Buffalo Boy's Blog
Giving You More Than Just My Two Cents
Buy GM and Chrysler
So, the auto industry wants all these billions of dollars and it seems like everyday they ask for a little bit more. What would be wrong with buying them outright?
They want some $30+ billion right now as it is. Their stock however is only worth $3 billion. So why should the taxpayers shell out $30 billion for something that is only worth $3 billion?
We shouldn't. Michael Moore on Larry King presents a great plan. Buy them. Buy GM and Chrysler. They want $34 billion but with assets they are only worth $35 billion. That way, when the feds buy them they can guarantee the workers who are the innocent ones in this, don't lose one more job.
Meanwhile, the feds can put in a viable business plan and put the company back out in the market place once they are re-organized.
One thing I do agree with, you cannot let this industry fall flat on its face. The job losses that would be incurred would be staggering.
Mike, come on now.. Michael Moore? And you expect to be taken seriously? Listening to that crack addict talk about something he doesn't fully understand is something more tuned for Comedy Central.
No government ownership of big business.. that's borderline communism. That's not what makes America great. If someone thought GM was worth buying, let private equity do it. Blackstone or something. Re-structure the hell out of it and make a profit.
Rob, actually, his first movie that he did in the 80s was about the auto industry. He is actually very knowledgeable in this area. His father worked for GM.
And really, what do you call the handouts to AIG, Citigroup and Wall Street? The government essentially owns it all right now anyway.
We have to do something. The Job loss alone from those companies going down and the economic impact from the companies that make parts and supply those three auto companies would kill this country.
My real question and I agree with Moore whole heartedly, why are we giving them $34 billion when their net worth including assets is $35 billion. His only point is we would be better off buying them and overseeing the process ourselves before selling it back to someone in the private sector. Thats an insane about of money to be giving an industry whose total stock value is only $3 billion.
Another thought is force the banks that we just gave all the bailout money to loan the $34 billion to GM and Chrysler.
Mike he's a gregarious, pompous snob who only sees the world through the lens of his own mind. All of his documentaries are well-refuted by the opposing side. I don't begrudge the man his opinion, but he's so radical it's hard to take him seriously.
The country isn't going to get killed. The steel industry collapsed and the country lived. It will live through an auto collapse as well. And once again, it will be the unions who cause the demise. The UAW is too powerful, thinks too much of itself, and will go down in flames with the industry. That's what happened to the steel workers.
Private equity would buy them out if they thought the business could be saved. If they can't save the business then why should the government buy it, or even give them a loan package? Government does a good job of screwing up everything it controls, so how would them owning the industry be any better?
Rob, I think you would be surprised if you went to Michael Moore's website at just how much research he does, whether it is through media outlets or actually going out there and talking to people who are involved in what he is passionate about. He does an extensive amount of homework on the topics he has covered in his documentaries. His first one Roger and Me was all about the auto industry and though it was close to 20 years ago, it saw this mess coming back then.