Posted by
CKHustler on Saturday, November 22, 2008 3:16:18 AM
I guess congress has decided that the auto industry is not worth a bailout. As do I, except I think the whole bailout business is wholly unneeded.
Problems ailing the Auto Industry in America:
Unions
Gas
Government
Unions are killing the American automakers because of not just wages, but pensions and whatnot. Here are a couple stats...a few years old, but this just lets you know that this problem has been ailing them for some time.
http://www.theglobeandmail.com/servlet/story/LAC.20060308.IBGM08/TPStory/?query=
Now take note of how much they are cutting these costs of workers that aren't even working and on healthcare!
"reduce the Detroit-based company's year-end 2006 pension liability by about $1.6-billion."
"GM earlier won $1-billion in annual health care cuts from union employees,"
Reduce by 1 billion and 1.6 billion? How much are they spending?! And we wonder why Japanese cars are like half the price of ours with the same quality. Unions have suffocated the auto industry and now they are paying for it. When the auto industry goes under, there will be no benefits going out. Kind of like socialized health care if you ask me. You want all this coverage through government mandated, and then it costs so much the government goes under and no one gets benefits, or at the very least they ration(read some previous posts from me for that story, it is long). The auto industry cannot ration, so they are forced to go under. There goes benefits for millions, on top of jobs lost for current workers. Thank you unions. There was a place and time for unions, and I firmly believe that time has passed.
Gas: Prices went up and people consolidated. Many American automakers make lots of their money on trucks. Foreign cars already had a hold on the car business. With higher gas prices, there goes their truck sales.
Government: The government taxes the hell out of these businesses. I couldn't find exact numbers unfortunately, but our businesses are taxed much more heavily than say Japan's auto industry. With lower taxes they can afford to lower their prices and make just as much as the companies here. With that they have lower prices for the same quality and that is how they are selling more.
Add those 3 up and you have a perfect storm. Billions lost...jobs disappearing. What is going to happen? In general they will have to file bankruptcy and lets see how this pension stuff works out for them. The only way they can compete in the future is to rid themselves of the unions that are strangling them. Heck, honestly, if I were them, I would be outsourcing with the work environment here. In an effort of nationalism though, for them to stay and work, unions must be taken out.
"All that is necessary for evil to triumph is for good men to do nothing" Edmund Burke