' read "I've got a gun pointed at your head" from the BIG 3 that were/are incredibly stupid. Imagine making $75.00 an hour plus full family benefits PLUS the most lucrative pension package on the planet. And all with a grade twelve, if that, education. My eight grade grandson figured something important about this mess: "Why didn't the BIG 3 keep track of how many and what kinds of cars and trucks Toyota and Honda were selling for the last twenty years. Then compare those sales figures with what the BIG 3s sales figures were and see if they could see a pattern?" I've e-mailed this gem of logic to the CEO of Ford.
The logic that the BIG3 were only making/selling what the customer wanted is flawed. If there is a steady decline in the number of buyers but they all wanted big SUVs, which has been occurring, hence the crisis, you don't say well there's less buyers coming in the door but they want the SUV so we'll just concentrate are main efforts on making them. That's nuts! You ask what can we do to get more buyers in the door. Didn't someone somewhere say "what are Toyota and Honda doing that we are not"?

[Rich LaHaye]

Consumer preferences are cyclical = always have been and always will be.
AMC (American Motors - remember them?) one day, Ford the next, Chrysler (the mini van is introduced) the next, Honda the next Toyota the next - an so on.

Its worth noting that in today's world largest car market - China GM/ Chevrolet is #1. In the world second largest car market - Russia, GM is again #1. Not Honda - not Toyota. (BTW - I drive a Honda and a MBZ) Both are great vehicles - but it comes down to preference.

Because of the last five months of record oil prices the domestic automotive sector suffered - because its domestic stocks were filled with American auto preferences known as SUV's and trucks. However in the Europe where Ford is a top seller - they (Ford) had an abundance of smart looking and fuel efficient vehicles to offer - because that market (Europe) has been living with higher fuel prices for the last decade.

Look at any other time - I'd agree - let them go into chapter 11.
Except this time were in a finical condition like no other in the last 40 years. We can make this down turn not as bad and shorter in duration or we can simply allow it to be REALLY REALLY bad in its effects and duration.

Letting GM go into chapter 11 will throw hundreds of thousands of pensions and health care plans onto the governments hands - 200 billion by some estimates. The hold over assistance package that is being bantered about is at around 23-26 billion. Both are bitter pills - however, one is much larger than the other.

Again if we attach the right "strings" to the package - as well as a pay back demands. This can be a WIN - WIN.
We need a WIN WIN.

We don't need an additional 2M newly unemployed Americans right now - in addition to effect on main street - the government will end up with all the additional costs in unemployment claims, assistance to families, job retraining assistance, loss in tax base - etc etc.

It would BITE big time if NOT assisting Detroit - would end up costing more than the actual "assistance package".

[puffin]

Well the 'bailout isn't going to happen anyway. No during this session. There's a lot of House members and Senators who wish to be reelected in a couple of years and their constituents aren't have any of the LIB bailout scam. It will be months before a nickel crosses the palms of the imbecile auto execs even after 'SS' is sworn in. Hopefully by that time the UAW members will be working at jobs that require them to wear a paper hat. "would you like fries with those fries sir".
The UAW/Mafia had a good thing going for years and they were able to bully the simpletons in the exec. offices of the BIG3 to give them the most insane wages and benefits and pensions the world has ever known. Happily those days are fast coming to an end.
Let the $75.00 an hour employee find other work and get paid $15.00 an hour (if they are extremely fortunate) like most workers do. Sure they'll have to sell their partially completed home built airplanes but I don't care.

[USA1]

What's wrong with you people? You are looking at this all wrong.
You are knocking the hard working union members that have faught
for a better life for all working citizens of this great country. Let's fight for
the chance that all employees get the same opportunity for fair pay for a fair days work. All workers need safe working conditions, so that they can go home to their loved ones in the same shape they left them when going off to the job.
What you should be fighting for, is to demand a safer working environment, higher wages and benefits for the work that you do, the same rights as those who have faught that same battle before you, i.e. the Labor Unions! The last generation faught for us; are we going to fight for our children's future? Or are we going to give in and let our children have less of the American dream than what we have now?
If you break the backs of the Unions, it will trickle down to the non union shops as well. Meaning there will be no one out there to keep an eye on the
average guy trying to provide for their familys. Even the non union shops benifit from the union, the company's try to compensate their employees so they don't bring in the union. Now take all the unions away and see what happens to all the workers in this country.
If you think it's bad now just wait.

[Gene]

Why can't the oil companies bailout the Auto manufacturers?

[Rich LaHaye]

With all their recent profits - they could...but do you want them being the ones deciding the next generation of technology that powers the vehicles of the future?

Ahhh NO.

[Gene]

Originally Posted by Rich LaHaye

With all their recent profits - they could...but do you want them being the ones deciding the next generation of technology that powers the vehicles of the future?

Ahhh NO.

What? Someone tell you they are the only auto manufactures in the country? Let them decide whatever they want. I'll buy from one of the others.

[Bertilla Baker]

This whole Big Three Bailout thing is just making me so mad!!! They've got the entire country over a barrell (of oil, if you will). If we don't bail them out, some 3 million jobs not just in the auto industry, but in related industries will vanish. Why is it that we all saw this coming- rising pump prices (what's going on now is only a temporary reprieve compared to what's coming) because of diminishing supply- all of us, that is, except the executives of the auto industry???? We should have had electric cars a long time ago. And how about the new technologies of pneumatic cars- yes, cars that run on air- they're doing it in India, among other places- check it out on youtube. There's even a water car that uses a form of electrolysis to break down water- also on youtube. But that would cut out the oil industry, wouldn't it......Ahhhhh, we have our answer. As Hamlet would say, "Ay, there's the rub." The automobile and oil industries are so far up each other's backsides that such alternative technologies for fueling our cars are completely overlooked at best. Conspiracy theorists say that such alternative fuel technologies are squashed out of existence by the Goliaths with other interests.

So, what in God's name do we do? Loan- let me repeat that- LOAN them money at a reasonable rate of interest with the stipulation that the money must be used to retool all their factories to develop cars that run on anything other than oil. How about giant sails on top of cars??

[USA1]

That is one of the problems with this so called bailout. Its is a [B]loan [/B]that will be paid back. There are mulltple issuses going on right now that has created the problems the auto industry is having right now. First they are having trouble with the banks to get money to run the everyday bussines at hand, second there customers are having trouble getting loans to buy their cars. All this is due to the credit crunch that the banking system is having right now. The big 3 all have new models and fixes in the works to help solve their problems of the past. But no one was counting on the credit crisiss at hand. It has been a 1, 2, 3 punch that has got them down. They need the help right now. If we wait the problem of them going under will be devistating to our whole economy in ways that we have never seen before. It will cost the tax payers more money when all the people affected are out of work and looking for help from uncle sam being welfare, pension bailouts,crime and loss of the income taxes that the government collects from all the employed autoworkers. Let alone more home foreclosures on the books to deal with bring down the value even more from everyones home. Like it or not we are all in this toghether!
Be carefule what you wish for.....

[puffin]

You go on and on about how the unions have been great for the country. How about explaining how it is that UAW workers get about 75.00 an hour PLUS full family benefits PLUS great pensions while the rest of the about ten million non UAW workers in the US earn below 20.00 an hour. The retired UAW workers receive more pension money than the current UAW workers get per month. Go figure. The UAW/mafia are largely responsible for where they find themselves now. Honda/Toyota workers make half the hourly wage as a Big # worker. Guess who's jobs are secure and why. It doesn't take a genius to figure out why.
I say let the Big 3 go broke. From what's left maybe UAW free, intelligent auto manufacturers will be created. If not Honda and Toyota will continue to make autos with outstanding quality/mileage and durability. That's what they are doing now and if I know anything about the Japanese they will continue doing so.

[sam]

Yes, I know that the Dems will bail out the big 3 as soon as they are able. I sincerely hope that it turns out to be the right thing to do.

When the Toyota plant opened here in San Antonio, lots of folks were excited at the prospect of making $23 per hour. It's not much of an exaggeration to say that half the people I know went and applied out there. I also know that Texas is a "right to work" state which essentially means that an employer can let a worker go at any time without reason. It's hard for me to work up too much sympathy for unionized employees.

Even if the big 3 can get past their labor issues, they've got lots of improvements to make. I can't speak to the quality of the larger vehicles in the last 10 years, but there is a marked difference in quality with the smaller autos. Just try changing a tail light in a Ford!

I hope we are not just prolonging the inevitable. I really need the Dems to start working on affordable health care for us non-union employees.

Come on Rich, convince me. You're my best hope.

[ksat]

For 25 billion, the govt. should get the keys to every car the Big 3 have yet unsold. Govt. agencies get the transport they need, the Tres Anos get bailed, and somebody actually gets what they pay for. Until now, I thought the "Big Three" was what cheney called his personals.
ksat

[Rich LaHaye]

A agree with you the agony is only postponed if we just give them the money.

I'm for the assistance if it comes with strings. Specific strings that ensure that America leads in the production and sales next generation of hybrids.

That means that they wont look as utilitarian as the Perius - say more like the Chevy VOLT. That the sales price of the American Hybrids are priced accessible for the average family. And that if the Government dose anything else that it will encourage sales of those vehicles through tax incentives and rebates to encourage record numbers of the American hybrids sales from the factories through the showrooms on to the road - sooner rather than later. Thus encouraging less foreign oil dependence and fewer green house gas emissions.

In the end a updated version of the American electric grid will have to be completed - thus making us the continued envy of the world and YES the new Green economy will lead the way in creating the millions on HIGH paying jobs for Americans - not the Japanese or Korans. And by the way I don't have a problem with Americans making more per hour than their foreign counterparts. Japan & Korea help cover health costs and R & D of their respective automotive manufacturing sectors. realities that keeps getting over looked - in all the dust up about "assisting" OUR domestic automotive manufactures.

BTW: Where did all those "AMERCIA FIRST" types disapear on the Republican side? Man they took off fast! I guess it was just more word twisting that when that had to stand behind their slogans - was always didn't pass the light of truth.The Republicans has lost their core - their integrity and creditability.

I'm just one more Reagan Republican that can say - I didn't leave the Republican party - they left me.

I tried of them chanting mantras over rational thoughts and reasoned realities based on the here and now.

Elected Texans... pack your bags - your next.

[puffin]

Hopefully by the time 'SS' and his merry band of socialists take over at least a couple of the Big 3 will be filing for Chapter seven. Then by the time real cash money is being sent to whoever of them still have the plant lights on it will be too late.
Ever watch a heroin addict beg grandmother for another thousand bucks? If you watched the reps for the Big 3 yesterday at the senate hearings you would have a good idea how it's done.

[Rich LaHaye]

METRICS are not emotional or opinionated.

I'd suggest you consider the FACTS (ie metrics) look at the top five.

1)% of Gross National Product - that the American automotive manufactures represent.

2) % of national retail sales that the American automotive manufactures represent.

3) # of working Americans that would be unemployed should the American automotive manufactures go out of business.

4) The cost to pay unemployment costs both health and unemployment claims to the millions of displaced workers as well as retraining and job replacement costs.

4) Amount of lost $ / tax revenue both locally and nationally should the American automotive manufactures go out of business

You might want to consider the facts - rather than just stretching ill informed hyperbole.

The BANK are struggling because of lack of credit liquidity
Why is so hard to understand that the largest segment of the American retail sector - the Automotive makers / distributors are suffering from the same realities?

Look at the news outlets in Japan, Korea & Europe - their governments are also seeking to provide assistance to their own auto manufacturers.

SOOOO - what would you think if that happened and we choose to set on our hands and do nothing?

Your idea of America First?
Ahhh I get it you mean that slogan to mean American First to go under...
now that's patriotic.

[abg88]

What happened to the automobile industries. the cost of living has gone up and the inflation rise has brought down the auto sector. due to the cost cutting measures by the MNC and Core companies the auto sector has come down

[Bertilla Baker]

The Fat Cats of the Big Three rode their private jets to DC yesterday with their tin cups held out. What were they thinking????? How gross and example of corporate excess is that? What a total disconnect! I'm aware of all the facts behind this situation, and am in favor of a loan (sort of) but it's really chapping my butt.

They might have been able to afforded to maintain the princely salary and benefit packages they pay their laborers if they'd only kept one step ahead of what was going on in the market place. First of all, the UAW tried to get the workers in the foreign auto plants to unionize, but the management routinely intimidated workers into not unionizing. The workers free choice act will change all that. If the majority of workers want to unionize, and say so in a secret ballot, they're unionized. That's that. That, in theory, would create a level playing field on which to play for both American and foreign auto manufacturers.

The end result of nonunion laborers in foreign auto plants was that the Big Three could only make a decent profit by humping the big gas guzzlers to the public. The public, in turn, because of soaring gas prices, started opting out of gas guzzlers in the driveway for more thrifty vehicles. The Big Three also felt fiscally compelled to close a lot of plants in the US, and manufacture off shore where the union monkey would not be on their backs.

Unfortunately for union efforts, what could possibly happen to the foreign manufacturers in the US if their labor pools were unionized and started asking for the kind of bennies that the Big Three laborers get, is that the foreign manufacturers might decide to close up shop in the US and move offshore too. What a freakin' canundrum.