Does anyone really believe politicians can run Detroit any better than the greedy goons who have been in charge? I mean, they took their private jets to Washington the first time to ask for a handout then thought better next time and drove. That is, in a nutshell, how much forward thinking that has gone into these companies probably since I was born. They can't even anticipate how their actions would be perceived in their dire situation. How could they be expected to understand what would drive demand in favor of their cars.
Talk about reactive management, do you know anything more reactive than our Congress? They only respond to existing circumstances, there is no way they can strategically manage Detroit out of their misery. They can throw money at the problem but that's the extent of their ability. And it's our money!
Detroit's problems are so deep and complicated there is just no way that a politically appointed czar can do any better. Politics should have no part in this, but it would be the key issue, if an appointed czar answering to the President or Congress is the "solution".
The major concern seems to be the potential loss of jobs if bankruptcy happens. Well, it seems to me that the jobs that exist now are a big part of the problem. Too many jobs at too high a wage. One can't protect these jobs and expect to solve this situation. There are also concerns about supplier and dealer jobs. Here again, there are too many dealers and too much employment in the supplier ranks.
The demand for autos is not expected to return to the 2006-2007 levels. Therefore, one can't expect to maintain capacity throughout the system with lower overall demand. And we also must consider the foreign auto cos. who have taken market share over the past years and build these cars here in the U.S. Their demand and profits are hurt also but they are better positioned to weather the storm and will probably gain market share during this time. There will be a finite number of cars sold here no matter what. It all depends on who gets the business. Detroit will get some, but, based on today's cost structure they can't make a profit on what they will sell.
The best solution is to allow for the "survival of the fittest". That's what the animal kingdom is based on and also the premise that allows capitalism to exist. We have laws in place to allow for the orderly transition from "weak to strong" without being totally devoured in the process. It's called Chapter 11 bankruptcy.
I sure would enjoy reading others' position in this issue. Thanks.
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2 comments:
I think you are right on. I vote no bail. I really think the unions have a huge part in the problem and yet they are unwilling to help fix it You can't really blame the worker who just gets his pay and pays the dues to the union. So who wouldn't be happy getting $70 an hour. What are they to say, no I don't want that. The unions raised the money and compensation bar, the whole auto industry went along with the plan for years. This situation goes way deeper than just cars. It is the greed and corruption that is pervasive through out every aspect of our government and corperate world. Just look at the situation in ILL. How deep does this go? No one in Obama's camp knew anything? Jessie Jackson Jr. was unaware? This is like I didn't know the gun was loaded, I just killed someone. The excuse is...??
Wow, Sixty Something...all this talk makes me really feel my age. I remember a friend telling me in the 70s that everything was controlled by the industrial-military complex, and then oil went to $12 barrel, gasoline became almost nonexistent at the pumps, and we believed him. Next thing you knew the guy in the White House and all his henchmen were in court, a big chunk of the Watergate tapes were missing, and "nobody" knew a thing about any of it. Decades later we're chasing around in the same old circle. I'm tired of all of it and would rather hear more about how much you love your dog!
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