As angry as I am at GM, Ford, Chrysler, and the UAW, I have decided to speak up for the bridge loan. It is so simple, yet I almost blew it. If these companies suddenly go out of business, we will be forced to buy foreign. Think about that for a minute. Where will all those cars and trucks come from? The US car companies make about four million cars in the USA each year. If their plants are no longer producing, who will build these cars? Easy you say, Japan, Korea, Germany, Italy, Sweden, etc. Well folks, these companies all have their own markets. They would never be able to ramp up to build an extra four million cars overnight.
So your beater finally died, and you have no other choice than to buy another car. You go to the local Toyota showroom and discover that a Camry costs one hundred thousand dollars, and you are placed on a waiting list. Not to worry, you amble over to the used car dealer to discover that a used Chevy with one hundred thousand miles is commanding twenty five thousand dollars. What the hell is going on?
It takes several years to build new car plants. The extra sales placed on the foreign car companies would strain their resources. There would be a severe shortage of cars for several years after the “big three” have been buried. The shortage plays into the hands of the economists old rule that the price is dictated by suppy and demand. Fewer cars, more sales equals higher prices.
Do we really want to see car prices triple, or do we want to see the “big three” live on?
As much as I hate the UAW, and the even dumber GM management for their stupid tactics over the last forty years, I would sooner see the big three survive. Let’s give them the loan!
What a joke to watch the Big Three CEO’s squirm on Capital Hill today. They gave the Senate an earful. Basically, we would have gotten off with a bargain had we accepted the 25 billion bailout the carmakers asked for in November. Of all the jokers who spoke before the Senate, I thought the guy from the UAW was most off base. After listening to a proposal from GM which could save an estimated eight billion dollars a year, he proceeded to argue about how he didn’t really believe the numbers of the proposal. Of course not. The proposal meant the UAW would lose some jobs. These are jobs that should be lost. GM, Ford, and Chrysler all carry dead wood because of the UAW contract. In the meantime, their Japanese and Korean competitors are hiring people in this country who are only happy to have a job. They work for considerably lower wages than a UAW greed monger will. The typical UAW response was one which was adversarial to the management of GM. Even in a hearing which held the life of the company in it’s hands, the UAW forgot why they were there and began to argue against the management. They were there to support the company. They could not. They are the problem, have been the problem and will be the problem for as long as they are in existence.
It has been my experience that everytime a UAW worker goes up against GM he takes the attitude that “I’d sooner see you go down and look for another job than lose this contract negotiation to you bastards.” Over the years, GM has caved in, time and time again in order to please the stock holders. In the meantime, the UAW has become the strongest union on the world. At least it thought it was strong. All it was doing was looking at the immediate bottom line for its workers. Never did they imagine that the mighty GM could crumble. Never did they imagine that the Japanese and the Koreans would steal their lunch.
My opinion of the GM management is not much higher. They were arrogant enough in the seventies, eighties and nineties to believe that the Japanese could not unseat them as the number one carmaker in the world. In the meantime the Japanese continued to do everything right. Little by little they chipped away at the GM market share which went from forty-five percent in the seventies to twenty percent today. They are lucky to have that. The management of GM today is finally waking up and making some good cars. Their quality rivals the Japanese. They have a way to go with overall reliability, but their quality has improved. Their styling sucks. Their current hot car, the Cadillac STS is a winner, but the Chevy Malibu, their work horse, is a dog. I can’t believe that with all the design talent in the USA and within GM that they continue to make cars that look shitty. I can only blame it on the management. Their designers are better than that.
In the meantime, the Japanese continue to work their fifty year strategic plan. Their car companies are in union with the government. They work together in thier industries for the good of the country. The car company employees work under a job for life program. This program keeps them from organizing. These employess are also retrained to work in many different areas in order to reamain employed. They do so. In the meantime our wonderful UAW is protecting jobs even when they are no longer needed.
Another famous UAW contract point is the pay for no work. When a US car company sees a downturn in business, and needs to cut back to save money, the UAW workers continue to get paid eighty percent of their normal wages for up to eight months. What a sweet seal that is. Get paid for nothing, bring on the layoff.
Henry Ford created the middle class when he began building cars. Over the years the UAW has created the “wealthy middle class.” Thier workers are so well paid they rival the wages of our most educated college students. A UAW worker does not have to give up four or more years of his life to study either. He works the line doing some mundane job better served by a robot.
In the meantime, GM does a profitable business in other parts of the world. Why? Ask yourself that? Why can they compete in other countries but not the USA? The Japs sell the same car against them in other countries, so why do they do so poorly in the USA. Two reasons: The first is perceived quality. GM has sold us such crap for so many years we don’t believe that it is improved to that of the Japs. Second, GM costs are too high compared to their competitors, and they cheeze the car to make profit. That second point only hurts the first one.
If Congress gives them the money it should be with the following caveat: eliminate the UAW, or get major concessions from them. Another option, let GM build cars in another country and import them to the USA.
As angry as I am at GM, Ford, Chrysler, and the UAW, I have decided to speak up for the bridge loan. It is so simple, yet I almost blew it. If these companies suddenly go out of business, we will be forced to buy foreign. Think about that for a minute. Where will all those cars and trucks come from? The US car companies make about four million cars in the USA each year. If their plants are no longer producing, who will build these cars? Easy you say, Japan, Korea, Germany, Italy, Sweden, etc. Well folks, these companies all have their own markets. They would never be able to ramp up to build an extra four million cars overnight.
