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• GM says China '08 sales up 6 pct but growth slows 1/5/2009, 10:42 p.m. EST
• Toyota to suspend production for 11 days in Japan 1/5/2009, 10:08 p.m. EST
• Nissan dealers back out of the Detroit auto show 1/5/2009, 10:01 p.m. EST
Auto-state senators ready to pitch bipartisan deal for industry rescue to fellow lawmakers
by Ken Thomas | The Associated Press
Thursday November 20, 2008, 12:30 PM
WASHINGTON (AP) -- A bipartisan group of auto-state senators reached a last-ditch compromise Thursday to throw Detroit's Big Three a government lifeline worth billions, but the plan faces an uphill battle in a reluctant Senate.
With the auto bailout stalled, the fate of hundreds of thousands of workers and Detroit's once-venerable car companies hangs in the balance.
Senate Majority Leader Harry Reid, D-Nev., canceled plans for a vote on a bill to carve $25 billion in new loans out of the $700 billion Wall Street rescue fund. The Bush administration and congressional Republicans oppose that plan.
• Auto-state senators ready to pitch bipartisan deal for industry rescue to fellow lawmakers
• Chinese automakers want a bailout, too
• GMAC files for bank holding status
• Ford shuffles manufacturing executive lineup
• U.S. isn't showing inclination to 'Keep America Rolling' these days
Warning of economic disaster, Democrats and Republicans from auto industry states reached a deal Thursday on an alternative package that would temporarily divert money from a fuel-efficiency loan program to cover the Big Three's immediate costs. But it was unclear whether it could draw enough support to pass.
The group, led by Sens. Carl M. Levin, D-Mich. and Kit Bond, R-Mo., scheduled a news conference to announce details.
Even if agreement can be reached to consider their plan, Reid signaled earlier Thursday that the Senate was not likely do so until after Thanksgiving.
"We have some procedural roadblocks," Reid said.
With all sides sensing doom for a Big Three automaker rescue, the finger-pointing proceeded.
White House press secretary Dana Perino on Thursday blamed Reid for not allowing the Republicans' separate auto-aid plan to come up for a vote.
"Unfortunately it looks like Sen. Reid just wants to pick up his ball and go home for the next two weeks -- two months -- for vacation," she said.
Pressed on what the White House would do if Congress can't agree on a plan to rescue the automakers this week, Perino said she thought lawmakers would return after the Thanksgiving holiday for an emergency legislative session if an auto company was in imminent danger of collapsing.
"I can't imagine a scenario where they wouldn't come back, unless the answer is that they just don't care. And if that's the case, then the American people ought to know that."
Congressional Democrats countered that the Treasury Department already had the power to grant emergency funds to the automakers, but the Bush administration opposed the approach.
Former Massachusetts Gov. Mitt Romney stood steadfastly behind forces opposing the bailout.
Speaking Thursday morning amid growing signs of gridlock in Congress, Romney said, "There's no question but that if you just write a check, you're going to see these companies go out of business ultimately."
Romney, who had run for the Republican presidential nomination, told CBS' "The Early Show" that he doesn't want to see the carmakers go out of business, "but we don't want them to continue business as usual."
The leaders of General Motors Corp., Ford Motor Co. and Chrysler LLC painted a grim picture of their financial position during two days of congressional hearings, warning that the collapse of the auto industry could lead to the loss of 3 million jobs. Detroit's automakers, hurt by a sharp drop in sales and a nearly frozen credit market, burned through nearly $18 billion in cash reserves during the last quarter -- about $7 billion at GM, almost $8 billion at Ford and $3 billion at Chrysler. Both GM and Chrysler said they could collapse in weeks.
"I don't believe we have the luxury of a lot of time," GM CEO Rick Wagoner told a House hearing.
Alan Mulally, the CEO of Ford Motor Co., said the company had enough cash reserves to make it through 2009. But United Auto Workers union president Ron Gettelfinger said a bankruptcy could spawn others.
"If there's a Chapter 11 (for) one of the companies, it will drag at least one other with them, if not all of them. And I do not believe Chapter 11 is where it will end. It will go to liquidation," he said ominously.
Automakers ran into more resistance from House lawmakers, who chastised the executives for fighting tougher fuel-efficiency standards in the past and questioned their use of private jets while at the same time seeking government handouts.
"My fear is that you're going to take this money and continue the same stupid decisions you've made for 25 years," said Rep. Michael Capuano, D-Mass.
The stakes are high. The Detroit automakers employ nearly a quarter-million workers, and more than 730,000 other workers produce materials and parts that go into cars. About 1 million more people work in dealerships nationwide. If just one of the automakers declared bankruptcy, some estimates put U.S. job losses next year as high as 2.5 million.
The White House and congressional Republicans have urged Democrats to support a GOP plan to divert a $25 billion loan program created by Congress in September -- designed to help the companies develop more fuel-efficient vehicles -- to meet the auto giants' immediate financial needs.
Sens. Carl Levin, D-Mich., Kit Bond. R-Mo., and George Voinovich, R-Ohio, are trying to broker an alternative that could provide bridge loans or a guarantee that the fuel-efficiency loan fund ultimately would be replenished. Negotiators were discussing a scaled-down aid package of $5 billion to $8 billion to help the automakers survive through year's end.
But it was unclear if any progress could be made. Democrats strongly oppose letting the car companies tap into the energy loans for short-term cash-flow needs.
Despite the gridlock in Congress, there could be a contingency plan: a return to Washington in December for another postelection session to try to strike a deal.
House Majority Leader Steny Hoyer, D-Md., noted that Democratic leaders were planning to gather for an economic conference the week of Dec. 8. "That is available," Hoyer said. "The year has not ended."
Let them go bankrupt or be purchased. Perhaps the transition will allow them to get rid of that huge rock around their neck called the UAW so they can become profitable. Maybe without them they will be able to get rid of those monstrous wages they are paying to people who provide the same menial labor and still walk off the job. In my opinion, if you don't get an education you don't get a high paying job. Sure, people have intrinsic value, but employers pay people on the value of the work to the end product.
And if you are ticked because execs make big $$, I'd like to see the average complainer do their job. The fact is, it takes more talent and drive than most line workers will ever have. And because it takes talent, they provide a service that not anyone can replace. Therefore, supply and demand, they get more money and they get that money in greater amounts as the supply of people who can do their job gets smaller. Ask the average non-union worker if they think it's fair that a union worker gets 3x the wage for the same job.
dtownprof,,, you sound like the average COMPLAINER to me . I have worked in the shop and currently run my own business I can tell you I can do the job of these so called talented execs at half their pay and still take a 2 hour lunch. HMMM Let me see,,, if I take half their pay that would be what? 8 million dollars. I don`t begrudge a greedy exec getting his, no more than an average Joe getting his. How about I stop by in my corporate jet and we go have a massage in L.A. right after I get my bail out.
The execs who agreed to the outlandish labor contracts with the unions are to blame for this situation. Retirees are getting huge pensions and paid health insurance paid, not only for them individually, but for their families as well. The retiree benefits are taking the biggest chunk out of the companies' budgets. First off, these companies should fire all the high-priced execs who so poorly managed these companies and ran them into the ground. Then they should file chapter 11 and renegotiate the union contracts so they're not paying out what they are to retirees. This bailout won't help get these companies back on track and bring about better autos. It's a quick fix to help them pay their bills (their retirees) over the next few months. Pretty soon they'll be back asking for more.
To all you union bashers - WalMart is now the biggest employer in the U.S. I hope that all of you end up working at WalMart and you will see firsthand the need for unions. I would like just one of you to make an educated arguement regarding how the "walmartinization" of the U.S. is a good thing.
Does WalMart create wealth in the communities where they put up a mega store? If so, how?
Does WalMart share it's success with its' employees? Isn't that they way capitalizm is supposed to work? You work hard for your employer because the better they do, the better you do right? Is this what happens at WalMart?
deeznuts: WalMart gives their employees bonuses for saving on costs. Every level gets a bonus check. Those checks can be several hundred dollars.
From MSNBC:
Based on the numbers Wal-Mart released, the mathematical average payment would be $651 per worker but Wal-Mart said the individual amounts varied. It declined to provide a range or the specific level of payments, citing competition with other employers.
It's not about cars or unions, it's the economy:
TOKYO (Reuters) - Japan's economy is expected to contract for two straight fiscal years as the global financial crisis takes a toll on exports and corporate activity, a Reuters poll showed.
The gloomy forecast comes after government data said on Monday the world's second-largest economy slipped into its first recession in seven years in the third quarter, meeting the widely used definition of two consecutive quarters of contraction.
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BEIJING (AP) -- Chinese officials warned Thursday that the country faces a "grim" employment outlook with demand for workers falling and job seekers in the cities outnumbering new jobs by two-to-one as the economy slows.
Officials from the national police chief to local leaders have warned job losses could spark protests threatening social stability and one-party communist rule.
-----
The beleaguered Goldman Sachs Group's initiative to cut 10 percent of its global labor force worked its way to the Capital Region earlier this week, with dozens of layoffs reported at its Ayco financial consulting arm.
A Goldman Sachs spokeswoman in New York confirmed today that the former investment bank is laying off 10 percent of its 32,000 employees worldwide and that those cuts include Capital Region workers. In 2003, Goldman Sachs acquired the Ayco Co., which later moved its corporate offices to Saratoga Springs.
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OTTAWA - Prime Minister Stephen Harper jets to Peru Friday morning for the latest international summit to deal with the global economic and fiscal crisis.
It's not about cars or unions, it's the economy:
TOKYO (Reuters) - Japan's economy is expected to contract for two straight fiscal years as the global financial crisis takes a toll on exports and corporate activity, a Reuters poll showed.
The gloomy forecast comes after government data said on Monday the world's second-largest economy slipped into its first recession in seven years in the third quarter, meeting the widely used definition of two consecutive quarters of contraction.
------
BEIJING (AP) -- Chinese officials warned Thursday that the country faces a "grim" employment outlook with demand for workers falling and job seekers in the cities outnumbering new jobs by two-to-one as the economy slows.
Officials from the national police chief to local leaders have warned job losses could spark protests threatening social stability and one-party communist rule.
-----
The beleaguered Goldman Sachs Group's initiative to cut 10 percent of its global labor force worked its way to the Capital Region earlier this week, with dozens of layoffs reported at its Ayco financial consulting arm.
A Goldman Sachs spokeswoman in New York confirmed today that the former investment bank is laying off 10 percent of its 32,000 employees worldwide and that those cuts include Capital Region workers. In 2003, Goldman Sachs acquired the Ayco Co., which later moved its corporate offices to Saratoga Springs.
--------
OTTAWA - Prime Minister Stephen Harper jets to Peru Friday morning for the latest international summit to deal with the global economic and fiscal crisis.
Yo Challenger4 is that average of $651.00 yearly, daily, weekly, what? If that is yearly that would come to about $55.00 a month or ALMOST $2.00 a day divided by a 7 hour shift (because no one works full time at WalMart , do they?)That would come to about .25 an hour add in the $7.50 they earn an hour would a WHOPPING $7.75 an hour. Welcome to WalMart?????
Challenger - would you work at WalMart? Do you know what they pay people? I know people who do, some of whome have college degrees. They are treated terribly and extremely underpaid. The ones who are lucky enough to be "full time" to get benefits have pretty bad benefits. They pull all kinds of dirty tricks to avoid paying for overtime.
My point with the WalMart example is this: GM used to be the #1 employer in terms of numbers in America. Now WalMart is. As far as creating wealth and raising the standard of living in a community, it's not even close. We seem to forget that the unions (Teamsters, UAW, etc) were responsible for the creation of an actual middle class as we know it in this country.
To me, WalMart is an example of what is wrong with this country and an example of why unions are necessary. The CEOs and major shareholders of Walmart get extremely wealthy while the workers share little if at all in this wealth. When they put a store in a community, they drive other small local businsses out, so for each of the crappy part time low wage jobs they create, they destroy at other jobs at local businesses. Wages in the local community actually go down. it's a great concept - drive wages down in the area and get rid of competitionso that the only place people can shop at and afford to shop at is yours.
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