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I haven't thought this through yet but, what if GM & Chrysler had been left for dead and, say, $20B had been spent differently. Do you think, on a whole, the American economy would be better off a few years from now? Let's leave the obvious environment benefits linked to some of my ideas off the table.
$1B - A research grant pool open to universities to fund the 50 most promising proposals in the fields of green cars, batteries, and similar fields. Something like $10m each to the top 50 to develop a proof of concept, and the other $50m paid out each to the top 10 of those with the most promising proof-of-concepts after 2 years.
$1B - The private sector equivalent. $1B of capital gains tax-free for VCs investing in green technology companies. In this crappy economy there isn't much exit activity, so this plan would stretch over 5-10 years.
$10B - Roughly $500m each to the 20 largest US metropolitan areas to be spent on public transportation infrastructure, allocated proportionately to their size and other factors like population density.
$8b - Airlines are putting off retiring old (fuel-hungry) planes due to their financial positions. $8b in interest-free loans and incentives for them to retire planes below a certain CO2 / fuel efficiency threshold in favor of more modern planes.
Bad idea? Good idea? Would you spend the $20b differently if the broad goal was future economic wellbeing?
 
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On March 05 2009 05:18 nvnplatypus wrote:
I haven't thought this through yet but, what if GM & Chrysler had been left for dead and, say, $20B had been spent differently. Do you think, on a whole, the American economy would be better off a few years from now?
Any sane economist would say yes. Supporting a failing industry is bad economics. There would be a lot of short term pain, but in the long run it is better to let failing companies die.
Politicians are forced into bad economic policy to secure votes.
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On March 05 2009 05:26 Mastermind wrote:Show nested quote +On March 05 2009 05:18 nvnplatypus wrote:
I haven't thought this through yet but, what if GM & Chrysler had been left for dead and, say, $20B had been spent differently. Do you think, on a whole, the American economy would be better off a few years from now?
Any sane economist would say yes. Supporting a failing industry is bad economics. There would be a lot of short term pain, but in the long run it is better to let failing companies die.
This
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Jesus Christ... nobody even buys those fucking cars. HINT THATS WHY YOU AREN'T MAKING ANY MONEY GM
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On March 05 2009 05:35 LordWeird wrote:
Jesus Christ... nobody even buys those fucking cars. HINT THATS WHY YOU AREN'T MAKING ANY MONEY GM
Err...
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I hate these bailouts. I think they've spent close to or over a trillion dollars. One trillion divided by 300 million U.S. citizens=$3,333.33 for every single American citizen. How would that be for a stimulus package. Fuck the banks, who needs em?
btw: I have no clue what I'm talkin' about but this stuff seems so incredibly crooked. I do feel much more empathetic towards the auto industry than the banks but if they can't compete now I don't see why giving them money to stay alive for another year will change anything.
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51280 Posts
GM/Chrysler cars are awful except for Dodges.
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On March 05 2009 05:35 LordWeird wrote:
Jesus Christ... nobody even buys those fucking cars. HINT THATS WHY YOU AREN'T MAKING ANY MONEY GM
GM has the second largest market share in the world just behind toyota, they don't have a problem selling cars, they have a problem with profitability, they spend a ton of money on retarded corporate expenses(private jets, and resorts) and pay their workers ridiculous wages for jobs any able bodied adult can do with a week of training(good job UAW) and they are just in general inefficient.
Giving GM bailouts is just continuing the problem, force them to file a chapter 11 and they will turn profitable quick.
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Any company will hold large shares if they own 8 different brands of cars. People are buying fewer and fewer of them every year.
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thedeadhaji
39489 Posts
I'd probably shave a billion each from the planes / public transportation and double the research funding.
Damn, this looks infinitely better than bailing out GM.
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i think the whole reason of the bail out is so there won't be 10000000 workers without jobs.
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On March 05 2009 07:16 haduken wrote:
i think the whole reason of the bail out is so there won't be 10000000 workers without jobs.
Thats what I thought too, but the bailout may only be prolonging how long they have jobs, since their industry is failing anyway. Ironically though, a reason these industries are failing is because they aren't willing (or can't due to labor union pressure) to cut salaries for these workers to match foreign competitors.
On March 05 2009 05:42 Jonoman92 wrote:
I hate these bailouts. I think they've spent close to or over a trillion dollars. One trillion divided by 300 million U.S. citizens=$3,333.33 for every single American citizen. How would that be for a stimulus package. Fuck the banks, who needs em?
If only... I'm sure there's problems with this reasoning, but its a very pleasant thought nonetheless
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On March 05 2009 06:13 Klapdout wrote:Show nested quote +On March 05 2009 05:35 LordWeird wrote:
Jesus Christ... nobody even buys those fucking cars. HINT THATS WHY YOU AREN'T MAKING ANY MONEY GM Giving GM bailouts is just continuing the problem, force them to file a chapter 11 and they will turn profitable quick.
Yeah, they'll turn profitable by laying of 3/4 quarters of thier workers. Which will in turn leave the huge numbers in manufacturing with nothing to do and hence no job. They'll then have no money to buy a car and you get very nasty cycle kicking in.
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Letting the US auto industry die might be good in theoretical economics, but from a practical, sane perspective the auto industry can't just be let to die. Whilst I agree that bailing out bad companies is unwise, we need to remember 2-3 million people depend on these companies to survive. Having a couple million more unemployed isn't a viable option for neither long or short-term growth, as well as it would be a widely unpopular decision just to let them die.
It's quite easy to rule a country in theory, I just don't doubt that it'd be hard to inform the millions of people who would lose their jobs that 'it's good for the economy: unfortunately it blows for you'.
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As many have already said, the bailout wasn't exactly for the companies (unlike the financial sector) but for its workers. As well, these companies are rooted so deep in America, too many small companies will be affected, both directly and indirectly.
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United States22883 Posts
8 billion to airlines? Have we all forgotten that Bush bailed out the airline industry?
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There would be more jobs created/saved if it was not put into those companies. More jobs and more productivity and return of investment per dollar.
Bail outs don't stop the bleeding in bad companies. A simple assembly line worker shouldn't make more than minimum wage or about 1600 dollars max. It takes the same amout of skills as flipping burgers.
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How would there be more jobs. So we start a building project instead of giving it to the auto industry, sure if we take out the aspect of time it will be equal to bailing out car industry, but if time is present (e.g. the real world) the new building projects will take time to get off the ground, meanwhile there will be a million more people without jobs, who obviously won't be spending, causing others to lose their jobs and thus, in fact, less people will have jobs, then with the auto bailout.
While, I think, the bailout of the auto industry made sense, bailout of banks was fundamentally flawed. What reason do banks that are already heavily in the minus have to suddenly start loaning money to people who, at least in the short term, can't pay it back. That would only result in a greater - for the banks.
In the long run, I think the only solution is either short-term nationalization of the banks, or a massive building project. I suspect the better choice is the earlier, because, while the later allows people to keep jobs, it does not guarantee that they or the companies start spending. Furthermore, the reason for this economic crisis is too much money being lent, so in the long run an overhaul of the banking system is probably needed, might as well make that overhaul happen now and fix our eco.
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if the big 3 goes down im pretty sure you can expect a very large domino effect as suppliers start going down and cars become more expensive as a result. even toyota doesnt want any of the big 3 to go down because it would simply drag so much down with it.
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On March 05 2009 07:30 Hans-Titan wrote:Letting the US auto industry die might be good in theoretical economics, but from a practical, sane perspective the auto industry can't just be let to die. Whilst I agree that bailing out bad companies is unwise, we need to remember 2-3 million people depend on these companies to survive. Having a couple million more unemployed isn't a viable option for neither long or short-term growth, as well as it would be a widely unpopular decision just to let them die.
Allow me to propose a hypothetical scenario. Suppose 2-3 million people are employed by a firm and their job is to spin around in circles in the desert for twelve hours a day. The firm had enough customers to sustain its workforce, but suddenly hard economic times hit and citizens decide it's no longer a good use of their money to pay people to spin in circles. Should the general public still be forced to support this industry through a bailout, so that the 2-3 million workers do not become unemployed?
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EPT
