33 Comments

1. Bailout Fallout | The Sundries Shack:

[...] the mostly-stalwart Republicans blew up the UAW/Democrat payback-o-rama that we knew as the Big Three Bailout last night and there are still chunks of it splatting around [...]

Dec 12, 2008 - 9:11 am 2. Steve Collins:

The UAW acts collectively like a parasite and it is about to kill it’s host — the auto industry. Now it wants to attach itself to the next victim that has a near limitless blood supply — the taxpayers! They should only get bailout money if EVERYONE including the UAW takes significant reductions until the industry is viable. If they will not agree to this, we should let them try their hand in bankruptcy.

Dec 12, 2008 - 2:05 pm 3. PanSkeptic:

Take a good look at that photo of Roger Kimball.

If he was next to you in an elevator or in a bar, would you listen to a word he said?

Of course not.

Lose the bow tie, Roger.

Dec 12, 2008 - 3:17 pm 4. Danny:

I just wanted to make a point -

Who’s been spending so much? You meant Republicans, right?

Take a look at your numbers as to which party has been spending the most the past 10 years.

Looking at your bow tie…you must be a Republican.

Get a clue.

Dec 12, 2008 - 3:52 pm 5. putt:

“But why? I know Democrats like to spend as much money as possible.”

Hmm…groping for an identity much?

Disregard the $700 billion in confetti thrown at Wall Street. Pay no attention to those exploding deficits over the past 8 years. Forget the $10 billion a month poured down the drain in Iraq. Ignore the Medicare Prescription Drug giveaways that expanded the welfare state and shoveled billions back to the pharmaceutical industry. Forget all that, folks, because it’s obvious, isn’t it? The Republicans are the responsible ones and Democrats just want to give away money.

The impetus knocking the tin cup from the Big 3’s hand is a blend of opportunistic union busting, an homage to free markets, and erecting a façade of fiscal probity.

What a transparent joke.

Dec 12, 2008 - 3:53 pm 6. valwayne:

Its called corruption!!! Gov Blagojevich wants Obama to pay him to give him his choice of Senate replacement. The unions want Obama to hand them billions in tax dollars to pay them for their support. Its the way things are done in Chicago. If its bad for Blagojevich to hold up Obama….why is it ok for the Unions. We all know that without bankrupcy style reorganization and lots of pain the car companys might as well just flush or burn the money. How do you spell corruption? Give me an O, give me an A, give me a M, you can finish it!!!

Dec 12, 2008 - 4:06 pm 7. Alex:

Danny,

I agree. In the past 8 years, the Republican Party has proven that it is no longer a conservative party. What ever happened to social security reform?

Anyways, the auto bailout is nonetheless a terrible idea. We’ve known for years the reasons why GM is failing: they give their workers absurd benefits that would make white collar workers blush, and their cars just plain suck. Let’s not reward this kind of behavior.

Dec 12, 2008 - 4:43 pm 8. Dave:

It’s clear that the wages the UAW members get are part of the problem – “part” of the problem. How about equal scrutiny and criticism of the management (you think their salaries aren’t worthy of similar criticism?).

And how about all the congressional members who voted against requiring higher MPG numbers of American-produced autos and cars?

I’d like to see the voting records of the “oh so sorry” members of Congress voting against the bailout, who also voted against more stringent MPG requirements. Those who voted against these requirements should be dragged behind an exhaust-spewing
SUV till they are dead meat.

Dec 12, 2008 - 5:13 pm 9. K G:

You know what’s odd about your argument Mr. Kimball is that you make a great argument against unions but at the same time a bad one against free market rule.

In a free market, the union negotiated a contract with the car companies. Why is it only the union deserves your wrath? The union practiced free market rules and won. The auto industry signed a stupid contract. They played free marker roulette and lost.

And let’s not act like there aren’t any larger issues here. The larger issue is the cost of health care. Those costs exploded and the car companies got caught with their pants down. If we address the cost of health care, then we can do something useful to save not only Detroit and the UAW, but everyone else in AMerica – business and people.

The original contract that was signed with the UAW that included the damaging health care costs was signed almost 20 years ago. Why is it just now that you seem to think that its all the union’s fault? The union has done everything it needed to – productivity has increased every single year and the quality of the cars has increased, overall, every single year. The union does not design cars that people don’t want. The union doesn’t build big gas guzzlers that won’t sell in a tight oil market without any other options. The union doesn’t pay its executives tens of millions of dollars for losing less money this year than last. The union didn’t cause the economy to nose dive thereby drying up the money to lend to people to buy cars.

As a matter of fact, other than the costs of the employees – most notably pensions and health care costs – is the only thing the union had any hand in. And they got what they have by playing free market rules and negotiating the best deal in its interest.

Why not stand here and defend free market rules again – this time in favor of the unions?

Few morsels for thought – if we had nationalized medicine 15 years ago, would the big 3 still be in trouble? If the answer is yes, then that is not the unions fault as they don’t control the company only the workforce, If the answer is no, then it turns out you have to admit that the Clinton’s were right in trying to nationalize health care for everyone and get those expenses off the backs of business.

Also, had Detroit not fought everyone for the past 30 years about building more fuel effecint cars – as many were begging them to do – would they have continued to lose market share? If the answer is no, then you have to admit that the managers – not the employees or union – are repsonsible for the current mess. If the answer is yes, then we have to look at why that is?

It’s amazing how people are always for free markets until the businesses get in trouble, then it’s always the fault of the worker – the worker who doesn’t make any of the decisions.

Unbeleivable – you really want people tio give up their income, pensions and health benefits – the people who actually do the work that produces the products we are talking about – in order to keep the company in business. How about we take away every bonus, perk, corporate jet, paid rent, paid taxes, company car and exorbitant salary first, then see where we stand. In case you haven’t noticed, without these workers, there will be almost no economy in the US. The workers are what drive the economy, not the executives.

Unbelievable that this even needs to be explained.

Dec 12, 2008 - 5:14 pm 10. Scott:

Danny, the article is about the big three bailout – stay on topic! I am sure we all can recite the GOP’s spending tendencies – they lost their fiscal conservative base and lost the last two election. That doesn’t matter two s%$7#s as to whether the UAW should get a big wet kiss from the taxpayers – unless you think that will somehow reign in the spending you decry – if so, please explain!

Typical response from the party of tantrums – you don’t like a statement – don’t address it directly! That would require thought and a grasp of facts – why do that when it is immensely easier to launch into ad hominem attacks, smears and innuendo (see Sarah Palin and Joe the Plumber). Get a clue

Dec 12, 2008 - 5:29 pm 11. Cadmus:

When the religious right delivered the presidential election to George W. Bush, was there this same cynicism when he turned around immediately and annouced privatizing social programs and funding the faith initiative? Can we go back and review the campaign contributions of KBR/Halliburton and Blackwater executives before our war efforts were privatized and no-bid contracts were awarded?

When Paulson asked for $700B for Wall Street with a three page plan…did the Southern Senators stop to think the hypocracy of saying no to the UAW and auto industry request for $14B? Can you imagine if Democrats had said no to Paulson and let AIG, Citigroup, Morgan Stanley, Merrill Lynch and JP Morgan just shut down so European and Asian financial giants could sweep in and take over our investment, banking and insurance industries?

Republicans really have an ax to grind with blue collar workers who value their benefits and a safe workplace.

Dec 12, 2008 - 6:06 pm 12. Doug in Washington:

The Big 3 are failing because American consumers refuse to buy their shoddy products. Let capitalism takes its course and force these companies to restructure or die. The bailout is especially unfair to thousands of Americans who work for “foreign” car companies and who are being taxed to subsidize their competition.

Dec 12, 2008 - 6:29 pm 13. David:

Blaming the UAW for the failures of Detroit management is like blaming the grunts in Iraq for the failures of the Bush administration.

If we had more unions with the discipline and reach of UAW, we wouldn’t be watching the US economy self-destruct, with unemployment claims exceeding 500,000. We would have a middle class that could earn a living wage and not be sucked into the downward spiral of mortgage slavery.

The only parasites here are managers and politicians who think they can milk the cash cow forever, and don’t have the horse sense to plan for the future.

Detroit management has been living in the same fantasy world as Bush & Co. Time to wake up. CHANGE IS COMING. If these fools don’t shape up right quick, labor is going to get organized enough to toss them all out for good.

There are many among the broader public who have been intelligent enough to see what Bush and his cronies have been up to. Corporate America is infested with these greedy parasitic managers, who are happy to subscribe to endless war and free money. Just remember – there’s no such thing as a free lunch.

Unfortunately, the taxpayers are going to end up footing the bill, because these robber-barons have already stashed their loot.

Dec 12, 2008 - 6:47 pm 14. smokin:

The bailout is because of what?

It’s because no one WANTS TO BUY THEIR CARS!!!!!

end of discussion…..

Dec 12, 2008 - 8:25 pm 15. Annie:

So now Republicans find fiscal responsibility after they have bankrupted this nation with needless wars and bad choices for the last 8 years. It is irresponsible to try to keep these industries afloat that employ thousands of useless little people who usually live in blue states anyway.

I agree that the Big Three have done a wretched job of producing products people want to buy but this is not the time to throw even more people out of work under the guise that the Republican party doesn’t like to spend money. They love to spend money. Just not for anything useful for the common people.

Dec 12, 2008 - 9:21 pm 16. Kyle:

Hey KG,

I like your defense of the free market principles. I agree whole heartedly that the unions and the company were both working in the free market. But you don’t follow the free market analogy to its conclusion: bad (unprofitable) companies must go under. How they go under is up to the surgeons who decide if anything is salvageable, but they most go so new, profitable, sustainable (finally a way to use that word that doesn’t make me vomit) companies can take over.

Is this painful for everyone in the company? Yes, from top to bottom nobody wants to lose their jobs.

Is it necessary?

I don’t know the answer to that because I am not an economist. I do, however, know the history of governments dictating how the economy of a country should run and it isn’t pretty and hasn’t been successful. (Japan is a good place to start researching if you are interested.)

The silver lining in the failure of the big three is that the people put out of work when the car companies fail will be rehired by new companies who think they can build cars better, safer, greener, and more profitably then their foreign competitors or the former big three. American’s are resilient, savvy, entrepreneurial people when given a chance. The big three is standing in the way of that culture.
Its time for change we can believe in any one?

I say let the asteroid hit so we can be done with the dinosaurs and start the evolution of a dozens of new nimble mammals.

Dec 12, 2008 - 9:32 pm 17. Jesse:

Bow Tie = Republican? Louis Farrakhan and Sen. Paul Simon(D) might beg to differ.

Dec 12, 2008 - 10:06 pm 18. 1%er:

1. It will cost us more to pick up the pieces of this disaster than loan 14 or 140 billion to them.
2. American products are not “shoddy” and the companies can be quite competitive (Ford made a profit the 1st quarter of this year). In my opinion, all Japanese cars are boringly designed boxes that are always trying to copy someone else.
3. Why is the common denominator here lower wages for workers? CEOs and top execs have been making many multiples of what workers make, but no guarantee that they take a pay cut? Ask yourself why that is…
4. If you work for a foreign company, ask yourself why your company doesn’t allow the Big 3 to compete in that country on a level playing field. Not only do we allow that in the US, we even give big tax incentives to these foreign companies to pay us less than they pay their own citizens at home.

Dec 12, 2008 - 10:28 pm 19. neal:

Either the unions accept the benefits that the Japanese pay American voters or let the car companies file Chapter 11, fire all the union hacks and start anew!

PERIOD!

Dec 12, 2008 - 10:29 pm 20. Lars:

It’s quite entertaining to see the UAW refusing to negotiate down terms at the big 3 to levels of other car companies based in the US.

Paying workers $40 an hour is a sure way to lose any competitive edge you might once have had.

Chapter 11 -> gov’t buys out assets -> remove and replace management -> no debt, no liability -> fresh start.

That’s the only way it can work. Sure, everyone whom the big 3 owes money will be shafted to some degree, but it would prevent a full collapse of the american economy.

Saving UAW jobs, punishing shareholders and management, and keeping important business in the country.

The big 3 *will* go under unless their slate is wiped clean; their debt burdens simply cannot be maintained, and asking tax payers to sort this out is unethical at best.

Dec 13, 2008 - 12:06 am 21. Matt in Minneapolis:

The ‘Big 3′ make automobiles that are world class; nobody makes them better. They cannot, however make suffcient profit doing so. Why is this?

Is it due to the wages paid to their employees? When compared to the wages paid to competitive manufacturers, the answer is yes. Why, we must ask, did they agree to pay such wages? Certainly, just as the forclosed home owners made poor financial decisions, so did the ‘Big three’.

We must also note that while the past labor agreements have negatively impacted the ‘Big 3′, the current economic climate is the true source of their current problems. Folks simply are not buying automobiles. Period. It matters not the source, the quality or the price.

We, the American people, simply don’t know what the future holds in store for us. Are the banks collapsing? Are the bailouts making the problem worse? What plans can we make when the world’s various governments upset the apple cart on a whim?

As an average working Joe, (not a plumber by the way) I know that if we don’t build power plants, whether coal, nuclear or natural gas, the cost of energy is going to skyrocket. I also know that solar power is uneconomical and that wind power requires 80% backup by conventional power plants (look it up).

We can’t drill, we can’t build, and we’re trying to eliminate essential trace elements from the atmosphere. We are getting exactly what our unrealistic expectations have promised.

We do, however, seem to like this if the past election is any indication. We returned over 90% of our elected officials to power. What’s that old saying? Insanity is repeating the same actions and expecting different results?

Dec 13, 2008 - 12:16 am 22. Tom Carr:

It was you Liberal idiots that wanted the suv’s and trucks to be outlawed because the harm that you told everyone they were doing to mother earth. (remember) Then gas went to $4 a gallon and what did you and your moron cronies say, that’s great now we can make the people drive the cars that the Europeans drive. Well you got your wish, now your saying we have to save these American institutions (for what) you now have your global economy and all of a sudden you want to be protectionist. The tree huggers started this now we have to live with it, aren’t the enviromentalist great. LOL

Dec 13, 2008 - 3:22 am 23. The Intellectual Redneck:

Ever wonder what a UAW contract looks like? It is over 2200 pages and weighs 22 pounds. It no wonder the big three can not compete in the global market. Honda and Toyota don’t have to deal with that kind of crap. It would take a team of lawyers just to understand this document. You can see the document here. 2215 pages of inefficiency brought to you by the UAW

Dec 13, 2008 - 4:57 am 24. Mike Alexander:

Roger writes: Is America the basket case that the American car industry is?

Well yes it is. Trillions of dollars have been poured into our failing financial system with little signs of recovery.

If $40 billion can keep 2% of workers employed by preventing liquidation of the US automakers, this translates to 2 trillion to keep 100% employed, less than what the Fed and Congress has already thrown in the black hole that is the American financial system and which has done nothing to reverse the decline.

In other words, the 15 billion infusion is a lot cheaper than what we did with the banking industry. And since the car industry is a lot less sick that the financial industry, it is more likely to work.

Dec 13, 2008 - 6:34 am 25. Bill Archer:

By far the most amusing aspect of this sad, saga is the reaction of the UAW towards the Republicans. They are frothing-at-the-mouth furious at the callous disregard GOP lawmakers are displaying towards the UAW’s fine, fine members.

Well those fine fine members ought to consider that it’s their craven leadership which has spent the last couple of decades working overtime to ensure that the Republicans owe them nothing.

If there was ever even the slightest chance that the UAW would support a Republican – ANY Republican, ever – then maybe the Republicans, in turn, would be inclined to listen to their problems.

Instead, all you have to do is plop a (D)after a candidates name to guarantee that the UAW will shower him with money and manpower.

Furthermore, if every Republican in Congress stood up tomorrow and proclaimed total undying solidarity with the autoworkers and voted to give them everything they want, come the next election the UAW wouls still be lavishing money on their opponents and telling their members that the GOP is the party of anti-union fat cats.

So the UAW apparently thinks that a bunch of guys they’ve been publicly savaging and trying to get replaced for a decade ought to stand up for them?

It’s not just the contracts that union leaders have screwed up – they’ve played politics about as poorly as it’s possible to do and now their members are going to get hit, badly.

I hope the UAW leadership enjoys being invited back to the White House for state dinners and commission meetings and such.

Because in the end, that’s all that their members hundreds of millions of dollars in contributions has bought them.

Dec 13, 2008 - 6:41 am 26. Victor:

Mr. Archer,
The reason the UAW has not supported Republicans is because Republicans have been anti-union forever.
It’s like asking, “Who don’t I, a Shiite, support a Sunni?” Could it be because he wants to kill me?
You state your point well. Which, since it’s illogical, is quite a task.

Dec 13, 2008 - 8:02 am 27. Bryan:

Unions are on the rise now because greedy Republicans put the economy in the ditch (just as in the 1920s). If you don’t like the rise of unions, you should have thought about it before you voted for the kleptocracy that ruled for the last eight years. Viva la change!

Dec 13, 2008 - 8:07 am 28. Gary in Columbia:

The UAW did what everyone else does – it got as much as it could(the AMerican way, no?). So, why should the burden be put on them to save the auto folks. The burden lies with “big picture” decisions management made along the way over the last 20 or so years and how those decisons lead the American auto industry to be less competitive than foreign counterparts. Matt in Minneapolis maintains American cars are world class – maybe in the last 2-3 years. The Big 3 execs themselves admit to as much. Yet, there they are (still!) with hands out expecting to be rescued/rewarded with acting contritiously as the only consequence? I agree some sort of chap. 11ish process needs to happen but only because current management(and management culture)has shown it has no vision/will/balls. But, to say the workers should bare the brunt of the blame is a bit over the top. Also, as an aside,why is no one screaming for healthcare/insurance to take a (fill in the) % cut in order to bring auto overhead costs down(and just about every other business in the country)? I work in a public school system and healthcare insurance costs eats up a larger piece of the budget pie every year (and for less coverage in return).

Dec 13, 2008 - 8:09 am 29. Eric Rejector:

This tissue of lies, exaggeration and fabrication is pathetic even for ‘Pajamas Media’. DEMOCRATS like to spend as much as possible?

WHO squandered a federal surplus? Republicans.
WHO tosses millions per MINUTE away in Iraq? Republicans.
WHO appoints incompetents to tend critical national infrastructure? Republicans.
WHO ignores experienced military advice? Republicans.
WHO fires those who bring concerns to light? Republicans.
WHO gives sweetheart no-bid deals to their cronies? Republicans.
WHO drove the country off a cliff and won’t take responsibility? Republicans.

I can’t decide which is greater: your gall or your ignorance.

Keep the tie: it makes it easier to know who to spit on.

Dec 13, 2008 - 8:35 am 30. Jake:

Aren’t auto manufacturers throughout the world, with little exception, state subsidized?

Dec 13, 2008 - 11:13 am 31. E Lewis:

Tom Carr:

The problem is that us liberal idiots didn’t get our way, idiot Republicans didn’t. you opposed increased fuel efficiency standards not us. Gas didn’t go to $4/gallon b/c of the tree huggers, Republicans were in charge for the last 8 years. Bush vetoed any liberal proposal related to fuel efficiency and energy, so don’t blame Democratic control of Congress for the last two years either.

Why don’t you ask Chevron and Exxon why gas went to $4/gallon. and it wasn’t b/c of regulated offshore drilling either,which tends to be significantly more expensive, and energy companies weren’t even taking full advantage of the drilling they were allowed to do on land, which is cheaper. As for SUV’s, it was the big 3 that chose to focus on the SUV market not idiot liberals.

Had we gotten our way, SUV’s and cars would be sporting the kind of fuel efficiency that would be competitive with European and Japanese automakers. I bought a Honda b/c it retains its value better than US autos and more importantly sports significantly better gas mileage. I knew $4 gas was inevitable. maybe you should have listened to us so-called “liberal idiots” and forced the auto industry to produce fuel efficient vehicles rather than protecting them from the big bad liberals who wanted to raise CAFE standards for cars, trucks and SUV’s.

Dec 13, 2008 - 11:48 am 32. Jules:

I’m confused why other countries are helping out their auto makers in the light of the downturn, but in America we want to let them fail.

I don’t understand why Republicans think it is a good idea to take well paying jobs away from consumers.

What I DO understand is that once the unions are gone all of our wages (well those of us who actually have real jobs, not management or pundit-type jobs) will go down as the years go by. Hell who needs a middle class.
Right?

Dec 13, 2008 - 12:11 pm 33. Danny:

Scott

Democrats – party of tantrums??

Hmm….

Which party is going down in flames again?

Which party is fighting amongst itself?

WHO’S THE MAJORITY AGAIN?

Oh…but I’m off topic, aren’t I?

It’s pretty pathetic that the Republicans rallying cry is connected with tearing down millions of jobs.

Face it Republicans….your party is dead.

Dec 13, 2008 - 4:07 pm

Write a Comment

Name:	(required, displayed)
Email:	(required, not publicized)
URL:	(optional, displayed)
Comments: