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Let Detroit Go Bankrupt

nytimes.com

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Re: Let Detroit Go Bankrupt

#71

Post by hooande »

The biggest problem with the detroit automakers is their high pension and medical cost burden. People are living far longer now than they were predicted to when the pension deals were struck in 1951. The Detroit automakers have an unbearable burden when compared to foreign car makers. This drives up their prices and effects all of the business decisions that they make.

The management at the big three auto companies hasn't been very brilliant or innovative, but I bet they've done just about as well as the management teams at comparably sized companies. Firing all of them would probably just cause a lot of chaos and waste decades of learning and experience.

This financial problems they are facing have more to do with the credit crisis than making the wrong kind of cars. There is this insinuation in that media that if Ford had just made more eco-friendly cars then everything would be ok. There is still plenty of demand for american cars and trucks (especially in the american south). It seems like they just need some time and money to re-negotiate things with the unions and this can be worked out.

Re: Let Detroit Go Bankrupt

#72

Post by ensignavenger »

yummyfajitas wrote: post #27
blackguardx wrote: post #25

Earlier quoted context omitted.

This post smacks of jealousy. What is wrong with zero deductible healthcare? I don't fault someone for trying to climb society's ladder. I want everyone in America to be able to earn a living wage. Being in a union doesn't make one lazy or overpaid. How do you over pay someone anyway? Who deems what a job is worth to society? It is very unfortunate that the big three made the agreements they did, but they made them.…

Person A, a waitress at Dennys, making about $8-10/hour with high deductible health care. Person B, an auto worker at GM, making $30-40/hour with zero deductible health care. [edit: see response to this post, auto worker gets $73/hour.] The bailout: tax person A in order to help person B, with 3 large corporations taking a cut of the proceeds. Does this make any sense? Incidentally, the original poster did not descri…

Person A might very well pay taxes, if they are a single individual with no children. They don't pay a lot of income tax, but they likely do pay some.

Re: Let Detroit Go Bankrupt

#73

Post by hooande »

fallentimes wrote: post #4

The entire time I read this article I found myself nodding in an agreement. I found myself doing the exact opposite during Romney's campaign. As a Detroit native - and this is hard to write - the car bailout should not happen. GM, Chrysler & Ford are currently nothing more than welfare vehicles. Lots of people will go bankrupt and lose their jobs (my Dad already has), firms will die and Detroit will be in absolutely…

What does Romney stand to gain if the big three go into a "controlled bankruptcy"/government take over? If they fire all the executives at those companies as he suggests, will Bain Consulting make a lot of money guiding the automakers through a restructuring? I don't want to sound conspiratorial but it is convenient that he's publically expressing opinions like this while closely tied to a company that does business consulting.

Re: Let Detroit Go Bankrupt

#74

Post by jmtulloss »

ckinnan wrote: post #53
yummyfajitas wrote: post #27

Earlier quoted context omitted.

Person A, a waitress at Dennys, making about $8-10/hour with high deductible health care. Person B, an auto worker at GM, making $30-40/hour with zero deductible health care. [edit: see response to this post, auto worker gets $73/hour.] The bailout: tax person A in order to help person B, with 3 large corporations taking a cut of the proceeds. Does this make any sense? Incidentally, the original poster did not descri…

Actually the average UAW salary is around $73 an hour. But the executives are far worse and totally undeserving of any taxpayer help: "While Uncle Sam debates a $25 billion rescue for the country's automakers, some 9,000 GM managers continue to enjoy one of the industry's best perks - a new car every six months for $250 a month, with repairs and insurance included. And they can write off gas on their expenses." http:…

Can you site that $73/hour wage? A cursory glance around the internet indicated something around $30/hr as of last year. The only places I saw $73 were other forums, but maybe they all have a common, legit source.

Re: Let Detroit Go Bankrupt

#75

Post by jmtulloss »

mattmaroon wrote: post #47

Why didn't he talk like this on the campaign trail? If he'd done that instead of trying to fist bump every black guy he saw while yelling "who let the dogs out" he could have been the nominee.

He gave plenty of economically motivated speeches, both on the campaign trail and while he was governor. The media just covers the fist bumps.

Re: Let Detroit Go Bankrupt

#76

Post by jmtulloss »

byrneseyeview wrote: post #69

I think we should allow the car companies to form a union. They can collectively agree that unless every single auto worker accepts $10/hour and no benefits, they all fire everybody. It would be very interesting to see how this works out.

Who benefits from this scenario? Between the American people, car company execs, auto workers, and the government, this is a lose-lose-lose-lose plan.

Re: Let Detroit Go Bankrupt

#77

Post by rms »

jmtulloss wrote: post #74
ckinnan wrote: post #53

Earlier quoted context omitted.

Actually the average UAW salary is around $73 an hour. But the executives are far worse and totally undeserving of any taxpayer help: "While Uncle Sam debates a $25 billion rescue for the country's automakers, some 9,000 GM managers continue to enjoy one of the industry's best perks - a new car every six months for $250 a month, with repairs and insurance included. And they can write off gas on their expenses." http:…

Can you site that $73/hour wage? A cursory glance around the internet indicated something around $30/hr as of last year. The only places I saw $73 were other forums, but maybe they all have a common, legit source.

I believe that $73/hour number includes all executive pay and obviously is an average chosen to misrepresent information. The average assembly line worker wage (and the median wage) is closer to $30.

Re: Let Detroit Go Bankrupt

#79

Post by ewanmcteagle »

mhartl wrote: post #46
crabapple wrote: post #11

one must ask why a waitress at denny's who makes minimum wage and has no healthcare must bail out union workers at gm who make 8x the wages, do less work, have ZERO DEDUCTABLE healthcare (do you? i doubt it), and full pensions. or why should a succesful worker at honda in ohio subsidize not only a failed competitor, but in essence have his own taxation used to undermine his own hard work? as for saving jobs and inves…

I basically agree with you, but it's worth noting that your hypothetical Denny's waitress would pay no federal income tax (though she would pay the payroll tax), and would probably qualify for the Earned Income Tax Credit. It's really the professional wage earners (doctors, lawyers, etc.) pulling in a few hundred grand who get the shaft.

$8/hour = $16k per year (roughly). Since this is greater than the standard deduction you will not be avoiding federal income tax at this level.

Re: Let Detroit Go Bankrupt

#80

Post by mdasen »

jmtulloss wrote: post #74
ckinnan wrote: post #53

Earlier quoted context omitted.

Actually the average UAW salary is around $73 an hour. But the executives are far worse and totally undeserving of any taxpayer help: "While Uncle Sam debates a $25 billion rescue for the country's automakers, some 9,000 GM managers continue to enjoy one of the industry's best perks - a new car every six months for $250 a month, with repairs and insurance included. And they can write off gas on their expenses." http:…

Can you site that $73/hour wage? A cursory glance around the internet indicated something around $30/hr as of last year. The only places I saw $73 were other forums, but maybe they all have a common, legit source.

I cannot say what the previous person was referencing, but NPR has a great comparison of GM and Toyota at http://www.npr.org/news/specials/gmvstoyota/

If you read the list, it looks like you're both (partially) correct. The average hourly salary for non-skilled assembly-line workers is a little over $31. However, GM's labor cost per hour exceeds $73/hour for those workers.

So, in terms of GM's costs, it's over $73/hour. I'm guessing the UAW has structured it in a way that benefits the employees, but I can't imagine what benefits would be worth more than my salary. Seems to me like more in salary and less in benefits would appeal to me more.

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