Or take the movie unions. More and more movies are being produced in Montreal or South Carolina. Why? Because film companies can hire just enough staff to produce the movie, instead of having to fill every position that the unions say they should have. A 2005 article said that a movie could be made $2 Million cheaper by leaving LA.

If you want to say that it is wrong to lend them money, then that’s fine to have your opinion to that effect. Is is also wrong to give money away to people who have had their homes destroyed in a natural disaster like a hurricane or a tornado?

The government’s role in a disaster is to save people from immidiate danger. It should be up to private groups like the Red Cross and United Way to provide food and shelter for folks.

In fact, by promising (implicitly or explicitly) to provide for a disaster victim’s every need, government encourages people to a)ride out the storm, and b)move to and live in areas prone to flooding.

Hasn’t anybody ever heard the phrase “throwing good money after bad?”

….

I’m red in the face over all the union bashing going on here. The UAW didn’t cause the problems here. People not buying cars did. The insanity of the credit crunch did. The stupid CAFE standards did. Yet those are complex and harder to demonize than the UAW.

UAW workers don’t live like kings. Having a dear friend whose father was a lifelong member taught me that. His parents had a 2-bedroom house in Ohio. They were most definitely not rich.

All the union-busting going on is awful. Auto workers need unions. The Big 3 need unions. Auto workers not in unions need the UAW or their salaries would suffer. So don’t blame industry-wide failure on the workers of that industry. Nothing they did brought this on.

….
Viscount_Bolingbroke on December 19, 2008 at 6:37 PM

I think I understand the resentment. Unions should serve the interest of the worker by protecting that worker from a hazardous work environment. But my impression of unions is that they have created a pervasive atmosphere of entitlement that is unreasonable to sustain. If the business is underperforming, if the revenues are falling, then workers should expect that they may see a drop in pay. I never can understand the concept of a strike. At every job I have ever had, if I refuse to do my job, I lose my job. It’s that simple. I will never understand the kind of entitlement mentality that constitutes a striker who refuses to work, yet assumes that because of the protection of the union that they can keep their job. I don’t get it. And yet I recall a number of times I have read about auto workers who strike outside of the factories, refusing to work. But they are protected from losing their jobs which they refuse to do. In my world, if I’m unsatisfied with a salary, I either can ask for a raise or I can go look for a job someplace else. Why can’t auto workers do that? Is it because they wouldn’t find a higher paying job?

JDPerren on December 19, 2008 at 7:08 PM

You the man, great posts.

Whether the President’s/Not-so-Big-2’s plans succeed or fail is irrelevant. The President’s actions here are immoral. He has no right to use taxpayer money to fund private businesses. That is not what government if for; it is an injustice. It’s true that what they really need is more of a free market, not less. But that argument aside, economic difficulties do not justify robbing even one Peter to pay a single Paul, much less thousands who (at least in part) did it to themselves.

JDPerren on December 19, 2008 at 3:15 PM

This is a good point. As are many others presented here.

GM and Chrysler, with or without the bailout are going to be half their size sometime next year. The firings that they are blackmailing us with are coming, the only difference now, it is on our dime. GM will be closing half its plants and permanently firing the workers. Their pay will be the same as non union plants when it is over or all the plants will be closed. Like all the other bailouts to date the money will accomplish nothing. You cannot put Humpty Dumpty back together, ever.

No amount of lipstick can change GM and Chrysler from the pigs they have been these last 30 years.

Here, watch Fred Thompson as he mocks the stupidity I’m talking about.

http://blip.tv/file/1528079

I do not believe the government should be making billions in health care payments either. Do you think that because the system is less than ideal we should continue to move in the wrong direction?

But my interest is not solely in supporting a philosophy as some abstract ideal applicable only in a perfect world. It has consequences every day, every minute for real people everywhere.

I outlined a few alternatives that would help keep the car companies afloat. I could list literally hundreds and bore everyone here. You seem to be assuming that a Federal loan is the only tool the government has to help resolve a problem which — while we’re being honest let us admit – they had a huge hand in creating in the first place.

No corporate welfare for anyone, for any reason. Not health care providers, not agriculture businesses, not car companies, not investment banks or mortgage lenders. No one. It’s wrong, and it’s impractical. This is not “mere opinion,” it is a conclusion based on long personal experience, depth of study in economics and philosophy, and a fair time spent looking at the history of the past few centuries of the U.S. and elsewhere.

Take the railroads during the 19th century, just as one quick example. Dozens of railroad executives went hat in hand to the Feds and State governments for subsidies, bailouts, and special favors. They misappropriated funds, bribed politicians, misplanned routes, went bankrupt, and generally made a mess of one of the most essential business arenas of the period. J.J. Hill said No Thanks to all government assistance and successfully stayed afloat through several serious downturns. He also helped create jobs, transportation, and several large cities because he took this principled stand and applied his own genius.

It’s not like there is no precedent to guide us here. Look to history.

Why, just as one thing to consider, do you think Ford is not nearly in such a mess as the other two? Philosophy is the most practical thing in the world.

Respectfully,
Jeff

Free market? The US government spends billions of dollars on health care that goes to doctors living in mansions and taking nice vacations in the tropics every year. And yet, they complain that they are barely making it…however, their lifestyles are not sustained by the market alone because average people could not afford to pay those prices.

In a case like this if we really want to talk about the market then be honest. Millions of people could suffer if these companies go under and most of those people are not even in the UAW. And most of the people who are so bound and determined to see these companies fail are more interested in their own philosophy than they are in the real life costs to others.

I think the biggest problem was not even subprime lending or labor costs, it was high energy costs that just bled the economy of capitol. There was no money for cars and mortgage payments and the economy suffered.

Paul_in_NJ on December 19, 2008 at 6:22 PM

If you think sales being down almost 70% over last year has nothing to do with failure, you failed elementary school.

The reason for a Job Bank is so that workers can be found quickly when needed to boost production. It makes financial sense to keep them around even if they are never needed because the cost to find and train a skilled worker outweighs the cost of keeping one handy.

Please think about this issue. Understand that unions are not inherently bad. Union workers are not thieves. They most certainly didn’t cause Detroit’s current troubles.

UAW workers do not make $70 an hour. As far as that is concerned, the people working at Toyota do not make $48 an hour. That includes all their benefits, including health care. My understanding is that this help requires certain concessions on the part of workers.

BTW, how many people include their benefits when they calculate their wage? I know doctors make hundreds of dollars an hour, so do lawyers and so far as I know they will never be required to compete with anyone who makes a dime less than they themselves charge.

NO doubt, some changes need to be made to keep these companies viable, but if they go under now in the present economic climate millions of jobs could be lost. Most people just assume their jobs will not be among them. If and when it is their jobs on the line people tend to have a different view of these things.

I agree that saying Chrysler and GM won’t pay the loans back is speculation, which can be well founded or just arbitrary. But stating that it is immoral is not mere opinion. I know from reading your comments during the election campaign that you do not view moral ideas as “just an opinion”.

By the same token, no I do not believe it was or is appropriate for the government to be engaged in disaster relief. But let us not to get too far afield.

If Bush and others are sincere about wanting to help the American car companies survive, rather than advocating or applauding short-term, pragmatic efforts such as hand-outs of taxpayer funds, they have alternatives. They can advocate that the conditions that put the American car companies at a competitive disadvantage be changed.

They can advocate stripping the UAW and every other union of government backing that has existed since the Wagner Act (actually before, but never mind). They can suggest a two-year suspension of all corporate taxes and capital gains taxes for owners/investors in the GM and Chrysler. That would be less than ideal, but it would be a step in the right direction. They can remove the thousands of regulations that are strangling all businesses, such as Sarbanes-Oxley.

The President, who imagines he is in favor of the free market, can at least push for these things.

Beyond that, one has to wonder why the President believes he has the Constitutional authority to bailout the car companies when the Senate clearly expressed the will of the people, who have consistently opposed all bailouts by a majority.

If you wish to argue that all this is “mere opinion” you are at liberty to do so. But then, on those grounds, every belief beyond a perceptible concrete is “mere opinion” and there would be no point in trying to decide what should or should not be done in any situation.

Respectfully,
Jeff

The truth is that people say they don’t like bailouts, but if that was true the Democrats would not control the Congress and they would not have won in the last election as much as they did. People like for government to be tough with the other guy, but when it comes to voting for their own rep, right now they are voting for the people most likely to extend their unemployment benefits.

Time and again in the last two years I have heard people say that this poll or that poll says people want everything from small government, to enforcement only immigration policies to off shore drilling…but that is not how they are voting.

Bush knows that a Democrat will be taking his place in a few weeks and if those auto industries do not get something now, they will get even more then.

And those folks are taxpayers too.

I’m red in the face over all the union bashing going on here. The UAW didn’t cause the problems here.

Bollocks: they’re a big part of it. If you haven’t learned by now that most of a business’ expense is labor, then you not only flunked Econ 101, you don’t have the knowledge to speak authoritatively on this.

Have you seen the numbers? UAW workers make about $70/hour, or almost twice what workers at the other seven car companies which operate in the US make.

That’s not true of the “job bank” denizens; those poor souls only make 95% of that — for not working at all.

Now are you starting to see the problem?

Not only does it kick the problem into Obama’s lap, but then the Democrats will have to decide, all by themselves, whether they want to explain this impossibly unpopular ‘loan’ to the voters.

Consider this tiny amount in the greater scheme of things. $17.4 billion is not much compared to what has already been spent. This money is going to support an industry which actually makes things, rather than all that previous money which went to – what? Companies which move money about.

I’m red in the face over all the union bashing going on here. The UAW didn’t cause the problems here. People not buying cars did. The insanity of the credit crunch did. The stupid CAFE standards did. Yet those are complex and harder to demonize than the UAW.

UAW workers don’t live like kings. Having a dear friend whose father was a lifelong member taught me that. His parents had a 2-bedroom house in Ohio. They were most definitely not rich.

All the union-busting going on is awful. Auto workers need unions. The Big 3 need unions. Auto workers not in unions need the UAW or their salaries would suffer. So don’t blame industry-wide failure on the workers of that industry. Nothing they did brought this on.

So the President did a good thing today, and makes me glad that I voted for him twice. He’s a good man who wants to do what is right. Those here who denigrate and snipe at him should be ashamed.

Lets watch the Dem’s in action.
First thing they will try and do is pass Card Check. This way they can unionise the southern car plants so that the UAW will not have to make any concessions. They will strike these plants to get them in line. That saves their pay at the American consumers expense.