What of the Automobile Industry?

As some of you may or may not know, the leaders from the Big 3 American Automakers (dubbed "Detroit 3" by southern senators, but more on that later) and the UAW met in Washington to discuss the possibility of an Automotive industry bailout.

The first meeting did not go so well, as the leaders were chided for their symbolic gesture of flying in on their private jets. For this, the second meeting, they all drove in, again a symbolic gesture, from what I hear in Hybrid and Electric cars -- the latter part seems just a little unnecessary, as in a hybrid vehicle, the electric part of the motor is not engaged at all, or perhaps maybe only slightly, in the course of highway driving. I would imagine most of the journey from Detroit to Washington to be made of highway driving.

But nonetheless, the Senate Banking committee was noticeably more impressed and willing to bail out the automotive industry than previous. All groups made larger concessions, though really they should've been made before the first meeting.

What does this all mean though, how likely is it they are going to get bailed out, should they get bailed out?

The likelihood this is going to pass is still pretty thin. Oddly enough, the issue isn't really broken up by party lines, as it is broken up by geographic ones (though MSNBC would like you to believe they are the same). Northern manufacturing states are very much for the bailout -- Michigan obviously leading the charge, likely followed by Ohio, Illinois, Indiana, Minnesota, and Pennsylvania's Bob Casey, who made a comment to the effect of trying not to have another major industry collapse within the country (talking about the old steel industry, based out of western PA). The opposition to this bill is in the south. The reason for this is southern states, such as Tennessee, Georgia, Alabama, and Mississippi all have thriving auto-manufacturing plants -- owned by foreign companies such as Toyota and Nissan.

So, in other words, the South doesn't want to bail out the American auto industry, because they are getting supported by foreign ones. A side note, this technically destroys the whole "buy American" movement for cars, because it was started more so for the labor, not the corporations. Anyways, not only would it be against their interests to vote in favor of bailing these companies out (at least presently) but these Senators and Congressmen are in the pockets of these companies (private interests eventually even out though, don't hate the player, hate the game). This is why they have dubbed the "Big 3" the "Detroit 3". They feel this problem is isolated to Michigan, and should thusly be dealt with locally. Not to mention the Senator from Tenessee was giving them shit about Federal subsidies to deal with developing new technologies and improving existing ones, such as hybrids. Fuggin Assclown. The Foreign companies that are manufacturing here are getting the same subsidies from their respective nations.

What's going to get this either passed or sunk is whether it can get support from the other regions of the country -- remember the Senate is evenly distributed amongst states. If it gets to the House of Representatives, it will have an easier chance of passing, as the house is represented by population, and the regions directly affected are more densely populated.

But should they get Federal support?

On the one hand, they represent a huge chunk of the remaining manufacturing and heavy industries. If these 3 companies go down, they could take an entire region of the nation, and put it in a depression that could last longer locally than whatever impending (or present) national disaster there is.

On the other hand, they have a flawed business model, which got them in this mess in the first place. In addition, the foreign companies are already manufacturing the cars to be sold in America, in America.
Not to mention they tried (pretty successfully) to ruin Johnny Cougar


Most of the cars (not trucks or SUVs) break down at 70,000 miles, forget about the fact that Toyota and Honda make more hybrids, their cars last to 150,000+, oftentimes quite a bit more.

The problem with the last argument is you can't tell if they changed that bit until at least a few years after the models roll out.

Do the companies need to be bailed out?
yes.

Why?
If the Big 3 fail, there will be no American company to take its place. Not to mention it would take too much time and capital to develop a car company to take its place, even to have an impact at a niche level. What does this mean -- America will eventually have to laxen its tariff requirements. This would lead to a very possibly vacation of the auto-manufacturing industry from the south also. Southern labor may be cheaper than Detroit labor, but foreign labor is even cheaper. In addition, all the supplying industries that still exist will all face a major restructuring that they themselves may not survive.

Simply put, the Big 3 are too big to let them fall. Their fall will destroy much in its wake. But they need oversight. This is, after all, a federal investment with taxpayer money. It's not the corporations that deserve this bailout, but rather the nation and its workers. So their bosses are idiots, why should they get fired, and more importantly why should that hurt the rest of the American economy?