Capitol Hill Blue Forums Political Issues Finance, the economy & Economics Bailing out the auto industry - yes or no?

There are a lot of other industries that depend on the big three to buy their products while building their cars. So if you let the big three fail, those other companies will also fail and then, and what do you expect the 25 million or so folks that will be laid off do to pay for their cars, clothes, food and housing?

Wait for the government to bail them out too?

NetFlix just sent us:

Who killed the electric car?

We're going to watch it tonight right after NCIS, so I'll have more to say to this topic tomorrow.

If the auto industry would provide us with something like the Japanese Kei Trucks as well as the land yachts it has become famous for perhaps they would deserve some respect. The Mini Trucks have a 660 CC 3 cyl. gas engine and get around 50 mpg they are legal on the streets almost everywhere in the world including Canada, but not here.
These trucks are available here but are not allowed on the streets.

Julia
Other problems include ...

the credit crisis, which makes it more difficult for buyers to finance a car

The recession and unemployment which makes it much less likely for people to consider buying a car at this time.

General public panic about the current economic situation which makes people less likely to buy a car even if financing is no problem, even if they have a stable job with no financial problems... a lot of people are in a wait and see mood about making any big expenditure.

It seems to me that there is a tendency to look for scapegoats and assign blame in the face of a uncertain economic condition. Everyone knows that GM and Chrysler especially did a terrible job of shifting their product mix to more fuel efficient vehicles.

That doesn't answer the issue of whether to provide loans or other assistance to them. A large chunk of our economy rides on the health of the auto industry. For better or worse, I don't think we can afford for them to fail. I also do not trust any of the dire predictions from them or anyone else.

All this hysteria smells phony to me. I just do not believe these thieves on anything, yet I am not willing to let the economy to fall apart.

I do not want any form of welfare, bailout or other financial deal, however, without guaranteed changes to their operations. I know that labor has already made significant concessions to the industry, but they will have to make more. I just want to make sure that the public has a major say in how the industry goes forward.

If the want my money I want to have a say in how they use it.

I thought it was a superb documentary, BT. Nice setup, great punch line.

As a nation, we've been laughing ever since. Laughing all the way to the gas pumps.

I'm not arguing the point, but is this not true of other major American industries? (wait - are there any left?)

If the Big Three are not bailed out, I am sure it will take them at least as long to lay off all their workers as it takes for our troops to withdraw from Iraq. During that time, the $25 Billion not being spent to bail them out can instead be used as startup money for new, more appropriate industries that can utilize the same skills as those workers already have to make items that are more useful.

Which "new, more appropriate industries" do you have in mind? Any ready to give them jobs now? This year?

That is IMO pure fantasy. There are no such new employers. Yes, possibly with enough government money (much more than $25 billion btw) new industries could be started or expanded -- in about 5 years.

Do you have some examples that we can look at?

Industrial workers who have lost their jobs over the past 20 years have typically found their income and benefits dramatically reduced. Walmart an McDonalds are the employers of last resort.