General Motors

[Paradoxium]

White House, Democrats reach deal on $15 billion auto aid

 

[BlackLantern]

I guess the Senate does know how to haggle.....

 

[Paradoxium]

I guess the Senate does know how to haggle.....

It's quite easy when it is not your money, you merely put up a face to look concerned.

If they can surrender so much to Paulson and Bernake without any oversight or measures of accountability, this is pretty small fry. Paulson and Bernake pulled the old bait and switch with the mortgages, because it was never about that. The whole damn bank bailout was to bailout Mr. former Goldman and Sach's old friends. What they said would happen (Depression or huge recession) was going to happen with or without the bailout. I warned about this months ago. Now all they are going to say is "at least we tried to something" (never mind it did even more damage)

I also find it funny the MSM does not report the fact not only did these two clowns lie about buying the mortgages - but they also lied to the Chinese who were suppose to get a bailout. They are pretty furious about this.


-------------------------------------------------

There has been leaks that are saying The Chinese (and the Koreans) are going to devalue the their currencies by 30%.

What does this mean?

If you thought the trade deficit was horrible, wait till you see this happen. And yea it looks like a deflationary period now. People with debt are going to be in a bit of trouble. California, Minnesota and New Jersey are in big doo-doo right now.

In a way, this is just deserts: for letting all this happen on our watch, from the nonchalant people who ignores everything, to the pro bailout people.

 

[dnno1]

Because the employer's share exists in addition to anything you see on your pay stub. I didn't add anything back. I put it there in addition, because that is exactly what it is and how it is handled.

You realize that they pay this (Social Security and Medicare) for every employee (even the salaried non-union ones)? I would argue that they are contributing more for the salaried employees than the hourly. Furthermore, they have to do this because they are required by a law under the Federal Insurance Contributions Act - or FICA). You can not blame the unions for those payments. Once again why are we including this into the equation?

No, this is where (I don't mean to sound arrogant, here) I understand taxation better than you do. SST and MRT are handled this way according to law: 50% of the total tax liability is borne by you. When you receive your W2 for 2008, you'll see in Boxes 4 and 6 your gross wages times a net of 7.65%. This is one reduction of your gross pay in order to get to your net pay. So, the $44,000 employee will see a total of $3,366 in those two boxes. In essence, for your own personal accounting, the $3,366 is an expense to you. It never shows on the company books--only your gross wage does. The $400 a month you pay for health insurance is the same way.

Now, what you will not see is the employer's 50% of the SST/MRT liability. They also pay $3,366. This expense is on their company books, along with your gross wage of $44,000 and the half of your health insurance premium they pay for you of $4,800. So, employee DNNO has a total of $44,000 + $3,366 + $4,800 in expense associated with employing him, which is a total of $52,166. Assuming these are the only expenses, $52,166 is the cost of employing you to the company.

If you understand that it is the law then you shouldn't blame the unions for the extra expense made by the employer. You should not turn and blame the law since it was enacted to protect working people who eventually retire to a lower income level. Employee expenses are only 10% of the cost of operating an automobile industry and the expense to union employees are only a fraction of that. Once again we shouldn't be blaming the unions for the fact that there is a lack of credit, fuel prices were extremely high, and consumers are not buying as many cars as they used to (this last fact can be seen throughout the industry).

I'm mistaken, here. I thought (without reading the article) that the $69/hour was the hourly pay rate to the employee, not the labor cost. I stand corrected.

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This is just a talking point anyway. These employees are not actually receiving that much money in their hands. In addition, a portion of that sum is payments made to retirees who's number are not actually figured into the average. The bottom line is that $44,000 is not that much over the poverty line and when you point the finger at the unions, you are basically saying that they should have been closer to that line. I don't think that is the way people should be treated. In closing here is the opening statement of UAW president, Ron Gettelfinger. I think this makes more sense:

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[BlackLantern]

well dnno...I hope you're happy now, more of MY money is going to pad executives pensions and compensation packages....I hope you're happy knowing that taxpayers are helping rich people buy that 6th gold toilet....

 

[XpunkRocker]

actually, you're right. but in detail, your money is going to be invested overseas by making new plants for for the motor companies. then a whole bunch of people here are going to be laid off and their jobs outsourced elsewhere. and in the end, the american motor companies will STILL be screwed. they can't make money until they make better products. our cars dont even meet china's standards. that is right, china has higher standards on cars than we do. if we made better cars, more people would by them AND they could be sold in china. that is how they should make their money. making better cars. but they are failing to compete and it is rediculous.

 

[Addendum]

Nothing will change with the American car makers.

 

[BlackLantern]

It's also an issue of costs....labor costs outside of the US are extremely low, it's cheaper to mass produce outside of the US and get the same quality product....any company that wants to make money is going to figure out a way to get product made for as cheaply as possible to turn a maximized profit

 

[XpunkRocker]

not as much as you think. A lot of their plants are overseas and they still cant compete. If they put all their plants over there, it will save them money, but it won't fix there financial trouble. The real reason they are in trouble is that they aren't selling cars period.

that is what they are doing. they are making cheap products that no one wants to buy. you can't make a profit unless you sell sell sell.

GM is the only one that shows some promise, but that isn't saying much. the only thing GM has done that i thought was good was talk to electric companies about electric cars and how to set up "Stations" for charging them. but that is a small step, and the only step that needs a lot more than that. i personally think that all the american companies will merge right before they are about to go under.

 

[Kelly]

well dnno...I hope you're happy now, more of MY money is going to pad executives pensions and compensation packages....I hope you're happy knowing that taxpayers are helping rich people buy that 6th gold toilet....

Bingo.....



This is getting stupidly ridiculous.....

 

[dnno1]

well dnno...I hope you're happy now, more of MY money is going to pad executives pensions and compensation packages....I hope you're happy knowing that taxpayers are helping rich people buy that 6th gold toilet....

Actually it's just a loan (as I suggested), and they will be paying it back faster than any of us normally would.

 

[Kelly]

Actually it's just a loan (as I suggested). and they will be paying it back faster than any of us normally would.

I guess the Box Office crystal ball has come to the Political Forum.....

 

[BlackLantern]

Actually it's just a loan (as I suggested), and they will be paying it back faster than any of us normally would.

There is no guarantee they will pay that money back....and how would the government collect if they didn't anyway??

 

[dnno1]

I guess the Box Office crystal ball has come to the Political Forum.....

This isn't magic, it's just common sense if you put aside your partisan tendencies.

 

[BlackLantern]

What the Senate should have done is have the automakers sign over the plants/facilities themselves as collateral to guarantee the loan is paid back

 

[dnno1]

There is no guarantee they will pay that money back....and how would the government collect if they didn't anyway??

If it is written in the law, then they will have to pay it back. What are you talking about?

 

[BlackLantern]

On paper is one thing, but how what if they don't pay it back...how would the government go about getting payment...would they seize property? what would they do?

 

[Kelly]

On paper is one thing, but how what if they don't pay it back...how would the government go about getting payment...would they seize property? what would they do?

Communism looked great on paper.....

 

[BlackLantern]

Exactly....the law says don't kill and don't steal but people are still doing that....

 

[Kelly]

This isn't magic, it's just common sense if you put aside your partisan tendencies.

You're funny.....



So, who do you think I voted for in the last, lets see........................5 elections?

 

[BlackLantern]

This isn't magic, it's just common sense if you put aside your partisan tendencies.

It's not about being 'partisan'...it's about myself and countless other Americans who are going to pay more in taxes, have more money taken out of our pockets, basically having to make do with less because 3 car companies, either out of laziness or lack of giving a ****, failed to plan ahead, failed to produce a product that people want, need a ****ing handout.....

 

[Paradoxium]

There is no such thing as free lunch.. from the WSJ

Bridge Loan to Nowhere

All three restructuring plans are heavy on promises to build the "green" cars that a Democratic Congress wants built. GM promises 15 hybrid models by 2012 and 37 miles per gallon on average for its cars. Chrysler commits to putting flex-fuel engines, which can run on ethanol or gasoline, in half of its cars. Ford promises to save 16 billion gallons of gas by using "advanced technology" and to invest $14 billion to improve fuel efficiency.

All three CEOs also drove to Washington in hybrid vehicles as penance for their private-jet flights back in November. This bit of political obeisance was supposed to show that they’d gotten religion both on their perks and their carbon footprint. But it may not have been enough. One Congresswoman wanted to know why they couldn’t hit a 50-mpg fuel-economy target by 2015. Another asked whether, maybe, they weren’t selling enough cars because everyone in America was waiting with baited breath for the coming revolution in fuel economy.

After Barney Frank was done roughing up the CEOs, he hustled them out to hear from David Friedman of Union of Concerned Scientists and Jeffrey Sachs of the Earth Institute. Mr. Friedman warned the Members not to give one inch on fuel-economy standards and not to relax the environmental strings attached to the $25 billion Congress has already made available to the car companies.

You get the picture. If there was ever any question whether Congress actually wants to "save" Detroit, this week dispelled it. This is not a bailout that Congress is debating. It is a federal takeover. We don’t mean that in the sense that the feds will own the companies on paper, although that can’t be ruled out. What Congress wants to own is their business plan, and Detroit seems prepared to oblige.

Well at least if they run the business into the ground, they can blame it on the government for micromanaging everything. Their competitors meanwhile will be able to adapt and calibrate to market turbulence and be able to adopt any new breakthroughs without having to run through red tape.

Given what happened with Ford earlier, I wonder if they will be forced into these constraints. I hope they can make it through without a bailout - at least we can salvage something out of this debacle.

 

[BlackLantern]

I own a Ford now...I had planned on buying a Ford for my next car, but this whole thing has ticked me off to no end, I just might buy an import

 

[dnno1]

On paper is one thing, but how what if they don't pay it back...how would the government go about getting payment...would they seize property? what would they do?

Look, let's not talk in suppositions here. The last time we did that with Chrysler back in 1979, they paid their loans back with interest within 4 years. That is a fact, and I see no reason why the Big three would not be able to pay back this debt seeing that they have presented a very well thought out business strategy before congress (GM's alone was the size of a phone book). Part of the deal would be that the CEO's would only take a dollar in salary (that would mean that they wouldn't get the money for themselves) so your premise that the money would go to the executives is kind of misconstrued.

 

[dnno1]

This is were this entire arugment is going:


Just guess who of use are mimicking the pundits (my guess is that Paradoxium is Niel Cavuto).