Big Three Bailout

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#1
WASHINGTON – A bailout-weary Congress killed a $14 billion package to aid struggling U.S. automakers Thursday night after a partisan dispute over union wage cuts derailed a last-ditch effort to revive the emergency aid before year's end.

Republicans, breaking sharply with President George W. Bush as his term draws to a close, refused to back federal aid for Detroit's beleaguered Big Three without a guarantee that the United Auto Workers would agree by the end of next year to wage cuts to bring their pay into line with U.S. plants of Japanese carmakers. The UAW refused to do so before its current contract with the automakers expires in 2011.

The breakdown left the fate of the auto industry — and the 3 million jobs it touches — in limbo at a time of growing economic turmoil. General Motors Corp. and Chrysler LLC have said they could be weeks from collapse. Ford Motor Co. says it does not need federal help now, but its survival is far from certain.

Democratic leaders called on Bush to immediately tap the $700 billion Wall Street bailout fund for emergency aid to the auto industry.

Majority Leader Harry Reid, D-Nev., called the bill's collapse "a loss for the country," adding: "I dread looking at Wall Street tomorrow. It's not going to be a pleasant sight."

GM said in a statement it was "deeply disappointed" that the bipartisan agreement faltered. "We will assess all of our options to continue our restructuring and to obtain the means to weather the current economic crisis," the company said. Chrysler, too, said it "will continue to pursue a workable solution to help ensure the future viability of the company."

The White House said it was evaluating its options in light of the breakdown on Capitol Hill.

"It's disappointing that Congress failed to act tonight," Deputy Press Secretary Tony Fratto said in a statement. "We think the legislation we negotiated provided an opportunity to use funds already appropriated for automakers and presented the best chance to avoid a disorderly bankruptcy while ensuring taxpayer funds only go to firms whose stakeholders were prepared to make difficult decisions to become viable."

That bill — the product of a hard-fought negotiation between congressional Democrats and the Bush White House — was virtually dead on arrival in the Senate, where Republicans said it was too weak in its demands on the car companies and contained unacceptable environmental mandates for the Big Three.

Thursday's implosion followed yet another set of marathon negotiations at the Capitol — this time involving labor, the auto industry and lawmakers. The group came close to agreement, but it stalled over the UAW's refusal to agree to the wage concessions.

"We were about three words away from a deal," said Sen. Bob Corker of Tennessee, the GOP's point man in the negotiations, referring to any date in 2009 on which the UAW would accept wage cuts.

The Senate rejected the bailout 52-35 on a procedural vote — well short of the 60 required — after the talks fell apart. Just 10 Republicans joined 40 Democrats and two independents in backing it. Three Democrats sided with 31 Republicans in opposition. Reid also voted "no" for procedural reasons.

Congress is not scheduled to return for legislative work until early January.

Some Senate Democrats joined Republicans in turning against the House-passed bill — despite increasingly urgent expressions of support from the White House and President-elect Barack Obama for quick action to spare the economy the added pain of a potential automaker collapse.

"In the midst of already deep and troubling economic times, we are about to add to that by walking away," said Sen. Chris Dodd, D-Conn., the Banking Committee chairman who led negotiations on the package.

Alan Reuther, the UAW's legislative director, declined comment to reporters as he left a meeting room during negotiations. The union had no immediate reaction to the bailout's defeat.

The stunning disintegration was eerily reminiscent of the defeat of the $700 billion Wall Street bailout in the House, which sent the Dow tumbling and lawmakers back to the drawing board to draft a new agreement to rescue financial institutions and halt a broader economic meltdown. That measure ultimately passed and was signed by Bush.

It wasn't immediately clear, however, how the auto aid measure might be resurrected, with Congress now set to depart for the year.

Democratic House Speaker Nancy Pelosi called Senate Republicans' refusal to support the White House-negotiated bill irresponsible and urged the Bush administration and the Federal Reserve to provide short-term relief for the automakers. "That is the only viable option available at this time," she said.

Congressional Republicans have been in open revolt against Bush over the auto bailout. Senate Minority Leader Mitch McConnell of Kentucky joined other GOP lawmakers Thursday in announcing his opposition to the White House-backed bill, which passed the House on Wednesday. He and other Republicans insisted that the carmakers restructure their debt and bring wages and benefits in line with those paid by Toyota, Honda and Nissan in the United States.

Hourly wages for UAW workers at GM factories are about equal to those paid by Toyota Motor Corp. at its older U.S. factories, according to the companies. GM says the average UAW laborer makes $29.78 per hour, while Toyota says it pays about $30 per hour. But the unionized factories have far higher benefit costs.

GM says its total hourly labor costs are now $69, including wages, pensions and health care for active workers, plus the pension and health care costs of more than 432,000 retirees and spouses. Toyota says its total costs are around $48. The Japanese automaker has far fewer retirees and its pension and health care benefits are not as rich as those paid to UAW workers.

Republicans also bitterly opposed tougher environmental rules carmakers would have to meet as part of the House-passed version of the rescue package, and the Senate dropped them from its plan.

The House-passed bill would have created a Bush-appointed overseer to dole out the money. At the same time, carmakers would have been compelled to return the aid if the "car czar" decided the carmakers hadn't done enough to restructure by spring.

The House approved its plan late Wednesday on a vote of 237-170.

A pair of polls released Thursday indicated that the public is dubious about the rescue plan.

Just 39 percent said it would be right to spend billions in loans to keep GM, Ford and Chrysler in business, according to a poll by the nonpartisan Pew Research Center. Just 45 percent of Democrats and 31 percent of Republicans supported the idea.

In a separate Marist College poll, 48 percent said they oppose federal loans for the struggling automakers while 41 percent approved.

___

Associated Press writers David Espo and Alan Fram in Washington and Kimberly S. Johnson in Detroit contributed to this report.


$14B auto bailout dies in Senate - Yahoo! News
^ source

Why did the Senate do this?

Are they aware how bad Michigan is going to suffer from this?

Do they even care?

I sure as heck to since it means I am going to have to work more to support my family which Congress is lucky since they do nothing all day and get payed good money.......
 
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#2
Just quick input as I have to do some traveling today!

The government bailed out wall street with nary a thought or at least Bush tried, congress thought a little or as much as they can ;0!

Now when we have a situation that effects, yes directly effects middle class folk, they want concession they never thought of for wall street!

As Pink would say or did say: "Just another brick in the wall!"

I will be back!
 

Iceman

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#3
The link below will explain what a lot of the problem is. There is something wrong when automobile plant workers are making seventy dollars an hour making cars and people making ten and twelve dollars and hour trying to buy them. It is not the taxpayers duty to bail them out when, with better management, they would not be in this fix.



http://www.clickondetroit.com/video/15908257/index.html
 

Flynn

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#4
http://www.clickondetroit.com/video/15908257/index.html[/URL]


Ice

American auto plant workers DON'T get paid $69 per hour.​



That figure is what it costs GM to employ an auto worker after they pay.... wages, tax, insurance, health benefits and all other finanacial costs incurred by having an employee.




quote opening post

GM says its total hourly labor costs are now $69, including wages, pensions and health care for active workers, plus the pension and health care costs of more than 432,000 retirees and spouses. Toyota says its total costs are around $48. The Japanese automaker has far fewer retirees and its pension and health care benefits are not as rich as those paid to UAW workers.
 

Flynn

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#6



Stinky

Economics 101.....Rule one....read the facts.

Teaching an old dog how to jump through economic hoops is a challenge but I'm up to the task !


 
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#7
Take note everyone...a first is about to happen... This time I am in agreement with the Flynn...The workers do not get paid 69.00 an hour, however their benefits are large and this is where alot of costs occur. Maybe as Congress tries to cut their benefits, they should do the same. Any thoughts about that?
 

Flynn

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#8



Ghost

It depends which employee benefits you want to drop.

The people who work for me would not be happy if I stopped covering them for work accidents. They wouldn't be happy if I didn't pay them for the Christmas, New Years holidays.

My employers just want the job done they aren't going to pay me extra unless I build into an already stretched budget.


 
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#9
[QUOTE="GhostWhisper, post: 2581268]Take note everyone...a first is about to happen... This time I am in agreement with the Flynn...The workers do not get paid 69.00 an hour, however their benefits are large and this is where alot of costs occur. Maybe as Congress tries to cut their benefits, they should do the same. Any thoughts about that?[/QUOTE]

Thought.....Congress should cut their benefits or figure a way to spend our tax dollars better so we as the middle class can afford sick time, dental and some nice thick steaks once in a while.:sneaky:
 
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#10
http://www.clickondetroit.com/video/15908257/index.html[/URL]
Thanks for the video Iceman

I can only wonder what is happening to GM since they are the only place that I am willing to buy an American from.....

From what I am seeing, the union is getting too powerful and needs to get stopped... it seems they have become the coruption they were created to fight.......
 
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#11
[QUOTE="GhostWhisper, post: 2581268]Take note everyone...a first is about to happen... This time I am in agreement with the Flynn...The workers do not get paid 69.00 an hour, however their benefits are large and this is where alot of costs occur. Maybe as Congress tries to cut their benefits, they should do the same. Any thoughts about that?[/QUOTE]


hello, illegal aliens...soon to be GM, Ford, and Chrysler auto assembly workers...


...at $69 a day...and happy to get it...
 
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#12
Ghost

It depends which employee benefits you want to drop.

The people who work for me would not be happy if I stopped covering them for work accidents. They wouldn't be happy if I didn't pay them for the Christmas, New Years holidays.

My employers just want the job done they aren't going to pay me extra unless I build into an already stretched budget.


[/SIZE]
I am not saying drop their benefits, maybe, have the employees share the cost alittle more like the rest of us. I know they have some really great benefits,I have friend who works at the GM Arlington Plant. And I am not talking about paid holidays or accident insurance, but their medical and retirement is really a large part of their costs to the big three.(matching and paying)
 

Flynn

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#13



The medical and retirement cost an American employer has to pay is over and above what other countries currently pay and that's because like so many other things in America you are living in the past and refuse to catch with with the future.

I was listening to a cross section of independant world economists who said that the USA economy can not afford to lose the auto indutry at this time as it will put too many more people on the unemployment line.

There was general consensus that the Big 3 should be taken over by international companies like Honda and Toyota because the management path American Auto Companies are are lead straight to the junk yard compactor.

Compared to Euopean cars American automobile are inferior in quality and American designs and standards do not meet minimum international standards.

The home of Henry Ford and now you can't produce a car for the average family, you went up market and forgot your place in the scheme of things.

I guess that's what greed does to a nation.


 

sybarite

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#14
Dear Employee,

Next week, Congress and the current Administration will determine whether to provide immediate support to the domestic auto industry to help it through one of the most difficult economic times in our nation's history. Your elected officials must hear from all of us now on why this support is critical to our continuing the progress we began prior to the global financial crisis.....................As an employee, you have a lot at stake and continue to be one of our most effective and passionate voices. I know GM can count on you to have your voice heard.

Thank you for your urgent action and ongoing support.

Troy Clarke
President
General Motors North America

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

From Gregory Knox,

In response to your request to call legislators and ask for a bailout for the United States automakers please consider the following, and please also pass this onto Troy Clark, the president of General Motors North America for me.

You are both infected with the same entitlement mentality that has bred like cancerous germs in UAW halls for the last countless decades, and whose plague is now sweeping the nation, awaiting our new "messiah" to wave his magical wand and make all our problems go away, while at the same time allowing our once great nation to keep "living the dream".

The dream is over!

The dream that we can ignore the consumer for years while management myopically focuses on its personal rewards packages at the same time that our factories have been filled with the worlds most overpaid, arrogant, ignorant and laziest entitlement minded "laborers" without paying the price for these atrocities and that still the masses will line up to buy our products

Don't tell me I'm wrong. Don't accuse me of not knowing of what I speak. I have called on Ford, GM, Chrysler, TRW, Delphi, Kelsey Hayes, American Axle and countless other automotive OEM's and Tier ones for 3 decades now throughout the Midwest and what I've seen over the years in these union shops can only be described as disgusting.

Mr Clark, the president of General Motors, states:

There is widespread sentiment in this country, our government and especially in the media that the current crisis is completely the result of bad management. It is not.

You're right, it's not JUST management, how about the electricians who walk around the plants like lords in feudal times, making people wait on them for countless hours while they drag ass so they can come in on the weekend and make double and triple time for a job they easily could have done within their normal 40 hour week

How about the line workers who threaten newbies with all kinds of scare tactics for putting out too many parts on a shift and for being too productive (mustn't expose the lazy bums who have been getting overpaid for decades for their horrific underproduction, must we?!?) Do you really not know about this stuff?!?

How about this great sentiment abridged from Mr. Clarke's sad plea:

over the last few years we have closed the quality and efficiency gaps with our competitors.

What the hell has Detroit been doing for the last 40 years?!?

Did we really JUST wake up to the gaps in quality and efficiency between us and them?

The K car vs. the Accord?

The Pinto vs. the Civic?!?

Do I need to go on?

We are living through the inevitable outcome of the actions of the United States auto industry for decades.

Time to pay for your sins, Detroit .

I attended an economic summit last week where a brilliant economist, Alan Beaulieu surprised the crowd when he said he would not have given the banks a penny of "bailout money". Yes, he said, this would cause short term problems, but despite what people like George Bush and Troy Clark would have us believe, the sun would in fact rise the next day and something else would happen. Where there had been greedy and sloppy banks, new efficient ones would pop up. That is how a free market system works. It does work if we would let it work!

But for some reason we are now deciding that the rest of the world is right and that capitalism doesn't work; that we need the government to step in and "save us". Save us, hell we're nationalizing and unfortunately too many of this once fine nation's citizens don't even have a clue that this is what's really happening but they sure can tell you the stats on their favorite sports teams yeah THAT'S important.

Does it occur to ANYONE that the "competition" has been producing vehicles, EXTREMELY PROFITABLY, for decades now in this country?...

How can that be???

Let's see - -

Fuel efficient -

Listening to customers -

Investing in the proper tooling and automation for the long haul -

Not being too complacent or arrogant to listen to Dr W Edwards Deming 4 decades ago -

Ever increased productivity through quality, lean and six sigma plans -

Treating vendors like strategic partners, rather than like "the enemy" -

Efficient front and back offices -

Non union environment -

Again, I could go on and on, but I really wouldn't be telling anyone anything they really don't already know in their hearts

I have six children, so I am not unfamiliar with the concept of wanting someone to bail you out of a mess that you have gotten yourself into. My children do this on a weekly, if not daily basis, as I did at their age. I do for them what my parents did for me (one of their greatest gifts, by the way). I make them stand on their own two feet and accept the consequences of their actions and work them through.

Radical concept, huh?

Am I there for them in the wings? Of course but only until such time as they need to be fully on their own as adults

I don't want to oversimplify a complex situation, but there certainly are unmistakable parallels here between the proper role of parenting and government.

Detroit and the United States need to pay for their sins.

Bad news people, it's coming whether we like it or not.

The newly elected Messiah really doesn't have a magic wand big enough to "make it all go away" I laughed as I heard Obama "reeling it back in" almost immediately after the vote count was tallied "we might not do it in a year or in four"! Where was that kind of talk when he was RUNNING for the office

Stop trying to put off the inevitable!

That house in Florida really isn't worth $750,000!

People who jump across a border really don't deserve free health care benefits!

That job driving that forklift for the big 3 really isn't worth $85,000 a year!

That couple whose combined income is less than $50,000 really shouldn't be living in that $485,000 home!

Let the market correct itself people, it will. Yes it will be painful, but it's gonna be painful either way, and the bright side of my proposal is that on the other side of it is a nation that appreciates what is has and doesn't live beyond its means and gets back to basics and redevelops the work ethic that made it the greatest nation in the history of the world and probably turns back to God.

Sorry, don't cut my head off. I'm just the messenger sharing with you the "bad news"



Gregory J Knox

President

Knox Machinery, Inc.

Franklin, Ohio 45005
 
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#15
Thanks for posting this Syb, I can now see why my father emailed this to 9 Senators that voted "No" to the Bailout..... I guess the Big Three need to grow up and be real men instead of little kids...........
 

Flynn

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#16



Americans just don't understand what is going on around them.

The American economy sucks so bad at the moment the last thing needed is more workers unemployed. It would be more cost effective to the economy if the government bailed them out.......... for the short term which is 1 to 3 years.

Remove the words Car Workers and replace it with the simple statement.......................Can the American economy afford to have 10's of thousands more workers unemployed ?

The answer is NO.

It doesn't matter whether they are retail workers or truck drivers the American economy can not afford to have another section of the work force collapse.

From what I've read the MOST a production line auto industry worker can expect to earn is $30 an hour and that's after long years of service. Starting pay is probably less than $15 per hour.

If the auto industry does not have a steady reliable work force then manafacturing schedules fall behind and the industry falls apart, that's why auto industry workers get paid above normal labour rates.

Time has come for Americans to understand that there are 300 million of you and the majority are never going to be more than mediocre. Not many can aspire to be part of the upper class. Not many of you will ever achieve middle class status. Most Americans will be minimum wage menial task employees from the start of their work life until the END.









 
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#17
That is why Granholm supposedly went to Japan to get some companies to start their offshore buisiness in Michigan.......... She has also been promoting Michigan to the rest of the states to try to not have us rely on the auto industry..........
 

sybarite

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#18
Americans just don't understand what is going on around them.

The American economy sucks so bad at the moment the last thing needed is more workers unemployed. It would be more cost effective to the economy if the government bailed them out.......... for the short term which is 1 to 3 years.

Remove the words Car Workers and replace it with the simple statement.......................Can the American economy afford to have 10's of thousands more workers unemployed ?

The answer is NO.

It doesn't matter whether they are retail workers or truck drivers the American economy can not afford to have another section of the work force collapse.

From what I've read the MOST a production line auto industry worker can expect to earn is $30 an hour and that's after long years of service. Starting pay is probably less than $15 per hour.

If the auto industry does not have a steady reliable work force then manafacturing schedules fall behind and the industry falls apart, that's why auto industry workers get paid above normal labour rates.

Time has come for Americans to understand that there are 300 million of you and the majority are never going to be more than mediocre. Not many can aspire to be part of the upper class. Not many of you will ever achieve middle class status. Most Americans will be minimum wage menial task employees from the start of their work life until the END.









[/SIZE]
So what happens when another industry goes under? Bail them out, and then another, and then another? How much money is the American tax payer supposed to spend to bail out private industries? How many millions are going to go into the top dogs fat bonuses? If I'm laid off, I'm supposed to support an auto worker so he can keep his $30.00 an hour job plus benefits while I'm standing in the unemployment line?

I know, I see your point and what your saying. We really can't afford to have such a large industry go under right now. What I'm saying is, where does it stop? Are these companies going to be accountable for the way this money is being spent? Do you see how this frustrates the taxpayer? Case and point, Sunday the Wall Street Journal reported Fannie Mae will allow tenants to remain in their homes and avoid eviction even if the building's landlord goes into foreclosure. They are headed down the same road they were on before the bailout. Throwing money at the situation not going to work because they are not fixing the problem that caused the bailout in the first place.

The only people I know that are making minimum wage are the high school students. There is no way you can support yourself or a family. You have a defeatist attitude. There are people that have started with nothing but the clothes on their back and went on to become millionaires. It depends on how hard you want to work for it. If a person is content to be mediocre, that's fine. If you want more, go get it. It all depends on your goals.
 
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SpiderWeb

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#19
here is something a friend sent to me ....


Here's something else to think about: Ford has spent the last thirty years moving all its factories out of the US , claiming they can't make money paying American wages.


TOYOTA has spent the last thirty years building more than a dozen plants inside the US . The last quarter's results:


TOYOTA makes 4 billion in profits while Ford racked up 9 billion in losses.


Ford folks are still scratching their heads.


IF THIS W ASN' T SO TRUE IT MIGHT BE FUNNY