Senate negotiations on auto bailout break down

[Tucker]

I heard on the radio today that nationwide, 1 in 7 jobs is tied to the auto industry. Breaking the union aside, can we afford to let them fail?

A big emphatic no.

[Miss Mia]

I heard on the radio today that nationwide, 1 in 7 jobs is tied to the auto industry. Breaking the union aside, can we afford to let them fail?

A big emphatic no.

I've always read 1 in 10 jobs are tied to the auto industry.  It's way more than just the people at the plants and the UAW. 

[Duke Nukum]

What happened yesterday was short-sightedness on everyone.  The failure of GM will reverberate throughout and I think most people don't realize the ramifications of what will happen. 

What difference does it make if the get bailed out or fail if the underlying problems aren't fixed?  Congress is designing the cars anyway and until that stops American's aren't going to be buying anyway.

Between Congress and the UAW there are already a lot of ramifications thrashing the economy.  Everything from demanding banks make loans to people who can't pay them back to CAFE standards and regulating CO2 as a pollutant, government is the problem and until it stops being the problem what will a measly $15 billion fix?

[Baruch Menachem]

the economy will adjust to whatever happens.     If GM folds, the folks who make the parts will have a short business life doing aftermarket stuff for a while.  But I can't believe that GM is the only thing they do.

Either way, the economy is going to have a huge impact.  It is better that the things causing damage are removed, rather than subsidized.

Were I an auto employee, or dependent on auto employees, I would be terrified now.  I can feel for them.

But the deal is, they make a product I don't want, don't like, they get paid twice what I do and have benefits that cost twice more, and why I should do with less so they can have more strikes me as the worst kind of socialistic stupidity.

GM needs to dump the UAW contract that has dozens of featherbedding workers.  That is what is good for GM, and that is what is good for America.

[Tantal]

Last year Toyota sold 9.37 million vehicles.
Last year GM sold 9.37 million vehicles.
Last year Toyota MADE 17 billion dollars.
Last year GM LOST 38 billion dollars.

Why should we, as taxpayers, be forced to support a business model that has obviously failed? The Big 3 need to get their shit together, in bankruptcy, and come back with a more competitive business plan......and better cars. Not that it matters that much to me......I'll probably continue to buy U.S.-built Toyotas. The only things I've had to do to my 2002 Tacoma is change the battery and one radiator hose. Wish the same could be said of the American vehicles I've owned after 7 years of use.

[Tucker]

Last year Toyota sold 9.37 million vehicles.
Last year GM sold 9.37 million vehicles.
Last year Toyota MADE 17 billion dollars.
Last year GM LOST 38 billion dollars.

Why should we, as taxpayers, be forced to support a business model that has obviously failed? The Big 3 need to get their shit together, in bankruptcy, and come back with a more competitive business plan......and better cars. Not that it matters that much to me......I'll probably continue to buy U.S.-built Toyotas. The only things I've had to do to my 2002 Tacoma is change the battery and one radiator hose. Wish the same could be said of the American vehicles I've owned after 7 years of use.

Should we allow a foreign corp. to come into our country and lower our standard of living? No.

I would make the asian auto manufactures raise their employees wages to match American auto workers wages. Better yet, if the parent HQ's isn't located in this country, I would slap a tariff on all their products equal to the one Japan puts on America cars.

[rich_t]

God willing, they won't hang that long.

It is time for a serious cutting -- and let the chips fall where they may

I agree.  It is well past that time IMO.

[Tantal]

Should we allow a foreign corp. to come into our country and lower our standard of living? No.

I would make the asian auto manufactures raise their employees wages to match American auto workers wages. Better yet, if the parent HQ's isn't located in this country, I would slap a tariff on all their products equal to the one Japan puts on America cars.

They are not lowering our standard of living, they are competing in a capitalist market and beating us at it.

No, we shouldn't FORCE any company to raise wages for any job. Why would do that when the high wages are the reason that the Big 3 are in the shape they're in? If the wages suck that bad, then the employess can find work elsewhere. As far as tariffs, I believe in exact reciprocity. If they tariff ours, we should tariff theirs at the exact same rate; however, Toyota isn't simply bringing cars in. Many of them are made right here in the U.S. My Tacoma and my dad's Sequoia came out of the same factory in Indiana. GM, Ford, and Chrysler are just going to have to lower their wages and make cars that are more desirable and of better quality if they want to compete with Toyota and Honda.

[Baruch Menachem]

Should we allow a foreign corp. to come into our country and lower our standard of living? No.

I would make the asian auto manufactures raise their employees wages to match American auto workers wages. Better yet, if the parent HQ's isn't located in this country, I would slap a tariff on all their products equal to the one Japan puts on America cars.

The Japanese pay just a little less than the US companies, $26 per hour vs $28.   The UAW has a deal that that prevents layoffs or even shut downs.   The US companies have to pay the same wages whether or not they make a single car.  

Plus there are all the other parts of the union deal that effectivly raise the hourly cost of an employee to $77 per hour.  


Then there are the quality issues.

[Chris]

They are not lowering our standard of living, they are competing in a capitalist market and beating us at it.

No, we shouldn't FORCE any company to raise wages for any job. Why would do that when the high wages are the reason that the Big 3 are in the shape they're in? If the wages suck that bad, then the employess can find work elsewhere. As far as tariffs, I believe in exact reciprocity. If they tariff ours, we should tariff theirs at the exact same rate; however, Toyota isn't simply bringing cars in. Many of them are made right here in the U.S. My Tacoma and my dad's Sequoia came out of the same factory in Indiana. GM, Ford, and Chrysler are just going to have to lower their wages and make cars that are more desirable and of better quality if they want to compete with Toyota and Honda.

I have a friend who works in the IT department at Nissan.  Not only do they have a factory here, they moved their North American HQ down the street.

[Chris]

The Japanese pay just a little less than the US companies, $26 per hour vs $28.   The UAW has a deal that that prevents layoffs or even shut downs.   The US companies have to pay the same wages whether or not they make a single car.  

I think the big difference in cost is that the Japanese worker pays in taxes what the UAW/Detroit companies are paying for retiree pensions and insurance.  When you've got that much of a base to spread the cost around, it's not so bad when you compare it to three or four companies laying out the same money from their own pockets.  Honda and Nissan aren't paying for their worker's health insurance at home... the government is, and that's one less cost associated with manufacturing cars.

[rich_t]

The Japanese pay just a little less than the US companies, $26 per hour vs $28.   The UAW has a deal that that prevents layoffs or even shut downs.   The US companies have to pay the same wages whether or not they make a single car.  

Plus there are all the other parts of the union deal that effectivly raise the hourly cost of an employee to $77 per hour.  


Then there are the quality issues.

One has to also consider the $$$ value of the benefits.  The UAW always glosses that over when discussing what they "pay" their UAW employees. When comparing it to their competitors.

[Baruch Menachem]

I think the big difference in cost is that the Japanese worker pays in taxes what the UAW/Detroit companies are paying for retiree pensions and insurance.  When you've got that much of a base to spread the cost around, it's not so bad when you compare it to three or four companies laying out the same money from their own pockets.  Honda and Nissan aren't paying for their worker's health insurance at home... the government is, and that's one less cost associated with manufacturing cars.

Japanese medical insurance is a very different deal than the comprehensive style in Europe and Canada.  Plus I gather from my watching of Japanese video that the care is very different as well.   The family is expected to come in and do the laundry on a regular basis over there too.  That includes the sheets.   Also the Japanese medical insurance has a high deductible and a co pay.

Government pensions everywhere seem to work on the Bismark Tontine model.  I am sure Japan is no different.   Again, from watching Japanese video, it is considered normal to live with your parents after they retire.   Which explains why love hotels are considered acceptable there.    Government pension benefits are never generous.

My bank does the health insurance 1/3 to the employee 2/3 to the bank, so can guess the most expensive option, Kaiser, which is closest to the government model, costs the bank $70 per week,  or about $1.75 per hour.

So the insurance isn't that big a deal.  As a cost, it is huge, but it isn't what is killing the car companies, or providing that big a boon the Japanese. 

The big issue is UAW featherbedding.  Paying for the no shows.  Paying for operating the plant with a full payroll when there are no cars being built.

If the companies could just shut down and re tool, they might survive.

Don't forget one big thing.   If the companies get on the government teat, we are paying for the UAW contract too.  And the featherbedding.