Obama's Auto Bailout CAUSED Thousands to lose jobs

[Rebecca Sink-Burris]

Gotta pay off the UAW.

The companies should have been allowed to bankrupt. Toyota, Honda, Ford, et al would have then been able to buy production capacity for pennies on the dollar, resulting in more robust and profitable auto companies, and either a reduction in the price of cars, or an increase in the profitability of companies that have proved to be good stewards. Win for everyone.

Now, we have 2 companies that continue to hemorrhage money, no reduction in the price of cars, no increase in the profit of car makers, lose lose lose lose, all around.

Exactly, I believe this is referred to as "creative destruction", the process by which resources get moved from companies that have squandered them to companies that will put the resources to more efficient use. Banks should have been allowed to go through this process also. The free market works if it allowed to, those who take the risk should get the reward and suffer the losses, not the taxpayer.

But of course this was about saving union jobs and those care dealers were not union.

 

[Blackhawk2001]

How do you get to slavery from outsourcing?

A bit of alternate history by way of explanation.

What do you think would have been the outcome of WWII if the US hadn't had the capacity to rapidly ramp up its manufacturing and production capacity to unprecedented levels?

Back to the present. How long do you think it takes to re-open a manufacturing line once it's been closed down? How much does it cost to replace manufacturing capacity, both in terms of production machinery and replacement of trained workers?

As a nation, if we cannot rapidly produce and upgrade our capacity to produce the materials necessary for our national defense, we will be out-produced by an enemy at war with us, as we out-produced the Germans and the Japanese in WWII. The Chinese already outnumber us; what will we do if they engage in a war with us and can out-manufacture us as well as overwhelm us with numbers?

 

[BloodEclipse]

Exactly, I believe this is referred to as "creative destruction", the process by which resources get moved from companies that have squandered them to companies that will put the resources to more efficient use. Banks should have been allowed to go through this process also. The free market works if it allowed to, those who take the risk should get the reward and suffer the losses, not the taxpayer.

But of course this was about saving union jobs and those care dealers were not union.

I'm not convinced it was about saving union jobs at all. In fact many plants were closed as a result. The UAW workers lost many things. The International union however gained power and money.
The UAW worker now has three masters. The Government, the Company, and the Union.
All three are interested and vested in cost cutting and profit making at the expense of the workers.
We have a huge conflict of interest with the union that is supposed to be representing us, owning interest in the company.
I think the workers would have been better off if we had been allowed to go through a bankruptcy.

 

[ATOMonkey]

A bit of alternate history by way of explanation.

What do you think would have been the outcome of WWII if the US hadn't had the capacity to rapidly ramp up its manufacturing and production capacity to unprecedented levels?

Back to the present. How long do you think it takes to re-open a manufacturing line once it's been closed down? How much does it cost to replace manufacturing capacity, both in terms of production machinery and replacement of trained workers?

As a nation, if we cannot rapidly produce and upgrade our capacity to produce the materials necessary for our national defense, we will be out-produced by an enemy at war with us, as we out-produced the Germans and the Japanese in WWII. The Chinese already outnumber us; what will we do if they engage in a war with us and can out-manufacture us as well as overwhelm us with numbers?

The biggest difference between pre-WWII production and current production is that we already have companies dedicated to making military hardware. If we needed to ramp up production, we'd just get P&W, Rolls-Royce, GE, Navistar, et al on the phone and tell them to start burning the midnight oil.

Industrialization for the sake of defense is a moot point since all of that production capacity already exists, and we produce much more military hardware now than we did pre-WWII.

In fact, there are laws in place saying that XX% of all military hardware be manufactured in the US.

So, in conclusion, prior to WWII, we had little military manufacturing, and few companies dedicated specifically to military manufacturing. Which is why many companies had to re-tool to make military hardware.

Today, we have a very high rate of military manufacturing, and many companies dedicated specifically, or at least heavily to military manufacturing.

The two situations really aren't comparable.