Perhaps there was more reason to believe in Lee Iacocca than in Rick Wagoner. Should the government loan money to anyone who asks? If I run my business into the ground, should I get a government loan? Shouldn't the government exercise some due diligence about who it gives loans to? Giving out loans to people who couldn't pay them back is what got us into this fix. Your solution is more of the same? barfo
$1T in, $10B out is not a good result. Nah, it neatly coincided with Nancy becoming Speaker. We regulated Toyota into a better position to succeed. Ford and GM both gambled on green technology. GM's gamble on Ethanol failed, the nation pushing ethanol inflated the cost of food and created shortages. Ford gambled on diesel cars that get 60 MPG and sold a lot more cars overseas. You do know that GM and Toyota joined forces to build the Geo Metro and other vehicles. They sold like hotcakes - NOT.
Govt. should loan when it determines a big player in a big industry needs the help. Govt. loans to small business, too - see SBA.
Yes, no one is arguing that $1T isn't much larger than $10B, if that's the point you want to make. Right. Pelosi becoming speaker instantly tanked GM. She's all-powerful. And GM was in perfect shape before that. That's why their market share had been declining for so many years. That's right. We made regulations that applied to everyone but Toyota. It was totally unfair. Hmm. Gambled, huh? They just picked those strategies on a roll of the dice? They didn't make any effort to try to make projections? It couldn't be that Ford made better conscious decisions than GM? Yes, but I'm not sure why you bring it up. Just suggests to me that GM has the reverse Midas touch. barfo
I just wonder how many Penskes may have come out of the woodwork and bought up portions of GM and Chrysler if the market had been allowed to work.
Depends on what you mean by allowing the market to work? Do you mean if the government had refused to put money into GM? GM would have entered bankruptcy a few months earlier, but in a more uncontrolled fashion (and at a time of greater economic uncertainty). In the end, what could be sold would still be sold, but without debtor-in-possession financing GM itself would have had to be shut down and liquidated. barfo
The point I want to make is that it's foolish to consider GM some sort of investment that's going to make back what we're dumping into it. Tanked the whole economy in fact. Not quite. The regulations (CAFE standards, $45/hour salaries for workers) favored companies like Toyota. People demonstrated which cars they wanted with their wallets, and they were SUVs. Yep, gambled. No green technology is profitable, it's just a matter of which ones governments around the world are going to subsidize - and thus benefit the auto maker taking the gamble. See my comment about wallets and SUVs. GM made the kind of cars Obama and you seem to think GM should have been making and it wasn't a success. Where's the poor judgment on management's part there? Careful, if GM's management had poor judgment all along, then so does Obama now.
Ok. No one said otherwise. That isn't even consistent. If people want SUVs, there are plenty available. Many of them made by GM. SUVs have not been regulated out of existence. Some people have more insight into government regulations than others, apparently. Not that I believe your thesis anyway. How much money did GM spend on ethanol, as a percentage of their overall budget? I'll bet it is tiny. GM also made the kinds of cars you seem to think GM should have been making - in much larger quantities - and it wasn't a success. That doesn't make much sense at all. GMs had multiple major problems. Acting as if the Geo Metro was what killed GM is ridiculous. barfo
You're the one who talked about Obama's GM folly with the term "profit": Nobody said they were regulated out of existence. That's a very different thing than the regulations favoring Toyota (which they do). GM invests in 'trash to ethanol' start-up - CNET News GM spreads bets with investment in second ethanol start-up | Green ... GM, Marathon invest in cellulosic ethanol's future - Ethanol ... GM, Chevron, Pacific Ethanol Collaborate on E85 Project in CA .. GM - Environment - News - Janesville Assembly Plant Produces ... &c The investment seems large enough: http://en.wikipedia.org/wiki/General_Motors GM is the North American leader in E85 flex fuel vehicles, with over 3 million FlexFuel vehicles on the road in the U.S. As of 2009, GM offers 18 ethanol-enabled FlexFuel cars and trucks in the US, and produce more than one million new FlexFuel vehicles. GM's goal is to have half of their annual vehicle production be E85 or biodiesel capable by 2012. (My note: 50% of their vehicles with no fuel distribution here, and agressively by 2012) It was all along. GM's problems seem to stem from GMAC being a home lender. Obama's acting like the Geo Metro is going to save GM. D'oh!
Yes. But all I said was that it would be better to make a profit than not. That doesn't seem a very controversial statement. But you claim people have voted with their wallets for GM anyway. There isn't any question they spent some money on ethanol R&D. My question was what percentage of their overall budget they spent on that. You haven't noticed their market share declining over the past 20 years? That was all due to GMAC? Yes, because the Geo Metro is the only fuel efficient car that it is possible to make, and no fuel efficient cars sell well. That's why Toyota is doing so badly, after all. barfo
It's an absurd expectation. To make a "profit" we'd have to get out more than we put in. The #2 selling vehicle in the USA right now is the Chevy Silvarado (light truck). GM's sales are down 25% from last year, compared to Toyota and Honda whose sales are down close to 50%. linky: http://blogs.cars.com/kickingtires/2009/06/top-10-bestselling-cars-may-2009.html Significant if they're intending to have 1/2 their vehicles be ethanol in 2 years. The 2012 model year is 2011, right? Their market share declining is simply because there are lots of other automakers out there, particularly the korean ones. Even so, GM still makes gas guzzlers that sell in the top 10 of all vehicle models sold. Toyota's sales are down 50%, as I pointed out before. What Toyota does have in its favor, aside from regulations, is their patents on hybrid technology.
You are making up strawmen and arguing against them. I never said I expected to make a profit. In fact, either in this thread or in another one, yesterday I predicted that we'd sell at a loss. And according to your linky: No, that doesn't logically follow. If they intended for 1/2 their vehicles to be black two years from now, how much investment would that require? Right, which puts the lie to your claim that gas guzzlers have been over-regulated. More competition doesn't inevitably lead to lower market share. More competition that is better than you does, however. Which they stole from GM, right? Because certainly they couldn't have made better business decisions than GM. barfo
You seem to "get" Obama's plan. I haven't seen one articulated. Go for it, I'm all ears (or eyes, whatever). Logic flaw. If Toyota's sales were $.01 and last year were $.02, record sales! Let's say virtually all of their R&D. As well as the acquisitions and investments I already linked. No, it puts the lie that they're regulated out of business to rest. And it puts the lie that people don't want vehicles like the Silverado to rest, too. No, but it is a nifty competitive advantage. Toyota will license their patents for a nice fee, jacking up the regulated prices of GM's vehicles even more.
Come on guys do you seriously think either major party really manages things to the benefit of anyone but their politically connected buddies? Blaming the economic crash soley on Pelosi/Obama (or Clinton) is as absurd as blaming it all on George W. Bush (Or Bush I/Regan). BOTH parties managed the economy to the benefit of the financial "industry" and their other politically connected buddies. Here's an article that might open your eyes that ran in the Atlantic it is bi-partisan in blame laying as it should be. I like Libertarians and, I also like Progressives on the left, there are certain elements of both of their platforms that I agree with and elements I disagree with. The environment is in fact what keeps this spaceship livable but it's undeniable that a free market makes people more free, it is managed economies whether the result of socialism, facism or Monopoly capital that are devastating to freedom, of course personal rights are critical as well. Democrats and Republicans are so far adrift from the principles that most of their constiuients hold its absurd.
As far as I know, the plan is to get it out of bankruptcy, get the stock relisted, and divest as rapidly as possible without driving the price down too far. No, that doesn't make any sense. You'd have to know the sales for all years prior to last year in order to know whether last year's sales of 2 cents were a record. I've no idea what you are trying to show anyway. If Toyota sales were only 2 cents last year, then the 50% drop this year that you brought up is meaningless. Let's just make things up, you mean? Again, you are arguing against strawmen. I certainly haven't claimed people don't want Silverados. That's capitalism for you. Everyone is out to make a buck. Some succeed (Toyota). Some fail (GM). barfo
That's certainly true to some extent, people are people, after all. No one in politics is selfless. I read that awhile back so I only skimmed it today, but it is interesting. What principles are those? barfo
Well both parties claim they respect the rights of the individual and both routinely enact policy that violate those constitutional rights. A good example of this is the warrantless wiretapping. Bush ordered it and Obama voted for retroactive immunity for telecom companies for any crimes they may have committed. Both parties claim to believe in the family even if they have different visions and yet both parties enact policy that hurts the family by using our schools as a political battle zone rather then preparing our children for our highly competitive globalized economy. Those are just two examples. Also both parties hurt small business and both attack capitalism in a free market form and help to create protected markets and monopoly capital (1996 telecommunications act, many many bush policies etc.). Meanwhile, they get everyone all hyped up about gay marriage, abortion and evolution vs. creationism. While everyone is all stirred up about those issues and silly ideologies they pick our pockets and cede greater power to the financial industry and monoply capital and non-competitive protected markets.
I'm with Idog on this. Especially the bit about managed markets being doomed to failure and it's time to keep the govt. out of business. As far as Obama's plan... Presidents say things that become memorable. Reagan said, "govt. isn't the solution, it's the problem." GHW Bush said, "Read my lips, no new taxes." I think Obama's famous quote is going to be, "we're out of money."
