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Are the big oil companies really the main corporations causing high gas prices? What about car companies? |
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Mrs. Winterbourne | Do you think the Bailout of the U.S. Automotive industry is a goo idea? Why or why not? |
I was totally against it at first, but after giving it some more thought, I have changed my mind. I know it doesn't seem right for the government to be paying for the automotive industry's mistakes. On the other hand, if we let them fail then we will be completely dependent upon foreign automakers for all new vehicles. They can make the price anything they want it to be. What leverage will we have to deny paying it? They won't have to produce the more expensive low emissions vehicles or continue working to find greener solutions for automotive fuels. We can't make china or japan produce safer products, they will say "if you don't like our product, then do without!" We can't stop them. This in turn will force our reliance on primarily foreign oil sources for fuel. Again, they can make the prices anything they want, we can either pay, or do without. The automotive importers can refuse to pay taxes, what can we do? Just stop buying them, but that will cripple us. All of this without considering the massive layoffs that will occur when the companies shut down. On the opposite side of the fence, if we bail them out, we can lay down our own terms. Like forcing them to spend the largest portion of their future design and planning budgets on hybrids or designing vehicles that use cleaner fuel sources. This bailout could actually be a good thing. What is your opinion, and what reasons do you have? |
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Cotton Eye Joe
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They should tie any new money to the $25 billion for them to develop energy efficient cars. They would get funds to help pay their bills for now in return for a plan to develop better and more marketable cars. Maybe academia could get involved. Use them to provide expertise on manufacturing, design (i.e. design schools), and labor. We need some creativity come out of Detroit or we'll just see them fail and our federal dollars wasted. |
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Daramandy
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The big 3 can declare bankruptcy, which doesn't mean they close their doors, it means they have the space to reorganize and renegotiate their agreements. This way they have to face the problems that caused this problem to begin with. Throwing money at the problem will not help if they don't face the fact that bad decisions made by executives there created the situation they are in now - and they need to fix them. Otherwise they will find themselves in the same situation again, after having blown through the bailout money. |
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Tom Z
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Based on the principles of free markets, philosophically, I too was against the auto bail out at first. But because the economic effect will be much greater than $25 billion I, somewhat reluctantly, have changed my mind. Consider the following:
• Should all of the Detroit Three's U.S. operations cease in 2009, the first-year total employment impact would be a loss of nearly 3 million jobs in the U.S. economy—including 239,341 direct job losses at the three auto companies; 973,969 secondary jobs at auto supply companies; and more than 1.7 million jobs at other employers from the reduced spending by those jobless workers. The employment picture would recover somewhat in 2010 and 2011, due to increased U.S. production by foreign-based automakers and dislocated workers finding new jobs.
• Even if just one or more of the auto companies goes down, the first-year losses would still be nearly 2.5 million jobs in the U.S. in the first year before coming back somewhat in the second and third years. That's because the domino effect of one major automaker going under would push several financially fragile auto suppliers into insolvency, which would interrupt production at the remaining car companies.
• In economic terms, a 50% cut in the Detroit Three's U.S. operations would reduce personal income by more than $125.1 billion in the first year, and $275.7 billion over three years.
Center for Automotive Research (CAR) Chairman David Cole, one of the authors of the study, says legislators and members of the public who doubt the U.S. auto industry is worth saving "should realize the costs of it failing are far greater than the $25 billion in loans the industry is seeking." |
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Vantage Point
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Bailing out the Big 3 is a corrupt idea. Use the money to pay for unemployment and medicare. Lobbying is a corrupt idea. The Big 3 and UAW labor union lobbied congress for a bail out. Giving $$$millions to senators and congressmen. It looks like the Big 3 and UAW cannot survive if the will of the majority is heard.
Tom is quoting a bunch of numbers that I don't agree with. Right now there's around 9 million unemployed nationwide.
This number will still rise. We need use the money wisely, not on a bankrupt idea. |
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Radman
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I'm for the bailout...with conditions of improved fuel/emissions standards. We give $10B a year to that rogue nation (Israel) and all they do is cause us problems. Why not help our own??? $25B is a penance compared to the housing loan bailouts in which I have NO sympathy! |
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Jack B
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I think you have been watching too much propaganda by those guys in Detroit.
Yes we are reliant on foreign oil.
Okay so makes more fuel efficient cars? Let's see Japan then Germany.
Who makes low emissions cars? again Japan then germany
Who makes hybrids? Detroit and Japan
but who's hybrids do people buy? Japan
Face it, these clowns in Detroit at GM mainly and then Chrysler deserve the blame. Ford says it doesn't want a bailout and rightfully so.
Detroit and especially GM went w/ SUVs and trucks as their primary products and then with the financhial collapse and high gas prices...their world collapsed and now these fools want money as a bailout for their stupidity in decision-making.
Screw Detroit and these arrogant corrupt ceo's. |
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Tommy K
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Any form of a "bailout" goes against both Capitalism and the Free Market concepts. Failure is part of the game not just success. So it is not possible for another American car company to be formed? Is it against the law to start a car company now? Look at Tesla Motors, they are a new car company with great demand for their product. Letting these 3 fail and saying that the US won't have anymore car companies is the same as saying if Christopher Columbus didn't discover the New World we would never have found America. How about all of the Mortgage agents/brokers, Real Estate agents/brokers that went out of business as their bubble burst? Seems to me that there are still plenty of people out there to help you buy or sell even today. Oh, and by the way, Japan makes some of the safest products on the market today, maybe not China but the Japanese cars have repeatedly outperformed crash tests done by the Insurance Institute for Highway Safety, a third party testing company. In the Small Car category, there isn't a single American car in it and not a single US SUV in the Large Car category, now what does that tell you about US car companies?
No one wants to see people suffer but I don't hear anyone crying for the poor and destitute around the globe. Here are some facts:
1. The US and the rest of the world is in a recession, cars are the last things people are going to buy.
2. The public perception is that German and Japanese cars are far superior than American and Chinese cars.
3. The only way to save any of these car companies is to downsize. Less demand for cars mean less people to make the cars and less factories/facilities to make cars in.
4. Executives and CEOs will continue to get their fat salaries while laying off thousands of workers.
5. If foreign car companies "jack up" the price of cars and make the market that lucrative, I assure you some rich American will start another car company to "get in on the action". It always happens. When oil hit above $100 per barrel, I saw dozens of old oil rigs that were pretty much abandoned start up again along the California coast in Huntington Beach. If there is money to be made, I assure you someone will jump in, then another, then another, until there are too many suppliers to the market, then the Free Market squeezes the excess out of the picture.
No one needs to force anything on anyone, let the consumer decide and the rest will fall into place.
Wake up people don't let the BS ads that GM has put on YouTube get you all sentimental. |
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