Question: Should the Big Three be Rescued?

[markallyn]

For you cyclists out there, here's the big question the country's facing:

Should we rescue the Big Three?

The Big Three, I mean GM,Ford,Chrysler?

Or let them go and use the resources for more green transportation such as what we do here (cycling)?

Mark

[Attornatus_Oregonensis]

In a word: No. No more corporate welfare.

[Arem]

I can understand your reaction AO. However, there are some compelling reasons that they should get a helping hand to lift them out of the dirt, as Gov. Cozine (New Jersey) was speaking about this morning on the news. There should be come caveats to the deal that force these companies to move towards more effecient vehicles that are not dependent upon fossil fuels. Which we likely will not see action upon until the beginning of the Obama administration.
Allowing this entire industry in this country to fail miserably would have unintended consequences. Certainly there would be more bicycle traffic potential. However, the fall of these companies would put several thousand people, individuals, out of a job and potentially collecting unemployment benefits further taxing the states in which they reside. Not to mention it would have a cascading effect upon other companies that depended upon the clientele of the "Big 3" to keep themselves afloat. Plastics, metals, glass, leathers, other textiles, circuit boards and engineering firms would inevitabley flounder and potentially fail with the loss of business demand from the automotive production companies.
If the government extends a helping hand, there ought to be certain clauses attatched to guarantee that go forward in a different direction instead of continuing to use draconic and obsolete technology and that the government gets a return off of future profitability as an investment.

On yet another hand, it may be necessary to have them vanish to give opportunity to allow fresh companies to emerge that will start out with alternate power sources for vehicles and while the people in the country may have to address some serious sacrifice and suffering, it would indeed encourage more bicycle-centric travel amongst other related unforseeable outcomes.

[wsbob]

Not rescue the Big Three? Doing that wouldn't just put the pinch on obscenely over-paid white collar execs. It would devastate the livelihood of working class people around the world. The American auto industry is a screwy one to be dependent upon for your livelihood, but that's just the way it is for many hundreds of thousands of people.

Bankruptcy will probably mean major layoffs. Where's the work for all those then unemployed people going to come from? Bankruptcy itself is a rescue. The burden of the rescue is shifted differently, but it's still a rescue.

What could help to reverse the downward spiral for the Big Three, is if they produced cars that were truly advanced, superior in quality, alternative fueled contenders to the leading alternative fueled, foreign motor vehicle...the Prius. I suppose it's possible, but it doesn't seem likely. The Chevy Volt that's coming out doesn't exactly seem like a head-turner.

[Richard Seton]

I also think they should be bailed out, but!

1. Let them file for chapter 11 first.
2. Have every Vice President and above justify why they should remain employed. If half end up staying, then we were not strict enough.
3. Remove golden parachutes. Full stop! I don't want my money paying rich people to get richer.
4. Be very critical of their operations. Downsize ruthlessly where appropriate
5. Union contracts, pensions, etc, will have to be changed. The big three have this huge overhead that the other auto manufacturers don't. (I never understood why big business was against a national health or pension plan. That would remove a big burden from most of them, you would think?)
6. Combine where necessary. Chrysler probably just has to go.
7. Tax payers money should only be used on investments that will grow a viable operation. None of the big three are viable at present.
8. Fund the bailout with an increase in the gas tax. Pay as you go. I don't want to increase our already huge debt, nor do I want to increase my income taxes. Let the folks who bought the gas guzzlers pay the bigger share of the bailout! We'll all pay anyway. At least there is some sense that we can change our car behavior while we at it.

(Sorry for the rant. I don't know what came over me)

[Attornatus_Oregonensis]

And I understand your reaction Arem. I have heard this argument before, as it is being made ad nauseum by the talking heads on the cable channels. It would indeed be a big economic hit. But what I think you and they fail to understand is that not providing massive amounts of public money to these businesses isn't "allowing them to fail." They've already failed. Again and again. For over 30 years, they've shown that they cannot surivive without public subsidies. Bailing them out is simply throwing good money after bad. It's incredibly ironic that all those so-called capitlists who worship the market are not willing to admit that manufacturing automobiles in America is a business that will not survive alone in the market. I say take the massive amounts of public money we would spend on proping up a failed business model and give it to the employees to re-train to do something that is actually in demand in our economy, or to retire, or some combination. The notion that we either provide the big three more corporate welfare or everyone starves is a false dichotemy. Put the people to work elsewhere and let the dinosaurs go extinct.

[biciclero]

Here's what I want to know:

I just returned from a vacation to the UK, where we rented a Ford, yes, a Ford Fiesta, loaded it with luggage, a driver, and a passenger, and toured the whole island. The gasoline (not diesel) engine on our rented Ford Fiesta got us a combined (urban + extra-urban) mileage of 40 (forty) mpg. Forty mpg. One more time: FORTY mpg. Not 40 kilometers per gallon, 40 MILES per gallon. There are diesel models of vehicles available in Europe that get in excess of 50 or even 60 mpg. This is in a country where citizens pay road tax based partly on CO2 emissions, so emission control would appear to be a priority, yet with whatever emission controls those cars use, they still get 40 -50 mpg. And, I might add, have way more power (i.e., acceleration capability) than my Nissan Altima.

<RANT>
Why, oh why have cars like that not been available in the U.S.?? Our own car companies (Ford, anyway) can obviously produce very fuel-efficient vehicles, yet Americans can't buy them? In the US, Ford gets its butt kicked by Toyota/Honda because the Japanese hybrids available in the US are the only ones that get mileage comparable to the gasoline-only European Ford models. WHY? Do we truly impose such rigorous emission controls here that all power is drained from our necessarily gigantic engines?

Not that I want to encourage more driving, but geez, if we have to drive, why can't we drive an affordable, fuel-efficient vehicle made by an American company?
</RANT>

[Richard Seton]

Biciclero, don't forget, the English gallon is bigger than the US gallon.

However, your point remains. We can do much better with efficiency here.

[biciclero]

I don't believe the measurement used imperial gallons, but I would have to check.

My recollection is that we could go about 300 miles on roughly 27 - 30 litres of petrol. That would be
300 / (30 / 3.785411784) = 37.85 miles per US gallon to
300 / (27 / 3.785411784) = ~42 miles per US gallon.

My recollection could be fuzzy, but I still think that the mileage our dashboard computer showed us was per US gallon. If anyone knows for certain that this is not true, then my rant is deflated a little.

[wsbob]

biciclero, re; fuel sipping diesel's in foreign lands: read a fascinating article in...I think, the NYTimes 2-3 wks ago. Why aren't cars like the Fiesta you rented, available here in the U.S.? According to a Ford or Chevrolet rep quoted in the article, Americans perception of and interest in the diesel is such that a market sufficient to make distribution here in the profitable, does not exist.

According to the Big Three spokesperson, Americans consider diesel's to be stinky-smelling weenie cars; they won't spend their money on them. They'd rather spend their money on a Suburban (not a bad deal with gas at $2/gal again), or, out of an irresistible submission to trendiness, the Prius.