Auto bailout showdown: Lansing mayor versus guy who predicted the financial crisis
posted at 4:36 pm on December 8, 2008 by Allahpundit
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Yeah, that guy — Peter Schiff, former Paul advisor, current YouTube heartthrob, and seer of the economic End Times. Pelosi’s set to announce the Democrats’ bailout plan at a presser any minute now; to tide you over while we wait, here’s Schiff enduring 13 minutes of pure demagoguery from a guy who, near as I can tell, thinks companies exist for the sole purpose of providing lucrative makework for his constituents. And if you disagree, you’re unpatriotic. Or something.
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well… that was fun.
thecollegepolitico on December 8, 2008 at 4:41 PM
Can’t wait to go home and watch it. Or something.
Mr_Magoo on December 8, 2008 at 4:44 PM
i’m sick and tiured of youy folkks referring to schiff as “the guy who predicted” the financial meltdown.
that’s bs.
the cause was fannie mae and bush and greenspan and snow and mccain and even hagel ALL said that if fannie mae was left outta control it would cause a financial meltdown.
reliapundit on December 8, 2008 at 4:46 PM
Progress?
2000 yrs ago, three wise men sought to bring gifts to King Jesus.
Now, three unwise CEOs are seeking to get gifts from King Obama.
jgapinoy on December 8, 2008 at 4:46 PM
I say let them go bust, as Schiff says they are not viable but don’t just take his word for it, take it from someone like me that had been a “Chevy Man” all of my life. I have never bought anything but American Made Chevy’s, including a Chevy Colorado I bought new in 2004.
However, that’s where my “love affair” with American made cars (and Chevy) ended! Within the first two years of owning my new Colorado the air conditioning adjustment knob (to increase/decrease airflow) stopped working in all positions but “high” the CD player stopped working and ate one of my CD’s, the entire tread belt delaminated on the rear right Continental tire while I was driving on the highway (at 65 mph) and it caused $2000 in damage.
When I took my truck back to the dealer after the tire failed and damaged my truck I was told there was nothing they (the dealer that sold me the car) could do and I had to deal with the tire manufacturer directly because the tire was a “normal wear” item.
I had to get two estimates, take several photos, fill out 10 pages of paper work and send it to Continental directly, in all it took me a lot of work and 6 months to get my money from them!
While Continental paid for the damage to my truck they would only pay for the one tire that failed and wouldn’t pay for the other three tires I had purchased because the tires I purchased were not Continental’s to which I replied “did you expect me to put Continental tires back on my truck considering what happened andd and how dangerous that type of failure was, do you think I’m suicidal?” but they wouldn’t budge and so I got stuck shelling out $300 for tires that I shouldn’t have needed for a truck that was only two years old! But again there was no way I was putting Continental tires back on my truck!
Bottom line is while the drive train on the Chevy Colorado I bought was fine and I’m sure would have lasted many years it was the rest of the vehicle that worried me, in fact I don’t think I would of had much of a car left around me after 10 years the way it was already falling apart within the first two years!
It was bad enough I could have been killed had that tire failed while I was driving on a windy mountain road, but the fact I had to deal directly with Continental despite my truck still being under warranty was unforgiveable and I should have not had to do anything, Chevy should have repaired the damage to my truck, replaced all of the tires, and dealt with Continental directly to get their money back. I decided at that moment to never buy a Chevy or an American car ever again!
The “Big 3″ obviously don’t stand behing their cars nor do they stand behind the customers that buy their cars, so why should I stand behind the Big 3 by giving them my hard earned tax dollars to bail their sorry arses out?!?!?!
I say no way to a bailout and good riddance to the Big 3!
Liberty or Death on December 8, 2008 at 4:47 PM
I’m not exactly sold that schiff predicted it exactly as it happened, he has been predicting doom for years. Actually if you took his investment advice this year you would be down about as much as the Market overall is. Gold is down, which he was saying to buy back in early summer when it was $1k/ounce, while also predicting massive Inflation for Fall 2008(which we’ve had Deflation instead).
Find someone who pointed out in the past that Deriviative contracts specifically would cause the house of cards to fall down, predicting what has happened or appears to be happening.
jp on December 8, 2008 at 4:47 PM
That is priceless!! Merry Christmas
Child In Time on December 8, 2008 at 4:49 PM
thats the root of it, which its congress fault of course. However $250 Billion in defaulted mortgages wouldn’t bring down all these Financial Institutions that had to be bailed out.
Its all about the way they Securtized them. i.e. Credit Default Swaps for example, and these happen to be Un-Regulated contracts which apparently virtually everyone didn’t understand how they would work in a sitution like what has occurred.
although Warren Buffet did refer to them as “Weapons of Mass Financial Destruction”.
jp on December 8, 2008 at 4:50 PM
I predict the stock market is going to go down. then up. then down. then up. etc.
rbj on December 8, 2008 at 4:51 PM
bailing out the Auto companies is pointless unless they get rid of the Parasites/Cancer sucking them dry. Of course I mean UAW, if something isn’t done about them than all this Bailout does is punt GM/Ford going bankrupt down the road several years.
Corporate/Union Welfare is all this really is. If the media was worth a crap, they’d be doing stories in Southern states at Toyota, Nissan, BMW, Mercerdes plants where Auto workers are doing just fine.
jp on December 8, 2008 at 4:52 PM
Would you believe that my beloved Lansing mayor, Virg Benero has a reputation as a hot head? His screaming matches w/ the city council are stuff of legend. Either way, he’s just a GM/UAW shill, not to mention just plain wrong.
Daft Punk on December 8, 2008 at 4:59 PM
advocating for all the Financial Institutions going bankrupt at basically the same time is also Insane. Look, I love the free market, however I’ll take a pragmatic version that recognizes the world is not a perfect place over Martial Law and probable chaos. Look what happened in New Orleans after Katrina or Earthquakes in L.A., Imagine that on a national scale when companies quit making payroll suddenly, CC and Debit Cards quit working and the fact 99% of Americans don’t farm their own food.
jp on December 8, 2008 at 4:59 PM
This bailout seems dumb to me
As I see it, the big3 were on the way to working through the union and pension issues when:
1 – first the new CAFE standards threatened to put them out of business; and,
2 – the Fannie/Freddie credit meltdown affected their ability to make money on financing.
The underlying problem all three face is that Americans who want small cars assume Detroit can’t make good ones, and Democrats who don’t want other Americans to have big cars don’t want Detroit to make the vehicles their customers want to buy.
All of these problems are more caused by Congress than by the executives in Detroit – so I think Congress should wear the horns on it – and that means:
1 – no monetary bailout for the big3;
2 – retraction of the CAFE standards instead;
3 – strong FHA efforts to buy mortgage risk (not mortgages); and,
4 – prosecution of those responsible for the credit meltdown – dodds, Obama, and Frank to start with.
Paul Murphy on December 8, 2008 at 5:01 PM
+1
abinitioadinfinitum on December 8, 2008 at 5:02 PM
In some sense, the pensions and health insurance promises (which are the bulk of the per-worker costs now) were a loan of unknown interest rate that was never really recorded correctly on the balance sheet.
Count to 10 on December 8, 2008 at 5:03 PM
If you can’t get youtube at work:
http://www.europac.net/Schiff-CNN-12-4-08_lg_FLV.asp
Theworldisnotenough on December 8, 2008 at 5:05 PM
Ha! That headline is sublime.
Beatnik Joe on December 8, 2008 at 5:10 PM
Bailing out the big three is like rearranging the deck chairs on the Titanic. The ship is going to go down anyway.
My collie says:
CyberCipher on December 8, 2008 at 5:11 PM
“thats the root of it, which its congress fault of course”
Exactly…..YOUR ELECTED REPRESENTATIVES have caused this crisis. They are IDIOTS. There is no way private business can cause the destruction a handful of willful, arrogant, isolated government perverts can cause. No private business is big enough.
All of the vituperation heaped on CEO’s. It’s ludicrous. They are supposed to do make as much money as they can for their companies. But your elected representatives are supposed to look out for YOU, not deliberately roll the dice to satisfy their personal whims.
So what does the country do. Re-elect the fools.
When I see the disgusting, drooling, pervert Barney Franks appear on TV, click. I’d LOVE to meet him face to face.
notagool on December 8, 2008 at 5:11 PM
We all know the Democrats are bailing out the UAW. What has to burn is all the other unions that aren’t getting a bailout. SEIU, AFCSME, etc they are going to take it in the teeth with all the state budgets that are going to have to be cut. I’m sure the Dems will make it up with cardcheck.
Theworldisnotenough on December 8, 2008 at 5:12 PM
What is it about Michigan? They elect people that chase businesses out of the state and wonder why they have the worst economy in the nation?
Theworldisnotenough on December 8, 2008 at 5:14 PM
Since the American public has no sway over their politicians anymore why can’t we expedite the demise of the big three so that at least they won’t be in a position to beg for more of our money next March. Cuz, you know that is coming.
Start groups, hold townhalls, anything to get people to promise not to buy a Ford, GM or Chrysler. If the market isn’t there these companies fail and we can move on. I know it sounds cruel but the alternative is even crueler. They get their money and still shutdown plants and you’ll have rioters and idiots like the people holed up in the Republic factory in Chicago.
grdred944 on December 8, 2008 at 5:16 PM
FYI – Chevy is sponsoring “Hot Planet” on Discovery tonight, featuring none other than Jumpin’ Jim Hansen. If GM has enough money to sponsor BS propaganda in their current state, then they surely don’t need my help. In fact, it would appear that they are a little truth challenged all the way around. Here’s a clue – like Liberty above, I’m a Chevy man. I drive an S-10 ZR2 4×4 which I like, and the missus has a Trailblazer that we really enjoy so far. NO MORE. We looked at Hyundais and Subarus, and if these nimrods get bailed out that is ALL we will look at in the future.
PS… non-union Hyundai employees in Alabama say they LOVE the company.
rhodeymark on December 8, 2008 at 5:20 PM
Take the union workers “sitting in” in Illinois as an example of the mentality that is infecting this country. These union workers get laid off and their first instinct is not to run out and find another job, but rather to whine and fuss and ask for assistance from the government. This is a destructive (lazy) approach, and will only encourage more “bailouts” and less self-reliance.
But then again, they’re good little socialists, aren’t they?
dugan on December 8, 2008 at 5:24 PM
I have been hearing on the news, all day, that 1 in 10 mortgages have late payments or are in foreclosure. How in the world is 10% bringing down the world? Doesn’t that mean that 90% of the mortgages are being paid? How does that compare to “normal” times? Also they report that some of the people who were able to refinance their mortgages are back in the same situation of being unable to make the new payments six months later. All of this is crazy.
Cindy Munford on December 8, 2008 at 5:26 PM
Re Schiff, this is true:
I had exposure to foreign ETFs (something he deals in) and they tanked hard, but still feel that eventually he will be very right about metals. His forecast window is off, but his reasoning is sound.
rhodeymark on December 8, 2008 at 5:26 PM
Who is this loudmouth dingbat saying the government should dictate to the auto manufacturers that they should make only electric cars?
Schiff may or may not be a sage, but everything he says here is right on target. The Lansing mayor is a complete dolt.
greggriffith on December 8, 2008 at 5:27 PM
Yeah, and I predict that the MSM will blame W, credit O!, blame W, credit O!, etc.
/sarc
Y-not on December 8, 2008 at 5:31 PM
I am intrigued by your theories and would like to subscribe to your newsletter.
grdred944 on December 8, 2008 at 5:31 PM
Nobody really need worry about these bailouts but the Chinese. They, after all, are the ones paying for them. As long as foreigners are willing to subsidize our idiocy and lifestyle, let them. When they pull the plug, the discussion will then be mute. So this problem fixes itself.
keep the change on December 8, 2008 at 5:36 PM
Can’t bear to watch the clips, The Lansing Mayor is a lugnut.
Tim Zank on December 8, 2008 at 5:37 PM
This guy is rolling over in his grave as we go full cicle today: December 8th
1861: William Crapo Durant, founder of General Motors, was born on this date, in Boston. Starting in the carriage industry in the 1880s, he began making Buicks in 1903. He brought in several auto makers in 1908 to form General Motors, but he lost control in 1910. Then, with Louis Chevrolet, he founded the Chevrolet Motor company in 1915, and then retook control of GM. He lost control again in 1920, and then formed Durant Motors. By the time he died in 1947, GM had become the dominant U.S. car company under his replacement, Alfred Sloan.
patrick neid on December 8, 2008 at 5:42 PM
CNN Anchor: Let me just say this – All big three CEOs are working for a dollar a year.
Peter Schiff: They’re overpaid.
Me: (LOL)
TightAggressive on December 8, 2008 at 5:44 PM
In “normal” times the default rate for mortgages is around 1-2%. So now things are anywhere from 5 to 10 times worse than “normal”.
The entire financial system runs on margins. So when something happens that is 5-10X different than what was expected, it is magnified exponentially. It’s like when you a buy a house with 10% down. If the value of the house drops 10%, you lose 100% of you investment. So even though 90% are OK, that 10% that isn’t has a lot of more influence than just 10%
angryed on December 8, 2008 at 5:48 PM
Did you notice that the loud-mouthed moderator stuck her two cents in about why Washington should decide manufacturing goals? So, she thinks that all manufacturers should scrap their industries and produce electric cars. How out of touch is she?
onlineanalyst on December 8, 2008 at 5:52 PM
She works for CNN. How do you think she got that job?
macncheez on December 8, 2008 at 6:02 PM
When the automakers first revealed their plan, Barney Frank was skeptical at first. Then he heard about the new technology for vibrating heated seats and he quickly garnered the votes necessary to approve the loan.
Goodale on December 8, 2008 at 6:17 PM
I will never buy a vehicle from one of these 3 again. They can go bankrupt later, instead of doing it now and restructuring and getting on with business. The argument that no one will buy a vehicle from a company in bankruptcy is absurd. I think that if these 3 do it now, that will signal an effort of honesty of trying to fix their problems and I think people would see and understand that and support them. Now, no way ho-say.
cjs1943 on December 8, 2008 at 6:19 PM
I didn’t know Chakka from “Land of the Lost” had a financial television show.
MikeZero on December 8, 2008 at 6:29 PM
” How in the world is 10% bringing down the world”
It isn’t. It’s being used as the trigger by socialists to undermine the free market. There is LOTS of market manipulation going on along with this, and LOTS of media manipulation at the same time.
And it is HIGHLY unlikely that 10% of mortgages are in default or close to it.
But with the drumbeat of negative news, and the crazy government interventions, they may get the country there, or worse.
Do you think the Socialist / Communist Obama will mind if unemployment goes over 10% and defaults go over 10%. He would LOVE it. He gets to play god and the blessing for the country is socialism.
notagool on December 8, 2008 at 6:30 PM
Ouch. Schiff just ate the Mayor’s lunch. Within the first minute of debate it was something akin to a fight between Pee Wee Herman and Mike Tyson.
batter on December 8, 2008 at 6:47 PM
Let buyers bail out companies the old-fashioned way… by purchasing their worthwhile products… or let the companies fail.
It’s called capitalism.
Otherwise known as free enterprise.
profitsbeard on December 8, 2008 at 7:11 PM
So you think people who bought houses fro $700K on a $50K salary are magically paying the mortgage? Jeez, everything is a conspiracy theory now.
angryed on December 8, 2008 at 7:19 PM
So, GM, Ford & Chrysler are responsible for the poor customer service of a German tire company. You admit that mechanically there was nothing wrong with your truck but you believe that a faulty switch and an eaten cd are indicators that mechanical components will start to fail.
This is pointless. I’m beginning to think that the 9/11 troofers are symptomatic of other Americans. Urban legends, myths, conspiracy theories. You guys will believe anything as long as it confirms your biases.
As for Peter Schiff, I’d be willing to bet that the mayor of Lansing knows more about manufacturing than Schiff does. Schiff has never made a damn thing in his life. He’s just another stock broker taking a percentage whether the market goes up or down. When Schiff has run a manufacturing business instead of making money from paper shuffling, he can lecture others about being overpaid.
I wonder, when Euro Pacific Capital account holders’ portfolios go down in value, does Schiff refund their commissions?
rokemronnie on December 8, 2008 at 7:20 PM
This idiot has been flapping his yap for a week now and I, as a Michiganian am pretty fed up with it. Because of his party’s governor,Jenny Granholm, and the way she has taxed this state into oblivion, Lansing is suffering. Wah, Wah, Wah!
It’s about time that the Democrats in this state wake up and realize that they are the ones responsible for ruining our economy and their policies have been the ones that have driving business out of the state and their alliance with the unions have succeeded in doing what the Japanese weren’t able to do and that is bring the Big 3 to their knees. The unions blame every one else but themselves for this debacle. No one should be paid $40 an hour to put a lug nut on a wheel. Other car companies have come and gone and probably if Chrysler had been left to go out of business years ago, the industry would be better today. This argument that Granholm has been going around spouting off that if the Big 3 go bankrupt that no one will buy one of their cars because they won’t be able to get parts. Anyone ever hear of After-market parts? NAPA, etc……
If one of the Big 3 goes under, that means the share of the market for the other 2 gets bigger. That’s capitalism at it’s best. And by the way, how many times has The Donald gone bankrupt?
flytier on December 8, 2008 at 7:46 PM
Here is an article explaining how the banking industry fed, nurtured and rode the tiger that ate them. It’s long but it’s a nice read.
DFCtomm on December 8, 2008 at 7:53 PM
Thanks to banking magic that 10% was multiplied many times over. They had a market for these bonds, and couldn’t find enough people, even unqualified ones, to create all they needed, so they came up with yet another slight of hand to “clone” these bonds, and that cloning process is what created this mess.
DFCtomm on December 8, 2008 at 8:00 PM
I read Schiff’s book (the older one.. “Crash Proof”) a few weeks ago. I wish I’d read it this time last year, because I would have moved my company 401k into the money market and saved myself almost half my retirement (actually I would still have it and would be able to transfer it back into funds and buy twice as much or more). Ugh.
He’s right on this btw, but Congress will do what it did last time and sink us further into debt. They continue listening to Paulson and Bernanke as if they had nothing to do with this meltdown. Ha.
popularpeoplesfront on December 8, 2008 at 8:21 PM
I read Schiff’s book “Crash Proof”. Basically, over the next 5-20 years, the dollar will continue its slide and inflation WILL happen. The facts are all there.
The question is how long can foreigners keep lending us what we want when we float those dollars out there. That combined with large federal deficits and a maniacal FedRes pumping mounds of money into the system. At some point, probably when the worldwide economy starts to come back, the US will experience inflation as energy prices creep back up, and the huge amounts of newly waved into existence money chase the same goods and China and Japan start to show some reluctance in taking dollars. Watch what happens to the dollar when a higher percentage of oil sales happen in some other currency.
The short term strength of the dollar is just that: short-term due to a temporary flight to cash from stocks and other investments. That cash is in USD for now but over the next generation, the dollar has nowhere to go but down.
Anybody want to lay down $1,000 in a bet with me? I predict that $1,000 today in gold will be worth less in 10 years in gold.
Sapwolf on December 8, 2008 at 9:39 PM
With all due respect, you, sir,are an idiot.
A classic example of people who don’t know what they’re talking about.
You think NAPA makes parts? Aftermarket parts are often made by OEM suppliers. NAPA buys them from those same suppliers. They just put them in a different box. Of course the fact that there are no aftermarket dashboards, instrument panels or other interior parts is lost on you. Can you buy a transmission at NAPA? New engine blocks? Heads? Or shall we start building new cars with rebuilt engines and transmissions?
Why do you think Ford, which doesn’t need an immediate injection of funds, supports a bailout? One would think, based on your logic, that Ford would eagerly anticipate the demise of GM so they could gain market share. Ford knows that if GM is liquidated, the damage to the supply chain will be so severe as to make Ford’s own production damn near impossible.
I’m no fan of Granholm and the Dems notion of taxing ourselves to prosperity and I realize the Dems and the UAW are convenient excuses for you to dump on the automakers, but your comments are laughable.
I see all sort of nonsense, bullshit really. Things like calling the UAW “commies”, completely ignorant of the history of the US labor movement and how Walter Reuther and others in the UAW were fierce anti-communists who fought tooth and nail to keep socialist and communist influence out of their unions.
But hey, while you’re whining and bitching about the UAW, don’t pay any attention to the public employees in the SEIU who are picking all of our pockets.
Lawyers and public employees are far more damaging to the US economy than the UAW or the inept BOD of GM.
rokemronnie on December 8, 2008 at 9:42 PM
Do you think your mayor realizes how much he is hurting the workers’ cause when he appears on TV? I have sympathy for the workers (not the Union itself) but Mayor Benero is repulsive! I expect he is causing whatever support that does exist outside the Rust Belt to evaporate.
Red State State of Mind on December 8, 2008 at 9:46 PM
As long as China and Japan keep lending us the money for consumption, we can keep the scheme going for awhile, but at some point it will have to trigger inflation so the government can pay it back with devalued dollars.
The Chinese are our friends. :)
Sapwolf on December 8, 2008 at 9:48 PM
The above link is the single best summary of what happened on Wall Street that I have come across. Do yourself a favor and read it. It is by Michael Lewis who I like a great deal.
Charles Martel on December 8, 2008 at 9:49 PM
Virg Bernero is a moron thug, incompetent as all hell and arrogant like you cannot believe.
benrand on December 8, 2008 at 9:50 PM
Oops. Link didn’t come through. Here it is:
Michael Lewis’ “End of Wall Street’s Boom”
Charles Martel on December 8, 2008 at 9:50 PM
I laughed out loud. He was right on. My ex-wife’s family was a GM family. What an entitlement mentality. The UAW was good, and management bad.
I hate southeast MI with a passion, except the ex and my boy. His Catholic grammar school is an oasis amongst the desolation.
Sapwolf on December 8, 2008 at 9:55 PM
Virg Bernero cannot run a municipal golf course.
I am not joking, two fo them here have been shuttered, left to rot…and I have a feeling he did it for kickback reasons. One of them is right next to campus, with a nice spot for more student housing.
He is a slimebag of the highest order.
benrand on December 8, 2008 at 9:56 PM
I had never even seen or heard of him before. But, I sure as heck thought he was some union/mob thug by his looks, mannerisms. You just confirmed it. Hope he doesn’t read HA and send one his ‘boys’ down here to convince me to unionize without a secret ballot.
Sapwolf on December 8, 2008 at 9:58 PM
Those of you that are thinking of trying some of Schiff’s strategies have to remember one thing: He is not short-term, but thinking medium to long term.
Don’t use his writings to in effect day trade between gold, USD, foreign stocks, etc. You will lose money trying to time it perfect just like stocks.
Phase in an amount each month over the next 12-24 months out of USD investments. Then watch as the dollar continues its long-term slide and you are more protected in your buying power.
Sapwolf on December 8, 2008 at 10:03 PM
I’m tired of this Michigan people. That state is turning into some sort of mythical Americana place. Don’t people realize how corrupt is it for an elected official, an employee of the government, to be openly advocating for the welfare of specific private companies? Doesn’t he understand even the most basic principles of public employment and ethics? This guy should be in jail, not on TV.
Baphomet on December 8, 2008 at 10:30 PM
If you don’t agree with socialism and businesses that volunteer to submit to fascism then simply use your dollar vote.
Don’t buy any “American” cars. Hell, even if you don’t care about any of this stuff, you’ll get more from your money with a Japanese or German car – and it’s easy to find one made right here in the late great USA.
Dorvillian on December 8, 2008 at 10:33 PM
You’re an idiot.
nazo311 on December 8, 2008 at 10:36 PM
Ha! It’s my Mayor! LANSING QUAKERS!
I wish I would have known about this and called in. I voted for Virg when he was up for Mayor, but he’s such a blowhard.
I would have NAILED him over GM and the EV1. GM had the first all-electric car — the EV1 — and it was manufactured IN LANSING, MICHIGAN! If GM had stuck with the EV1, they could have come out as the preeminent “green car” producer. Instead they went and pushed light trucks and SUVs, said the EV1 was a market failure (while never giving it a chance or even a small market share), and lost the “green” wars to Toyota and the Prius.
And now? GM is reducing its Lansing workforce. Oldsmobile is gone. So how the hell is bailing out GM “good” for the Lansing economy? They’re putting all of their poker chips on the Volt, when they had the freakin’ EV1 as it was! And it was LANSING made!
Ugh. His whole line of argument is so irritating.
lansing quaker on December 8, 2008 at 10:38 PM
This is a union boss bail out and nothing more. The UAW made this bed. Let them lie in it. There’s plenty of work available at the NON-union car plants in other states. Welcome to reality union bosses.
Mojave Mark on December 8, 2008 at 11:10 PM
I watched this a few hours ago and then waited before commenting because I still can’t believe what Bernero said. He said – essentially – that even though the big three were not competitive because they are producing crap at least all those people have jobs with health insurance and benefits instead of being unemployed and on the street. So. All we have to do is throw up a butt load of crap factories, smack the entire jobless population in them, and keep throwing money at them from the tax payers who are left still producing marketable products. At some point, of course, the US will run out of people making an actual living in companies making a profit and products people want to buy and we will all be working at crap factories making stuff no one wants but they have to buy because it’s the patriotic thing to do – and there’s nothing else competing for business.
.
This all sounds so familiar to me somehow. Anyone? Anone?
.
Oh yes! The Soviet Union just before the fall.
.
If we allow electric light to be manufactured the candle makers will go out of business and because the candle makers employ so many people we can’t allow them to go out of business so the electric light? Ain’t happening.
BrideOfRove on December 8, 2008 at 11:18 PM
More bullshit. BMW is offering employees buyouts at their South Carolina plant that builds SUVs and sports cars. Mercedes is laying people off at Senator Shelby’s, R. Mercedes/Hyundai/Toyota/Honda, favorite SUV builder. Hyundai has cut production in Alabama, as has Honda. Apparently Detroit wasn’t the only one hitching their wagon to the SUV bubble.
If I had a dollar for every piece of arrant nonsense I’ve seen concerning the auto industry I could afford a Ferrari – another company, btw, that must be as stupidly run as the Detroit automakers since it just laid off 10% of its workforce after seeing sales decline about 85%. I guess that’s the UAW and Rick Wagoner’s fault too.
rokemronnie on December 8, 2008 at 11:28 PM
But those companies CAN lay off workers in a way that keeps the company running until better times and a more timely product. They aren’t in DC asking for a bailout from the tax payers. Corporations that old should not be this vulnerable to market conditions.
BrideOfRove on December 9, 2008 at 7:17 AM
Funny…I went to college with Virgil Benero. I knew he was destined for politics.
ConMom on December 9, 2008 at 7:40 AM
I look forward to seeing you on CNN, oh wise one!
hawksruleva on December 9, 2008 at 9:04 AM
Great point. Americans have already voted on the bailout, by not buying more of the “detroit” cars.
I’m really surprised that companies haven’t noticed the effect that begging, literally BEGGING for money has on thier stock price. If you’re looking to invest, GM looks like a really bad buy. Ford, meanwhile, is looking better and better. At this point they’re saying “we don’t need a loan, but please help our sick, inept poor-planning brethren”.
hawksruleva on December 9, 2008 at 9:09 AM
Ahh, yes, if only they had sold a car that no one wanted, they would be sitting pretty right now. Those dummies.
xblade on December 9, 2008 at 12:42 PM
All hail the widsom of our newest wiseman, rbj.
HAIL.
/which reminds me one of the Men In Black II scene.
Sir Napsalot on December 9, 2008 at 2:36 PM
It is called re-tooling. Which IS exactly how any viable company should be running.
Those companies have competent market analysts and management, given the directions of which way the wind blows, they know when/how to adjust.
They may have shut down some part of their manufacturing for un-popular models (incidnetally, unprofitable) this year. Next year when they roll out newer and better models that consumers want, you can bet those workers will be back in the assembly line.
None of the Big3 and union bosses know any of that. Instead, they RELY ON consumers’ incredible loyalty and being ‘American made’ for the past several years.
Sir Napsalot on December 9, 2008 at 2:59 PM
Yea… that’s the ticket! Let’s tell these companies to all make electric cars. Let’s tell the executives how much they can make. Let’s just have the government own them all and tell them all how to get the job done. Screw the cowbell, what we need is a little more communism!!
Sultry Beauty on December 9, 2008 at 7:04 PM
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