A Straight Talk Solution for the Automobile Crisis

   Bankruptcy is not an option. That is for reorganization. You cannot reorganize a company without capital. capital is not available.

It's obvious who manages the the company and who does the work. The workers need to feed their families and pay their mortgages and the GOP could care less.

Wow, nice article, thank you

Here Here, great truths are lost on little minds, too bad they just can't see from their ideological blindness that they are selling our country for little profit,

So when does the alternative energy fairy show up in Detroit to sprinkle pixie dust over the automakers so they can magically produce all these green cars?

Even if you save the automakers with a loan, who is going to buy the cars given the current economic conditions?  Car sales are falling because people can't afford them right now. 

I agree with you that the current managment needs to be replaced, but the only way to save the automakers is indeed restructuring through bankrupcty.  Bankruptcy reorganization proceedings will force all parties to the table (managment, labor, creditors, vendors) to negotiate.  Restructuring through bankruptcy is not the same as liquidation through bankruptcy.

I dont really know how happy I am with any bailouts... but, at least with the car companies, there is property to show for it... for the banks, we gave them money to invest (essentially), with no real tangible assets to back anything they did with it...

Chrysler paid us back once...  I'm sure that a loan would be worth it, as long as we got some words in on how the heck the company administrations are structured...

I worry about the returns... I mean Lukepccpa has a point in that no one is going to be scouring the market for some cars right now... and I'm not exactly the first person to go out and buy a Ford, Chrysler, or GM car... but that has to do with their design for market... Im one of those rare Americans than doesnt think a big car means safe... Id much rather have a Ford EcoFiesta avaliable here, or a diesel Mini, than a GMC Yukon or a Hummer.

Besides, if you look at the ownership maps, they all own stock in each other anymore... its like a huge clusterfluck figuring out who bought how much stock in this auto or another and when...

Bottom line, Ive got no problems with a US backed loan to the auto manufactuers... with some promises on where the money is going and some work done to recover what we lost when GM quit funding the technology for the EV1 and let the Japanese take that technology back.  What Id really like to see is a push for some diesel technology to hit the states beyond VW and BMW.  I love my VW... but Id just as quick look at a Ford Diesel car too...

I too am appalled by the narrow minded shortsightedness of the Southern Senatorial Coalition of Ignorance!  Not only does this stink of an ideological run at union busting, it appears their constituencies are Japanese, Korean and German auto companies.  I suggest, especially at this time of economic crisis, that their constituency is the United States of America, and OUR auto industry.  The ramifications of the Big 3 failing would be catastrophic.  Thank god the Bush White House feels boxed in, and may need to step in.  Mr. Blevins, thank you for a very well reasoned and argued article.  Kudos!

I don't get it. Everything was moving along and then some cracker republican asked the UAW if they would help out by accepting a cut in their benefits to a still acceptable level by year 2010. The UAW called it right. This was done intentionally by the crackers to derail this. Everyone knows that that the unions are untouchable and one never asks them to show some help in a situtation that they helped create.   This now gives lefties an opening to tell industry what their product will be and how much to produce. Thank goodness for Central Planning by committee.  If Obama were president today this problem would go away. He said he has a master plan to save us from ourselves.

Just how much cash do you advocate giving these morons?  $14 billion dollars will be gone in a flash.  Regardless of your thoughts on how sacrificial you think the UAW is or has been, the cars the Detroit 3 make are not largely perceived as desirable by the buying public.  They have claimed for thirty years that their substandard quality is improving.  Baloney. They even published an apology recently admitting that.  I'm 60 years old.  I've watched GM laugh at Toyota and ignore their progress for well over forty years.  They have had DECADES to avoid the situation they are in.  Those UAW folks are claiming now that they will be too underpaid.  Truth is they have been overpaid for years.   This situation did not occur as a result of the housing market, Wall Street, or gas prices.  It is the result of greed, arrogance, and defiance.  It took 40 + years to get here and the pendulum will swing very slowly back in their favor, if at all. 

Robert....nice rant and forgivably so due to the complexities of the problem. I am however not sure either way. The UAW I believe is not to blame and the fact that the Republicans hitched their wagons is ultimately their failure to find their way as a party.

On the other hand the auto companies with their purchases of other car companies such as Jaguar, and Saab, leads us to conclude as preassuaged by the mathmatical "Black swan" in our financial crisis that bigger isn't necessarily better.This leads us to conclude that the current mantra of wall street's wave of merger's doesn't serve anyone and could be and has been ultimately dangerous.

The American government has it's own guilt to bear in the sense that they let the auto industry exploit a rather simple EPA requirement that had been imposed on cars and trucks by letting them clim that truks and SUV's, essentially built with the same chasses as their automobiles that allowed them to not to be prepared for the energy crisis as their Asian counterparts.

Equal blame has also be perpetrated by the executives for not only not recognizing the current state of affairs and marketability of their own cars, but also by not acting on it quickly enough. Worse than that evenis to actually have business plans that would allow them to spend right into this current crisis without forethought or a backup plan that didn't involve bankruptcy as chapter eleven wouldn't work for the secured creditors who would quickly force them in a real bankruptcy.

I'm at a crisis of opinion in my own head with the complications added by the so-called financial crisis which we had no prolem bailing out right in the face of the ex-director of NASDAQ being the head of a 50 billion dollar ponsi scheme the largest in history.

We all want to save jobs but history tells us that in it's prime there were 237 different car companies in America and the big three brought out or forced out of existence. I believe wall street has exceeded it's free market mandate too far when companies like GE own 10,000 other companies bring destitution to it's purchases when companies like this fail. Isn't it much better to broaden the effort over many smaller companies? We should take into account that Tesla Motors was put together in Silicon Valley and has been to date pretty successful, except for the fact that they have considerable problems in just knocking out sixty cars.

In the end don't we need at least one car manufacturer that can at least build the cars that are needed?  I think so but am unable to com to a concensis in my head.

Thanks for bringing it up Robert,

Forest

As an American taxpayer GM, Ford. Chrysler and anyone else who cannot make it  can go out of business . I think it is wrong for us "The Taxpayer" to even remotely consider this. We are not in the BANKING BUSINESS. I have never had the Government tell me "Hey, its ok if you cannot pay your tax's this year. We will loan you the money and if you can't pay that back well that's ok too. They are business's and if you cannot stay afloat YOU SINK. Throwing money at the problem it is not the answer. If we The American People who are supposed to be the Gov. (By The People, For the People) Actually do have a say why are we not being HEARD !!!  And I am tired of hearing its not that simple. Its as simple as not paying your water bill. Try it. Don't pay your water bill and see how long you have water. I say NO MORE. Its terribly ironic how all this is happening right at the end of  "President Bush's Watch".  "His Watch", now that's pathetic. I watched earlier today as a Iraqi reporter threw his shoes at the PRESIDENT. I did not see one Secret Service agent come to his aid. Again "Pathetic". I guess I'll get off my soap box. Thanks for letting me vent.