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Thread: Two Tidbits From the Auto Ind. Bailout Loan Deal

  1. #1

    Two Tidbits From the Auto Ind. Bailout Loan Deal

    --The Govt. will appoint a "Car Czar", who will have ultimate authority to veto ANY investment or action by the Car Makers that exceeds 25 Million $.

    --The Car Companies will not be permitted to contest (in court) ANY future State or Federal Laws regarding Greenhouse Gas Emissions.

    Feelings?

    Does this effectively mean Govt. Control of this Industry? Or is this just "common sense", as lawmakers say?

    Is this de facto Nationalization? Or just appropriate oversight and a smart imposition into the "free" market?

  2. #2
    It's a little bit of both, but more oversight than nationalization and it needs to be done. The only way this 'bailout' works is if the car companies are guided properly in investing in green technology and giving the American consumer what they want. It's historically apparent that they're probably not capable of doing this on their own.

    This is a post I put up several weeks ago when the concept of an auto bailout was brought to the table. Thus, it's hard for me to be against the process they're using when they've pretty much done this. Now all that's left is to just make sure that they hire someone competant for the job, which is never a certainty. Most importantly, what needs to be ensured is that the level of oversight and control never goes higher than this.

    [QUOTE=RutgersJetFan;2846684]The auto industry is one of the few aspects of the economy where I actually prefer the gov't get involved in so long as they enforce the companies going ahead full steam with new sources of energy technology. The entire American auto industry needs a makeover. However, if it's simply another bailout, no thanks.

    Auto plants all over have to be retooled for the most part for primarily hybrid and alternative vehicles, and with the American industry being in shambles, they need help to do this. It's going to take too long for them to be able to accomplish this on their own. Normally I'd prefer to let the market stabalize itself and the industry adjust on its own, however I don't know if we as a world power in competition with the EU and Asian markets have time for that.[/QUOTE]

    Needless to say, I think this is much more a matter of oversight taken to a higher extreme than normal simply due to the circumstances.

  3. #3
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    Just read this yesterday.

    [URL="http://www.forbes.com/manufacturing/forbes/2008/1222/040.html"]http://www.forbes.com/manufacturing/forbes/2008/1222/040.html[/URL]

    [QUOTE][B]Everybody's An Expert[/B]
    Jerry Flint, 11.27.08, 06:00 PM EST
    Forbes Magazine dated December 22, 2008
    Bankruptcy is a good thing for Detroit--and other myths worth debunking.

    I've never seen such misinformation floating around about the auto industry, whether it's from New York Times columnist Thomas Friedman on the left or his colleague David Brooks on the right. They think Detroit should die. At least the Republican senators from Alabama and Kentucky have a reason for wanting to ruin Detroit. They don't tell you, but their states have plants owned by Honda, Mercedes and Hyundai (Alabama) and Toyota(Kentucky). If General Motors goes down, the Midwest may sink into rubble, but Alabama and Kentucky will boom.

    So let's knock down a few myths about General Motors and Detroit:

    [B]There's a plus side to bankruptcy.[/B]
    Wrong. There's no plus side. Name any existing auto company that has survived bankruptcy. Few people would be idiotic enough to buy a car from a bankrupt company. Trade-in value disappears. Warranties are worthless. Repair parts vanish. GM goes bankrupt on Monday and on Tuesday the only customers are vultures looking for giveaway deals. In fact, sales are probably collapsing now because of all the bankruptcy talk.

    "Oh, but you can throw out the union contract and cut UAW pay and benefits," goes another argument. Humbug! Are union workers going to happily return to the assembly line with their pay slashed? Of course not. And no judge, no company, can order the UAW to do anything.

    [B]Detroit needs restructuring.[/B]
    Detroit has been restructured to death. It needs a few great cars with great looks and great performance. George Romney saved American Motors with the Rambler. Lee Iacocca saved Chrysler with the K car and the minivan. Phil Caldwell saved Ford with the Taurus and the Town Car. Just maybe the coming minicar Cruze and the electric Volt will save GM.

    [B]The government can appoint learned bureaucrats to run GM right.[/B]
    Have you ever heard of a successful government-run auto company? Sure, they work if all other cars are banned and they torture anyone who criticizes the design. I've seen some: the Trabi, built by East Germany, or the cars of the nationalized British auto industry until that industry died, or those Renaults when the French government ruled. Let's not even mention the Soviet cars.

    [B]Green machines must be a condition of any aid.[/B]
    That nonsense would put GM out of business faster than its own management. Ultrasmall cars like the Smart and the Mini have minuscule sales. There's only one successful hybrid, the Toyota Prius, and it's outsold by gas-guzzling pickups like the Chevy Silverado, Ford F-150 and Dodge Ram and is even outsold by Detroit's own small cars, Chevy's Cobalt and Ford's Focus, and GM's family-size Chevy Impala and Malibu. (Note that Toyota is losing money in America, too.) Even the head of Honda says Americans like big cars, and that's what Honda wants to do, improve mileage on real cars. Electric cars are easy to talk about, but there would be a $10,000 cost premium on a lithium-powered electric with a mere 40-mile range.

    [B]Detroit hasn't been building cars people want, meaning tiny gas savers.[/B]
    Detroit's cars are basically the same as the foreigners'. It's true that Detroit's trucks use lots of fuel, but so do the big Japanese and German vehicles. The problem is that Americans believe, whether it's true or not, that the other guys' cars have better quality, run on smoother engines and smoother transmissions, have better interiors and are better looking. Detroit hasn't been building cars people don't want; it's just that car buyers think the other guys do it better.

    [B]Order them to make all hybrids. [/B]
    That one successful hybrid, the Toyota Prius, carries an $8,000 premium over a similar nonhybrid Toyota. It's tough to justify $5,000 to $10,000 more for a few miles extra per gallon. Sure, Detroit's cars should get better if the industry is to survive, lots better. Better looking, better handling, smoother shifting and better fuel economy. But most of our cars and trucks will be powered by internal combustion engines, gasoline and diesel, for the next few decades.

    [B]A bailout won't solve anything, just postpone the day of reckoning. [/B]
    Maybe. But so what? Demanding certain victory before attempting battle never works. Success in the auto business requires great leadership and great vehicles. Ford isn't that far down, yet, and GM and Chrysler can come back. Will they? I don't know, but they deserve the chance.

    I've been at this since George Romney was attacking "the dinosaur in the driveway" 50 years ago. No one, no one, has been more critical of GM management over the past 15 years. I remember when we needed GM's help. We got it. Now they need ours.

    [I]Jerry Flint, a former Forbes Senior Editor, has covered the automobile industry since 1958. Visit his homepage at [url]www.forbes.com/flint[/url].[/I]

    [/QUOTE]

  4. #4
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    [QUOTE=Warfish;2901598]--The Govt. will appoint a "Car Czar", who will have ultimate authority to veto ANY investment or action by the Car Makers that exceeds 25 Million $.

    --The Car Companies will not be permitted to contest (in court) ANY future State or Federal Laws regarding Greenhouse Gas Emissions.

    Feelings?

    Does this effectively mean Govt. Control of this Industry? Or is this just "common sense", as lawmakers say?

    Is this de facto Nationalization? Or just appropriate oversight and a smart imposition into the "free" market?[/QUOTE]

    You know what I think is f'ed up, the government Nationalized the Banking/Financial industry, now the auto industry.

    Obama is entering office in a month, and the real fear of socialism coupled with the Nationalization of these (and prob many more) will lead us into a very different and scary America in the IMMEDIATE future.

  5. #5
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    [QUOTE=Warfish;2901598]--The Govt. will appoint a "Car Czar", who will have ultimate authority to veto ANY investment or action by the Car Makers that exceeds 25 Million $.

    --The Car Companies will not be permitted to contest (in court) ANY future State or Federal Laws regarding Greenhouse Gas Emissions.

    Feelings?

    Does this effectively mean Govt. Control of this Industry? Or is this just "common sense", as lawmakers say?

    Is this de facto Nationalization? Or just appropriate oversight and a smart imposition into the "free" market?[/QUOTE]

    It just shows that Republimorons are just as socialist as dumbocrats.

    And it makes me think and laugh that two super duper awesome fantastic republicans are strangely missing from the board after Obama's election. Almost as if they are p*ssys or something.

  6. #6
    [QUOTE=PlumberKhan;2901839]It just shows that Republimorons are just as socialist as dumbocrats.

    .[/QUOTE]

    You're right, but if they weren't, you'd call them elitists, like you've done to me.

  7. #7
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    [QUOTE=PlumberKhan;2901839]It just shows that Republimorons are just as socialist as dumbocrats.
    [/QUOTE]

    +1776

    Us Libertarians get it ;)

  8. #8
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    [QUOTE=BrooklynBound;2902045]You're right, but if they weren't, you'd call them elitists, like you've done to me.[/QUOTE]

    We've been over this before...you're an elitist because you wear platinum fronts, son.

  9. #9
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    [QUOTE=Warfish;2901598]--The Govt. will appoint a "Car Czar", who will have ultimate authority to veto ANY investment or action by the Car Makers that exceeds 25 Million $?[/QUOTE]

    If they had done this in 2000 they may not be in this mess. Short sighted American auto manufacturers and secret short sided energy policies by Cheney via Bush2 helped put the 3 in this position. A zar most likely would not had the balls to go against the heard.
    [url]http://www.pbs.org/now/shows/347/oil-politics.html?[/url]

    [QUOTE=Warfish;2901598]--The Car Companies will not be permitted to contest (in court) ANY future State or Federal Laws regarding Greenhouse Gas Emissions.?

    Feelings??[/QUOTE]

    Some one must look out for the good of the people. Car companies that make small technical changes but perpetuate stagnant ICE technology so they can keep their revenue stream in tacked must be delt with. Purchased politicians and judges can't do it. Car companies could buy all the support they needed until now.?

    [QUOTE=Warfish;2901598]Does this effectively mean Govt. Control of this Industry? Or is this just "common sense", as lawmakers say?[/QUOTE]

    The same needs to be done with the oil companies but they are rich and can buy all the support they need right now. We will never have cheap batteries, solar panels, or even bio fuels as long as they are rich and powerful.

    [QUOTE=Warfish;2901598]Is this de facto Nationalization? Or just appropriate oversight and a smart imposition into the "free" market?[/QUOTE]

    I don't believe that a Zar can tell what will work with the American consumer any more than GM. Now that gas is cheap I hear that GM has some SUV plants working over time to keep up with demand. Young and stupid consumers that don't have a clue of the future is my guess? That or they are contractors and others who do need the vehicles. Probably just some soccer moms who do not like what they see in their pants and are compensating.

    Oh wait. Scratch that last one. I guess that doesn't work.

    How about GM's apology. [url]http://www.autobloggreen.com/2008/12/08/gm-apologizes-for-betraying-american-consumers-focusing-on-ga/[/url]
    Last edited by Freeridelectric; 12-09-2008 at 08:21 PM. Reason: addition

  10. #10
    [QUOTE=Freeridelectric;2902470]If they had done this in 2000 they may not be in this mess. Short sighted American auto manufacturers and secret short sided energy policies by Cheney via Bush2 helped put the 3 in this position. A zar most likely would not had the balls to go against the heard.
    [url]http://www.pbs.org/now/shows/347/oil-politics.html?[/url][/quote]

    There is no proof that a lack of "green: vehicles is any part of the Detriot lack-o-profit problem. Yet green seems to be the primary goal of Govt. in nationalizing them.

    [QUOTE]Some one must look out for the good of the people. Car companies that make small technical changes but perpetuate stagnant ICE technology so they can keep their revenue stream in tacked must be delt with. Purchased politicians and judges can't do it. Car companies could buy all the support they needed until now.?[/QUOTE]

    Since when is it a private businesses job to "look out for the poeple"? If you want to build green cars, and selling them is so profitable, why don;t other companies get into the business?

    [QUOTE]The same needs to be done with the oil companies but they are rich and can buy all the support they need right now. We will never have cheap batteries, solar panels, or even bio fuels as long as they are rich and powerful.[/QUOTE]

    So Nationalize Oil too then, eh? Are there any industries you would leave privately owned? Just curious.

    [quote]I don't believe that a Zar can tell what will work with the American consumer any more than GM. Now that gas is cheap I hear that GM has some SUV plants working over time to keep up with demand. Young and stupid consumers that don't have a clue of the future is my guess? That or they are contractors and others who do need the vehicles. Probably just some soccer moms who do not like what they see in their pants and are compensating.

    Oh wait. Scratch that last one. I guess that doesn't work.[/QUOTE]

    Freedom, it's a real ***** sometimes, but they (Govt.) is working it.;)

  11. #11
    The Fed was so on top of the real estate/banking debacle, I'm supremely confident that they'll outwit the foreign auto market. Man, thank god the government is here to rescue us.

    In reality, the Big 3 need to go away if they can't compete. Now that the government is involved, it will balloon into a giant bureacratic mess that it does with everything else it shouldn't be involved in. If it doesn't work, the average tax payer will still fund it. Who bailed out the milk man?

  12. #12
    [QUOTE=Freeridelectric;2902470]


    Some one must look out for the good of the people. [/QUOTE]

    Let me know when they start.

    The best person to look out for me is me.

  13. #13
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    [QUOTE=Warfish;2902477]There is no proof that a lack of "green: vehicles is any part of the Detriot lack-o-profit problem. Yet green seems to be the primary goal of Govt. in nationalizing them.[/QUOTE]

    When they needed green vehicles most a few months ago when demand, speculation, and profits drove gas to 4.25/gal and there lucky the world economy went to crap and they have an excuse as they would be in bankruptcy now if not. They had little to offer compared to Toyota for green cars.

    [QUOTE=Warfish;2902477]Since when is it a private businesses job to "look out for the poeple"? If you want to build green cars, and selling them is so profitable, why don;t other companies get into the business?[/QUOTE]

    Once a company becomes the size of a small government and acquires unlimited amounts of influence and money to get it's way it should be scrutinized and regulated by the government for the good of the people. The government as regulated factories because of pollution, Philip Moras because of cigarette's, cars for safety and pollution.

    Other companies are manufacturing and selling green cars and those are the ones that are on top.



    [QUOTE=Warfish;2902477]So Nationalize Oil too then, eh? Are there any industries you would leave privately owned? Just curious.[/QUOTE]

    Sorry these companies are to big and powerful and perpetuate bad conditions for the American people. They would have the American people there slave and poison them in the process. Big oil doesn't care about national security. Fact they probably like war so they can sell more oil. All they give is lip service in return. Oh yea and a lot of taxes. One time I like taxes is when I hear the oil companies have to pay. They make it up by not paying proper royalties. [url]http://www.pbs.org/now/shows/319/[/url]

    The oil companies should be bailing out the auto industry as they have the most to loose if going green does catch on. They can always go to a third world country with a weak government and pedal there indespencable product while buying subsidies.



    [QUOTE=Warfish;2902477]Freedom, it's a real ***** sometimes, but they (Govt.) is working it.;)[/QUOTE]

    When these companies influence government so much, they become the government. I don't want a oil company for my government. I don't want my government purchased by the oil companies either. The oil companies along with the banks, insurance and auto are just to big to fail or to have influence our government when they are healthy. Cash is king. The oil and bankers have much of it and when they don't we give it to them. The politicians don't have enough so they get it from the tax payers via the big companies. A viscious circle jerk.

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