Bailout Plan - new idea (OT)

[Mark R]

Probably not the place to discuss the issues, but it's the companies who
need the money.  If they default on a number of obligations, the government
would be "on the hook" for billions of dollars of retirement costs, let
alone ripple effect and damage to our overall economy.  The government is
structuring the money as loans- with an eventual payback.  Tax credits don't
get the government the money back, unless they structured it like the first
time home buyer credit, which eventually needs to be paid back (at 0
percent).  The problem is- homes should appreciate in value, making it
easier for the home buyer tax credit to be paid back.  No such reasoning
with vehicles.
Besides, at the rate the car companies need the cash, the profit from an
individual car sale is a drop in the bucket... so a BILLION cars would need
to be sold immediately.  That's impossible... in a market which is running
at what?  14 million cars/light trucks per year?

Last I knew, almost $2000.00 of EVERY car sold from the big 3 went to
retirement costs.  That's a huge number.  And few people blame the unions?
Do people not understand that the unions did scale back, but still demand
"job banks?"  If there's no job for a union employee, they get (almost)
FULLY PAID (and with FULL benefits) to show up and sit for the day (or week,
or month, or year).  Look it up- they literally sit around reading and
chatting.  And at a burdened labor cost of $75-$125 per HOUR for a union
employee... its no wonder the big 3 are in such situations.  The foreign
makes (which even in this country aren't unionized) don't have the same
legacy or current costs.  Any bankruptcy judge would slash those
contracts... something the union (Ron Gettelfinger) is desperate to have not
happen.

The bottom line- it's cheaper to bail out the corporations than have them in
a Chapter 7 or Chapter 13 situation, despite the contract benefits....
because a bankruptcy would put some large suppliers out of business, causing
a huge ripple (in both directions).

Mark Rosenkrantz
On Thu, Dec 11, 2008 at 9:04 AM, <mccohens at aol.com> wrote:

>
> I am sure someone else has proposed this, but I haven't seen it discussed
> yet.
> ?
>
> Rather than give the money directly to the auto companies, give taxpayers a
> huge(50%) credit on income tax for any new american made car purchased.?
> Force the banks that took bailout money to underwrite the loans, based on an
> acceptable application of course.?
>
> ?
>
> Let the auto makers pitch their management changes to the public, let the
> public vote with cash for the best plans and the best cars.? I would
> actually consider buying a new car with this sort of package.
>
> ?
>
>