Socialsm in the US Government?
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if you dont like our president vote next time
ive waited eight years to say that
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thrash;277768 wrote:
It all came from the Obama administration. And the actual owners of GM have been fighting this tooth and nail. Obama told them to take 10 cents on the dollar, while giving the UAW something like 40 cents on the dollar. Except the actual owners are legally first in line to get the lions share of the proceeds of whatever divestment or restructuring happens.I'm aware of different types of bankruptcy. The point is that GM isn't going to evaporate, because there are real assets there. You'd only be concerned about people losing tons of jobs if you thought all those people were worthless at what they do. In which case, they SHOULD lose their jobs.
Think of all of those machinists and line workers and engineers and janitors and everyone else, lending all of their efforts to a company that can't compete. Once you free them to do something else [whether that's in a new, leaner GM, a carved off subsidiary, or something altogether different], there's a good chance that it will be a more effective use of their talents than what was happening before, and at a more sustainable level.
Bankruptcy is the process by which the US economy re-shuffles investment -- both in terms of external capital and internally employed labor -- away from failed ventures and into activities that are more likely to succeed. It's a critical part of the strength of the American economy. We re-shuffled the "Deck" all the time, on an ongoing basis. It's also why, unlike europe, some of the top 10 companies and gabillionaire families in our economy didn't exist 30 years ago.
Ahh...but they DIDN'T take the $.10 on the dollar for the $27 billion which is why they now filed for Chapter 11 protection. AFAIK the UAW was given the stakes in the company as a concession (from both sides?) to modify their existing contract. Like the link I posted stated, that could be a double edge sword for the UAW. On one hand they might get a UAW friendly person on the board of directors because of it, however that person on the board might want to give the UAW a better deal, however they are probably going to have to make better decisions/compromises for both the employees that they represent AND the stocks/company that they have a legal obligation to ensure the well being of. It might actually work out good for all involved where everyone is trying to work toward the good of the company.
And Dustin, my understanding is that they were nearing filing Chapter 7 (whether that was a ploy to scare the gov't into investing in them....who knows?)
The UAW wages & benefits are ~$70/hour....the hourly paycheck is ~$28/hour (less if you are a new employee as they now have a 2 payscale workfloor...I want to say ~$14/hour) the pensions and other benefits add up to the rest of it....which is a LOT of cash for benefits, though I've never sat down and figured out my "hidden" paycheck at the past 2 jobs I've worked, at Simplex it was in the neighborhood of $30/hour extra in pension, 401k match, health/life/dental/vision insurance plus the use of a new automobile every 2 years.
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Knowing only the details that I've heard rumored....I don't know.
What we know:
The companies were in dire straights, and facing a potential chapter 7 in which case all of the assets would have been liquidated and the companies shredded and sold as scrap essentially. If this had happened, this recession we are in right now would have looked like childs play and the unemployment numbers would have soared FAR beyond where they are now (in MY opinion) as not only would have the manufacturers failed, many of their suppliers would have also failed, and then the suppliers that provide parts for those parts suppliers would have failed, and then more companies would have failed, etc, etc, etc.... So, I don't know. Was the bailout a necessary evil? Without it would have we seen a HUGE drop in manufacturing in the US? Are we as a country better off keeping one of the staples of our economy intact w/ taxpayer dollars or letting them fail and having the employees live off of taxpayer dollars in the form of unemployment/welfare?
Despite what many of you think about my political views, I generally don't want the gov't to bail out businesses....however I don't think many of you realize how much some of the businesses borrow from the government, even when they aren't in crisis. The lending of the money doesn't bother me at all, the taking ownership of stock does....but every bank asks for collateral on most loans, so that is how I am trying to look at this as well. So long as the Fed doesn't control the companies and force them to do things, I'm for the most part accepting that they have a share of the businesses.
I'm kind of neutral on this whole thing to be honest as I can see both sides of the argument. What I want to know is this: IF GM pulls out of this in a few years, pays back their loans, etc... will this go down as a success story for the USA or will it forever be tainted as a socialistic move that despite working, was the wrong thing to do?
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Trafik Jamz;278074 wrote:
I'm kind of neutral on this whole thing to be honest as I can see both sides of the argument. What I want to know is this: IF GM pulls out of this in a few years, pays back their loans, etc... will this go down as a success story for the USA or will it forever be tainted as a socialistic move that despite working, was the wrong thing to do?IMHO, even if it "works" (i'm not really sure what "works" means in this case) it is a failure. The gubmint is gambling with billions of our dollars and meddling where it doesnt belong. Bush should be slapped for starting this fiasco and Oblama should be slapped for expanding it. Then Oblama should be slapped again just because he's a lib.
DaveH
'94 Supra- 7.77 @ 176mph -
MisterCMK;278089 wrote:
So do you think that the ends justify the means?I don't know...maybe? Again, it's not like this is unchartered territory for this country (again, that doesn't justify doing it).
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Trafik Jamz;278074 wrote:
So long as the Fed doesn't control the companies and force them to do things, I'm for the most part accepting that they have a share of the businesses.Like force the resignation of certain people?
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I wasn't in favor of that. Do I think it probably should have happened? Absolutely! But not by the direction of the government.
I personally think that all stock holders (excluding the US Gov't) should have a better ability to overthrow a board of directors and/or CEO if they aren't performing.
The worst part about the bailout is that there is no foreseeable end in sight. Other industries could/will try and get a piece of the pie as well. My question is if these industries are too big to fail, then aren't they too big to exist as well?
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