Baseball, Apple Pie and Corporate Welfare

Townhall.com ^ | November 14, 2008 | David Harsanyi

[Kaslin]

The public already has cast a landslide vote on the nation's automotive industry. They hate it. And why shouldn't they? The Big Three automakers have generated a level of consumer satisfaction not seen in America since the English started taxing tea in Boston.

The Republican Party also has been peddling a highly disagreeable product. And if they have a desire to regain relevancy, it is incumbent on them to use whatever meager power they still possess to stop the Democrats from passing a bailout of the Big Three.

We should be calling this a bailout of incompetence, corporate cronyism and unionism, actually -- and a step toward nationalization, as Congress wants a stake in these companies in exchange for, you know, helping out. (Does anyone remember the Trabant?)

What is one to make of Democrats' enlisting the genius who helped bring about the Freddie and Fannie mess, Barney Frank, chairman of the House Financial Services Committee, and a senator from Michigan , Carl Levin, to craft the Detroit bailout legislation? It's a shame Jack Abramoff is too busy to chip in with his thoughts.

Though Congress already has approved $25 billion in loans to prop up a defective auto industry, one wonders whether anyone in Washington has asked whether this near corpse is worth saving in its present form. If it is, surely other corporations and investors will excavate the facets of the business that work.

Yet if you happen to listen to backers of a car bailout, you may be led to believe that the Tahoe is a pillar of American life. "It is critical that the nation understand this isn't just a Michigan problem, that 1 in 10 jobs in the country are impacted by the auto industry," Michigan Gov. Jennifer Granholm recently proclaimed in an interview.

We still are going to buy cars, Madame Governor, but perhaps we will buy them from companies that have the temerity to say "no" to unions and don't have crushing legacy costs associated with them. These corporations may not even be headquartered in Michigan.

Nancy Pelosi is worried that if General Motors declared bankruptcy, the union would lose power and executives would make off like bandits. So she would like taxpayers to help General Motors pay for the nearly 450,000 retirees who live off extravagant pensions and free medical care.

Now, unions claim they simply want "working" families to make livable wages. But Dr. Mark J. Perry, a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan, calculates that employees of the Big Three automakers' average compensation is $73 an hour. The U.S. employees of Toyota are at $48, a 52 percent differential.

GM, after all, is the company that caved to an idea that only a union or government agency could possibly concoct: a "jobs bank" program.

A jobs bank is not about jobs, per se. No, in a jobs bank, employees are paid nearly their full salaries (SET ITAL) to avoid all work (END ITAL) and hang out. Sounds more like a think tank than a job bank. And no taxpayer should be on the hook for either of those enterprises.

Now, we were warned that allowing the banking system to fail would result in a credit crunch that would turn New York City into a dust bowl. But GM shares are already worth an amount between absolute zero and the price of newspaper stock. That's what investors think of the company.

So this bailout is about taxpayer money being handed to a rotting business-union partnership that engaged voluntarily in agreements they can't honor. Let them go bankrupt and work it out among themselves like everyone else.

I, for one, have been punished enough. I already own an American car.

[Sybeck1]

In my driveway are two Nissans and a Toyota.......

[o_zarkman44]

Unfortunately we are very satisfied with our American cars.
When shopping there was little difference in cost between American and foreign models of similarity. I bought new a F250 in 06, trading off a 97 F150. My wife bought an 08 Escape, trading off an 04 Escape.

Average fuel mileage is double what it was 30 years ago. Why would that be a problem? With trucks we don’t expect economy because a truck is made to do jobs like haul and pull move things for working people.

But I do agree the autoworker compensation is out of line with the rest of our wages. Pensioners have been made promises the companies are unable to keep. Sounds no different than our government. Yet our government renigs on it’s promises all the time and gets away with murder.

The auto workers unions are going to have to expect less and not wait till they have bled GM and Ford and Chrysler dry, because then they will have nothing. BUT......

Along comes government saying those companies are also too big to fail and need help. Here are some ideas to help automakers. Keep oil prices reasonable with domestic drilling. Relax environmental restrictions on regional fuel blends. Cut corporate taxes. Relax intrusive environmental regulations that result in the importation of many of the raw materials needed to make autos. Moving good paying jobs offshore to avoid corporate tax plunder has hurt the consuming public, reducing demand on big ticket items.

The government says these companies are too big to fail and need a bailout. Perhaps. Perhaps the automakers need to adopt a new business plan also? But things will never change for the good if they are allowed to continue business as usual. Even our government supports business as usual because that keeps them in power to fix the problems they created but never saw coming. What a joke!! Until we quit re-electing incompetence and rewarding incompetence we are doomed to fail.

But my question is; Is our government too big to fail? And who is going to bail it out?

[Leisler]

Fascism.

Corporate, Union Worker, Finance, Government.
United.

For the good of the children( someone has to pay those long term debts )

[Leisler]

Paraphrasing Stalin. Detroit is a tragedy, you and I are statistics.

[Thermalseeker]

Fascism.

I recognize the stench, too.....and we both know what comes next.....

[The South Texan]

Four or so years ago, I would have stayed a mile away from a GM product. Today, I have a 2007 Chevy Avalanche and my wife drives a brand new GMC Arcadia. Both are drive well and are quality made. The Chevy Malibu is a nice sedan and Cadillac makes some fine rides too. And the Tahoe/Yukon by far is the most popular full size SUV on the road.

GM is doing something right and I would hate to see them go thru all this crap and have all their quality improvements go down the drain. But I understand Bankruptcy might just give them the chance to shead all of the nonsense and start over. Maybe moving all of their plants out of heavy union strongholds would help too? I don’t know.

GM is making some good stuff now and I think people like me that would have stuck to nothing but Toyota or Honda need to give them a chance. Ford still hasn’t sold me on their stuff and I had and F-150 a while back that gave me all sorts of headaches right after the warranty expired. I won’t even step foot on a Ford dealership after that experience.

[Leisler]

It's like people with a terminal disease. The work out, lose weight, eat right and kind of get better. For a while.

GM needs to go to Chevy and Cadillac. Chrysler out of business. Ford dump Lincoln, Mercury.

[Thermalseeker]

Maybe moving all of their plants out of heavy union strongholds would help too?

I'll be watching to see how the "right to work" states handle the open union ballot thing......

I had and F-150 a while back that gave me all sorts of headaches right after the warranty expired. I won’t even step foot on a Ford dealership after that experience.

Too bad. I drive an F-250 with 340K miles on it every single day and it's not given me a bit of trouble other than normal wear and tear items. The last GM vehicle we owned, a Chevy Cavalier that was my wife's when we married, was the single biggest POS automobile I have ever encountered, bar none. There isn't nearly enough bandwidth here to list all the things that went wrong with that piece of crap.

[o_zarkman44]

The three previous ford trucks I owned all had over 200k miles. the 91 truck had only a watrerpump replaced, and a tranny (right at the 190k mark). The 97 had a front brake caliper break that also ruined the spindle. Was it a quality issue? Doubt it.

My wife is so sold on the Escapes. they are excellent. ride well. Plenty of room. Good mileage. I like them too. One of Fords better ideas.

With all the talk about Detroit not changing, why is it that for most cars the only way we can tell what they are is looking at the nameplate? The differences are hard to see. And the Camry is higher price than a comparable Fusion.

I think American automakers have come a long way. But a lot of their problems are from being strong armed by the government, with Democrats leading the charge for the Unions.

Bankruptcy would allow the mfrs to renegitiate their contracts, shed unproductive lines and plants, and meet reasonable expenses rather than paying retirees huge sums because they used to work there. If those retirees would have to depend on social security they might not be so inclined to support Democrats. A taste of the real world, with real world expectations is in order.