Monday, November 17, 2008
Bail Out The Automotive Industry
We must be careful when we talk about bailing out the automotive industry. For one - we are only talking about bailing out the Big 3 (GM, Ford, Chrystler). Interesting enough Toyota and Honda who have plants right in the good old USA are not having financial difficulty. Why on earth could this be? Average hourly rate for someone working at Ford is $73, while Toyota is $48. What is the difference between those two when both are American workers? You guessed it UNIONS! Unions that restrict change and inhibit growth- meanwhile their salaries keep going up. So how is giving $25 billion to the big 3 going to change anything? All it will do is delay the inevitable. These big 3 need to fall on their face, start over, and create a new business model that is more efficient. Take a cue from Toyota and Honda. There is a reason why there businesses are making money and have the best sold cars on the road.
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2 comments:
Actually they need to declare bankruptcy so they have legal tools available to break the union coerced pensions that are destroying their business.
This is what the Airline industry did several years ago and brought prices for flying down, and helped revitalize the industry.
Honestly, this bail out is not about the car companies, its about the worker's pensions. That why I call it the auto worker bail out instead of the auto industry bail out.
Yeah, FUCK YOU RETIRING FACTORY WORKERS TRYING TO SUPPORT YOUR FAMILIES AND MAKE PLANS FOR YOUR OLD AGE! Kiss those pensions goodbye, jackasses.
Seriously, unions don't get to dictate their terms; CEOs have to agree with them. The reason you keep hearing about crippling pension debts is that CEOs can easily agree to something that costs them nothing until 20 years from now, at which point they'll have long ago moved on with a multi-million dollar bonus. This isn't to say that Unions are never corrupt or damaging to industry, but they're only one side of the problem. By allowing individual executives to succeed in their careers by making decisions that would ultimately bankrupt their companies 20 or 30 years down the road, the free market has failed on some of it's most basic tenants, causing the economic upheaval we're currently suffering through.
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