Procrastination Doesn't Fix It

(or A Long Term Solution for Our Auto Industry)

There is a reason that the U.S. auto companies are bankrupt and it is not just that we are having an economic downturn. That has merely accelerated the crisis. Last week we the taxpayers gave the automakers a one month reprieve in the form of a loan which cost 15 billion dollars. Next month we need leadership to do something that addresses the core problems in the industry as well as look at the economic big picture.

Auto industry problems:

1. Health care costs have been undermining the U.S. auto industry for well over a decade adding substantial overhead to the costs of manufacturing a car.

2. We are in a recession. Car sales are down by 1/3 and are not expected to improve in the near term.

3. The shortsighted choices of product line and more that have contributed to downward spiral of this huge American industry.

Sensible responses:

1. The vast majority of Americans are calling for health care that serves them and does not bankrupt them or the companies they work for. Dozens of other countries provide their citizens with better care at a fraction of the cost of U.S. health care. Time to learn from success.

2. The auto industry has the capacity to build more cars than consumers have the resources to buy for at least a year if not four. What might we do with all that excess capacity? Hmmm, we want to keep autoworkers employed, we want a competitive auto industry and we want clean renewable energy to power our economic recovery. So, why not convert 1/3 of the automakers' industrial capacity to building state-of-the-art wind generation?

You don't need to be an economist, an engineer, or a government leader, to see the common sense in this solution. During World War II the car industry turned into a tank industry. We need to be strategic in solving our economic and energy woes. This is in fact a great opportunity and a far less dramatic adjustment that WWII required.

3. Might be time to consider a change in management.

Like I said I'm basing this on common sense -- I'm pretty sure it is time to tap some of the good old American know-how and entrepreneurial spirit before our cautious, short-term, don't-make-waves solutions send us down the drain.

Comments

[autobailout]

This bailout is so not cool. Who made Bush king and why choose overpaid auto workers when the rest of us are also suffering? Bush doesn't rule. He was elected by us and should act in everyone's benefit, not just a select group.

Protest the bailout at http://www.autoindustrybailout.com/petition/

Peace.

[truthseeker7]

There are a TON of good ideas that can both get people working AND position our society for a better future - HOWEVER, as long as we are purely driven by a personal profit driven system, none of it will happen.

Give the automakers a bunch of money to retrofit to making wind power equipment and the current wind power manufacturers and investors will cry foul. These so-called subsidies will be decried by proponents of solar, clean coal, nuclear, hell, even big oil will whine.

Until we fix our monetary policy and overall economic system, none of these great ideas will go anywhere!

Step 1 - abolish the Federal Reserve and take back the generation of our money supply from the private bankers.

Step 2 - bring in high level technololgists and have open meetings on where we can go and what we can do to both get people working, get america building something again, AND position our country for long-term sustainable growth and not short-term, profit driven greed.

[Teamster]

Question?
if auto plants close as the *plan manufacture states can they reopen .
The labor force wil move .
It is Labor feeds and builds the world.
Monitary gain , Obama , needs be in the individuals hands .
a common sense approach of new growth .
When a worker is idle tax revenu is (0). The treasury fund is built on this revenue .

Capitol and labor are still at odds let us not put away or nullify arbitration and contract.

[mioffe]

Our car industries are relict of previous century.
If our auto industry will follow the best Japanese, or EU companies, they will loose because they will follow yesterday solutions.
The same is true in housing, steel, machine tool, high-speed rail, etc.
Green energy, wind, solar cells powers are disaster for environment, only Al Gore and members of new Gov. can"t understand that. If new Government will follow green recommendation it will be dead end for Economy.
CEO without creativity, who used old ideas, creates bubbles in housing, car industry, banking system etc.
We can"t afford support CEO who creates bubbles in economy.
We need new vision on global warming solutions. We need road without intersection, cart weighting 20 Lb. instead of 4,000 Lb.; small power plants where we can use as electrical as heat energy.
We need more Inventors for 21-century vision.
We need reevaluate almost all our offers, because they are not scientific.

[maab76]

How about retooling the automobile industry to create the shared "roads" of public transit? We need to get to work, to visit, to worship, to play. Our roads are inadequate and crowded in the best of weather to say nothing of the past couple of weeks in our Northern states. Let's make it a true "grid" instead of a hub and spokes to make suburbs and small towns accessible from each other without involving the center of the city near them. Our expressways and tollways are largely elevated or submurged, why can't we do the same for light rail? We don't need to replicate the European rails, but we can learn from their success and their problem-solving processes. Many of the trains and trams have spaces for bicycles and baby carriages. Shopping centers surround the stations. Don't know which came first, but the combination works. One comment from the past 2 weeks around Chicago: enclose the tracks to control the snow and protect the schedules.

[glaze]

Get the podcast of last Saturday's (Dec. 20) 'Car Talk" on NPR, or go to

http://www.cartalk.com/content/rant/gastax/

Besides the humor, you'll find the Brothers Magliozzi have a serious, logical, dare I say BRILLIANT fix for the transportation dilemma.

[DoesItReallyMatter]

I agree that much could be done for the public good with excess industrial capacity. Most people wouldn't think twice about federal programs for massive infrastructure rebuilding using private construction companies, I guess thanks to the WPA. However, at the mere suggestion of utilizing, and even developing home-grown private industry for the common good, and people freeze like deer in head lights! I don't believe it is Communism, or even Socialism but sound industrial policy, the same industrial policies our fellow global "trade" partners have been using against us for over 35yrs. BTY, the domestic Auto companies are not DOA. Although people are on the whole supportive, most seem to be mentally stuck in the distant past, or rather, MYTHS from the distant past! Thanks Ralph Nader, your ghost lives on!

[haroldburbank]

Princeton nobel laureate economist Dr. Paul Krugman told the National Press Club last week that the economy is in depression, not recession, and will get worse unless a major stimulus, of unknown description, is devised. I ran for the US House as a Green in 2008. I campaigned on a concept of an American Hydrogen Authority (AHA!) , to create a new US energy infrastructure based on renewable hydrogen power, to eliminate foriegn energy wars, create millions of green jobs, and reverse climate change. Campaign commenters, including engineers, told me wind power is not viable broad based power, since windmills are very expensive, hard to maintain, and wear out much faster than most people realize, since we do not have the materials and technology otherwise.

The US must get off foreign energy, principally oil, for security and defense cost reasons. Krugman argued we need a major stimulus, over $1 trillion, to get the economy anywhere near back where it was. Given these facts alone, a plan to replace the fossil fuel industry with a publicly built and owned renewable hydrogen energy refinery, distributuion and technology system makes great sense.

Some pundits argue the US should buy GM. This makes sense if Congress could order and control hydrogen energy (not fuel cell) transportation development in the public interest. What better way to explain to future generations that we were sorry for our mistakes, and made the best judgment we could to correct them for a safe, clean, economical energy tomorrow.

[Bonobo]

You might want to do some first person investigation of wind turbine expenses. And where do you think renewable hydrogen comes from, anyhow (at least, for now)? Hydrogen's a bad bet. It has serious pipeline and storage issues (leaks easily, doesn't compress cheaply). Makes a lot more sense just to move electricity around. The hydrogen thing is largely fossil fuel folks trying to muddy the waters.

[Wilburrr]

I'd rather not have a wind turbine that drops its tranny after 50,000 miles, thank you. Oh yeah.... that's long after the doorhandles break and the second alternator is about to fail...

[IslVoter]

You've missed about four "common sense" factors here:

(1) The bond-holders are going to have to give up 70% of the value of their bond debt and accept stock equity for part of it
(2) the stock holders will be screwed by diluted stock
(3) pensions worked earned over 30 years of work will have to be cut in half and equity given for the rest. How many seniors living on $1200 a month do you know who could live on $600 a month tomorrow?
(4) Healthcare costs are a problem in every industry, but the fact the the unions require it for this industry makes it a problem. The rest of American workers have lost their healthcare in pinched businesses (or self-employed).

So, could you get all this done, everyone agreeing, in three months? I know I couldn't.
(5) The UAW will have to agree to substantial pay cuts for other workers, not just their new ones. [Note that I'm not bagging on unions. They should be a shield for American workers to make sure they have healthcare and aren't mistreated, but in this economy, they too must lose before winning.]

Could you get all this done in 3 months?

[Bonobo]

Why three months? Not sure what the point is, here. And is this in support of the auto executives being bailed out? And, I believe the point about health care was to remove the drag on the specific industry by moving it to an economy-of-scale federal program.

[pfrogger]

Dennis Kucinich on Social Security : Aug 1, 2003
Double standard between employers & employees must end

One major theme [in Enron & Global Crossing scandals] - there are two sets of rules; executives get one set of rules and their employees have to play under a different set of rules. Employees have barriers to information, fewer options, more restrictions on investment, and no guaranteed returns. The most egregious disparity is that during a bankruptcy, executive pension plans are totally protected from creditors.

Dennis Kucinich on Principles & Values : Aug 1, 2003
Sacrificed political career to save city utility ownership

Kucinich was elected mayor on a promise that he would not sell off or privatize the beloved and trusted city-owned power system, though Cleveland was deeply in debt. By holding to his campaign promise and putting principle above politics, he lost his re-election bid and his political career was derailed. But today Kucinich stands vindicated for having confronted the Enron of his day, and for saving the municipal power company.

Stop corporate welfare
http://www.ontheissues.org/News_Corporate_Welfare.htm

[pfrogger]

Please read this and pass it on, open your eyes
1. http://www.truthdig.com/report/item/20081215_rep_dennis_kucinich_on_his_battle_with_the_banks/
Titled: Rep. Dennis Kucinich on His Battle With the Banks

2. http://business.timesonline.co.uk/tol/business/industry_sectors/construction_and_property/article3422322.ece
Titled: Cleveland: ghost town created by America"s loan scandal

"Cleveland"s mayor Frank Jackson knows who to blame: Wall Street. The mayor"s office is suing some of the world"s biggest banks. including Citigroup, Goldman Sachs, HSBC and Royal Bank of Scotland"s Greenwich Capital, claiming they acted like organised criminals financing the sale of products that they knew could do nothing but harm to Cleveland. Sub-prime mortgages have proved as bad as drugs in the destruction they have wrought on the community, he said."
They just want money and power. They don't care what happens to people.

[pfrogger]

the #2 solution is pure genius
it makes so much sense that it should be presented to Obama ASAP
put unemployed Americans to work making renewable energy sources for America's future

America first, American people first, not American companies
no matter what happens, renewable energy should be free for all Americans
we pay taxes, we can put tax money into wind power and solar,
why would be then turn around, hand it to some greedy corporate type who will then charge us for this renewable energy that we paid for

it's not completely free, there would of course have to be rules, such as max usage per household and such but there is no reason we should pay for renewable energy for basic and daily usage

American people first, all the corporate types who have been reaping the rewards of the common man can find somewhere else to roost
And please don't tell me government can't efficiently handle this, American corporate greed has shown repeatedly they don't care about people, only money and power

[allwrite]

How about a top to bottom review of our national transportation system, with the objective of reducing costs, planning for a sustainable energy future, and increasing efficiencies? If all costs associated with the auto are factored in, including road building and maintenance, the auto is a poor choice as a primary transport device. Need to get rail into the mix. Autos for local travel only.

[maab76]

Let's get going on this. The idea and the resources are to valuable to disregard!

[TankerRat]

I just bought a 2009 GMC Acadia. I couldn't be happier with it. I've NEVER owned a foreign car and WON"T buy one either. GM makes excellent products. So does Ford,and so does Chrysler. You want to help? Buy AMERICAN instead of a rice burner. I agree that the automakers have been lax, even lazy, and need a good swift kick in the a** but until this society stops putting MONEY ahead of everything else nothing is going to change. As for health care? We've already gotten all were going to get from these worker serfs so who cares? Right????????????? I do!!!! That's who!!!!

[SteveDenver]

U.S. cars are looking better and better, but not when parked side-by-side with imports. Longevity is a terrible issue with domestic cars.

There's a waiting list for small hybrids, i.e. Prius. Detroit's answer? A hybrid Escalade. That's like serving Big Macs at an Iron Chef competition.

Let the car companies collapse, pump the billions into unemployment and school benefits. Straighten out national health care. Many line workers make expert wages for manual labor, time to wake up.

[Wilburrr]

Those car companies have made record profits with high paid workers.... why are line workers the problem all of a sudden?

[Wilburrr]

My Toyota Tacoma was made in California and with 104,000 miles I've only had to perform routine maintenance; I still think of the truck as "new." I used to buy Chevy and Ford products, but they are now made in other countries. When my last Chevy S-10 Blazer had 98,000 miles, the doorhandles had broken, the A/C compressor had failed, the antilock braking system had gone south, I was on my 3rd alternator, 2nd starter motor, and 2nd radiator. That is not a fault of the UAW, that is the fault of cheap design and engineering. I also don't want to have to go back to trying to find parts for automobiles manufactured by bankrupt companies. I did enough of that in college.

Why are auto companies asking for more money than their float? Geez - even if we go back a few years...

[TankerRat]

And I owned a 96 Pontiac Grand AM that had 383K on it when we finally retired it. It still ran very well. All it ever needed was routine care which the VAST majority of people DON'T give a car. Then they wonder WHY it breaks down. BTW- We still have a 2003 Pontiac Bonneville which has been given the proper care. It runs like a fine watch at 120K and counting. Detroit's cars are every bit as good as any rice burner. Made in California or elsewhere.

[POdArch]

makes too much sense...the right will block it. If we had any sense we would look at the challenge the way we looked at World War II...and convert ALL of our unused factory space to this stuff. Hell we whipped the Germans in just a few years...we could whip the Arabs and Big Oil just as quick.