[Peace-discuss] Auto bailout - gas guzzlers guzzling more than gas?

Sun Nov 16 00:06:31 CST 2008

>Its not letting the industry die.  It aint all unhealthy.

That is not what I have heard.  All three auto makers have been hurting at
varying degrees and slowly dying at varying rates. All the Amerikan auto
makers are ranked below the non-Amerikan ones in sales and profits.  GM is
the biggest of the big three and also the one who is bleeding the worst; but
Chrysler is not all that far behind with Ford following Chrysler.  Moreover,
the parts manufacturers and distributors and other auto related businesses
are on the edge and would also begin to fail should any of the big three go
belly up. By the way Chrysler was never nationalized so I fail to see how
that illustrates your point about nationalizing a Zombie company.

I would not be surprised if down the line we start hearing the same from the
airline industry in the US, the tourist industry, the hotel industry, and
others whose status is shaky.  I fear we are seeing the real meaning of a
"trickle down economy."

And yes industries do die from both mismanagement and obsolescence; the auto
industry may be a case of the former as was the iron and steel industry,
whose obsolescence was the result of mismanagement and refusal to upgrade
equipment and facilities.  I do not think that the auto industry as an
industry is obsolescent yet or about to be in the near future.  Obsolescent
industries fail because there no longer is a need for their goods and
services.  If the Amerikan auto industry fails, there will be other auto
industries in other countries that will fill the need and demand for autos
and trucks.

From: E. Wayne Johnson [mailto:ewj at pigs.ag] 
Sent: Saturday, November 15, 2008 8:17 PM
To: LAURIE SOLOMON
Cc: Peace-discuss at lists.chambana.net
Subject: Re: [Peace-discuss] Auto bailout - gas guzzlers guzzling more than
gas?

Its not letting the industry die.  It aint all unhealthy.  

If GM dies, it will make more room for some others to survive 
if they are smart enough and innovative enough and lucky enough.

One could imagine maybe in a few years there might be
only a few 1950s to late 80s model cars (everything else had quit running)
and other Real Hybrids on the road.  (I
mean the sort of real hybrids they drove in the Mad Max movies.)  Sort of
like Cuba. 
I think that is not one of the possible futures, but interesting to imagine.

Nationalizing a Zombie company would just make it more difficult to excise
the dead meat.  
Look what a mess the Chrysler bailout became.

Industries become obsolete.  Its a normal process.  What about all the
candle wick makers
and the gas lamp factories and the carriage workers, and the cast iron
radiator workers etc etc etc.

It's not just mismanagement its obsolescence too.

LAURIE SOLOMON wrote: 

I fail to see how letting the industry die will help anything - especially
since I do not see the people of the US giving up their cars and trucks and
since there are so many already interdependent industries and businesses
connected to the auto industry.  Given all the people employed by that
industry and all the directly and indirectly related industries, I think it
would cost more to cushion the unemployment and retrain all those employees
than it would to nationalize the industry and keep it functioning.  Just
because under private control management had stupid unproductive policies
and made unwise decisions is no reason to kill the industry per se;
nationalizing it and changing the premises and policies would provide a
remedy to the mismanagement problem without killing the industry or creating
massive unemployemtn and iots associated costs.

-----Original Message-----
From: peace-discuss-bounces at lists.chambana.net
[mailto:peace-discuss-bounces at lists.chambana.net] On Behalf Of
n.dahlheim at mchsi.com
Sent: Saturday, November 15, 2008 7:01 PM
To: E. Wayne Johnson
Cc: Peace-discuss at lists.chambana.net; laurie at advancenet.net
Subject: Re: [Peace-discuss] Auto bailout - gas guzzlers guzzling more than
gas?

While I agree with Laurie's analytical breakdown of why the Big Auto
companies should be nationalized 
and the implications this has for the capitalistic myth that continues to
bewilder so many and inspire so 
many a failed policy; I think Wayne is basically right.  The car companies
must die---they have had 
poor management for a very long time.  AG Daimler was positively thrilled to
sell of Chrysler to 
Cerberus not too long ago; Chrysler's American management routinely insulted
the German members 
of the car company's management team with their intransigence and obstinancy
regarding company 
governance.  GM, as we all know, under CEO Rick Wagoner bowed to oil company
pressure to shut 
down the production of EV-1 electric cars in the mid-1990s.  And, despite
the overwhelming evidence 
that global oil production was getting set to peak in the early 21st century
and the growing 
dependence of the United States on foreign oil imports, GM decided to avoid
investing in capital 
improvements to build fuel-efficient vehicles.  Instead, GM decided to
produce gas guzzling "light 
truck" SUVs in order to take advantage of loopholes in the CAFE standards.
GM did not reinvest in 
retraining its workforce, refurbishing factories, or developing much more
efficient vehicles.  As such, 
there will be heavy consequences for GM's failure---the govt should cushion
the blow to GM's 
workers---but, let the company die.  Spending precious money on them in a
time of credit crisis is 
foolish when there are so many other social needs and many other businesses
succumbing to failure in 
this current economic depression.

Best,
Nick

----------------------  Original Message:  ---------------------
From:    "E. Wayne Johnson"  <mailto:ewj at pigs.ag> <ewj at pigs.ag>
To:      LAURIE SOLOMON  <mailto:LAURIE at ADVANCENET.NET>
<LAURIE at ADVANCENET.NET>
Cc:      'peace discuss'  <mailto:peace-discuss at lists.chambana.net>
<peace-discuss at lists.chambana.net>
Subject: Re: [Peace-discuss] Auto bailout - gas guzzlers     guzzling
more than gas?
Date:    Sat, 15 Nov 2008 21:12:54 +0000

The big companies need to fail because inherent decay and obsolences.

Nationalized, they will become administrative monsters like universities,
constantly wasting money, perverting reforms, and continually begging for
new infusions of money.

Let the collapsing big companies die like so many old dead trees,
so that fresh new growth can occur.

LAURIE SOLOMON wrote:

Try this on for size:  If a company is too big to let fail, it should be
nationalized since it is no longer a private operation with only local
impact and consequences but a national operation with societal impact

and

consequences.  The whole notion of Capitalism and free enterprise was,

as I

understand it, based on small local enterprises owned and directly run

by

entrepreneurial individuals whose own money was at risk so as to justify
their getting the profits.  It was not based on large national and
international corporations run by hired managers who have little

personal

stake in the corporation other than employment and are protected by

"Golden

Parachutes" on behalf of institutional stockholders and third party
investors who have little actual control over operations.

If these corporations are going to use national resources and have such
significance to the national economy and the lives of so many individual
citizens, then they should be owned and operated by the citizenry for

the

benefit of the common good of the citizenry under governmental

supervision

and control.

-----Original Message-----
From: peace-discuss-bounces at lists.chambana.net
[mailto:peace-discuss-bounces at lists.chambana.net] On Behalf Of E. Wayne
Johnson
Sent: Saturday, November 15, 2008 12:47 PM
To: kmedina at illinois.edu
Cc: peace discuss
Subject: Re: [Peace-discuss] Auto bailout - gas guzzlers guzzling more

than

gas?

Just simply let the big companies fail.  They eventually will anyway,

and

bailing them out only prolongs the agony and intensifies the impact.
If the tree doesnt produce good fruit, why do we burden the ground with 
a bad tree?
Cut the dead trees down, and make room for good new trees.

If there is any benefit to the society from domestic auto production, 
some wise
entrepreneurs will rise up and start producing cars again, or mopeds or 
bicycles or 3 wheel bikes, etc. which they could do
now if they were not being crowded out by the giants who use government 
regulations as
a barrier to competition and entry of useful new small businesses. 

Deep psychological blow? 
Oh my dear. You break my heart. Things are tough all over guys. 
But hey. I understand.  Here's a hug and a hanky.

Karen Medina wrote:

Ricky wrote: >   
http://www.bloomberg.com/apps/newspid=washingtonstory
<http://www.bloomberg.com/apps/newspid=washingtonstory&sid=aBlCucXR33Jw>
&sid=aBlCucXR33Jw

"The failure of those companies would likely bring down parts-makers,

dealerships 

and suppliers in addition to inflicting a deep psychological blow."

The whole argument about "too big to fail" is frightening. I think

there

should be 

restrictions on how large any company / bank can become. Wouldn't a

bunch

of 

smaller companies create a more competitive environment? Allow the

industries to 

change directions a bit faster? Spread out the profits? Have fewer

extremely high 

paid individuals? Be kinder to their workers? Lay off fewer people in

hard

times? 

-karen medina
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