Should the Auto Industry Get Bailed Out?
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If you have been paying attention to the news lately, the latest disaster for the nation (are you keeping track? there will be a test later!) is the eminent (and imminent) failure of the auto industry. Depending on your depth of thought, you might already have the preliminary decision in mind already, as many in the Congress apparently do.
After watching the Sunday morning news programs, and getting up at 3 AM this morning, as I missed ‘Meet the Press’, and our local affiliate replays it at that time, I was not surprised to see that it was the main topic of discussion yet again. It featured one of the senators from Michigan, a Democrat, and one of the southern Republicans as the starters in the debate. The Democrat was, of course, in favor of the bailout, as the crisis is in his home state, and is affecting his constituents directly. The Republican was on the side of free market economics, and believes that the auto industry should be allowed to fail – after all, his state has little to do with that set of businesses … or does it?
Immediately upon the main screen behind Tom Brokaw was a map, delineating exactly how many, and where the auto industry jobs are located, and next was the thought that so many more jobs would be lost in the support businesses across the nation, irrespective of state borders.
Tom Friedman was on the discussion panel this morning, right after the Congressmen left. For those not aware, Mr. Friedman writes for the New York Times, and also happens to have won the Nobel Prize in Economics.
Mr. Friedman put forth the very astute observation that we are in the midst of a crisis that has never been seen in our world’s history. Essentially, this puts any normal answer to the main question into the category of wasted time. The economy, whether anyone who thinks the market should rule is listening or not, is entirely too fragile to suffer a blow of these proportions. The wrong decision on this could propel the nation into worse difficulties than those that arose in 1929, making this current series of events ‘the great depression’.
On the other hand, I do believe that the auto industry should be guided by its Uncle Sam, with things like top executive positions garnering meager pay until such time as the loans are paid back in full. (These people will not go hungry, they’ve been reaping large, unmerited rewards, the entire time that their companies having been circling the drain.) Perhaps the rank and file workers should be expected to take a pay cut, but it cannot be large, and besides, their wages pale compared to the five to ten top positions. These are, to put it in military terms, the generals, who are leading the fight, and if a sword must be fallen upon, it is the leaders job to do it.
It does remain, however, that America must have an automobile industry, and one in which the profit centers are somewhere within our borders, not in Japan or Korea. America is the largest consumer of vehicles, so it makes sense that the monetary and ecological needs of this country call for the industry to reside here.
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The important thing is not to stop questioning.
Albert Einstein, 03/14/1879 - 04/18/1955
Nobel Prize Laureate (Physics)
Nothing endures but change.
Heraclitus
5 Comments
leftystrat
November 22nd, 2008
at 10:26pm
We have privatized profits and socialized losses.
No more handouts!
Let those who get paid to take the risks actually take the risks and reap the rewards or suffer the consequences.
Let’s stop rewarding failure.
(and contributors)
the oracle
November 23rd, 2008
at 9:02am
leftystrat, those are nice sentiments, but have you looked at how subsidized many businesses are in this country?
Think about it. If we weren’t subsidizing the dairy industry, milk wouldn’t be $4 a gallon, and cheese (plain old mild cheddar) wouldn’t be $4 a pound. When I see, or hear, of dairy farmers dumping milk into pits, to keep prices up, I get irate.
We should keep an eye on resolving these problems - but - the auto industry is like Humpty Dumpty, if he falls, all the king’s horses and men…
and then there’s the ball game.
Let’s get the patient well before launching into a tirade about what he could have done to make him sick.
cezar
December 9th, 2008
at 5:09am
phuck them. they make crappy cars and here is the result. we do not need electric cars, what we need is diesel cars. we need to make hybrid diesel cars not hybrid gas. diesel all the way :)
Steve
December 12th, 2008
at 10:59am
Hell with the auto workers. Who do the think they are. In this time, everyone is contributing to their healthcare. Even the coal miners the risk their life everyday. And they think that they stand there and turn a few bolt on the line they shouldn’t have to contribute anything for their heathcare for putting the piece of junk cars out that they do! Not alone the rediculous rates they make. I didn’t know they had it so easy. But I’ll tell you one thing. Let them go out and find out what it is to make it without the union to back them. Management was stupid to even consider the unions offer. Bailout or not. I’ll never buy a car from these spoiled people. The steel industry didn’t get bailed out , so neither should the junk auto manufacters get bailed out. If anything bring the steel back and junk the car industry.
the oracle
December 12th, 2008
at 12:24pm
Steve, have you ever worked on an assembly line? There are pressures to keep the line going, and make no mistakes.
They do have fully paid healthcare, but then, if you could have it, you would too. The union may have gotten them more than you think they deserve, but without it, the workers would be walked upon, like yesterday’s newspaper.
The problem is not the workers - they merely put together the designs of the upper eschelon.
However, after all this, the point is not what the rank and file makes or doesn’t - it is about the failure of the industry that will throw the entire country into a panic, with unemployment rates over 10% for the nation.