Automakers and The Bailout

The automakers showed up in Washington again on Thursday.  Some are calling it “Bailout Thursday”.  Part of me wants to test GM.  GM says it can’t make it to the end of the year without help.  That’s not that far away!  I think they’ll make it.  I really do hope so.

One congressman, that I saw, asked again, where’s the plan to turn this around.  What are you going to do to fix it.  How will you start making money? He went on to say that if they showed up at a bank with this type of information, the loan would probably be denied.

Congress seems to know that the American People do not want the auto companies bailed out.  But if they think the people will be angry about bailing them out, wait till the anger they will face when we are in a depression.

I think we probably need to help them find another line of work.  Or many of them.  If it hap

Auto

pens all at one time, the result will be simply catastrophic.  The damage to the economy will be too great.  For me, easing this transition has little to do with helping the auto industry but rather helping the US economy.

Would it be cheaper to put the auto workers that loose their jobs on a government powered early retirement?  Now for each manufacturing job you should realize there will be at least five more jobs lost.  The bailout is expected to be at least 30 billion dollars.  Maybe it would be cheaper.  I doubt it.  And we loose the production of those cars and instead end up with the government creating more money for the life time of those workers.  Don’t think it would be a good idea but has it been considered?  Too silly of an idea to merit consideration?  I don’t know.  its a new idea to me.

Technology is the way of the future.  As I’ve said before, car building is something that many countries can do.  They are already doing it much better than we are.  Though most auto-makers are having problems right now.  I doubt the ultra high end is being hard hit. Lexus and Cadillac are not ultra high end.  Lamborghini and Rolls Royce are ultra high end.  I’m sure those that are truly rich are staying that way.

This is a middle class issue.  Its not about the executives of the auto industry, its about the middle class for me.   Though it might feel good to “just say no” to the American automaker.  To kick the habit once and for all but it wont feel good when the economy goes into a depression.

Congress will step in.  They will posture and put on a public show.  Then they will do what has to be done and  bailout the automakers.


Tagged with: AutoMakers • Bailouts • Economic Crisis 2008 • Government • Money

Filed under: Economics and Finance

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