Should the American automakers...

[devilsadvocate]

I found this quite interesting considering the tone in Washington

linked from realclear politics http://www.nydailynews.com/opinions/...uto_maker.html

I think it's written in a very biased way but it makes an interesting point IMO

Republicans subsidize foreign auto makers, but leave Detroit hanging

Sunday, December 14th 2008, 4:00 AM
The group of Republican senators whose procedural votes doomed the auto industry bailout bill perfectly illustrates the narrow, "America Last" politics that is crippling efforts to revive the U.S. economy.
The proposed $14 billion in short-term loans for General Motors and Chrysler were supported by a truckload of industry leaders and economists, along with President Bush, President-elect Barack Obama and majorities in the House and Senate.
All agreed that a loan would be better than bankruptcy, which could put as many as 3 million people (and 40,000 of them in New York alone) out of work.
But a clique of Republican senators blocked the bailout, which required 60 votes rather than a simple majority. And they did it for the worst possible reasons.
Exhibit A is Sen. Richard Shelby of Alabama, an outspoken opponent of the bailout who told Detroit CEOs point-blank - before hearings even began - that he would vote no on a loan.
Shelby, it turns out, is a bought-and-paid-for advocate for non-American carmakers.
Toyota, Honda, Hyundai and Mercedes-Benz all operate in Alabama, a so-called right-to-work state where unions are scarce - but taxpayer help for corporations is not. At a recent press conference, Ron Gettelfinger, president of the United Auto Workers union, ticked off the staggering sums of subsidy money Alabama has given to these foreign companies.
"We have Hyundai Motor Co. that got $252 million in incentives. Toyota there got $29 million in incentives. Honda, $158 million," Gettelfinger said.
Alabama gave Mercedes-Benz the sweetest deal of all: job training, incentives, an agreement to buy 2,500 cars and a parcel of land valued at more than $250 million - the price to Mercedes of building a plant.
"That incentive package totaled somewhere around $175,000 per employee to create those jobs there," Gettelfinger said. "We can offer incentives to our competitors to come here and compete against us, but at the same time we are willing to walk away from an industry that is the backbone of our economy."
That, in a nutshell, is the problem. Nationwide, right-to-work states have poured $3 billion in subsidies into foreign-owned carmakers since 1992, according to the union. And yet Republican senators from states like Alabama, Mississippi, Kentucky, Tennessee and both Carolinas suddenly turned into born-again opponents of giving government dollars to private companies.
The UAW actually gave in last week, agreeing to bring the salaries and benefits of Detroit autoworkers down to the lower level paid by foreign car companies in union-hostile states.
But even that concession wasn't enough for Shelby and the anti-labor senators, who insisted that UAW salaries drop to foreign car company levels within a year.
When the union declined to gut its members' paychecks so quickly - at a time when the economy is in turmoil and people are hurting - the bailout deal collapsed.
Keep all this in mind the next time you hear conservatives carping about how "greedy" unions hindered Detroit's profitability.
A similar blind spot in the debate obscures the free trade pacts that give advantages to foreign carmakers. Current trade rules limit U.S. auto companies to selling 5,000 cars in South Korea - while allowing South Korean giants like Hyundai to sell 600,000 cars here.
Though it looks likely now, we don't know if the White House will order the Treasury Department to lend bank bailout funds to GM and Chrysler until the new Congress convenes next month.
And if the administration does, we don't know if the money will be too little, too late to head off major job losses.
What we do know for sure is that the economy won't recover anytime soon if pols keep subsidizing foreign companies at the expense of American industry.

Back in the day I seem to recall the hog makers being saved by Honda introducing the goldwing, which was a much better product technically, reliably and performance wise than the Harleys of the day.
It spored a bout of "buy American patriotism" among bikers and phrases like "rather have a sister in a whorehouse than a brother on a jap bike".

I guess car buyers are a different breed.

[j2k4]

I read that and see this-

""We have Hyundai Motor Co. that got $252 million in incentives. Toyota there got $29 million in incentives. Honda, $158 million," Gettelfinger said.

Alabama gave Mercedes-Benz the sweetest deal of all: job training, incentives, an agreement to buy 2,500 cars and a parcel of land valued at more than $250 million - the price to Mercedes of building a plant."

It seems we have four thriving automakers employing scads of American workers for a billion dollars, more-or-less.

I think that's a better deal. :

[devilsadvocate]

I read it and see government subsidizing private foreign owned business on one hand and saying that's not what government should be doing on the other.
I'm supposed to accept corporate welfare because it's a sweeter deal?

[clocker]

Back in the day I seem to recall the hog makers being saved by Honda introducing the goldwing, which was a much better product technically, reliably and performance wise than the Harleys of the day.
It spored a bout of "buy American patriotism" among bikers and phrases like "rather have a sister in a whorehouse than a brother on a jap bike".

I guess car buyers are a different breed.

The whole concept of "Buy American" has always escaped me.
To knowingly and willfully invest in a substandard product seems like the very antithesis of being American.

Don't get me started on Harley Davidson...my hatred is deep and boundless.

The proposed $14 billion in short-term loans for General Motors and Chrysler were supported by a truckload of industry leaders and economists, along with President Bush, President-elect Barack Obama and majorities in the House and Senate.

And opposed by 60% of Americans- the people who will actually end up paying for it.

I'm reminded lately of the British auto industry.
In the early 50's they dominated the world's export market (and produced some of the most iconic and desirable cars of all time- think Jaguar XKE and even that most American of performance cars, the Shelby Cobra, which was a British design), yet by the 70's they were dead in the water, subsisting on massive government aid.

Even with all the government intervention, today's British auto industry is but a shadow of it's former self.

There might be a lesson for us to learn from that...

[iEATlilKIDS]

i m for the bail out, my reasoning is that i would like to see the whole yank life style go down with flames and not just the couple hundreds of thousands of those who would loose thyre jobs due to American arrogance and sheer retarded narrow short term thinking that led to the making of some of the worst manufactoring and engeniring that has ever been prouduced by man.
let em fat bastards sit in the corner and think bout how dumb thyre way of life is for a while

[pentomato]

This is politics as ussual, republicans always talking about been patriotic, but they turn around and vote all the time to send jobs overseas, now they want to destroy millions of jobs in favor of foreign cars and the money they make will go to other countries. Of course American cars are bad, they buy the parts in china, so not surprise here.
I hope the day will come, when american people will hold those politicians accountable of so many job losses.
Free market just for big bussinesses, we the people get nothing in return.

[devilsadvocate]

Not only are foreign manufacturers benefiting from US corporate welfare but they get it from home ass well

Currency

“A sharp appreciation of the yen in November led to comments by a number of Japanese officials...[Official comments on exchange rate policy] may introduce additional volatility in exchange markets, and therefore are unhelpful.”

— Treasury Department Report to Congress on International Economic and Exchange Rate Policies,
December 2007

The Impact of a Misaligned Yen
on U.S. Automakers

U.S. automakers welcome competition from Japanese companies and other international competitors. We believe that competition in a free and fair environment is good for consumers, good for innovation, and good for creating ever safer and more fuel-efficient cars. However, the U.S. government continues to passively accept subsidized imported vehicles from Japanese automakers who are not competing fairly because their government effectively subsidizes its auto industry through the use of an artificially low yen. This policy has led to the skyrocketing levels of auto exports to the U.S. that harm the economy and cost American jobs by giving Japanese automakers an unfair and unearned advantage over American automakers.
The artificially low yen has helped fuel our trade deficit with Japan, which hurts the U.S. economy and gives Japanese automakers an unfair advantage over American automakers. Nearly two-thirds of that deficit, or $56 billion out of a total $88 billion, is exclusively a result of Japanese auto products.
This issue is not trivial or just a technicality. The impact of an artificially low yen on the automotive sector is a major competitive factor in the whole automotive industry: The misaligned yen gives the average imported Japanese car a huge windfall cost advantage over U.S. automakers and other competitors in the market. This 'yen effect' also crosses over to Japanese vehicles made in the U.S. because of the high level of subsidized imported auto parts used in their U.S. plants.
A few facts:

• With a yen valued at 118 to the dollar, Japanese automakers enjoy an average windfall $4,000 cost advantage per vehicle more than they would if the yen traded at its true value. The overall subsidy Japanese automakers gain for the 2.2 million vehicles they import totaled $8.8 billion in 2006.
• The total yen subsidy provided to Japanese automakers in 2006 was $13.4 billion – $8.8 billion for car & truck exports to the U.S. and $ 4.6 billion for imported parts used in American-made Japanese cars.
• More than half (52%) of all automobiles manufactured in Japan were designated for export in 2006, exceeding 50% for the first time in 19 years. In fact, even as demand within Japan for new autos is declining, Japanese companies are adding production capacity to Japan-based facilities, reactivating assembly lines, adding workers and postponing planned factory closures as they move to export ever greater numbers of vehicles.

It is time for U.S. policy to place the needs and survival of its own manufacturing sector first. To do so will require the U.S. to demand that the Japanese allow the yen to regain its undistorted value. Japan must be pressed to bring its currency into alignment and trim its excessive currency reserves.

Yet all the southern republicans are interested in is cutting wages, pensions and health care for American workers.

[j2k4]

Not only are foreign manufacturers benefiting from US corporate welfare but they get it from home ass well

Yet all the southern republicans are interested in is cutting wages, pensions and health care for American workers.

Well...we still like a little piece of "home ass", too.

[clocker]

Not only are foreign manufacturers benefiting from US corporate welfare but they get it from home ass well

The Japanese have always considered their heavy industry as a national strategic asset and have exercised extreme government oversight to protect and nurture it. The government decided who was going to have access to raw materials- specifically steel- and steered engineers and other necessary labor to the companies it thought most likely to succeed. In a very real way (unlike GM's similar but self-serving claim), what was good for Nissan was good for Japan.
Since the end of WW2 when Japan was forced to disarm, corporations have taken the place of the military. Companies like Mitsubishi are the warriors of modern Japan, sent out to protect,conquer and maintain Japan's stability.
Given this role, it's hardly a surprise that the Japanese government will stop at nothing to ensure their corporate success.

Prior to the recent financial carpocolypse, such government intrusion into American businesses was considered totally unacceptable- nay, unAmerican, bordering on communist- and yet today that's just what they cry for.

A classic case of wanting one's cake whilst eating it too.
When times are good American companies want the government to leave them alone- no taxes, no regulation, unfettered capitalism at it's purest- when things go sour they want all the benefits and protections that Big Brother can provide.
Naturally, once the immediate danger has passed, Big Brother is supposed to gracefully bow out and allow the corporations to operate as they are used to doing.
Like that has ever happened here in the US.

[devilsadvocate]

@j2k4 I have a dell keyboard, made in china where they have problems with their ars oh never mind.


@clocker

I agree with all you say, I gave my opinion on a bailout in my first answer. I've been posting since on the talking points. The last one was about all this hot air from lawmakers decrying government subsidies while supporting them when it suits and all this stuff about how these foreign companies are doing well when they have certain advantages afforded them.

Just adding ignored tidbits.

What do you have against Harleys BTW? Is it the company, the bikes or the riders or just motorcycles in general?