Cafferty: Will Loss of Auto Makers Lead to a Depression?
September 1, 2010 by admin
Filed under Automakers
From the Cafferty File: A top executive at Chrysler, Vice Chairman Jim Press, is warning that the failure of just one of the Big Three automakers could drive the US economy into a depression. The CEOs of Chrysler, Ford and GM were back on Capitol Hill today asking for $34 billion in aid, just two weeks after they asked for $25 billion and were shot down. Ford CEO Alan Mulally quoted an estimate from Goldman Sachs during his testimony that said the failures of the three companies could cost the US economy up to $1 trillion. Sure the companies need cash. And sure they directly provide jobs to 355000 workers. And an additional 4.5 million jobs in related industries. But there are real questions about whether we would be throwing good money after bad. Detroit has failed to keep up with a changing industry for years, despite the handwriting that was clearly put on the wall by Toyota and Honda, among others. American cars come with legacy costs unrivaled anywhere in the industry. Sales figures released this week were terrible. GM down 41 percent, Ford down 31 percent. Congress is grappling with whether the cure is worse than the disease. Heres my question to you: Will the loss of any one of the Big Three auto companies lead to a depression?
Because laissez faire is the only logical solution. Print more money? Depreciate the dollar more and bailout these companies,placing more tax on the citizens already broke? OK smart move………
Really? We landed on the moon huh?…
What happen to the money that we gave them 6 years ago to build a better car I know what chevy did with it wasted it. GM made a car that would have saved GM and cut fuel cost setting a stander for all the auto maker’s but with the high sales and profits from SUV’s they trashed them now their begging for more money. Save the workers jobs but make GM use the blue prints they have for the car they trashed. Mr. Dobbs ( CNN )reported about this on his show once.
It will NOT bring about a depression.
It will benefit the American people & country as a whole. Currently, these 3 auto companies are corrupt and anti-American. They are trying to destroy the solidarity of the U.S. and they discriminate against white Americans. The communist controlled UAW labor is being paid twice that of any other auto company.
Bankruptcy is the only feasible and correct solution.
can you say UAW? lay the blame where it should be
remember the chevy VEGA,,..,lol
welcome to my world … lol;.;.maybe these auto workers will work for 16$ or so, like i did for 35 years as a carpenter;. at times with no insurance ;.;. maybe they can bail me out;.;.lol
that $34B can buy up the stock of all 3 co.s. anyways, even if the money was given to them, they would still close down factories/parts mftrg facilities here in the US & open them up in mexico. if they were really serious about endearing themselves to the amrcn public(not just selling 1 corp jet here & there), they would have offered to close down most of their foreign factories/parts mnftcrs & do at least 75% of their production in the US in order to hire as many americans as possible.
Because the Japanese Government heavily subsidizes their Auto makers.
I am ashamed of those car companies for getting into this kind of mess…
We should let them go under, I bet they will be bought out by someone, and our money would be better spent helping start up companies that actually have a vision for new technology.
We built “the bomb” in 2 years, we landed on the moon, we make food that has shelf life for years, we make dolls that are so life-like that we can f3@k them… why can’t we build a damn car better than the Japanese?
So the opinion of viewer’s doen’t matter…. hello, you are a viewer too….
I’m tired of hearing about Ron Paul. He’s just another damn Friedmanite neoconservative. Tell me how EVEN MORE laissez-faire economics would make this situation better????
The public is not stupid for not voting for Ron Paul, he didn’t do a convincing enough job of swaying the average voter. He like to point fingers alot…. I would love to see him get down and dirty and actually do something. All I here from him is a lot of talk. What he says at times makes sense, but again… it is only talk.
alot of smart letters read there.
Hopefuly congress skepticism right now abotu the bailout keeps up because they listened to their constituants.
If the gov gets involved at all I think nationalisation or partial ownership is preferable to a straight bailout that lets the same old leaders run the place.
The gov will never be paid back its loans anyway. Why dont we instead buy a say in where the future of the industry should go for the betterment of us all.
Paul would have mad an outstanding president…it’s a shame the public is so stupid
The U.S. wont be a happy place until it Manufactures none of its own goods & has 2 import everything,sending the U.S. dollar only in2 other countries economies and circulating none of its own revenues, this is much like the trend the U.S. has been on in losing jobs instead of increasing to pop. adjust. The U.S. is trickling down jack shit & pissing away evrything. Besides these Auto factoriesa matter of National Security, The only thing the U.S. has been exporting is JOBS!!!
They report news on the opinions of viewers. What the hell is this bullshit?
There is no magic fix. Those in the state have no magic powers. Let the market (the producers and consumers equilibrium) adjust.
Out with the old in with the new. Repossess the companies’ property and offer it to new, promising industries before they go completely under and take everyone with them. It’s perfectly fine for the government to repossess MY property when I’m behind on payments. The only other sensible solution would be for the workers themselves to rise up and seize the means of production.
Why is it never called Class-Warfare when the money of the middle and lower classes is redistributed to the wealthy?
A depression is inevitable, and our standard of living has to go down, we just need to live with that for a while. This is what we get for borrowing trillions of dollars over the years and only consuming with it. Price Fixing and bailing companies out is only going to make things worse. It’s also destroying the dollar and whatevers left of it. The best thing we can do now is let these companies get liquidated and have the market adjust like Ron Paul is advocating.