Auto Bailout Failed

[perry]

Date: 12/12/2008 10:44:37 PM
Author: Allisonfaye
Do you people watch all the experts opinions on this? Many economists think this will for sure propel us into a depression. 3 MILLION jobs are predicted to be lost. Our current economy can''t afford this kind of hit right now.

And is a depression really a bad thing in the long term.

The fact is that the economy goes in Boom and Bust cycles. It always has and always will. It is the very nature of a self correcting economy. Things actually get much worse in countries that control there economy to prevent the boom/bust cycle. The standard of living in such countries tends to pale in comparison to those that allow self correcting economies.

I note, that this will not be the first time that millons of jobs have been lost.

I also note - that I doubt most of those jobs will really be lost. The US will continue to buy cars... and people will need to build the cars and the parts. The vast majority of those jobs will stay in the US.

Of course, the factories may be purchased by another company - and the overall wages and benifits lower...

I suspect that at least 1/2 of the current factories will actually remain as viable enterprises - to someone. The jobs will not be lost - just reassigned to another employer.

Of course, many of the current employees may decline to take those jobs becasue they represent a paycut (ego is a powerfull thing - and often destructive as well). I''ve seen that before. I even personally know people who committed suicide becasue they could not get a job in a field that I was downsized out of in the early 1990''s. Me, I found other work - which was at a fraction of my current pay - but, it was what it was and I just focues on moving on the best I could.

Perry

 

[Lauren8211]

Date: 12/13/2008 11:25:08 AM
Author: geckodani
Michigan resident here. Not directly tied to the auto industry in any way. Please remember as you''re joking about Detroit burning, that a lot of other people live in the state. Please don''t be so cavalier about that horrible possibility.

Thanks, Gecko.

I was thinking the same thing. It''s not really very funny.

 

[Allisonfaye]

I noticed that no one has pointed out the fact that the R Senators that voted this down (the Southern ones) have auto plants in their states. Hmmmm...can you say ''ulterior motive''?

 

[perry]

Date: 12/14/2008 12:26:53 PM
Author: Allisonfaye
I noticed that no one has pointed out the fact that the R Senators that voted this down (the Southern ones) have auto plants in their states. Hmmmm...can you say 'ulterior motive'?

First, your statement is far from true - and I assume you are discussing foreign auto mfr's plants. See the results below of who voted "no" and my comments:

Note that the resolution failed on a 52 - 35 vote. 11 people did not vote, and one seat is vacant.

(D) = Democrate

(R) = Republican


State Name: [Auto Mfr 1 Plant(s), Auto Mfr 2 Plant(s),etc] : Senators (R/D) No

Note I have only listed final "light vehicle" (cars, pickups, SUVs, etc) assembly plants in current operation. Parts are produced all over and in many states. Some companies have anounced plans to build other plants - but even Toyota has recently announced that a planned plant in Mississippi may be delayed years (i.e. I'm counting the chickens that have hatched, and are alive).

I have tried to list all of the final assembly plants I can identify. Let me know if I have missed any.


Voting "no" were 4 Democrats and 31 Republicans.

Alabama: [Mercedes-Benz, Honda, Hyundia]: Sessions (R) No; Shelby (R) No

Alaska: Murkowski (R) No

Arizona: Kyl (R) No; McCain (R) No

Arkansas: Lincoln (D) No

Colorado: Allard (R) No

Florida: Martinez (R) No

Georgia: Chambliss (R) No; Isakson (R) No

Idaho: Crapo (R) No

Iowa: Grassley (R) No


Kansas: Roberts (R) No

Kentucky: [Ford, GM, Toyoto] Bunning (R) No; McConnell (R) No

Louisiana: [GM] Vitter (R) No

Minnesota: [Ford] Coleman (R) No

Mississippi: [Chrysler] Cochran (R) No; Wicker (R) No

Montana: Baucus (D) No; Tester (D) No

Nevada: Ensign (R) No

New Hampshire: Gregg (R) No

North Carolina: Burr (R) No

Oklahoma: Coburn (R) No; Inhofe (R) No.

South Carolina: [BMW] DeMint (R) No

South Dakota: Thune (R) No.

Tennessee: [GM, Nissan] Corker (R) No.

Texas: [Toyota] Hutchison (R) No.

Utah: Bennett (R) No; Hatch (R) No.

Wyoming: Barrasso (R) No; Enzi (R) No.


By and large most of the "No" votes came from states without any final assembly plant - or even without a major role in auto parts supply. In addition, No's also came from states with Big 3 plants.

Also, while you can point to Alambam, and perhaps a few others, as an example where the Senators may have voted for their local industry - you have a Michagan, Ohio, and perhaps a few others where the Senators voted "Yes" for their industry. Note that most Big 3 plants are in Michagan and Ohio.

Look at Kentucky - where there are Ford, GM, and Toyota plants. Both Republican Senators voted No. Note that this Ford plant is the 2nd largest Ford assembly plant in the US.

In the case of Indiana; which has significanat numbers of jobs related to both the Big 3 and Foreign mfrs (the Big 3 jobs currently outnuber the Foreign Mfr jobs); both Democratic Senators voted Yes (GM, Subaru, Toyota plants).

The following Foreign Final Assembly Plants exist - in states that the the Senators either voted for the Big 3 Bailout or did not vote:

Mitsubishi: Illinois [Chrysler, Ford, Mitsubishi] Durbin (D) Yes. & Vacant Senate Seat

Honda: Ohio Brown (D) Yes; Voinovich (R) Yes. [Honda plants outnubered by about 3:1 by GM, Ford, Chrylser]

However, it is interesting that Foreign auto mfrs have successfully built plants in places like Ohio, Indiana, and Illinois - and not just in Alabama, Kentucky, Tennessee, South Carolina, and Texas.


A much better argument - and I feel much closer to the truth - is that the Democrates were trying to payback to one of their biggest supporters - the Unions; and that Republicans were against such a one sided Union based bailout (why support a group that has historically been against you), in addition to the people who just feel that bailouts are wrong (period).

It is also true that Southern states are generally lightly Unionized and Northern States are more heavily Unionized. This has a lot to do with having "right to work" laws. It also tends to attract new manufacturing plants (i.e. non-union work enviroments tend to attract industry - and build an economy: In this regards - Unions have hurt themselves long term, a view that I personally hold - and I belong to a Union).

------

Oh, if you would like to see the actual roll call of the senate vote (and who did and did not vote):

http://www.google.com/hostednews/ap/article/ALeqM5hGwd1jlCNMafTX4H1T4CHfPGHGtAD950VMF85


Something of interest on why Auto Mfr is generally moving to the south... and what the Foreign Companies are looking for:

http://www.cargroup.org/pdfs/North-SouthPaper.PDF

Perry