Let Detroit Go Bankrupt

Let Detroit Go Bankrupt

www.nytimes.com

IF General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye. It won’t go overnight, but its demise will be virtually guaranteed.

Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course — the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check.

(visit the link for the full news article)

This is a great Op-Ed piece by the man who many think should have been the Republican candidate this year, Mitt Romney.

I have to say that I find a lot of what he says to be dead on. This is also how I felt about the bail out that went through already.

These types of things need to work themselves out naturally. Government intervention provides no incentive for these companies to alter they way they do business.

In the end it only leads back to more of the same problems. Bailing someone out is just a temporary fix, not a solution.

Right now, we need solutions.

www.nytimes.com
(visit the link for the full news article)

Go Romney. I think he hit the nail right on the head. I've been reading the same ideas on ATS for days. Nice to see the NYT publish the article.

The only reason the left is fighting so hard for a bailout is because they have been in the back pocket of the unions for ages. They certainly don't want to lose their contributions and votes. A managed bankruptcy and subsequent reorganization is the only solution that makes sense for a long term success in Detroit.

I completely agree with Romney. We need to let the system fix itself. If we keep bailing out people our capitalist system will implode.

One of the most important lessons people must learn is Responsibility. This applies to banks, auto industries, governments, and everyone across the entire spectrum.

We have to let economic darwinism run its course. You evolve and adapt or you fail. When we bail these people out they become a cancer or disease. They become parasites that feed off of the lifeblood of the nation. These cancers must be cut out and the parasites must be eliminated.

If we feed them, they will eventually bring down the entire system like a disease kills its host. People that try to take advantage of the system must learn responsibility and that there are consequences for their irresponsible actions.

I agree with letting Detroit fend for itself. But I find the argument that the 'liberals' (when will people on this board grow up??) want the bailout because they are 'in the pockets of the unions' a wee bit simplistic and naive. The only arguments being made for the Detroit bailout are based upon the impact failures of the 'Big-3' will have on the already comatose economy. We're circling the bowl and many (not just 'liberals') fear that a failure of that scale will quickly puish us over the edge. If most of the economy was sound I'm fairly confident the 'Big-3' would be cut adrift. But there is a huge risk in letting them fail at this point in economic history. Personally, I say let them go. But cleaning-up afterwards is going to be extremely ugly.

We already bailed out GM once. I think it's time for them to shape up, merge or whatever, or die off. We waste so much material making cars that sit in lots. Why aren't we doing made to order by now?

I would rather the government hand the 25 billion or more to young college graduates and let them build a new car industry, rather than letting the Union and corrupt company executives to continue to drive auto manufacturing to failure. No more bailouts unless all current executives, CEO's are fired.

I mean what happend to the profits the companies made over there entire life? Had they held on to some of it they would not need a bailout. Perhaps those who took the profits should be forced to give it back, even if it is share holder dividends just take it back in taxes from those individuals.

reply to post by Xeven


I agree if they want to give 25 billion dollars to anyone Invest it in a company that isn't failing and help the former employees of GM, etc.

Originally posted by Xeven
I mean what happend to the profits the companies made over there entire life? Had they held on to some of it they would not need a bailout.

And that's kind of the issue here.

These companies and banks needed a bailout because they mismanaged their funds. (and because of greed). If they had conducted themselves appropriately to begin with, they wouldn't have needed it.

What's more, giving them a bailout will not encourage them to change their habits. Once you bail someone out as the government has done, it's only a matter of time before they are in the same situation, or worse off than they were before.

Romney 2012!

Quite a few persons who won the lottery ended up bankrupt.

reply to post by KMFNWO


And your point?

Not sure I follow here...

reply to post by nyk537


I'm pretty sure he's referring to people being financially irresponsible.

At least that's my take on it.

I think some high ranking people want the bailout for the automakers of Detroit because the unions are lobbying for it. Political payback if you must. If Detroit had no auto unions, they would already be in line filing for bankruptcy. In the end, I think the unions will get their way.

Don't worry, I hear China is expressing interest in buying GM, and they have the cash to do so thanks to all the dedicated Wal-Mart shoppers out there (bless you all, LOL). I can picture all them UAWs wearing red already. I say let China buy GM. Then when it does go bankrupt because nobody is still buying their overpriced junk we can buy it all back for pennies on the dollar.

reply to post by jam321


I think you're right.
The unions are a big part of the problem. Let them all fail.

Originally posted by nyk537
This is a great Op-Ed piece by the man who many think should have been the Republican candidate this year, Mitt Romney.

Hear Hear!

Very well thought out article that emphasises the long term viability of the businesses before any short term effects.

Romney seems to tout research and development as the key to long lasting success not just in the auto industry but also for the broader economy.

Now thats a man with vision!

I am afraid that the guys who have to decide on this won't have the balls to do what they know is right.
The potential for serious and painful repercussions from denying loans, in both the short and long term is very high. Who wants to be held responsible for that?
A bailout would only delay somewhat the inevitable, but probably seems like a safer bet regarding saving one's hide, short term.
The auto companies need to bite the bullet and face their demons head on. Its the only way of getting to the other side and clear of their current woes.
Same goes for all of the failing businesses.
Question is, are Americans, and working class people worldwide prepared for the pain?
I am thinking we have no way around this mess and a major dissolution of the old -- including bankruptcies and foreclosures has to take place before we have any chance of a better working system.
Lets get it over with already and stop delaying the inevitable.

Originally posted by 44soulslayer
Now thats a man with vision!

Agreed.

For some reason Romney's name keeps being left out of these talks on where to go with the Republican movement in regards to Conservatism.

I'm not sure why.

Let's get Romney involved people!

Originally posted by jam321
I think some high ranking people want the bailout for the automakers of Detroit because the unions are lobbying for it. Political payback if you must. If Detroit had no auto unions, they would already be in line filing for bankruptcy. In the end, I think the unions will get their way.

And this is the sad part.


I'm all about placing a check on corporate employment via the use of Organized Labor (Unions), but the current state of Union affairs is abyssmal.

What really should be happening in congress right now is figuring out how to deal with the massive layoffs once the big 3 go bankrupt. We shouldnt be putting them on life support.

There are two different issues that the AutoMakers are trying to turn into one issue. The first... automakers go bakrupt... welll so what?

The second... we have massive layoffs... well ok then, let's figure out what to do with those people maybe so that it doesn't hurt the overarching economy, but for heavens sake, extending the life of the automakers doesn't solve anything.

reply to post by nyk537


Some of us have first-hand experience with Romney. Trust me, the dude does not walk on water. He left MA with a massive financial catastrophe the repercussions of which are just now beginning to surface for real. RomnAide drinkers will try and divert the fault to (most likely 'liberal', democrat, or 'left') other people . But the fact is, he was 'The Man' at the time. Reigning over the 'largest public works project in history' you'd think he would have been involved.