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Thread: GM's return to top continues as it rejoins S&P 500

  1. #111
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    Re: GM's return to top continues as it rejoins S&P 500

    Quote Originally Posted by LowDown View Post
    There would be more people working now if GM had gone through bankruptcy.
    Who was going to hire them? You?

    Unemployment in 2008 was higher than usual, especially in Michigan. If anyone was willing and able to hire people with the same skill-set, they would have done so regardless of the auto bailout.


    The ONLY difference the bailout made was that the union survived with their bloated wages and benefits....
    A lot of those "bloated" union wages were slashed and benefits cut.

    Again: Eye and dental coverage were axed. New hires are paid at almost half the wages as before ($17/hr instead of $29/hr), and they also get 401(k)'s instead of pensions. They no longer have guaranteed annual raises; they now get profit sharing, so if the company is not profitable, they don't get a raise or bonus. The "job bank" -- where union employees who were temporarily laid off would get paid regardless -- got axed. Strikes have been banned. The stock received by the UAW is non-voting, and because of that setup, the companies cut their health care obligations to pensioners by 50-70%.


    and to this day hangs like a leach drinking the blood of stockholders
    Yet again, stockholders in the old GM were screwed anyway. And the only way stockholders in the new GM will benefit is if the employees are sufficiently motivated to do a decent job.

    As much as you may wish it otherwise, the reality is that unions still exist, and almost certainly will continue to exist in the manufacturing sector.


    customers
    Existing GM and Chrysler customers would have been screwed if the companies went up, since all those warranties would be worthless, and parts companies would lose a ton of business.

    New customers of GM and Chrysler buy of their own free will. Market forces are just as present as always; if the companies charge too much, it will impact sales.


    And because the union is still there GM can't afford to hire more people.
    GM added around 600 employees last year, and are hiring 4000 more this year.
    Recession's Over: GM Hires New Employees, Not Laid-Off Workers, to Build Cadillac ATS - Automotive News
    GM Plans to Hire 4,000 New Employees | Wall St. Cheat Sheet

    Chrysler added 1,800 employees last night. They're now adding another 1,250 employees and investing $374 million into its Indiana plants.
    Chrysler To Hire 1800 New Workers « CBS Detroit
    Chrysler announces 1,250 jobs, $374-million investment for Indiana plants | Detroit Free Press | freep.com

    And maybe I missed it, but I don't recall all that many people eviscerating Reagan for saving Chrysler in 1980.

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    Re: GM's return to top continues as it rejoins S&P 500

    Quote Originally Posted by Fenton View Post
    The GM bailout was a payback to the Unions for their support, plain and simple, it was a poor choice that cost tax payers billions and basically let any Union know, if they're large enough, they can through the threat of strikes and collective bargaining run any American Corporation into the ground and receive a leg up when that corporation can no longer keep it's head above water.

    GM should have been allowed to go through a managed bankruptcy. Forget that their stock has risen in a Stock Market that exclusively held up with low interest rates falsely pushed down with massive printing and monetizing of our own debt. A stock market that's waiting for the first indication of stopping of QE so they unload massive amounts of over priced assets, equities and bonds.

    The GM bailout set a bad example.

    Mark Milke: Bailouts of GM and Chrysler were a bad idea - Opinion - Times Colonist
    I don't blame the unions. I blame management that agreed to their demands.

    I agree about the bailout, though...reluctantly. Our recession would have been much worse had we not had that bailout. There's just no question about it. No sense cutting off noses.
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    Re: GM's return to top continues as it rejoins S&P 500

    Quote Originally Posted by Visbek View Post
    And maybe I missed it, but I don't recall all that many people eviscerating Reagan for saving Chrysler in 1980.
    You did miss it.

    Reagan was widely criticized by Conservatives of the day and of course Chrysler had to be bailed out again. Companies should be allowed to fail and in fact that's how the economy grows, with newer and better run companies taking their place. The taxpayer could have bailed out buggy manufacturers as well, or shippers of whale oil but they had the wisdom to let the market and the consumer make the decisions as to who will succeed and who will fail. The politicians cannot and should not even try to get involved but should instead strive to keep everyone honest.

  4. #114
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    Re: GM's return to top continues as it rejoins S&P 500

    Quote Originally Posted by Grant View Post
    Reagan was widely criticized by Conservatives of the day....
    Actually, Carter signed the bill. My bad.

    By the way, GM was facing problems as early as 2006. The Bush administration basically refused to do anything about it. The private sector completely failed to step up to the plate. GM didn't want a bailout, and fired huge numbers of employees.

    You sure you remember things right?


    of course Chrysler had to be bailed out again.
    Erm.... 30 years later. Seriously? That's longer than the lifespan of some companies.


    Companies should be allowed to fail and in fact that's how the economy grows...
    Japan and China coddle their big corporations, far in excess of anything the US does. That's one of many factors in the success of those companies.


    The taxpayer could have bailed out buggy manufacturers as well, or shippers of whale oil but they had the wisdom to let the market and the consumer make the decisions....
    Americans have not decided to stop buying cars.

    And no one is forcing Americans to buy GM and Chrysler cars. They still need to compete in the marketplace.


    The politicians cannot and should not even try to get involved but should instead strive to keep everyone honest.
    And yet, everyone from every point on the political spectrum is demanding that the government a) stop job losses and b) create jobs.

    Let's face it, anything Obama did in this situation would be grounds for right-wingers spewing vitriol. If he bailed out the auto companies, he's a bastard for interfering in the course of business. If he does nothing, he's a callous job-destroyer who did nothing to stop unemployment, and let a major US industry fail on his watch.

    So pardon me if I take some of these objections with a big ol' heaping of salt over my shoulder.

  5. #115
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    Re: GM's return to top continues as it rejoins S&P 500

    Quote Originally Posted by The Man View Post
    In the end, GM makes ****ty, unreliable, uninteresting appliance vehicles that are way overpriced. And the only interesting vehicle that they make, the Volt, is so ridiculously overpriced that you'd have to have a lot of money and a retarded brain to even consider buying one. The handout from the government will only go so far until they're right back in the same situation, unless they get their act together and actually make vehicles that people are willing to, and can afford to buy.

    On the flip side, Ford has gotten their **** together, and they didn't even take bailout money. They make A LOT of nice vehicles that I would, and actually could afford to buy these days.
    If both GM and Chrysler had gone out of business I see no reason to doubt that Ford would have expanded to exactly fill in the part of the market left open by the demise of the other two companies. We'd have as much demand as before for American cars, Ford would be making and selling as many as otherwise are being made by all three companies, consumers would be getting better cars, and taxpayers wouldn't be on the hook for the cost of saving the two inferior companies that couldn't stand on the quality and value of their own products.
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    Re: GM's return to top continues as it rejoins S&P 500

    Quote Originally Posted by Visbek View Post
    Who was going to hire them? You?

    Unemployment in 2008 was higher than usual, especially in Michigan. If anyone was willing and able to hire people with the same skill-set, they would have done so regardless of the auto bailout.
    GM would have hired them when they emerged from bankruptcy, and they'd have had more resources to do so and would have been able to hire more people because labor would have been less expensive.

    A lot of those "bloated" union wages were slashed and benefits cut.
    They are still bloated, though.

    Again: Eye and dental coverage were axed.
    They still qualify for the Cadillac health coverage tax!

    New hires are paid at almost half the wages as before ($17/hr instead of $29/hr), and they also get 401(k)'s instead of pensions. They no longer have guaranteed annual raises; they now get profit sharing, so if the company is not profitable, they don't get a raise or bonus. The "job bank" -- where union employees who were temporarily laid off would get paid regardless -- got axed. Strikes have been banned. The stock received by the UAW is non-voting, and because of that setup, the companies cut their health care obligations to pensioners by 50-70%.
    Yes, these would be the workers the senior union members screwed over. Nothing new about that. Just so they get their boodle.

    Yet again, stockholders in the old GM were screwed anyway. And the only way stockholders in the new GM will benefit is if the employees are sufficiently motivated to do a decent job.
    Start firing people who don't do a good job and the rest will be highly motivated. But no, it's impossible to do that, hence the need for a bailout.

    But I'll tell ya, my heart really bleeds at the news that the jobs bank was axed. What is a union without no show jobs?

    As much as you may wish it otherwise, the reality is that unions still exist, and almost certainly will continue to exist in the manufacturing sector.
    Sure, sure, unions will exist. But we should no longer have to put up with the Wagner Act. It's outdated and it's harming American industry. FDR brought in the Wagner act, and then the next big crisis that comes along, WWII, he shuts it down because he knows it would interfere with productivity.

    New customers of GM and Chrysler buy of their own free will.
    Yeah, perhaps none so enthusiastically as the federal government.

    Market forces are just as present as always; if the companies charge too much, it will impact sales.
    More like political forces and crony capitalism.

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    Re: GM's return to top continues as it rejoins S&P 500

    [QUOTE]
    Quote Originally Posted by Visbek View Post
    Actually, Carter signed the bill. My bad.

    By the way, GM was facing problems as early as 2006. The Bush administration basically refused to do anything about it. The private sector completely failed to step up to the plate. GM didn't want a bailout, and fired huge numbers of employees.

    You sure you remember things right?
    Carter signed the bill and the money was paid out under the Reagan administration. Toledo Blade - Google News Archive Search

    What would you want the private sector to do? The private sector was already in the auto business and there was no crisis as far as the lack of vehicles went.


    Erm.... 30 years later. Seriously? That's longer than the lifespan of some companies.
    It doesn't matter. What good is a company that has to be bailed out every 30 years?

    apan and China coddle their big corporations, far in excess of anything the US does. That's one of many factors in the success of those companies.
    Now America wants to emulate Japan and Chine while they want to emulate America?

    Americans have not decided to stop buying cars.
    Exactly. So why should the taxpayer be responsible for ailing out auto companies when their is no reason to do so? It's the consumer and taxpayers who should be considered, not big business.
    And no one is forcing Americans to buy GM and Chrysler cars. They still need to compete in the marketplace.
    The fact is that they couldn;t compete or they wouldn't have needed taxpayers dollars.



    And yet, everyone from every point on the political spectrum is demanding that the government a) stop job losses and b) create jobs.
    That's obviously untrue.
    Let's face it, anything Obama did in this situation would be grounds for right-wingers spewing vitriol. If he bailed out the auto companies, he's a bastard for interfering in the course of business. If he does nothing, he's a callous job-destroyer who did nothing to stop unemployment, and let a major US industry fail on his watch.
    Obama is dishonest and clueless but those terms you use are new to me.

    So pardon me if I take some of these objections with a big ol' heaping of salt over my shoulder.
    No prob. Go ahead.

  8. #118
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    Re: GM's return to top continues as it rejoins S&P 500

    Quote Originally Posted by Bob Blaylock View Post
    If both GM and Chrysler had gone out of business I see no reason to doubt that Ford would have expanded to exactly fill in the part of the market left open by the demise of the other two companies.
    The problem with that theory is that GM, Chrysler and Ford have many suppliers in common. Without GM and Chrysler, those suppliers would have gone under, which would have seriously harmed Ford.

    Ford also would have had no way to ramp up production fast enough. The credit markets were frozen, so no one would have given them the funds to buy up the charred remains of GM and Chrysler. Plus, sales have been migrating to Japanese companies for years (notably Toyota). The destruction of two of the Big Three was not likely to boost Ford's sales.

    That's why Ford joined the push for the bailout, and their CEO still says it was a good idea. If they could have benefitted, they would've sat on the sidelines.

    And let's face it, if ~13% of US GDP went south, there is no way that could possibly have been good.

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    Re: GM's return to top continues as it rejoins S&P 500

    Quote Originally Posted by Visbek View Post
    The problem with that theory is that GM, Chrysler and Ford have many suppliers in common. Without GM and Chrysler, those suppliers would have gone under, which would have seriously harmed Ford.
    Suppliers would have altered their supplies. Car parts would still be required no matter who makes the cars. There would also be the same number of gas stations and car washing businesses.
    Ford also would have had no way to ramp up production fast enough. The credit markets were frozen, so no one would have given them the funds to buy up the charred remains of GM and Chrysler. Plus, sales have been migrating to Japanese companies for years (notably Toyota). The destruction of two of the Big Three was not likely to boost Ford's sales.
    Other car companies, also manufacturing in the US would take up any slack.

    That's why Ford joined the push for the bailout, and their CEO still says it was a good idea. If they could have benefitted, they would've sat on the sidelines.
    Ford refused any bail out money and did very well.

    And let's face it, if ~13% of US GDP went south, there is no way that could possibly have been good.
    Markets correct themselves, governments distort them.

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    Re: GM's return to top continues as it rejoins S&P 500

    Quote Originally Posted by LowDown View Post
    GM would have hired them when they emerged from bankruptcy
    GM and Chrysler were not going to emerge from bankruptcy. They would have been liquidated, because no one in the private sector had any interest in saving those companies. As noted, they were trying for years to arrange a rescue, and the private sector offered no help whatsoever.

    The unions had already made significant recessions. And contrary to your claims, GM and Chrysler are apparently bouncing back, and hiring people, both union and non-union.

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