Who killed Detroit?

[dgriffin]

Who killed Detroit?


xeniagazette.1upmonitor.com/main.asp?SectionID=17&SubSectionID=452&ArticleID=161743&TM=84052.44


By PATRICK J. BUCHANAN

Who killed the U.S. auto industry?

To hear the media tell it, arrogant corporate chiefs failed to foresee the demand for small, fuel-efficient cars and made gas-guzzling road-hog SUVs no one wanted, while the clever, far-sighted Japanese, Germans and Koreans prepared and built for the future.

I dissent. What killed Detroit was Washington, the government of the United States, politicians, journalists and muckrakers who have long harbored a deep animus against the manufacturing class that ran the smokestack industries that won World War II.

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This is Buchanan at his usual. I don't agree with a lot of it, but it's an interesting article.

[snickers]

It's interesting that the only two options put forth are 1. Give them what they want so they can keep on doing what they have been doing, or, 2. The End. Game Over. Everybody dies.

How about letting them fail, reorganize and try again, with an eye toward fiscal responsibility?

[Clipper]

I am with you snickers. Let em fail, reorganize and start over. Yes, it will impact vendors and jobs all over the US, but it is inevitable and necessary if the auto industry is to ever again be a viable competitor to the foreign automakers.

Maybe if Detroit suffers, Unions will learn more responsibility to America, and not just greed on behalf of their members. Maybe the cost of living and the economy in Detroit will fall into line with the rest of the country.

I would love to have a job that is considered "highly skilled" which entails nothing more than standing on an assembly line with a pneumatic wrench in hand, bolting a whatchamacallit to the thingamajig, over and over and over, for $50 an hour. Hell, a chimpanzee can be trained to perform THAT skill, and would work for bananas. Wake up folks! $25 maybe, but $50?? Naw!

The sad part is that half the time, you either get a recall or have to take your vehicle back for warranty work because the whatchamacallit was installed improperly. THAT is why Detroit is in the sewer, and foreign makes are whipping their asses.

Like I said the other day, there are plenty of empty textile and furniture mills here in the south and lots of well trained and ambitious people with a manufacturing background just ready to jump at a job. MOVE those automaker jobs south for non union, but skilled and ambitious, people willing to work for a REALISTIC wage.

Either that, or wake the unions up, and force them to renegotiate the contracts that hold America hostage to overpriced, over rated, poorly built cars.

[clarencebunsen]

I'm still working on "Who killed South Bend?" I loved the Avanti!

Is there a special class for the slow kids or have we been mainstreamed

[dgriffin]

I still think Detroit killed themselves. There are other industries that were regulated and unionized, but who fared better than the automakers. I have experienced consistently low quality products from Detroit. So, I don't buy their cars. Evidently, millions agree with me. How Buchanan gets from there to Washington being the root of the problem is a mystery to me.
Well, what can we expect from a guy whose sister (Bay) looks more like him than her mother?

Somewhere else on this forum, I posted a link to an article in which the author says that if we give Detroit the money, nothing about their business practices will change. They'll use up the $25B and be back for more.

[Deleted]

Nov 24, 2008 23:06:20 GMT -5 @dgriffin said:

I still think Detroit killed themselves. There are other industries that were regulated and unionized, but who fared better than the automakers. I have experienced consistently low quality products from Detroit. So, I don't buy their cars. Evidently, millions agree with me. How Buchanan gets from there to Washington being the root of the problem is a mystery to me.
Well, what can we expect from a guy whose sister (Bay) looks more like him than her mother?

Somewhere else on this forum, I posted a link to an article in which the author says that if we give Detroit the money, nothing about their business practices will change. They'll use up the $25B and be back for more.

You mean like Citigroup? It's interesting how Bush & Paulson jump at the chance to help out Bush's Wall St. campaign contributors, while the automakers are being allowed to swing in the wind. I get the feeling that if the Detroit autoworkers were non-union, then some folks would be singing a different tune. It's unbelievable to me that people are advocating to let GM & Ford go bankrupt while defending Jap automakers who are wringing their hands in anticipation for the day that GM & Ford go belly up. I can't wait for the day when we're all driving around in little shit boxes such as Civics & Corollas. And to hell with the millions of workers that work for companies that do conract work for Detroit, they can all go to work as waiters, clerks, & janitors in the service industry.

[Clipper]

They can all go to work for Toyota and Honda, Kia, Saturn, Nissan, all of which are manufactured here in the USA. Can't condemn the JAPANESE automakers. They must be doing something right. They are cornering an American market and they aren't needing a bailout. As far as the millions that support the industry. They will be needed to support the increased needs of foreign makes.

The big three won't go away, they will reorganized and learn to play nice. Their employees won't be out of work, they will learn to work for a realistic but decent wage, like the rest of America. The only thing that might go away is the Union, and that is doubtful, if they re-tool and look to represent without extortion, and greed, and pay attention to REALISTIC demands and issues come contract time.

Has anyone looked at a Ford Focus lately? Take a peek and tell me that a comparable priced Toyota is not a better investment. My sisters daughter has a focus and it is a piece of stripped down junk.

It seems that people have the idea that Japanese cars, are foreign, although made in the US, but Chrysler is an american car although it has been taken over by a European company. I personally don't see the difference.

We can wave our flags and holler "buy American" all we want, but let's face it. Efficiency and quality have become hallmarks of Japanese goods. If the Chinese ever catch up to the Japanese, we won't find ANY American goods that can compete anymore.

AMERICANS have made the Japanese autos the leading sellers that they are. AMERICANS are also the one's that send a message to the big 3 that it is time to change the way they do business, or go OUT of business.

Just ask an American on the street if they feel sorry for someone that is making 2 or 3 times what they make in wages, and is looking for a bailout and financial assistance out of the average American's pocket, in order to preserve their jobs and their high dollar benefits. Ask someone making 10 or 12 bucks an hour and paying for their own health insurance, if they feel badly that the $50 an hour person is having a problem extorting better health benefits from their employer. Ask a CEO of another company who is making a couple of hundred thousand, if he feels badly because the automakers can't seem to make it, while paying their top execs millions to throw rocks into the sinking boat.

It is simply time for the pendulum to swing back in the other direction. The inflated markets and the inflated demands of American's and their spoiled lifestyle have to swing back in the other direction. It simply kept inflating until it burst, and the bubble finally reached that point and burst.

Yesterday the market took a slight upswing. Hell yes it did! Why wouldn't it? The government put another transfusion into another financial institution. That way Citibank can buy some MORE bad debt and loans and qualify for SOMEMORE bailout money.

[clarencebunsen]

Are you sure Citigroup has been a big Bush supporter? (As opposed to Fannie & Freddie which both contributed to the campaigns of Sen Clinton & pres-elect Obama as well as Rep. Arcuri.)

There are some interesting reports about Robert Rubin, who earned more than $100 million from Citi since leaving Pres Clinton's cabinet.
From the NY Times
www.nytimes.com/2008/11/23/business/23citi.html?_r=1&hp=&pagewanted=all
"The bank’s downfall was years in the making and involved many in its hierarchy, particularly Mr. Prince and Robert E. Rubin, an influential director and senior adviser.

Citigroup insiders and analysts say that Mr. Prince and Mr. Rubin played pivotal roles in the bank’s current woes, by drafting and blessing a strategy that involved taking greater trading risks to expand its business and reap higher profits. Mr. Prince and Mr. Rubin both declined to comment for this article.

When he was Treasury secretary during the Clinton administration, Mr. Rubin helped loosen Depression-era banking regulations that made the creation of Citigroup possible by allowing banks to expand far beyond their traditional role as lenders and permitting them to profit from a variety of financial activities. During the same period he helped beat back tighter oversight of exotic financial products, a development he had previously said he was helpless to prevent.

And since joining Citigroup in 1999 as a trusted adviser to the bank’s senior executives, Mr. Rubin, who is an economic adviser on the transition team of President-elect Barack Obama, has sat atop a bank that has been roiled by one financial miscue after another.

Citigroup was ensnared in murky financial dealings with the defunct energy company Enron, which drew the attention of federal investigators; it was criticized by law enforcement officials for the role one of its prominent research analysts played during the telecom bubble several years ago; and it found itself in the middle of regulatory violations in Britain and Japan."

"In 2005, stung by regulatory rebukes and unable to follow Mr. Weill’s penchant for expanding Citigroup’s holdings through rapid-fire takeovers, Mr. Prince and his board of directors decided to push even more aggressively into trading and other business that would allow Citigroup to continue expanding the bank internally.

One person who helped push Citigroup along this new path was Mr. Rubin.

Pushing Growth

Robert Rubin has moved seamlessly between Wall Street and Washington. After making his millions as a trader and an executive at Goldman Sachs, he joined the Clinton administration.

Mr. Weill, as Citigroup’s chief, wooed Mr. Rubin to join the bank after Mr. Rubin left Washington. Mr. Weill had been involved in the financial services industry’s lobbying to persuade Washington to loosen its regulatory hold on Wall Street.

As chairman of Citigroup’s executive committee, Mr. Rubin was the bank’s resident sage, advising top executives and serving on the board while, he insisted repeatedly, steering clear of daily management issues.

“By the time I finished at Treasury, I decided I never wanted operating responsibility again,” he said in an interview in April. Asked then whether he had made any mistakes during his tenure at Citigroup, he offered a tentative response.

“I’ve thought a lot about that,” he said. “I honestly don’t know. In hindsight, there are a lot of things we’d do differently. But in the context of the facts as I knew them and my role, I’m inclined to think probably not.”

And from The Wall Street Journal
s.wsj.net/article/SB122757194671054783.html
"Citi never sleeps," says the bank's advertising slogan. But its directors apparently do. While CEO Vikram Pandit can argue that many of Citi's problems were created before he arrived in 2007, most board members have no such excuse. Former Treasury Secretary Robert Rubin has served on the Citi board for a decade. For much of that time he was chairman of the executive committee, collecting tens of millions to massage the Beltway crowd, though apparently not for asking tough questions about risk management.

The writers at the Deal Journal blog remind us of one particularly egregious massaging, when Mr. Rubin tried to use political muscle to prop up Enron, a valued Citi client. Mr. Rubin asked a Treasury official to lean on credit-rating agencies to maintain a more positive rating than Enron deserved. What signal will President-elect Barack Obama send if his Administration, populated with Mr. Rubin's protégés, allows this uberfixer to continue flying hither and yon on the corporate jet while taxpayers foot the bill?

And from a Huffington Post piece entitled: Is Robert Rubin "Competent" Enough To Guide Team Obama?
www.huffingtonpost.com/jane-hamsher/is-robert-rubin-competent_b_146372.html

Yes, it's incredible that nobody required Rubin and the board to resign as a condition of the Citibank bailout.

[clarencebunsen]

And I missed this recipient of Wall Street money and closet Bush supporter
www.cnsnews.com/public/content/article.aspx?RsrcID=39902

"Four major banks, including one that collapsed, two that received federal bailout money and one that filed for bankruptcy this past September, paid former President Clinton $2.1 million for 13 speeches he delivered on their behalf between 2004-2007, according to Senate financial disclosure statements filed by Sen. Hillary Clinton (D-N.Y.)."

[clarencebunsen]

And this question from The International Herald Tribune
www.iht.com/articles/2008/11/25/business/25sorkin.php
Where was Geithner in turmoil?
"But Geithner's involvement in several ultimately ill-fated efforts to buttress the American financial system is the very reason some Wall Street CEO's — a number of whom spoke on the condition of anonymity for fear of piquing the man who regulates them — question whether he's up to the challenge.

"We have only two things to say about Tim Geithner, who we do not know: AIG and Lehman Brothers," said Christopher Whalen of Institutional Risk Analytics. "Throw in the Bear Stearns/Maiden Lane fiasco for good measure," he said, referring to the site of the New York Federal Reserve, where many rescue discussions took place.

"All of these 'rescues' are a disaster for the taxpayer, for the financial markets and also for the Federal Reserve System as an organization. Geithner, in our view, deserves retirement, not promotion.""

[dan]

Well put and very well researched Clarence.

[clarencebunsen]

Thanks, but I just read. My son (the doctor) researches. I'm sure today he was up to his elbows in cow inards.

[dgriffin]

Nov 25, 2008 10:06:37 GMT -5 Clipper said:

Has anyone looked at a Ford Focus lately? Take a peek and tell me that a comparable priced Toyota is not a better investment. My sisters daughter has a focus and it is a piece of stripped down junk.

[/size] [/quote]

Yes, and might there be some connection between these crappy cars and the fact that American executives are paid compensation many more multiples of their average workers' wages compared to foreign manufacturers? Doing business the old fashioned way ... building an innovative product and building a reputation, thus building profits ... has been displaced by products meant primarily to push bottom lines for the few years the corporate staff will be around before they leave for greener pastures. The front office thinks it can replace engineering with marketing, and solid research with Power Point presentations. Upper management wants to sing a tune, grab the money and run. And not stick around for the long haul when bad decisions would come back to bite their asses.

Executive compensation plans have been detrimental in general to the American economy. Originally intended to motivate management to a high level of performance, today the system has warped itself into stock market games, with company officers stuffing their boards with cronies and milking cash out of the company, getting paid for potentialities. We should have learned something about Great Expectations from the dot.com meltdown. Evidently, we didn't.