#1. Breaking the Unions who normally vote for and support Democrats #2. Bringing jobs to the Red States at the expense of the Blue States
The real reason that there is a debate about whether the US Government should save the largest single entity in the US business world is that the Republican party wants to win back the White House in 2012 and doesn't care how they do it.
If the Big 3 are helped by the Federal government, 3 million jobs may be saved and many billions of dollars will be saved in pension costs, lost tax revenue, lost income, lower GDP.
But the Republicans argue that the Big 3 don't deserve being bailed out because the Big 3's management have made so many mistakes. But the workers will be the primary targets of the punishment. The CEO's and other top executives will be able get jobs in other industries, but the assembly line workers will be forced to lose all chance of a decent future and life style.
Why would the Republicans do this? Because the European and Asian car companies will fill the void and build plants in the "right to work" states of the South. There are already many Honda, Toyota and BMW plants in the Southern states and if the Big 3 go out of business, there will be at least a doubling of foreign car plants in the Red States. So who cares, as long as the cars are made here? We have to care, because when GM, Ford or Chrysler make a profit, the profit stays here, but when Honda, Toyota and BMW, or any other European or Asian car company makes a profit, the profit leaves the country. It is the same thing as buying a TV at a Wal-Mart that was made in China or buying gasoline at a Mobil station that was refined into gasoline after being pumped from the desert of Saudi Arabia.
The other thing that will be accomplished is that the UAW will effectively be broken. The UAW supports the Democratic Party with contributions and also turns out the vote. Take away all the jobs in the Blue States that depend on the Big 3 and UAW workers, and cripple the parts and materials suppliers, and the Democrats will suffer in 2012. The Blue States will lose jobs, population, Congressman and electoral votes as the population and tax base shifts to the Bible Belt.
It will also mean more home foreclosures and banks losing money, as the workers in the states where the Big 3 manufacture cars and the workers in the states that supply parts to the Big 3 plants lose their jobs. That will also doom supermarkets, clothing stores and every other kind of retail shop in cities and towns where Big 3 plants and Big 3 suppliers are major employers. It would seem that the Republicans would rather have the auto manufacturing profits leave the country and to possibly cause another depression than see Democrats win the White House again.
It is a mean spirited thing that the Republicans are doing, but what may be even more mean spirited is what the so-called "Blue Dog Democrats" are doing. The Republicans are putting party and state before country, but the "Blue Dog Democrats" are pitting state against state, and their states before country or party. The "Blue Dog Democrats" are selling out the Big 3 workers and the people who live in the states where the Big 3 manufacture cars and in the states that supply raw materials and parts to the Big 3 in order to bring European and Asian car manufacturing plants to their Southern states. As an excuse, they will use the poor business practices of the Big 3, the greed of the UAW and the laziness of the UAW workers, but all they really care about is getting re-elected because they will be able to claim that they brought jobs to their states, although the majority of money brought in by the plants in their states will leave for foreign shores.
We must save the Big 3. Strings can be attached to the tax-payer's money to safeguard the principal. But the Big 3 must not be allowed to go bankrupt. Republicans and "Blue Dog Democrats" will argue that it is about principle, but it is really about common sense and principal. The economy of the USA will not be able to withstand the loss of principal that the Big 3 going out of business will cause.
FreddieVee
I was born in Brooklyn, NY in 1945, worked as aircraft mechanic for 35 years and moved to Florida from Brooklyn in 2003. My wife and I will celebrate our 42nd wedding anniversary this year. Our only son is 41, married and has one daughter, plus his (more...)
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Unmentioned in the Mainstream press is that George H.W. Bush (41) is a major partner in Cerberus Capital Management(they own Chrysler and a lot more). John Snow is Chairman of Cerberus and previously, 41's Secretary of the TreasuryThe Auto bailout will happen judging by the dog and pony shows in D.C today. Poppy will get his Billions, its already a done deal for twice what they have discussed. I figure it will break Friday...$50 Billion for Auto
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kato krause (2 articles, 0 quicklinks, 3 diaries, 216 comments [1 recommended, 0 rejected]) on Wednesday, Nov 19, 2008 at 9:33:26 PM
Given that we need to move to Electric passenger cars, how will that effect the manufacturing location building weapons systems? Certainly with the large Defense contracts inplace,these units would survive with or without the passenger vehicle business.
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kato krause (2 articles, 0 quicklinks, 3 diaries, 216 comments [1 recommended, 0 rejected]) on Thursday, Nov 20, 2008 at 9:18:57 AM
unions are always strong in a strong economy--and weak in a weak economy so union busting is not the reason-----its just trickle down crashing from outsourceing our companies,unbalanced free trade, just like what happened to the steel industry years ago when they were trying to get the government to do something about all the cheap steal comming into the country. the government did nothing and the steel industry is a shadow of what it once was----we need equal free trade,and a global minimum wage to trade--------however the big 3 did force large trucks and cars on us in compliance with the oil companies
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TRADESMAN (0 articles, 0 quicklinks, 12 diaries, 335 comments [40 recommended, 1 rejected]) on Thursday, Nov 20, 2008 at 1:56:55 PM
Yes, the Republicans always have ulterior motives geared towards protecting their base: The ultrawealthy and the large corporations. No doubt, they would love to gut the Blue states of voter strength too. I agree wholeheartedly.
But hell, the Dems are just as bad, see "T.A.R.P. and the absolute lack of any oversight of $700 billion being handed to Wall Street banksters by their cohort, the ex-CEO of Goldman-Sachs, Treasury Sec. Paulson.
Make HIM use some of the $700 billion to "bail out" if you must: We have already raised the debt ceiling by $1 TRILLION to give him free reign with OUR money.
The reality is, right now, even Japanese automakers (and German Mercedes) are not selling vehicles, they are leasing acres and acres of space at Long Beach port to store the unwanted autos and SUV's. NY Times, Nov 20, 2008.
Their dealers are refusing to take on more stock. Japan is now in recession, with exports in freefall off the charts: NO BUYERS. The "richest nation in the world" is flat broke. That would be us, America.
The entire industry is in crisis mode, and we are going to GIVE these US automakers taxpayer funds?
HOW WILL THAT create consumers?
Why don't we just drop tons of cash over the US, and let the People have it to spend? Maybe they can burn it for heating their homes this winter, soon it will be worth less than scrap paper anyway. At least the taxpayer would get SOME benefit from being saddle with more debt.
$5 TRILLION and counting so far in regards this "financial crisis.". Yet, our "leaders" couldn't find ONE TRILLION to save Social Security. Over a FORTY YEAR period.
We are being SCREWED, and we should give MORE?? No.
Better than going to prop up failing businesses for an extra 5 or 6 months, when they will return with outstrectch paws again. "Buddy, can you spare a billion or so?"
And in the meantime, their execs will continue pulling down $20 million year bonuses for driving them bankrupt.
There won't be any "strings attached", you can bet on that. There isn't 41,000 registered lobbyists in D.C. for nothing.
Better we sell them to China, AND have it stipulated in sale the factories stay put for at least 10 years.
You see, that is what BORROWING, BIGGEST DEBTOR nation in the world type countries (Spelt: U.S.A.) MUST DO: Sell it's assets to survive.
How ya likin' "Free Market" economy now, America? How ya likin' Cheney's "debt is good" philosophy?
HANG THEM NOW. Flush D.C. clean, start OVER.
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David Hastings (0 articles, 0 quicklinks, 0 diaries, 116 comments [5 recommended, 0 rejected]) on Thursday, Nov 20, 2008 at 6:46:39 PM
THE TOTAL MARKET CAPITALIZATION OF THE BIG 3 IS $11 BILLION ($1B + $3B + $7B). IF THE USA JUST FORCIBLY BUYS ALL THE STOCK, THE "STRING" CAN BE THAT THEY'RE WHOLLY OWNED BY THE USA. THEY WANT SOCIALISM, LET'S GIVE THEM THE REAL THING ! THEN, WE CAN INVEST MORE TAXPAYER MONEY KNOWING WHERE THE MONEY WILL GO.
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lenngray (2 articles, 0 quicklinks, 8 diaries, 77 comments) on Thursday, Nov 20, 2008 at 8:19:37 PM
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