Obama Government should put out a statement….

If we bail out our Auto companies, it will zero-sum to taxpayers. The amount of money will be coming from (additional) fees on imported oil.
We will check national polls…if the public wants their car companies be rescued, they should be willing to pay for it. In return, the auto companies should will be accountable to the public by producing better and more efficient vehicles; or else…

In other words the Nation will make the decisions and Government and our kids (the ultimate payors) will be out of the equation.

One stone, three birds!!!

Regarding Chrysler, where is Cerberus in all this? This is the private equity group that purchased Chrysler two years ago. Shouldn’t those wealthy investors be bailing out their baby instead of us taxpayers? If Chrysler returns to profitability, you can bet Cerberus will try to keep those profits.

I think Congress is coming off too easily, and Detroit too harshly, in all this. The Big Three are now being accused of being out of touch with market realities for building gas-guzzling SUVs and trucks through the 90s and 00s. But those cars are by far the most profitable. Congress should have increased fuel-efficiency standards and put in place a federal gas tax with teeth. It didn’t, and Detroit was smart to take advantage of that to sell the most profitable products it could. This formula showed its cracks when gas prices rose. But if Congress had had the foresight of EU nations in imposing stricter environmental regulations, Detroit would likely be much more competitive today.

I notice the guest and callers are asking about the global reaction to what was laid out today about the auto companies.

Is it me or are your guest leaving out a crucial point?
Global crisis! I don’t think cars are being sold oversea’s as much as they were!

The dealer ’stimulation’ (at least in my area) is huge price breaks on gas hogs to get THEM off the lot. That is good news for people who NEED full size pick-ups, bad for the environment since most of them are sold to people who never tow anything or carry heavy loads.

The % discount on fuel efficient cars is MUCH lower.

Dan S., you are failing to recognize the fact that the auto industry has spent hundreds of millions of dollars lobbying Congress to keep fuel-efficiency standards low! Congress and the auto industry have been in bed together for decades. The auto industry is getting what it deserves and so to will Congress IF (and that is a big “IF”) voters remove them from office during the next election.

yet we cannot fire ceo of the banks that got us into this nor have them have a plan to be be solvent. Instead we blindly give money to this people who finds ways to game the system, or double pay each other, Like AIG payed citi group, ubs, bank of America and citi and BAC get money from use as well.

I hope people see the double standards that is promoted between the blue collar jobs and white collar jobs.

Agreed, Mike. CEOs of the banks and financial institutions that caused this mess should be removed if their institutions take funds from the shadowy, opaque TARP scheme. There is an incredible, howlingly astonishing double standard here. While I loathe SUVs as much as the next guy, especially when they are tailgating my Mustang, the fact is that the U.S. auto companies have made great strides in quality in recent years. Recent quality assessments have pegged some of Ford’s models as comparable to, or superior to, their Japanese counterparts. And if we lose the infrastructure, R&D and manufacturing facilities of the domestic auto industry, how will we ever get them back to develop the alternatively powered vehicles of the future? Or do we want our economy and social cohesion to permanently self-destruct when the inevitable oil peak occurs? But that’s another issue…

Consider also the impact of many, if not all, of the parts suppliers tanking at the same time, potentially crippling the “trans-plants” and foreign-owned manufacturers, too. Remember, the Japanese and others are masters of “just-in-time” supply chains. No parts, no cars, no deliveries to dealers and no jobs. And, when it comes time to replace a water pump, O2 sensor, alternator, belt tensioner, brake caliper or any of the myriad of other parts that make up your 2002 Honda or 1998 Buick, what the hell are you going to do for parts if the aftermarket is dead? Slog through the junkyard?

Finally, the problem with the carmakers today, like every other aspect of the casino mentality-caused financial crisis, can be laid at the doorstep of the banks and Wall Street “masters of the universe,” although a longer word with the root “master” comes to mind. The miscreants in the global financial system are the ones whose gambles, and performance bonuses, tanked the economy, threatened systemic collape through fantasy instruments like credit default swaps sold by the most shameless company in the world, and wiped out the values of individual investors the world over. They have cost millions of jobs of people with no financial blood on their hands. They are now killing industries that built this country and that broadly gave us the middle class standard of living, through wages and work rules won by unions and precipitated throughout the economy (like paid vacations and living wages), that we take for granted. And yet, TARP largesse is doled out in fabulous sums with few, if any, questions asked and the auto companies are forced to grovel for loans roughly equivalent to the bonuses the banksters and other world wreckers would make off with if given half a chance.

It won’t make a difference. Thanks to the banks, we are going to lose these companies and the jobs and subordinated industries that they support. And then we will reap the consequences, and the whirlwind, we deserve.

Hopeless: Fights are breaking out over Michigan in response to layoffs spurned by Obama’s choice for bankruptcy above all other options. Watch video:

http://tinyurl.com/hopelessobama

President Obama and the Democrats are talking out of both sides of their mouths. They have been fervent backers of unions for decades, and now they are reaping what they have sowed.

The unions and car companies have been bilking consumers for years with their inflated wages and benefits. The GM retiree benefits alone have brought GM down to it’s needs.

Now President Obama can go in and try to clean up the mess. Instead of firing Mr. Wagoner, he should have gone in and fired the heads of the unions. How can Wagoner afford to invest in R&D, new plants and systems if his corporation is being bilked by unions? Give us a break!

soooo, what golden parachute does wagoner have?
who is really running , gm?
how many businesses will be told what to do, and how, by the governement?
so a new goal for a business plan, would be to become so big, ie, aig/gm/chrysler, so can’t be allowed to fail? cool, guaranteed success.
where are we?
why are so we not marching on washington.?
do we care?
is someone in china smiling? or are they afraid that that we won’t allow them to fail?
medicine man joe

A handy suggestion: If you have any make or model of automobile that needs parts or maintenance anytime soon, get it done now and hope that the repairs will have the momentum to carry you for a couple of yesrs. It may be your last chance to get your vehicle the parts it needs for some time if GM and Chrysler tank. Without a parts industry, Ford will tank too. Not just me talking. A prominent industry watcher, economist and professor I spoke with on Wisconsin Public Radio last month agreed that there will be significant disruptions in the parts market, on the ordet of six months to a year. Long delays. Parts unavailability. I think longer… Hey, but we hate bailouts, except when pinstripes are involved. Then, it’s anything goes. Getting moderately disappointed with my choice in November.

“ Let’s try to put this thing in some kind of rational perspective … Wall Street, big banking, big business, the Detroit auto makers; Iraq, Afghanistan, revamping health care and social security; the stimulus package, Green Technology … and lets not forget whatever other shoes are yet to drop; the only way that our fat in America is going to be pulled out of the fire, is with lots and lots of money … money that has yet to be made by the children, or perhaps even grandchildren of those that haven’t even been born yet … “Yikes!”

First of all, I wish everyone in the punditocracy would quit referring to Detroit as the “Purveyors of Fuel-Thirsty Hogs” and the foreign manufacturers, particularly the Japanese, as the “Bringers of All That Is Green and Fuel-Thrifty.” Both Ford and GM design and build fuel-efficient vehicles of excellent quality, and have done so for decades. The only trouble is, most of them are sold everywhere in the world but here. They haven’t been sold here because those vehicles have not historically appealed to American tastes. We didn’t want them because we like the “spread-out” room of our captain’s chairs, we like to haul our new 50″ plasmas home from the local Circuit City (Oh, I forgot… They’re out of business!), and most of all, we could afford the gasoline. We might like small and fuel-efficient cars better if our gasoline cost $8 a gallon like it does in most of Western Europe. But it doesn’t, so there we are. That U.S. foreign and tax policies have resulted in Americans becoming spoiled by artificially cheap fuel (compared to the rest of the industrialized world) is not Detroit’s fault!

Ford and GM were caught with their pants down – once again – by the fuel price shock of last year. No one saw that coming. Up to that point, the American vehicles most Americans aspired to own were Cadillac Escalades, Chevy Tahoes and Suburbans, Ford Explorers and F-250’s. Ford and GM built small cars, but buyers in my part of the country – the Great Flyover – overwhelmingly preferred the 6,000-pound tanks, many of which were built right here in Janesville, WI.

It is time that people remember that Toyota (a company that up to now, has never posted a loss) was caught with their pants down, too. Toyota sells EIGHT – count ‘em – EIGHT lines of SUV’s and trucks in this country. And they are just as big and fuel-thirsty as their American-make competition. Indeed, only a few years ago, Toyota invested in a new plant in Texas for building nothing but large pick-ups. The local Toyota dealer here in Madison, WI has unsold large trucks and SUV’s stacked twenty deep.

The real “800-pound Gorilla in the Room” is not Detroit’s poor product vision. It is the fact – which no one talks about – that Detroit alone among the world’s automakers, is burdened with the costs of employee pensions and employee health care. America alone among so-called “advanced” industrial nations refuses to acknowledge that in an advanced country that wants to call itself civilized, access to decent health care is a right, not a privilege for the rich or for those lucky enough to have a government or a union job.

Health care has gotten too expensive for those of middle class means, to say nothing of the poor. So we have to buy insurance, which also is too expensive for most people. So traditionally, our employers have paid for it, either in whole or in part. As costs have climbed, large employers like GM, still with employees represented by strong unions, have been under strong pressure to keep up. The rest of us (46 million of us and climbing) are just doing without as our employers – one after another – drop their health care benefits, partly because they are feeling the pinch of global competition, partly just because they can.

These spiraling costs are breaking the backs of American industry, especially the Detroit Big Two-and-a-Half. No other automaker bears these onerous costs. In the rest of the G-8 nations, health care costs are spread out more evenly and more fairly – paid for by everyone through their taxes. Instead of America’s byzantine labyrinth of over 3,500 different health insurance providers, each with its own bureaucracy, there is only ONE insurance company – the government – hence the term single-payer insurance. Contrary to popular U.S. opinion, it is not the medicine which is “socialized,” it is just the insurance. The government, as the insurer, has much more power to negotiate with health care providers and big pharmaceutical companies for lower pricing.

I know this is true. In 2001 I was hospitalized in Western Europe and I had to actually pay the entire bill, since as an American, I was not covered by their universal insurance. The bill came to $98. This money covered a night’s hospital stay, emergency room care, an EEG, medication delivered by I.V., food, and a 60-kilometer ambulance ride! This was Western Europe, not some backwater Third World hovel. The level of care was fully up to the best available anywhere. For comparison, earlier that same year, I was injured here in Madison, WI and had to be transported by ambulance a whole TWO MILES. The ambulance ride alone was over $700. My overnight hospital stay plus emergency room care came to over $2,000. This is simply INSANITY!

Until American politicians quit being hung up on ideological (and incorrect) conversation-stoppers like “socialized medicine,” and put into place some form of single-payer universal health insurance, American industry will continue to decline until it collapses under the weight of the added costs that destroy its ability to compete. We will become like Brazil or Mexico – with no manufacturing base of our own – merely a colony of foreign multi-nationals, with wealth continuing to transfer upward, concentrating into fewer and fewer hands, with growing hordes of desperately poor, and effectively NO middle class left at all. America will become a Third World nation in all but name, and democracy will disappear, because political freedom means nothing if economic freedom and opportunity are gone.

William Irving amen to everything your saying here, I could not have said it better.

“We have met the enemy and it is us”
Walt Kelly

At the risk of sounding like one of the mind-evacuated robots who listen to the Excellence in Fascism syndicated hatefest every day:

“DITTOS, William and Jeffe! Nailed it!”

I agree it is unfair to force the CEO of GM out while the bank CEOs are still in their position and have received much larger bailouts. GM did not cause the economic crisis their problems are more of a symptom of it as where the bank’s decisions are a major cause of the crisis.

By living and working in the epicenter of this crisis, and following the issue closely through the different media. The one striking observation I will share is that no single person or individual really grasps the whole story. They understand and focus on an issue they may know well, but lack the ability to connect all the pieces.

So many factors have gotten us to this point, that no one, especially a Business School Professor or Nobel Laureate understands the solution to the problem or what it will take to correct the imbalance, in the real world, to create a sustainable automotive industry.

It’s easy to push a few numbers around in a spreadsheet and theorize how to solve the problem, it’s vastly different to make it happen. Just ask Steve Miller, the CEO of Delphi.

Lastly, Honda and Toyota are scared. They know this is a very competitive industry and that they are not immune to the problems facing GM, Ford and Chrysler.

The UAW destroyed this company over the past 40 years and the shareholders have really been left out in the cold.