How to Bail Out General Motors

No more bailouts. The $700B is a mistake too except in the sense of freeing up the credit markets somewhat. That would require a lot less money. But every cent that the govt spends on freeing up the credit markets should be paid back with interest minus the value of the assets which the govt acquires.

The Republicans in Congress would be foolish to agree to anything now. Let the whole mess be addressed by the next Congress. We are in for a long economic downturn. Get used to it!

You make many good points but miss the fundamental issue. This should not be a UAW bail out. Let the Federal Pension Guarntee Agency take over the outstanding pensions and health care. Mandate that The money provided is used only towards hybrids, multifuel or other improved technology vehicles. Charge them a reasonable interest rate, say 5% for the oney loaned. By raising gas taxes, you move the burdon for the big three's incompetence and the UAW's greed to the rest of us. That is something I am unwilling to finance.

The bottom line is that the Big Three have about a $1500/car cost disadvantage to the other domestic car companies. Detroit made big SUV's because there was the only place they could make enough profits to keep in business. Unless, and untill, the root causes of the problem are fixed, Detroit will NEVER be able to compete on small, fuel efficient, cars.

Since the Congress is will to spend MY money, then would agree with the condition outlined in the article. But not on the "promise" that they will do something. Fix the root problems first and THEN come back for the money. If they go out of business before then, well, that's a good indication that they are still living in the world of "business as usual". Giving them money before the fix the root causes of their competitive disadvantage is like giving dope to a junkie. They will thank you now, but be back for aother fix soon enough.

DalGal in Texas

From another website, "At least two Republican senators support an automaker bailout, George Voinovich of Ohio and Kit Bond of Missouri".

The bottom line is these people need to be assassinated. How on earth can you sign other peoples unborn children up for decades of cleaning up your arrogant, greedy mess?

The united states government and oil companies are to blame for this bulls**t. If they hadn't of been so against exploring new avenues with alternative energy vehicles then we wouldn't be in this mess right now. See where greed gets you. No where, and now all of us have to suffer.

Kill all who are for the bail out. Civil War II is on its way. I hope George Voinovich of Ohio and Kit Bond of Missouri are ready when I show up at their front door with my asault rifle.

Excuse my poor writing skills, I'm in a hurry.

Part II Our steel industry can come back again but this time, they will be able to use clean energy. I suggest this be done while there are those living who have worked in the industry and still remember how. (If you lose your educated middle class, you will lose your workforce.)
Whole new crops of small businesses will grow around this. It will not only eventually reduce our dependence on fossil fuels it will take a load off of the electric industry. This will give them time to focus on mass transportation issues and alternative electric production, although we would need to rely heavily upon them initially. However, with the up and coming solar solutions, we should be flying with industry soon!
Our government may choose to do the same with solar energy as well. Solar energy will play a huge role in the coming years and will be much less expensive, once produced by magnetic motors.
It is important to remember innovation grows from the bottom up; it cannot be forced by edict from the top.
And I will add one more thing, the public doesn't have to be chipped or followed by a camera, controlled, or manipulated. We have come much farther than that. We need education, a real education without slants. When a government lies to its people, that government reaps what it sews and her people suffer! It???s the difference between planting an ornamental tree and a tree that bears fruit!

Have all three companies, Ford, Chrysler and GM sell their existing inventory at a HIGHLY REDUCED price to the consumer. Our government should give the consumer twice as much money as it will cost to purchase one of the vehicles. (After all, it is our money, our taxes and we are paying for it we should we something for our money, other than the right to keep a job.) Let the other half be earmarked for retrofitting the existing fleet of newly purchased cars with magnetic motors. Let up and coming businesses begin building magnetic motors (make these motors interchangeable and build them to last!) Let all three companies piece out their existing assembly lines and sell these materials to the new motor businesses. In the mean time, all three car companies can focus on creating new materials and chassis design. They can transfer a majority of their workforce to the motor industry.
In the mean time, the other half of the money earmarked for the consumer, in their hands, not the governments hands, can be used to retrofit a magnetic motor into the surplus fleet now on the highway. However, they should be allowed to purchase solar solutions or a magnetic generator for their homes, should they so choose or, invest in any one of these new industries. In other words, they should be able to spend it any way they want or need but the government should stress the need to invest by purchasing and investing, not one or the other. The car industry should focus on making these motors and getting them out to the mechanics and consumers for retrofit as quickly as possible. A temporary industry for collecting and disassembling the old motors can be created. The old motors can be melted down and or recycled for replacement parts, as replacement parts for old type fossil fuel based engines are phased out; the need to make more will be reduced.

A Much Better Bailout Plan
For years now, the Big Three automakers have been unable to produce cars competitively, largely because they have to buy their employees??? and retirees??? healthcare through private insurance, whereas workers in all other industrialized nations are covered by cost-effective national healthcare plans. Even the foreign manufacturers who produce here undercut Detroit by recruiting a younger, healthier workforce.
Now that the bottom has dropped out of the market for SUVs and light trucks, the Big Three are facing certain bankruptcy and need a bailout, possibly for loans to fund the $51 billion they owe to the VEBAs they promised to set up for their retirees??? healthcare. However, the VEBAs will purchase health insurance through private, for-profit providers, which skim off up to 30% from the top, as compared to Medicare, with only a 3% overhead. It would be far better for Congress to allow the UAW workers and retirees to be the first to enroll in a program based on the Conyers-Kucinich Bill (H.R. 676), an expanded Medicare with no premiums, no deductibles, no co-pays, and no hassles. Like Social Security, the H.R. 676 program would be funded by a payroll tax of 4.5% from employers and 3.3% from employees.
Will this save money for Detroit? You bet. If we???re going to bail out the Big Three, let???s do it in a way that solves a real problem that is strangling U.S. manufacturing: the burden of private health insurance..

If congress immediately banned the production and import of all new gasoline or diesel powered vehicles, two things would happen. (1) The existing stockpile of new gasoline and diesel powered vehicles would be snapped up by those wishing to avoid the higher costs of the next generation vehicles and those wanting the raw power offered by gasoline and diesel (about 20% greater than CNG). This enormous spike in sales would give Detroit the capital it needs to tool up for production of CNG, flex-fuel, hybrid, plug-in hybrid, and all electric vehicles. (2) As the existing fleet of gasoline powered vehicles starts to fail and gets destroyed in the 7 million auto accidents each year (not all of which total the car); the market for these new vehicles would naturally emerge as the next-gen vehicles came into production.

Congress could also set a deadline where production or import of any internal combustion engines would be banned, say five years out. That would imply that people that wanted the range, power and flexibility of CNG would need to purchase one before that deadline, after which the only options would be all-electric or hydrogen powered vehicles. If Detroit or Japan or Germany can???t produce a workable vehicle by then, too bad, then there won???t be any new vehicles for sale until they do.

In addition, congress could set a deadline, say 10 years out, for all vehicles on the road to meet stringent emissions standards, standards only achievable using CNG, hydrogen or all-electric. This would imply a need to convert existing vehicles from gasoline to CNG or purchase a new vehicle. This would accomplish several things. (1) It would encourage sales of next-gen vehicles (2) It would address global warming in a big way (3) It would create jobs performing vehicle conversions (4) It would completely end our dependence on foreign oil entirely (4) It would stimulate the economy like crazy.

Nothing in this plan would cost the government anything, wouldn???t require a bailout of Detroit, and would go a very long way to doing what everyone said couldn???t be done; freeing the U.S. from foreign oil and switching our transportation away from fossil fuels, and everyone comes out a winner without bankrupting the government. Big oil will fight such a plan, but if congress had any balls at all, they???d do it before the end of the year and before the oil lobby knew what hit them. I have no idea if Detroit would go for this plan or not, but they are in no position to complain either.

Make all three auto makers merge into one American United Automotive group. Putting the best from all of them into an auto line we can be proud to own instead of buying more affordable, better running, loner lasting rice burners!

Creative destruction is a beautiful thing. Let them burn, and from the ashes we can rebuild anew.

It is simple, price cars at a level meant to increase sales. If at that level they cannot pay their bills, then they never will be able to.

They played the union game and lost, and if anyone thinks I am willing to subsidize the UAW with my NON union wages, they are in for a fight.

Let GM (Chrysler and Ford also) go. The thought of bailing these garbage building crooks makes me puke.

Terrific article that managed to say absolutely NOTHING!!! Plus, your idiotic idea of increasing the cost of gasoline has NOTHING to do with GM! It's very simple. IF the government gives money to GM, they should then demand that the company start making cars that are CHEAPER TO BUY, BETTER QUALITY and get better gas mileage. Maybe they could pay for the bailout through a penny increase in the federal gas tax, but you know, the idea of bailing GM out is not real popular as it is. Paying for it with a tax increase, while fiscally sound, will just make it even more unpopular. MY suggestion is that the government, instead of just giving GM money, actually buy up the stock and become owners. (Yes, that's a form of nationalizing, but whatever.) Then they can fire the board, and replace them with people making hundreds of thousands a year instead of hundreds of millions a year. The savings on that should more than pay for union pensions & healthcare. Then the new board can shut down the SUV's and start making better quality, fuel efficient cars and knock about $10 grand off the sticker. THEN maybe people will start buying them again.

When GM, Ford and Chrysler go Bk and it pushes this country into the Great Depression part 2, maybe the poeple who are so concerned with someone else making a buck can live in their Toyotas and Hondas

Toyota, honda and Nissan aren't going to want to build cars in a country full of illiterates. As recently as 2005, one of them decided to forego tax breaks in the south and decided to build cars in Canada instead because they are tired of dealing with illiterates in the anti union deep south.... where they are all for giving subsidies to foreign automakers but don't invest in their people.

if the big three go Bk, we will be in the Great Depression part 2.. maybe then you can live in your Toyotas and Hondas

Let the OIL COMPANYS bail them out!!!!