CDogbert

You think so? I get -3.75, -5.13 on politicalcompass.org... puts me about the same politically as The Dalai Lama. The exact opposite of that is, unfortunately, George W Bush... and you make far too many valid arguments to be compared to him.

Agreed on both the "patch" argument and DR-CAFTA. I'm all in favor of opening up mutually beneficial trade routes with other countries... but this is blatantly just "racing to the bottom". This domestic automotive crunch is going to fully take advantage of trade agreements like that, too. Call me a cynic, but what jobs don't get just blatantly laid off in the name of downsizing... are going to be laid off and given to some Guatemalan boy. "Restructuring" is going to turn into a pleasant word for "outsourcing", because that's the only way these companies are going to ever turn a profit in the short-term.

This was the point I was trying to make when I said if you don't keep your skill sets up, it's your own fault; when your job can just as easily be done by someone pulled off the streets of India or Guatemala for a fraction of what you're paid, you better make sure you either cover your ___ or make yourself valuable.

13edge

That's an interesting site, though I wish there was an option for not giving a crap. I ended up as follows:

Economic Left/Right: +0.25 (to the right)
Social Libertarian/Authoritarian: -3.13 (to the Lib)

Basically, 3 unit from center on the Libertarian line. Unfortunately, there's no famous person there that I'm close to.

CDogbert

^ Meh, you're just more economically moderate than I am, that's all.

There's a great piece on this in the NY Times: http://dealbook.blogs.nytimes.com/20...-auto-bailout/

CDogbert

Hey hey, an update!

So since we said GM can't have $10bn to merge with Chrysler, now they're saying they want their own $50bn bailout separate from the $25bn auto industry bailout, because they're going to "approach the minimum amount necessary to operate its business by the end of the year", having spent $7bn between July and September.

http://money.cnn.com/2008/11/07/news...ion=2008110716 and related articles.

Varsis

what ever happened to survival of the fitest.
i'm 27m, i dont own a house right now because i saw what was happening with the retarded market and loans etc. i chose to save my money and wait. I chose to be smart because i KNEW what was coming. Now you f**kers are trying to stop the inevitable. You should all die off like the trash you are and take the past 10 years of sky high intrest retardedly priced homes and ridiculous loss of value of the USD with you.
As far as public assistance goes i'm a firm advocate of the 6 months and go f yourself policy which basically means if you can't get your butt in gear and pull a full time job in 6 months you get CUT OFF. YOUR GOOD FOR NOTHING.
Dont give me no high and mighty bull about not being able to find the same caliber job etc. WASH CARS, MOVE FURNITURE, GET A JOB. I did it, SO CAN YOU.

To each and everyone of you people who bought houses twice over their "REAL" value, good luck. I hope you all crash burn and bring the stock market to a blazing fiery death with you. I'd LOVE to see the markets fall to levels reminiscent of 10 years ago.

And no I'm not rich, I'm an average joe like the rest of you, My wife and I bring in from 120 to 150 a year and live just fine NOT screwing ourselves over with credit and living HAPPILY with in our means. High school economics teach you guys anything?

UPDATE: Sorry guys, just venting. that felt sooo good to get off my chest.

CDogbert

Psst, this is about the automotive industry bailout, not the unrelated financial market bailout. Glad you feel better, though.

CDogbert

Alright, here we go. Here's what I feel "the way forward" is:

GM and Ford merge into one company with some snazzy name, completely eliminate all of their brands and cars that are notorious for either being gas guzzlers or unreliable, and concentrate all of their research on fuel efficiency. Since all I can go by are Wikipedia figures for this post, that's what I'm going to use. If someone has anything more current, post it up.

GM has $150bn in assets, Ford has $280bn in assets. If they merged themselves together, it would turn into a $430bn company. It would be about $500bn with Chrysler, and I originally was going to suggest all Three merge... but Chrysler's a private company, so screw them.

Now, trim the fat. Get rid of all brands that either don't sell any cars in at least two of the three global markets (US, Europe, or Asia), have notoriously poor cars or sales, or are going to have no contributions to the merger: Lincoln, Mercury, Buick, Cadillac, Daewoo, GMC, and Hummer. These can all either be absorbed by the remaining brands or eliminated altogether. By my estimations from 2007 figures, this could eliminate $2bn in losses from Ford, and another $22bn in losses from GM. Eliminating these losses from the combined net income reduces it from $41bn to $17bn, while reducing the company down to $307bn in assets.

Now, for the jobs. A reduction in company size would mean a reduction in the workforce, obviously. Keeping in mind that the ratio of assets:workers for GM is $0.6mn/worker, and for Ford is $3.1mn/worker... GM employs way, way, way too many people. If we were to bring this up to even $2mn/worker, the new company would employ 153,500 people. Unfortunately, this would make about 200,000 jobs redundant (30k from Ford, 170,000 from GM). However, this would free up another approx. $1bn from Ford's expenses, and another approx. $7bn from GM's expenses. This would take down the net income loss to just $9bn/year from our original $41bn/year.

Now that the supercompany has been trimmed down, it needs a new direction. The elimination of a lot of the underperforming brands will probably improve that, but it still isn't enough, gauging by the public demand for fuel-efficient cars that these companies just aren't making. Special care should go multi-market brands such as Mazda and Volvo, which usually sell independent of the fuel economy. To eliminate the rest of the $9bn, studies should be done to determine what percentage of American drivers prefer driving what kind of car. For example, if 20% of Americans prefer driving trucks, then trucks should only make up 20% of the lineup. This will ensure that the new company doesn't overproduce one type of car while neglecting one in more demand (see: the SUV bubble).

So, now we can assume we're even. In combining America's two biggest automakers and restructuring them, we've turned a $41 billion loss per year into breaking even. Yay!

13edge

How about the American car companies build something that people want to drive at a fair and reasonable price? I don't think they understand that they can talk about 'quality as good as Honda' all they want, but at the end of the day... or the end of three years, the jap car is worth twice as much as the American one.

There are so many people to blame for the mess in Detroit, from managment to the union, but at the end of the day, the only people who will suffer are the taxpayers.

Sorry to any autoworkers, but I say let all three of them fall flat on their butts.