GM wants $30 Billion more

[NeMont]

http://abcnews.go.com/Business/Economy/Story?id=6898148&page=3

What I don't understand is that as of the close today GM's total market cap. was $1.33 billion. So the U.S. taxpayers could spend $1.33 Billion and own every outstanding share of GM or dump $30 Billion more into the company. Seems like a no brainer to me. If Washington is so smart they should be able to run a car company and still save the taxpayers over $28 billion.

http://finance.yahoo.com/q?s=gm

At what point does one begin to let sound money policies rule the day?

Nemont

 

[overton]

Today would be a great day to start.

 

[huntindude]

It's not what a thing cost, it's what it pays.

Question is will it work? if it does the and we get paid back and the jobs stay in the US it's a good deal, if it doesn't it's a bad one. we don't know, nobody does.

Don't tell me don't worry someone else will buy it and keep the company here, that's doubtful. look at the tractor industry, if these companies go down they're gone from this country and the jobs go with them.

A world economy and free trade only work when everyone has the same standard of living, we're seeing the proof of that right now.

 

[NeMont]

LAST EDITED ON Feb-17-09 AT 08:57PM (MST)[p]

The problem is that China just surpassed the U.S. as the largest auto market in the world. Their standard of living is increasing, our is set to decrease, would it not be better to export some cars to China rather the just send them little green pieces of paper? That would not only employ Americans but it would also increase our standard of living.

To even get back to even it would require that GM stock increase from around $2.30 to $69 a share. It could be years, if ever, before GM stock reaches this number. Why not just buy them out right and let the Jedi Knights of Obama, Geithner and Biden tell us what cars to build and at what price? It would be far cheaper to just buy GM and keep the UAW employed and firmly in the Democrats voting block. In fact I would rather just give the UAW the $30 billion the let them go away rather the continue to throw money at GM. This is just one more payment not the last payment.

I would rather export cars then export fake money.

There is not sound reason not to let GM go into bankruptcy other the fact that the UAW and the Democrats cannot stand it. Instead they will continue to print money via fiat and screw the American taxpayers.

Nemont

 

[huntindude]

How many cars are the orientals going to buy from us? you know better than that. we don't expect trade we expect to borrow and buy, and they wouldn't have it any other way.

We don't have to get all our money back directly from GM to make this a good deal. what about all the taxes that the auto industry and related businesses and their workers pay? what do you propose we do to create new jobs for the millions of displaced workers the industry supports? and who's going to pay for the worker retirement and health care the failed copmpanies will dump on the tax payer? and I'm not just talking about UAW workers you guys need to grow past that, they're only a small part of the jobs the auto industry creates. I suppose we could have another stimulus bill to replace the auto industry , another dumb try at creating fake jobs in place of the real ones we sat and watched go bye bye, that makes perfect sense.

Just one more case of what a can of worms this mess is. anyone who thinks this is simple just doesn't get it.

 

[NeMont]

LAST EDITED ON Feb-18-09 AT 09:10AM (MST)[p]If a company cannot make profits in their current business model, has to take U.S. taxpayer money and invest in Brazil, is hamstrung by it's current obligations and is asking for 30 times it's market value in taxpayer money, that company has already failed. It is just getting propped up by taxpayers.

That is already a fake job. It is displacing capital that could flow into more efficient jobs and redistribute the work force. The auto industry would be better off in the long run because GM would emerge as a leaner more efficient company.

They are going to be back again in 6 months asking for more money. If we don't want to let them go bankrupt then let just nationalize them and own the company outright. Everybody would be better including the UAW, Obama would be their direct boss and Biden would be their shop steward.

The can of worms was created by the government not by the market. GM and Chrysler both should have never been given the first loans. Just like I said before the companies would be back asking for Billions more and they will be back again asking for Billions more in the future.

Why not just say the truth, This is a UAW payment and give the $30 Billion directly to them? Do Auto workers even generate $30 Billion worth of tax revenue to the Federal government?

Nemont

 

[huntindude]

You have to get past the UAW, they are part of the auto industry, they aren't the auto industry.

If there are 3 million jobs related to the US auto industry , the tax revenue would be significant. this is as many permanent jobs as what the stimulus is supposed to create temporarily, which is the better deal?

Forbes magazine says the cost of actual labor assembling a US auto is $70 higher than a Japanese one, so your theory the UAW wages are the reason for this mess holds no water. other factors more important are higher interest cost at about $579, profit gaps and worst of all health care cost. the big 3 are providing much higher health care cost than their competition and they're doing it on over 2 million people. the fact is doing business in the US cost more because employers are responsible for more, and if they didn't pay it then tax dollars would.

So lets suppose we let them crash and the jobs leave, we loose 3 million jobs, and who do you think is going to pay for the lost health care and retirement? what will replace those jobs?

Health care cost in this country are killing us no debate about it. I say make ALL employers including the government stop paying health care for any employee, that would be the biggest break our business sector could ever hope for. then and only then will Americans understand the burden health care cost are on our businesses and care to do something about it. my wife and I are both very healthy and we pay our own insurance, it's as much as a good car payment and we have a $5,000 deductable. I sympathize will American business I don't fault them for the unlevel playing field they're on, our health care system way more screwed up and poorly run than the auto industry, too bad we can't import that .

 

[NeMont]

Well if it is just about jobs, the health care industry employs far more then 3 million people yet you would have no problem cutting that in half. What are you going to do with those millions of unemployed when health care gets cut in half? Somehow auto workers jobs are more important then everyone elses.

You can import medicine or more accurate export yourself for procedures.

I don't care what the cost of labor is, I don't care what executive pay, I don't care what health care costs are. It is not the responsibility of taxpayers to prop up businesses including banks the banks.

At what point are you going to pull plug on the car companies? After $100 billion? $200 Billion? They will be back asking for more just like the banks are.

Here are some stats on the hated healthcare industry and it's 14 million workers. I guess it would be okay to dump 7 million health care workers but it is fine of prop up 3 million auto workers. The health care industry alone is set to generate as many new jobs as are in the entire auto industry, and these numbers do not even count all those employed by the health care financing industry.

http://www.bls.gov/oco/cg/cgs035.htm

Significant Points

As the largest industry in 2006, health care provided 14 million jobs?13.6 million jobs for wage and salary workers and about 438,000 jobs for the self-employed.
7 of the 20 fastest growing occupations are health care related.
Health care will generate 3 million new wage and salary jobs between 2006 and 2016, more than any other industry.
Most workers have jobs that require less than 4 years of college education, but health diagnosing and treating practitioners are among the most educated workers.