Friday's Random Thoughts

[chris_gerrib]

I will be attending Windycon this weekend, and am on programming. It's a new hotel, so hopefully people can actually find the programming without fighting the maze of the old place. Before I go, I do have a few random thoughts:

Big Three Automaker Bailout

As I mentioned the other day, I am generally in favor of some kind of bailout. Now, I've seen this discussed on various right-wing sites, and the anti-bailout crowd's rallying cry is "remember British Leyland! For those not up on auto manufacturing history, British Leyland was what happened in 1968 with Great Britain nationalized and force-merged the two British automakers.

Nobody can argue that the resulting company managed to become a competitive automaker. It did not - not that the bailout plans so far involve a forced merger. However, what Leyland did accomplish was prevent a sudden collapse of the British auto industry, with the resulting fire-sale of assets. By keeping the factories running, Leyland was able to sell off assets in an orderly fashion at a decent price, and unwind its workforce. So, if nothing else, Leyland succeeded at cushioning the blow. I submit that a US auto industry bailout would be at least as successful.

ETA Read this article which points out that the Big Three are already well into the kinds of reforms they need to make.

US Foreign Policy

Over on Jim Wright's blog, he's got an open letter to the Obama administration regarding foreign policy. All I can say is "amen." It's a bit long, but well worth the read.

Comments

[sinthrex.livejournal.com]

I thought this WSJ article (http://online.wsj.com/article/SB122628230122212449.html) was appropriate.

I agree with preserving American industry as possible. Rewarding bad behaviour when a punch in the nose is more warranted is out.

[chris-gerrib.livejournal.com]

Management and the UAW are not without blame here. Although the Big Three were making a lot of money selling big cars and SUVs to Joe Sixpack, so Joe's got to take some blame as well.

[sinthrex.livejournal.com]

I'm torn on that one.

You can make the rational consumer argument, but it takes hits when the company exerted most of it's effort to alter the market in it's favour. The consumers just made their choices based on the status of the market. Now that the market is unfavourable to the degree that those artificial limits no longer work, it's a failure on the part of the manufacturers that they are incapable of meeting market demand.

It's obviously possible. No one is saying Honda, Volkswagen or even Porsche are going out of business.

[chris-gerrib.livejournal.com]

All of them are hurting - the issue is that the Big Three burned a lot of cash trying to restructure, which the other companies did not have to do.