Does anyone else feel that the Big 3 U.S. automakers deserve what they are getting, and not getting?
For the past decade U.S. automakers have failed to situate themselves in a position where they are financially sound enough to weather the current economic storm. They have turned out model after model of overpriced, gas-guzzling land yachts, which are not good for the environment, and cost more than I paid for my first home back in the mid-70s. In fact, the loans that many consumers carry on their SUVs exceed the mortgage that I had on that house. That is, if they can actually afford to buy, and not just lease their car.
You can add into this mix salaries paid to top executives that probably exceed the combined income of everyone on my block. Really, does anyone contribute enough time or sweat into their job to be worth $22 million dollars a year, the 2007 income of Ford’s CEO Alan Mulally? That comes out to $41.83 per minute, for every minute of every day of the year. When asked by congress if he would be willing to symbolically cut his annual salary to $1, Mulally replied, “I think I’m okay where I am.” Yeah, I’d be ok with my income if I made $20,000 overnight while I was asleep.
I know it is going to be a very black mark on the U.S. economy for these 3 giants to take the fall that they are in for. But, don’t you think that for the most part, they have dug their own graves?
What about producing affordable, clean-running autos? What about manufacturing vehicles that you don’t have to go into debt for a decade to buy? What about flying coach? What about structuring an auto manufacturing corporation that isn’t based on a business model that is about 50 years out of date?
Congress, instead of propping up these already failed dinosaurs, why not fund a new start-up company that is dedicated to producing autos that are fuel-efficient, use renewable energy sources such as bio-diesel, and are priced at a level that the average American can afford, without having to decide between their children’s college fund or the new car? What about, instead of ensuring that Mulally won’t have to take a pay-cut, spending those billions on bailing out the average American worker that, jobless or not, is suffering right now?
In my mind, the Big 3 are getting just what they deserve. Thank you Congress for refusing to give them what they don’t.
I agree in theory, but have so many friends out of work, lives ruined that it seems that congress needs to step in, Joel: didn’t you talk about an idea about the government guaranteeing to buying certain cars from the Big 3 as a way to bail them out?
Hi VB, yes, I feel that the Obama government should negotiate a spec for a new, green car and truck, high mpg, low carbon, built in the US, that the government would guarantee to buy for all of its various uses: postal service, armed services, embassies, whatever. This could be a several million car order over ten years. Then the Big 3 would have guaranteed sales of this great car which they could also sell to the public. Along side with that the government should federalize the pension programs, short term taxpayer responsibility, in order to lower the cost structure. This is the best way to stimulate/subsidize a “new” Detroit.