The United States Needs An Automobile Industry

Despite the selfishness of the U.S. automobile industry, despite their own crass stupidity, the manufacturers must be saved and their house put in order.

Systems are not self contained. The impact they have on a nation, on an economy, is not limited to the silo of their ledger books or their assets.

Communities like Janesville do not deserve plant closings when they faithfully supported the manufacturer with an intelligent workforce, purchasing the manufactured product, and providing economic concessions.

When the United States entered World War II, the existing American automobile industry was quickly transformed for a wartime economy which meant manufacturing vehicles for the United States Armed Forces.

While I do not, and would not hope, that there is ever a reason to convert our automobile manufacturing plants into wartime production units, the point is made that having the resources, industrial and human, is a national asset that cannot be measured through conventional accounting methods.

One of the reasons for our present recession is the transfer of wealth through consumer spending to foreign countries. Workers are no longer in highly paid jobs allowing them to act as effective consumers which further grows the economy.

The decline of the automobile industry is part of the problem.

The automobile manufacturers have not served themselves or us well in the last forty years. Their efforts to destroy public transit systems, to refuse to take the challenge of foreign manufacturers seriously, their refusal to build quality vehicles, more importantly fuel efficient vehicles, and their efforts to make money by joining the banking industry by making money through financing cars rather than building them, are all reasons to tell them they are getting what they deserve.

Unfortunately there are larger issues to consider in this discussion than simply payback to some well-heeled executives.

We need to fix this industry even though the managers who got us into this mess do not deserve our sympathy.

Comments

[Rich Preston]

"Communities like Janesville do not deserve plant closings when they faithfully supported the manufacturer with an intelligent workforce, purchasing the manufactured product, and providing economic concessions."

That quoute sounds similar to a 10-year-old that just lost at kick-ball and exclaims, "That's not fair! Do-over!"

Let's all put our big boy pants on; grow up and break the lose-cry-bailout cycle.

Let them fail. And let's spend any potential bailout money on infrastructure. Many of these workers can build roads and bridges.

Please let's not put more money into a bad investment of over-priced labor and gas-guzzling cars.

[Michael J. Cheaney]

Please let's not put more money into a bad investment of over-priced labor and gas-guzzling cars.

Come on Rich its only a few BILLION dollars.

Us consumers don't need it....besides Government KNOWS how to better use our money remember?

THEY would NEVER EVER make risky deals or do something stupid with it. Besides We'll get it all back and then some, right Paul?

And besides organized labor is the Democratic Parties biggest supporters, if they don't deserve a bail out for that reason alone who does.

Uh-oh I just got hit by lightening

[jim guilfoil]

They have already 'failed' in the social sense.
They market psychological fantasies, not reasonable transportation. The unions have not pressured management to produce buses and vehicles for public transportation.
Too big to fail is PR and Advertising phrasing that hides the truth of a consumerism gone crazy in this country.
We need a moral climate to cut way back on production of needless commodities and place limits on the constant pandering to silly WalMart 'shop till you drop' marketing.
The markets have failed and are too big to survive the warning of climate failure brought on by consuming ourselves to death.
Too big to survive is the coming mantra.

[Nick]

First of all, Janesville is losing its plant no matter what happens. That closing was decided before the bailout talk even started. Secondly, say it with me now, Chapter 11 bankruptcy is not liquidation. Chapter 11 is a reorganization, where hopefully the companies come out with less debt, and hopefully under different management who is voted on by the debtors, instead of the shareholders, and where shares are canceled.

GM and Ford will likely come out of bankruptcy with better contractual obligations, and less debt, and hopefully in a better position to succeed overall. GM especially needs this, as its current structure of duplicated car companies (Pontiac, Chevy, Buick) that all make basically the same car is costing the company a lot.

Chrysler is in rough shape, but its been bailed out once already. How many do-overs does one company get?

But the overall thing to remember, is that the companies will continue to exist.

[Doug]

Whatever happens, we need to be a country that makes things. I believe that as a country your well being becomes vulnerable if you lose your manufacturing capability. While the financial people only see the bottom line and believe cost/value is everything, you have to weigh what happens when the world changes and your caught without the capability close to home. World economy or not. Being a country that makes things is important for job creation and national security.