How to Bail Out General Motors

$71.00/hr. for turning a screw or putting on tires? REDICULOUS!!! Does the public realize that most college professors (those entrusted with the future of our country) make far less?

Shut them down & start over. $41.00/hr. is shameful even for foreign auto makers.to pay this amount of wages/benefits.

why not have the employees take a five dollar an hour pay cut and LOAN it back to the car dealers. It would give them the incentive to help make it work and show they have faith in the company.

Is it GM, Ford and Dodge's duty to tell anyone they should not buy a truck or SUV?

GM has way too much production capacity, they have way too many dealers, way too high a union cost, and inept management. They have blown 80 billion dollars in the past 4 years alone. This down turn is not going to be a 6 month, or even a 1 year deal....it may be years....2 or even 3 before it begins to recover. You give them 25 billion no strings attached, and they will be back in 6 months. As sad as it is, bankruptcy is the only way to deal with sooooo many, and such deep issues. A bail out is a band aid on a terminal sucking chest wound. 25 steel manufacturers became three, how many airlines have gone bankrupt, and we think GM is worth saving, simply because of the consequences of bankruptcy are worse? Stupid basis on which to make a decision.

Another requirement should be the end of denial about global warming and the need for fuel efficient cars (read: not SUVs and pickups). This also falls into the category of making cars that people want and need instead of just what GM, et.al., want to sell (big, high profit dinosaurs).

The economy team needs to look at crisis areas and addresses them head-on one-by-one.

To deal with mortgage default crisis, the government can create a system or agency that allows government to do the following without red tape:
1) Pay off mortgage in for-closures to banks by BONDS
2) Create a BUFFER PERIOD during which these bought-out for-closed property can either: A) be REFINANCED with fixed low interest and payment level that the current owner can manage in the long run or B) be REUSED OR RESOLD while the current owner be discharged of the current mortgage without affecting personal credit history
3) Provide DEFAULT INSURANCE for the restructured mortgages by government's own mortgage default insurance company or agency

For near-bankrupt companies with plummeted stocks; the GOVERNMENT CAN TAKE OVER ONE-THIRD OF SHARES, allows financing for employees to own one-third; and leave one-third for the public

Building roads and promoting green energy are for long term. The more urgent need is to make industries competitive. For instance, it is not efficient for many countries to produce whole vehicles. All automakers are seeing sales plummet due to current global crisis. It is more efficient and competitive for a country to produce an automobile part that is cheapest for the required qualities; such as auto body in the USA, engine in Japan or Germany, upholstery in China. SPECIALIZATION needs to go hand-in-hand with global free-trade because it allows all to grow without impeding competitors??? growth.

When we see the comparisions between labor costs between Toyota and the big 3 two things stand out.
First Toyota hires a lot of part time and contract labor avoiding any benefits, the problem will come thirty years from now when these employees find they are too old to work and have no retirement or health care.
As for the big 3 we see benefit costs about equal to the hourly wage paid. something very wrong with this lack of balance and it seems to be largely in the healthcare costs.
The fact is the cost of health care is out of control and has been for some time.
Fix Health care and a whole lot of America companies would be far more competitive than they are now.
But the Republican stance that everyone should copy Toyota is at best very shortsighted. but thats typical.

Obama is quite satisfied that American Coal will not be a factor in his Natural Gas movement so use of Coal in a Fuel-Cell may be a long while in waiting for the US Government to endorse. By that time the government work published so far may get lost in the Obama Shuffle for finding a way to communicate and protect 5,000 or more large Natural Gas Refill/Electric Charge able parking lots, 100 or more 18-wheelers for each region in the US for transporting government Natural Gas plus those for military organizations, and approx. 500 or more smaller trucks per region for transporting, add to that all the airplanes, helicopters, buses, motorcycles, motorboats, ships, tugboats etc. all Natural Gas fuel type. Then adding costs of all the refilling stations each 100 or so miles for all those vehicles for all the USA makes some pocket change issue a super whopper of a organized labor force which must be US Government.

Congressional Interest in CTL
Previous Congress (109th)
H.R. 4761 - Deep Ocean Energy Resources Act of 2006
H.R. 5965 - Progress Act
H.R. 5653 - Investment in American Energy Independence Act of 2006
H.R. 5890 - American-Made Energy Trust Fund Bill
S. 1920 - Renewable Diesel Standard Act of 2005
S. 2446 - American Fuels Act of 2006
S. 3325 - Coal-to-Liquid Fuel Promotion Act of 2006

Current Congress (110th)
Coal-to-Liquid Fuel Promotion Act of 2007
S. 154
S. 155
H.R. 370

Projected Congress (111th)
Unknown

What is the hush hush in using the supercomputer to resolve the problem issue Congress is undertaking against The 'Big Three' Automakers? Is there some reason why the government does not force them to participate in solving the problem that way? I might ask, what is going to happen to the state of Michigan much less the city of Detroit that depends on revenue by the 'Big Three'?

Obama is quite satisfied that American Coal will not be a factor in his Natural Gas movement so use of Coal in a Fuel-Cell may be a long while in waiting for the US Government to endorse. By that time the government work published so far may get lost in the Obama Shuffle for finding a way to communicate and protect 5,000 or more large Natural Gas Refill/Electric Charge able parking lots, 100 or more 18-wheelers for each region in the US for transporting government Natural Gas plus those for military organizations, and approx. 500 or more smaller trucks per region for transporting, add to that all the airplanes, helicopters, buses, motorcycles, motorboats, ships, tugboats etc. all Natural Gas fuel type. Then adding costs of all the refilling stations each 100 or so miles for all those vehicles for all the USA makes some pocket change issue a super whopper of a organized labor force which must be US Government.

Congressional Interest in CTL
Previous Congress (109th)
H.R. 4761 - Deep Ocean Energy Resources Act of 2006
H.R. 5965 - Progress Act
H.R. 5653 - Investment in American Energy Independence Act of 2006
H.R. 5890 - American-Made Energy Trust Fund Bill
S. 1920 - Renewable Diesel Standard Act of 2005
S. 2446 - American Fuels Act of 2006
S. 3325 - Coal-to-Liquid Fuel Promotion Act of 2006

Current Congress (110th)
Coal-to-Liquid Fuel Promotion Act of 2007
S. 154
S. 155
H.R. 370

Projected Congress (111th)
Unknown

What is the hush hush in using the supercomputer to resolve the problem issue Congress is undertaking against The 'Big Three' Automakers? Is there some reason why the government does not force them to participate in solving the problem that way? I might ask, what is going to happen to the state of Michigan much less the city of Detroit that depends on revenue by the 'Big Three'?

If The 'Big Three' Automakers made their own Steel that would be one certainty to solving their manufacturing problem but CEO's are not trying to resolve issues of inappropriate vehicles and do not make an effort to communicate to the UAW Workers that are doing the work and that is the most important issue cause they are being black listed like Obama wants to blacklist the Coal Industry and formally see that it Bankrupts in no way of seeing it into a world of Liquid CoalProduction for Fuel-Cell use which is not associated to burning Coal and is a cleaner operation. Coal is what fueled the Jet Fuel issue of the military aircraft but the USAF is to cut that by 50% by using a mixture of 50% Natural Gas Synthetic Fuel with Jet Fuel & complete all aircraft usage by 2012 and if all Commercial Airliners do the same that will be another 50% cut in the need of Jet Fuel derived from Coal.

Germany is founding aircraft that will operate on Fuel-Cells preferrably Methane but could easily make them Liquid Coal Fuel-Cells and that could make the production increase. Many Mobile Homes are to be tested in a four different Methane Type Fuel-Cells feature to consider mass marketing possibilities.

However, there is only one Coal To Liquid Fuel (CTL) processing facility planned in America and fourteen under consideration, while China has 400,000 planned by 2025, South Africa has a 150,000 (bpd) Operational CTL Plant, Australia has two CTL Plants the Anglo American/Shell is a 60,000 (bpd) In Planning Stages and Altona Resources plc, Jacobs Consultancy, MineConsult which is 45,000 (bpd) In Planning Stages. One ton of Coal can be processed into 2 barrels of high-quality Liquid fuels. There is sufficient reserve to meet projected demand for electricity and up to 4MM bpd CTL industry for over 100 years. The United States has the most Coal (Millions of Short Tons) (1) Anthracite and Bituminous: 123,834, (2) Lignite and Subbituminous: 143,478.

That is not the problem, what is the problem is other nations that depend on Coal for their Economy will run out before The USA does and then their chatter will be ... 'What America Also Has A Problem Distributing Their Coal To Us'.

The automakers insecure of the $25 billion request could be worse. Congress still seems to be hiding the intelligence capable Supercomputer from all America in solving problems, but how can a problem solve if it is abuse now what is being shown of those that got a problem. I think it would be a issue of seizure to mandate a overseer to the automakers whom can handle the situation as a whole rather than single issues until at least some resolve to their crisis occurs, shrinking corporate jet use is a good direction to take since that one single issue could be playing a larger role as a disadvantage to a CEO's income as compared to other workers & ordinary American's whom cannot deliver their own mail you might say and depend on the USPS ans UPS or FEDx now that DHL is out.

How then can Obama claim victory when his jet size actually increased & so did his use of it esp. traveling to Hawaii so many times, or how can Obama's issue of a Hybrid Government Vehicle Fleet be a good direction knowing that 5,000 or more need a parking multi-level lot with refilling capability for Natural Gas according to his specifications. I do not see how a Hybrid Government Vehicle Fleet would be better than the cheaper direction that Monorail Systems could prevail without all those parking lots for job commuters, grocery shoppers, tourists, and run of the mill Corporate CEO's with nothing better to do than follow the misrepresented mailbag around the world in a jet. But I am not talking James Bond right now thats a UK vehicle Ford seems to have some value left in yet to be distributed. I am a member of The Picken's Plan, my name is Charles jones in case you want to search for me and see what I got up my sleeve.

"Why run these risks when the 6.5 percent unemployment rate seems headed toward 8 percent and almost a quarter of the 10 million jobless have been out of work for six months or longer? Just to satisfy a purist "free market" ideal? "

The answer is simple. America and the American people are a going concern. These companies are not.
The plan you put forth in the article seems like a nuts and bolts approach for lining the pockets of incompetent and overpaid management.


The free market ideal that you dismiss with one sentence is what built America and guards its dreams. GATT, NAFTA, The World Bank... all are intended to advance the ideals of free trade that improve the lot of people worldwide. Or did those treaties and institutions just create a world of suckers for US companies to prey upon? The world is watching, America. Protecting failure is what America USED TO chide and punish banana republics for. Soon, America wll not be able to grant itself MFN status! A LEVEL PLAYING FIELD has been the mantra of protectionists and charlatans for decades when attacking OTHER countries for protecting agriculture or sunset industries.. What will this bailout do for your level playing field? What foreign competitor can put in a call to Washington or any other government and pick up a hundred billion dollars more or less?
Liberal principles? Indeed. First America tricks the world into a war. Now it tricks the world's countries into accepting trade liberalization principles that it cannot adhere to itself.
What does America stand for? Wars? Oppression? Communism? Expedience? Amnesia? Studs Terkel said it is the latter. Hard to argue there.

Here is what America should stand for: Find the bad guys and put them away. Then help the victims. Do not punish the good guys. It is as American as Apple PIe.

Your idea is to take money from the good guys (taxpayers, lenders, Treasury bondholders) give it to the bad guys (management) to help the victims (labor?).
Seems pretty backward to me. Whatever madness Americans might eventually come to accept as a bailout, people around the world will see it as it is: a slap in the face of reason and American principles.

Look. It is this simple. Let me say it slowly. See the Japanese guys over there? Yeah. The ones building new factories, developing new technology, using no government funds, making cars that people want, keeping employees happy, saving the environment, pleasing the consumers. Yeah. Those guys. See them? OK. Now listen Detroit CEOs:
DO WHAT THEY DO!!!!!!!!!!
If you cant or wont, then it is already too late. They will beat you eventually or maybe the Koreans and Indians will because, well, you are incompetent, sloppy, lazy losers. You are the kind of people who fly corporate jets to Washington to ask for money. You make Sarah Palin look like a genius. She pays 150k for clothes, you pay 150k for a seat on a plane, what is the difference?? You have been paid enormous sums to make excuses and stupid mistakes for decades. Go ask Michael Moore if you want the real dirt.

Dont bore me with slogans about competitiveness and tough choices and all of that nonsense. Can you make cars or not? Fish or cut bait. If your business model does not work, FAIL IT. Let someone else use your resources efficiently if you cant. Get your jalopy out of the road!! Schumpeter would have wanted it that way. If the Japanese have built up an advantage of 2000 dollars per car or whatever, they have done it through better processes, better labor negotiations, better planning, better training, better logistics, better marketing, and a better sense of trends, and they did it on the cheap.

Now if the advice above seems, well, harsh to some readers, then you are nice people. You need to be sending money to Nigerian scammers by Western Union. If the advice seems obvious, then let me just add. Wasn't there ANYONE, I mean ANYONE, in Detroit ten years ago, with all the MBAs, JDs, etc. to tell Detroit that things would end badly with outsourcing everything except for the wild bet on SUVs? I bet there were people who warned them. I just bet the CEOs listened to good advice to end the hubris and idiocy.and then.. the CEOs just laughed and laughed and lit their cigars with 100 dollar bills.
Take away their 100 dollar bills.
Give GM to the American people.
Give it to people who can manage it properly for the good of all stakeholders.
Buy all of the stock and give it to workers. Let them work it out or sell the assets in their own interests.

This article misses the point of moral hazard. Keep in mind that this bailout is being used to shore up NOT competitiveness, but the bank accounts of people who fly in corporate jets to claim that they need money. These are the people who made cars that people do not want to buy. They have done it for a long time. Ford's CEO this year had higher compensation than the top 37 Toyota executives combined.
So giving all of these gifts to the BIG3 CEOs who created this situation... What do you want? An encore?

I think that the article gets into the finery of running an auto company that is frankly none of my business. You know what? I dont care. I dont want to be a GM CEO. I dont see why lenders should shoulder the burden of GM's poor decisions. If GM could not produce cars profitably, then why should I have sympathy for people with multimillion dollar salaries? The laborers did what they were told to do. Nuff said. An energy policy? It is called COP6 KYOTO PROTOCOL. Detroit lobbied to keep the US from signing that treaty so they could make their SUVs. Then Bush gave people money to buy them YIppee. The Big 3 should be skewered just for that. Other auto companies in other countries supported the Kyoto Protocol as the the right thing to do. THEY SUPPORTED SOCIETY, not the other way around.
I tell you one thing, the Japanese automakers did not manage their companies with US taxpayer money.
If the US government takes a controlling stake in any of these Detroit companies, I have some advice. Get yourself some Japanese management. You will never need to bail them out. The reason is that they are not helpless whining babies.

Labor costs need to be cut. By Lache's estimates, GM's hourly compensation -- wage plus fringe benefits -- totaled $71 in 2007 compared with $47 for Toyota's U.S. plants. Health benefits for retirees (many in their 50s, having retired after 30 years) are expensive. These cost contributed to GM's massive cash drain,$31 billion since 2005. But the United Auto Workers opposes concessions. Government aid, says UAW President Ron Gettelfinger, is needed "so that auto companies can meet their health care obligations to more than 780,000 retirees and dependents." The bailout should be more than union welfare.

I saw this article by Robert J. Samuelson in News Week, and I just wanted to Throw Up!!! Now Retirees get the blame for the GM Problems. Now I would guess that GM and UAW had a labor agreement at one time that included a 30 year and Out clause "I doubt it is still in the labor agreement" But first off this was done at the bargaining table and I am sure that GM got something in return. But I would also guess that a number of these retirees were encouraged to take an early out package which included Medical Health Care as part of their package. (That was my case at Embarq) and now the Media wants to blame the Auto Industry problem on what it cost for retiree health care!

Now don't get me wrong, I personally feel that Labor Cost are far to high in the US Auto Industry and I think that did cause part of the problem.But to blame it on "Retiree Health Benefits" just makes my blood boil.