The press is reporting that Detroit auto companies may not survive until the end of the year. I don't really understand. It's not a person sick with a disease. A company has bills to pay but can't pay them? It just doesn't pay. Someone tries to collect? They say no. Any efforts against a company require judicial process. And that ain't fast. So this impending crisis is nonsense. Bankruptcy may happen, but it never has to happen tomorrow. All GM or Chrysler have to do is not file for bankruptcy through the first week of January. A new congress takes office on January 3, then the votes will certainly be there to pass this bill as is.
What is horrifying is that the reason for the failure is the insistence by the GOP senators that huge salary cuts take place within two years. Huge salary cuts for management? Cuts for the massively overpaid people who screwed up? I don't think most people realize how much these people at the top earn, and how many hundreds and thousands of families could be employed if these salaries were reduced to normal ranges. No, say the Republicans - just huge salary cuts for the employees! And the very next moment these same people are saying that we should not be micromanaging the auto industry or nationalizing it. So the logic seems to be that we shouldn't interfere with business decisions except their business decision to make a deal with their union.
This shows you just how very anti-employee the Republicans really are. They really do want to turn this country into a place where a handful of very rich people (them) work for millions, while the rest of the public works for minimum wage. I can't wait until January 3rd.
Thursday, December 11, 2008
What do you mean, auto companies in bankruptcy by the end of the year?
Posted by The Law Talking Guy at 9:11 PM
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3 comments:
Yes, LTG! My thought exactly when I heard this morning.
Not only that, now the treasury is saying that it will release funds from the $700 mil. bailout money to "save" these companies, which is what these companies wanted all along. So I see this is as the GOP's sly little method of preventing any type of government oversight or control over the actions of these CEOS. And there is a good part of me that believes they planned that all along. The White Hose could look good supporting a Democratically lead and negotiated plan, and then let the GOP congressional delegation take the heat when it fell apart. Then the White House can say, "But we have no choice now but to use bail out money."
Companies don't just dissolve like that, especially not THESE companies.
It was a dirty, underhanded trick to try and blame the unions, unions who have already made a lot of sacrifices.
OH, just a note: people mention the number of pensions and benefits the companies have to pay out and they claim that GM is paying benefits to something like 7,000 people while Honda is paying to like 4,000 people. But what they fail to say is that GM has more beneficiaries because they gave away more golden parachutes in order to cut costs, not because these guys all retired at 65.
It's also amazing how the first time GM came to Congress, it had funds to last through March. Two weeks later it was on immiment life-support and might expire by the end of the year. Again, that's ridiculous, as you note.
Maybe they had an executive retreat and used up all the money?
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