No posts since November 2. What happened? I think I’ve been going through the 3 stages of political grief (in reverse).
At first it was Fear that despite polls, Obama wouldn’t win. Then, Disbelief that he actually won. Then Relief that someone with brains, maturity, and a coherent value system is actually going to be running country; that he will be backed by large majorities in both houses of Congress, and all of this is happening after 8 long years of idiocy. Whew. Unbelievable.
In any event, this is a blog, so what’s the topic of the day? Ah yes, the auto industry. To bail or not to bail….
I have a love/hate relationship with the big American auto makers. I love my car. I’m not sure I love Detroit cars. At the same time American automakers literally invented the car market: Henry Ford, Louis Chevrolet, Cadillac, Nash, Packard….on and on. It’s an American success story. How can we just toss this industry overboard? Particularly at a time of economic panic. Do we really want to dismantle Ford and GM in bankruptcy court? I don’t. Would Japan or Germany dump on their major manufacturers that way? No.
GM and Ford certainly have their problems; some of them self-inflicted, other not. One that’s not, is their “legacy costs” associated with providing health insurance for retirees. GM got efficient. Now they have far more retirees than workers. Should they be punished for that? No. Health insurance should have been nationalized fifty years ago, but the radical right blocked it then, just like it’s blocking it now. It was a massive error to ask employers to provide insurance that really should be social insurance. Now GM is paying the price. And so are we.
But the radical right still doesn’t get it. Yesterday, Mitt Romney announced that he favors letting the Big Automakers die. Who cares what it does to the economy. Apparently he puts Country Second and Destroying Unions First.
One other thought: the automakers are asking for a $25 billion loan. A lot of money. But is it really? Last time I checked, corporations were accumulating huge amounts of cash. For example, Exxon (according to their 6/30/08 10Q statement) has accumulated $35 billion in cash. That’s not just equity or working capital or short-term investments. That’s cash. I guess they can’t figure out what to do with it. Maybe they should loan it to their friends at GM who make the cars that use their fuel.