This is a continuation of my rant from The Economy, Big 3 Auto Bailout, and the Church // Part 1, which I will only post one more part. Until then, here is part 2.
The Big 3 Auto Industry Bailout
Have you been watching this?Â Now we should bail out three of the biggest looser (profit wise) companies in the country, perhaps the world?Â How smart are these guys?
The chairman of the Big Three testified on Capitol Hill this week, and Reid said did themselves no favors by responding when asked how they arrived to Washington that they had each flown in on their private jets.
And now the government is talking about taking partial ownership in the car companies (they could change their name to Amtrak) like that would be a better way to make these failing companies profitable?Â Where does it end?Â If we bail out the big 3, why not just bail out the entire country person by person.Â I could use some bailout money myself, how about you?Â Would we then be looking out the window at a fire sale turned waste land?
Who is it we are trying to help here?Â The employees, the auto industry itself, the fantastic cars they have produced over their spam as a business???Â I am certainly no economist, but, what in the world would be so bad about letting these overweight, unprofitable companies go the way of Braniff?Â Are you telling me these 320,000 employees will never ever find another job?Â Are they all that unqualified to work for someone else or is it the $71/hour the average employee makes?Â I know this is people’s livelihood we are talking about here, but really, are we going to be that dependent on one single company that is loosing BILLIONS?
Years and years ago this use to be the case.Â People would work for one single company their whole life, that company would have a nice pension for the employee to retire with and that was life.Â That was yesterday (as in decades and decade ago).Â Now people change jobs and companies like being a free agent with Major League Baseball.Â Many may see this as bad, but companies don’t profitably operate now like they did in the 1950’s.Â Companies are much more fluid and adjustable (unless you are a auto maker controlled by the UAW) and their needs change just like their employees.
When we use all this tax payer money to “bail out” failed policies or business practices, who is left in the drivers seat?Â The same people, right?Â Can they still drive that train or is it just the same old thing that has lost money in the past?Â If so, what makes a bailout something that will work and turn the company around?Â If you borrow money from venture capitalist, you are responsible to your shareholders.Â You borrow money from the government, you are responsible to the tax payers.Â What do they get?Â Better, greener cars?Â What if you don’t want to buy a GM vehicle?
What happened when Braniff and Eastern went out of business?Â Did all those thousands of employees never ever find another job?Â Or, did Southwest Airlines start to emerge as a “new” kind of airline, with lower prices, better service, while at the same time being a profitable business?Â Did Southwest Airlines pay as much, no, I worked there making $6.50/hour when Delta, American Airlines, Northwest, United, and US Airways all paid more per employee, and were all loosing money and going bankrupt (and they still are).Â I still chose to work for Southwest Airlines.Â It was fun, they were nice, happy people, and I could wear shorts and a t-shirt at work.
That is really one of the issues at stake here.Â No other auto company is going to pay a union wage of $71 per hour (that’s $150,000 a year for an hourly job, not including overtime and bonuses).Â They can’t, it would not make for a profitable business.Â Hyundai and Kia may not make the best cars in the world either, but they both moved to Alabama to manufacture cars, and are making money.Â They also don’t pay as much as GM and are not controlled by the UAW (as far as I remember).
So, as bad as it may sound… just let them go.Â If they can’t operate by loosing $5 billion a day (who could), perahps someone will step in and bring us better cars, more effieint cars, and maybe greener cars, all while making a profit, not costing the tax payers another $100 billion, and in the process, create jobs for those who want to work.Â Now if Ford can make a car like I saw in the new James Bond movie, and make it at a profit, great, I am all for Hydrogen Fuel Cell cars, but they always seem to be years and years behind Toyota.