3 posts tagged “cars”
There has been a lot of talk recently about a possible bail-out of the big three Detroit automakers. There are a lot of reasons for and against helping them out, but I'd have to say, it sure seems like the pro-bailout argument wins.
First, I'm actually glad that the republicans and still-president Bush are blocking a bailout right now. It seems to me that the CEO's of the big three are really pushing to get a deal now because they think that they'll be able to get an easier time from the republicans. It sure seems that way. Though Bush is standing on his lame free-market orthodoxy in public, I think a lot of the reasons why the republicans are against this is based on politics. They hate unions. Practically the only powerful union left in the country is the UAW. If the big three go under, well then, the union is dead. So these guys would rather watch a million jobs go down the tubes for their political gain, than do something to help. That, my friends, is the Rove way. Can you say "Katrina"? I knew you could.
Now, as far as I'm concerned, I don't mind that the republicans are blocking this right now. I'd be fairly surprised if GM goes under in the next two months. By February, we'll have Obama (can it be true???) as the President, and a Democratic congress. They will actually pass some legislation to help Detroit. It honestly doesn't make much sense not to. If Detroit goes under, all those jobs die. Not only the people who work directly for them, but all of the suppliers of parts. What little is left of our manufacturing base in this country will die with them. Sure, Toyota and Honda have US factories... but they are in the South, with no unions, low pay, and little benefits. They use some US parts, but have a lot more imported parts in their cars.
Just for the record, I do not own an American car. I'm not crazy. Let's just say that Detroit made its own bed here. They have made crappy cars that pale in comparison to the Japanese for about 30 years. I've had my share of American disappointments - mostly Fords.
However, I think that with the right leadership, this is a golden opportunity. I'm sure Obama's team is working on the details right now. How about predicating any bailout on Detroit getting its house in order? Forcing them to give up fighting against fuel economy standards? Forcing them to give up fighting against a national health care plan? Essentially forcing them to give up their stances that, while in line with their executives' political predilictions, were disasterous for their companies.
Let's face it, one of the big problems that Detroit has faced is that they have huge "legacy costs". That is, they have to pay tons of money out for the retirement benefits for their retired employees. They fought against the Clinton health plan. How much would passage of that 15 years ago have saved them in health insurance costs? Detroit has also fought tooth and nail against raising fuel economy standards so they could focus on building huge SUV's. How's that worked out for them? They made huge profits on those dinosaurs, but what did they do with the money? This was a huge failure of leadership. While Toyota plowed a billion dollars into development of the Prius... GM dumped a billion into development of the Hummer brand. Explain to me why the GM executives still have jobs...
So basically, Obama will have a choice. Spend billions to prop up the big three, or spend more billions in unemployment benefits, social services, and support for the great lakes states which will implode if Detroit goes under. It is kind of a no-brainer. However, with Detroit on the ropes, it will be the prime time to strike a tough bargain. They get US help, if they give us something in return. What will Obama ask for? We'll see in two months!
Is your car a piece of crap? Did you pay less than $500 for it? Well then, you will qualifiy for the 24 hours of LeMons...
http://www.24hoursoflemons.com/id1.html
Now, to scour craigslist for a $500 car...
While we are busy building Hummers and Escalanches which get somewhere around 8 MPG... The Canadians are busy building vehicles which get 3,145 MPG. No seriously. 3,145 MPG. Last year they only got 1,600 MPG, so by following that improvement curve, in a few years, a teaspoon of used french fry grease will allow us to drive to Mars.
