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GM goes bankrupt and gets nationalised

Government will not be able to succeed in the Auto business. Government has too many favors that they like to bestow on their "friends". It will be a porky mess.
 
Hey Slippery Slope...get caught up, you are way behind here.
 
Harry Guerrilla said:
Someone else is willing to do the same thing cheaper.
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Right, meaning they make less and can afford to buy less.

That is how it works, people in places with a lesser cost of living naturally don't need as much money compared to people in places with higher costs of living.
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OK, so why do some places have a lower cost of living? Environment, job availability and wages.
 
Baralis said:
I worked in a machine shop in the early 90's that was partialy unionized. The union workers not only made $4-5 more an hour then their non union counterparts but they also recieved more frequent and longer breaks.

I dont understand how anyone would fail to see how this would hurt the company. More money payed to people that work less. :shock:
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So why have labor laws at all then? To prevent corporations from taking advantage of their labor force and to provide a safe and healthy work environment.

Excerpt from - A day in the Life of Joe Middle-Class Republican

...On the way, he drops his 12 year old daughter off at the clothing factory she works at. Since there are no regulations against child labor Joe appreciates the extra income. Paying for kids to go to private school until they're 18 is a luxury, and Joe can’t afford to get the latest cool thing to impress his buddies without that extra income. Times are hard and there're no social safety nets so you gotta buy everything you can before you can’t work anymore.

He gets to work 5 minutes late and misses the call for Christian prayer, and is immediately docked by his employer. He is not feeling well today, but has no health insurance, since neither his employer nor his government provide it, and paying for it himself is really expensive, since he has a precondition. He just hopes for the best.

Joe's workday is 12 hours long, because there is no regulation on working hours, and Joe will lose his job if he complains or god forbid, tries to unionize. Today is an especially bad day because Joe's manager demands that he work until midnight, a 16 hour day. Joe does so, knowing that he'll lose his job if he does not. The good news is that he can call his daughter and tell her to work late too, since he can’t afford child care. He’ll just pick her up on his way home. Too bad neither employer has to pay over-time.

Finally, after midnight, Joe gets to pick up his daughter and go home. His daughter shows him the deep cut she got on the industrial sewing machine today. Joe is outraged and asks why she doesn't have metal mesh gloves or other protection. She says the company will not provide it and she'll have to pay for it out of her own pocket. Joe looks at the wound and decides they'll use an over the counter disinfectant and bandages until it heals. She'll have a scar, but getting stitches at the emergency room is expensive.

His daughter also complains that the manager made suggestive overtures towards her. Joe counsels her to be a "good girl" and not rock the boat, or she'll get fired and they'll be out the income.

His daughter says she can't wait until she's 18 so she can vote for change or go to the Iraq War. Unfortunately, Joe reminds his daughter that women can’t vote anymore because Joe’s Church, which is now the 4th branch of government, says that Jesus thinks adult women should stay home and take care of the household and stay out of politics which is for men.

They get home and there's a message from his elderly father who can't afford to pay his medical or heating bills. Joe can hear him coughing and shivering. But Joe understands that his father must suffer for not saving enough to live on after he couldn’t work anymore, at 83. Sure, he had some stock and a retirement package but the company filed for bankruptcy a few years back to get out from under it’s debt after the former CEO ran off with hundreds of millions and the current CEO is getting fired for poor performance. He still gets 300 million in severance pay, however.
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That's the way you think it ought to be?
 
Gill said:
So, if a person working in a southern auto factory makes $50,000. / year and it costs $30,000. for him and his family to live in a nice house, feed them, pay utilities, taxes, etc., then they are able to save $20,000.

His counterpart in Michigan makes $70,000., but it costs him and his family $60,000. in living expenses, which one is the "stupid" one.

After all, you've already described in detail how much cheaper it is to live in the south.
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Right so all corps should move to the south where it's cheaper and then all the people will move to the south thereby raising the cost of living. When the tech bubble busted Californians started moving out to Nevada, Oregon, Idaho, Arizona... guess what happened? I know, because we looked at these states too. The housing prices shot up as well as the cost of living. Because people with money moved in and could afford to pay more.
 
Redress said:
GM does have high production costs, but labor is far from the only reason for that. Legacy costs(mostly related to labor), inefficiencies, being slow to modernize methods and equipment, these are big parts of the high production cost. Labor is a contributor to GMs troubles, but certainly is not the only, or even necessarily the biggest reason for those troubles.
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Then why do people focus on the union wages? Because cons hate unions because they don't allow employers to take advantage of their labor and cons believe that if you can hold an employee upside down and shake the pennies out of their pockets then the corporation deserves to have those pennies.
 
Redress said:
How are you planning to do that exactly? Tell Toyota is has to pay more, so they move out of the country?
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No... the usually proposed solution is to unionize everyone -- so as to artifically raise labor costs, thus either raising the cost of the product or lowering the margin of profit.

"Leveling the playing field" like this in no different that raising average class scores by making the test easier.
 
Slippery Slope said:
But why is the contract hurting the company? Because their competition has lower wage costs. :2wave: Raise the wage in the south and suddenly GMs contracts are no longer a problem. THEN, all auto workers will make a better living. It's what drove the middle class before foreign car companies ever opened their first plant in the USA. Remember?
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High salary does not prosperity make.
 
Slippery Slope said:
Then why do people focus on the union wages? Because cons hate unions because they don't allow employers to take advantage of their labor and cons believe that if you can hold an employee upside down and shake the pennies out of their pockets then the corporation deserves to have those pennies.
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Because union wages and more importantly union benefit packages are a big part of the problem, and libs like unions as a rule(with me being an exception in some ways), so they are a convenient target. And the unions are rightfully a very large part of the problem, and does have to make concessions. You will notice however that the concessions don't include pay hourly pay cuts as I understand it.
 
Goobieman said:
No... the usually proposed solution is to unionize everyone -- so as to artifically raise labor costs, thus either raising the cost of the product or lowering the margin of profit.

"Leveling the playing field" like this in no different that raising average class scores by making the test easier.
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I gave you a thanks for that. Don't get used to it or start thinking I like you, but good post.
 
Harshaw said:
Yeah, inflation is great. But you're talking about raising prices for everyone and wages for few.

No. You've simply crippled Toyota so that it make GM look competitive. You don't make an asthmatic runner more competitive by making opponents wear a backpack full of bricks.

And what about everyone else who doesn't work for a car company? This is just breaking-records-on-your-head laugh-out-loud stupid. :roll:
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Right, because GM hasn't been selling cars at the current price, which somehow means that Toyota wouldn't sell them at that price point either. :doh
 
Redress said:
How are you planning to do that exactly? Tell Toyota is has to pay more, so they move out of the country? Are you going to expect suppliers to pay more too, or would you just shift more work from automaker plants to suppliers?
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Unionize Toyota. The Big 3 did just fine selling cars before foreign competition. Competition is good, but not unfair competition.
 
Slippery Slope said:
Right, because GM hasn't been selling cars at the current price, which somehow means that Toyota wouldn't sell them at that price point either. :doh
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This fails on every level.

1) GM has been selling plenty of cars.

2) GM's pricing is largely in line with the market, as is Toyota's.

3) You're the one gung-ho to raise car prices, not me.
 
Slippery Slope said:
Unionize Toyota. The Big 3 did just fine selling cars before foreign competition. Competition is good, but not unfair competition.
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You would force people who do not want to be in a union to be in one? I am pretty sure that is illegal. It is certainly a bad idea.
 
Goobieman said:
No... the usually proposed solution is to unionize everyone -- so as to artifically raise labor costs, thus either raising the cost of the product or lowering the margin of profit.
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How is raising wages "artificial"?

"Leveling the playing field" like this in no different that raising average class scores by making the test easier.
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That is a specious argument and not a valid analogy.
 
Redress said:
Because union wages and more importantly union benefit packages are a big part of the problem, and libs like unions as a rule(with me being an exception in some ways), so they are a convenient target. And the unions are rightfully a very large part of the problem, and does have to make concessions. You will notice however that the concessions don't include pay hourly pay cuts as I understand it.
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Why are unions, in your opinion, a very large part of the problem? Because of increased labor costs (labor costs include honoring contracts made with retirees which they wish to renege on now)? So here we are still talking about labor costs being higher for GM than nonunion companies.
 
Slippery Slope said:
Unionize Toyota. The Big 3 did just fine selling cars before foreign competition. Competition is good, but not unfair competition.
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Unionizing Toyota? Are you kidding? The only reason the Big 3 wages aren't soaring is because they couldn't sell cars for any higher price. If you unionize all of them, then they will all raise their prices.

I'm fine with employees unionizing themselves, but I'm also fine with that union getting fired for demanding too much. As we're seeing with the American car companies, the unions demanding too much is now forcing them out of a job. Great job guys!

And you say that Toyota and other Japanese auto manufacturers are subsidized. So what? They still have to sell a good product to us. However, that just means that their other industries are that much weaker. If there are two industries A & B in countries C & D, and B subsidizes A in C, then D will not have a very strong A industry, but B will be booming in D because B from C cannot compete in D what with their profits being tapped to pay for A in C. In short, it doesn't matter that they're being subsidized. In fact, there is an inherent inefficiency in subsidization and so we don't have to worry about another country doing that. You can't subsidize every industry. At some point, someone has to make money.
 
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Slippery Slope said:
Why wouldn't people want to be protected by a union?
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Ask the workers in those plants, and in many plants here in Michigan who have repeatedly turned away the UAW.
 
Slippery Slope said:
Why wouldn't people want to be protected by a union?
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If I'm a part of a union that demands too much, then I have to still go along with them and I risk getting fired. Some wage is better than no wage.

But if a union gets a company to demand that new employees join the union, then that's their prerogative. However, if the competition has no union, then I wouldn't expect that company to last too long (barring government favoritism).
 
Slippery Slope said:
Why are unions, in your opinion, a very large part of the problem? Because of increased labor costs (labor costs include honoring contracts made with retirees which they wish to renege on now)? So here we are still talking about labor costs being higher for GM than nonunion companies.
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Would you rather just have GM close it's doors? Then no one gets anything except a few creditors. GM loses, the retirees lose, the creditors lose, the workers lose. It is not in the workers best interest to not renegotiate.
 
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