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Nov 20 2008
Let’s Say They Put Me In Charge Of The Big 3 Mess
For gits and shiggles, let’s say my phone rings, and the voice on the other end says, “Rhino, we need your help with the auto industry problem.” What would I say? Well, for starters, I would immediately ask for some cash to help me think better, and I would turn that cash into 21yr single malt Scotch. Then, I’d get down to bid’ness.
Currently, the Big Three are asking for $25billion, but they haven’t been too clear on how they’re going to use that money, so I have a few suggestions.
1) 3 million workers will be out of a job if the Big Three declare bankruptcy. In order to make sure that these hard working Americans don’t just “wait it out” while the auto industry restructures itself, I suggest that the $25billion “loan” come with these stipulations. a) none of the money shall be used for executive compensation under any circumstance. b) conditional to a decleration of Chapter 11, an across the board liquidation of all vehicles will occur to fund work force retraining and compensate for health benefits of current workers, as well as pension and retiree benefits for retired workers, while the auto industry transitions into making energy-efficient/greener vehicles. c) workers may only recieve job retraining and benefits during the transition if and only if a contract is signed by said worker to continue employment with his/her company after it is restructured.
2) Serioulsy, kids, no one is going to buy a car from a bankrupt business. What happens if the car breaks down? Warranties would be useless and obsolete. Allowing these companies to go bankrupt would effectively kill the business outright. Foreign manufacturers setting up shop in right-to-work states only solves the problem for the execs, not the workers making minimum wage to assemble vehicles.
3) While new managent is necessary and good, importing the guys that made PowerAde successful is not the answer. However, with a few billion in their pocket, the American auto industry would be in a unique position to lure successful, forward thinking people away from their current positions. Knowing that they would go down in history as the saviors of the Big Three might be enough. Failing that, I would look to current employees in the Big Three that are middle-management or floor foremen and give them an opportunity to think-tank the situation out amongst themselves, present the solution to the Federal Government, and take it to a vote.
4) Broker deals with developing nations on behalf of the suppliers of auto parts to liquidate their stock in order to enable the supplier’s transition as well, because without people making the new equipment, there can be no transition to begin with. This calls for a bit of isolationism, and some nose-thumbing as well, but we’re bailing out US auto makers, not everyone.
5) Research grants for clean technology. It takes time to retrain new workers, so why not offer some cash to anyone who can help the transition and make better, more energy-efficient parts?
Last night I came up for air just long enough to hear Barney Frank say something to the effect of: “Okay so we save the banking industry for the white collar workers, but we are supposed to turn our backs on 3 million Blue collar workers?” Now, there’s an analogy! I wanted to take time to try to find that on Youtube, but never did… Will go look now. In the meantime, I can always hope your phone rings…
Oh and for the record: No one was more surprised than I that I was liking something B. Frank said… ~k
http://www.youtube.com/watch?v=_7SOVmkSCkw
Here it is. I think he makes a strong and interesting argument… ~k
It’s because of the workforce that this has to be given serious consideration, but I wonder what impact this is going to have on other industries who will proclaim to be “struggling” and holding up the employment contracts of the workforce as hostages should the Government bail out the auto industry.
That is THE MOST REDICULOUS plan I have heard of yet. Filing for chapter 11 bankruptcy will not kill the auto industry. It will allow them to get out of the contracts they are currently in with the unions and the contracts they have for pension benefits. If they can remove the two to three thousand dollars in legacy costs from each vehicle they sell, they will be able to sell cars cheaper while gaining a larger contribution margin on the sale.
Bwahahahahahahahahahahahahahahahahahahahahahahahahahahahahahaha
Now why didn’t you run for president?
Thanks for the comment on my post.
I think we shouldn’t give them anything until they agree to up the fuel-emission standards on all new cars. One of the reasons they’re going broke is because they can’t sell their cars to any other countries because of this fact alone. Now that the American people don’t have money to buy either, the industry is dying.
I don’t want it to die, that would be catastrophic. However, there has to be a lot of change with the Big Three for them to become successful again. Otherwise we’re just throwing away our money.