On Wed, Nov 12, 2008 at 10:14 PM, Robert Munn wrote: .... > The automakers, on the other hand, are not tied to every facet of the > economy. They could go through bankruptcy, wipe out shareholders, union > agreements, pensions, etc. and continue to operate as long as the government > provided financing through a structured bankruptcy. I don't believe the spin > in some circles that Chaprter 11 for the automakers is either impossible or > so painful that it could never be contemplated.
Let me tell you a story I heard from some dude who'd worked high up in some top-secret type deal: They have this rubber, that's like "super rubber"-- a tire made out of this stuff would last for like 200 years (or whatever). They cannot release this super-rubber to the public because they did some studies, and it turns out that tires are tied to every facet of the economy, and releasing the super-rubber would totally wreck havoc on the tire industry, and thus, the economy. Well, I thought it was a gorgeous tale. Made a kind of sense, too. "Those bastards, holding out on us, just to keep things quote stable unquote" > Let me be more precise and revise my initial statement, though. I would be > OK with the government financing the automakers as a last resort if it > happened as part of a structured BK that wiped out all the burdens that have > been weighing them down for so long. I don't know if that is a realistic > proposal. The unions would fight tooth and nail to prevent pensions and > union agreements from being wiped out. Even if they were wiped out, the > unions would take the first opportunity they could to strike for a better > agreement, potentially putting the companies back into a similar position > they are in now. Certainly the health care and pension obligations being > taken off the books would help tremendously, but there would have to be some > argreement that the unions would stick to more modern benefit demands like > 401K and health plans than pensions and health care for retirees. Those are > simply not sustainable benefits, as the $66 billion that GM has lost in the > last four years demonstrates. For something that by your own thinking isn't as important as the banks, you've got more things to say about the cars than you did about the banks (just kidding, but at first with the banks you were like 'we have to just get this done, I hope they pass it fast', IIRC, which is what I'm talking about, sorta). I think we should have been like this for the bank loan or whatever too. "You've got to do X Y and Z and none of this BS you will probably try to do, like buy stock in stable banks vs. lending that money out" or whatever. > Won had a pretty good explanation on another thread about the difference > between the banks and automakers, basically that the banks were facing a > short-term crisis, but the automakers have been facing long-term structural > problems with their companies for years, and the crisis just exacerbated the > problem. Won rocks, he won me over with the "teach critical thinking" comment on an evolution vs. creationism thread =] Economics is 90% attitude. Or something like that. =) -- Of all the varieties of virtues, liberalism is the most beloved. Aristotle ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~| Adobe® ColdFusion® 8 software 8 is the most important and dramatic release to date Get the Free Trial http://ad.doubleclick.net/clk;207172674;29440083;f Archive: http://www.houseoffusion.com/groups/cf-community/message.cfm/messageid:280195 Subscription: http://www.houseoffusion.com/groups/cf-community/subscribe.cfm Unsubscribe: http://www.houseoffusion.com/cf_lists/unsubscribe.cfm?user=89.70.5
