Looks like Government Motors isn't as profitable as promised. I guess Congress can keep attacking Toyota and pretend the whole GM thing didn't happen...
Lets do the math. If all 244k employees from GM had to go on unemployment, it would cost the government $109 million per week at $450 per week per employee. Since its bankruptcy GM has lost $104 million per week for the last 10 months on average. So its a little cheaper to keep subsidizing GM and keep people working making 30 bucks per hour or 1200 per week. Of course...we havent looked into the pension yet...but seems to make sense to subsidize GM and hope they turn around rather than send 240k uneducated workers to the unemployment line. At least for right now. I mean I am usually against subsidizing but at least these people are producing unlike the unemployed. And if it costs no more than it would to pay them unemployment...might as well keep GM going
It's not an either-or, though. The gov't could have followed established bankruptcy laws and allowed GM to restructure like any other company. Instead they negotiated a costly, inefficient scam with the union calling many of the shots. That being said, I'm sure the workers get some tasks done between all those union-mandated breaks...
What if people just DONT want to buy GM cars any more? (I'm not talking about buick, chevy and the other brands they own, I mean the actual GM made cars) How long will the Gov't spend our money on this dead wood? People are buying imports now. They are cheaper, and more reliable. American made cars have a bad rap now, but hey, it was 30+ years in the making, and people were too blind to see it.
Well, with the health bill we now have a precedent that we can be forced to buy something. Maybe we'll be forced to buy poor quality, hybrid Gov't Motors junkers one day. The joy.
And do we keep pretending that the whole Financial Institutions destroying the world economy while they made billions thing didn't happen? GM is guilty of paying workers a better than average buck to build a less than average car. Shame on them, but GM building shitty cars didn't wreck the entire economy, now did it? The money boys at the banks get bailed out, then so should do the guys on the assembly line.
Electric cars are the future. This is the link to the Nissan Leaf's website, an all electric car that is coming out in late 2010. It can go 100 miles on a single charge from a home outlet. It has no engine oil, timing belt, muffler, or transmission. http://www.nissanusa.com/leaf-electric-car/index.jsp
The financial institutions took what they were given from the gov't(artificially low interest rates, huge incentives to loan to the non-creditworthy and punishments for not doing so, a refusal to crack down on Fannie/Freddie when there were warnings almost 10 years ago, etc.) Yes, they found ways to profit from it, but they were hardly the cause of it. That said, I didn't support any of the bailouts, including theirs. But the Barney Franks and Greenspans of the world deserve the brunt of the criticism.