Arsenals of Democracy

[Navy1960]

Many debates have been held on this board as to the merits of saving or not saving the American Auto companies. I thought I might add a few little known things about them that people may not be aware of. Many people are aware that of course they all make cars. However these companies have been a major part of American life for over 100 years. In fact in World War 2 everything from B-24 Liberators made by GM in Michigan, to Sherman tanks, Jeeps, Anti-Aircraft Guns, and Liberty Ships were made by these companies. They have a long tradition up until GM's recent sale of it's aerospace division to Boeing. GM in fact bought much of Hughes Aircraft which is responsible for such things as Air to Air Missile Technology like in the AIM-120 AMRAAM. Further, they recently sold part of the communications division to News Corporation which for all you people who watch DirectTV "which it was renamed" too have a little GM in every box. As a matter of fact there is a web of technologies that the Big 3 have been involved in the defense industry for many many years, everything from the F-16 to the development of look down shoot down radar. One of the most recognizable is the M1 Tank which was developed by Chrysler Defense which later became part of General Dynamics In Lima Ohio.

The XM1 Abrams was designed by Chrysler Defense (in 1979, General Dynamics Land Systems Division purchased Chrysler Defense Division) and is currently produced by General Dynamics Corporation in Lima, Ohio, and first entered US Army service in 1980. It was armed with the license built version of the 105 mm Royal Ordnance L7 gun.

M1 Abrams - Wikipedia, the free encyclopedia

These companies although for many years have been mismanaged as it applies product and keeping cost in line in order to compete are for the last 100 years very much a part of the American way of life. Not only have they changed the way we lived by giving us the ability to be a mobile society but they have also come when called when this nation needed them most. While I still believe that these companies much change in order to survive and to provide a blank check to them would be a mistake of epic proportions , I do believe that our nation has the ability to solve this issue only if they would muster up the courage to do so. Yes, it would require some sacrifice on the part of EVERYONE that works for these once great companies, but I ask you is it not worth the effort to make a sacrifice , so that future generations of Americans can enjoy the benefits that these companies have given us and the ones they are yet to give?

 

[Luissa]

I think they should be helped to reorganize but they need to change quite a bit. Everyone talks about foreign automakers and how toyota's are made here now and all that. Last night on PBS I think they did a break down of what the executives make at say GMC/Chrysler compared to say Toyota! You should really look it up because I do not remember everything. The CEO of Toyota which is more profitable makes a million dollars while the CEO of an american automotive company can't remember which one makes 12.5 million with the company loosing money.

 

[editec]

I think they should be helped to reorganize but they need to change quite a bit. Everyone talks about foreign automakers and how toyota's are made here now and all that. Last night on PBS I think they did a break down of what the executives make at say GMC/Chrysler compared to say Toyota! You should really look it up because I do not remember everything. The CEO of Toyota which is more profitable makes a million dollars while the CEO of an american automotive company can't remember which one makes 12.5 million with the company loosing money.

We ought to be oursourcing CEO positions instead of production line workers.

 

[Navy1960]

The point of the post though was to more or less to advocate that that the benefits of an American Industrial base especially with these companies cannot be measured. It was also to point out that these companies need to change in order to compete and in order to keep that Industrial Base and long history alive it takes some sacrifice on the part of everyone that is involved there. There has been a mindset at the Big 3 for many years that is hard to break out of, but time and economic conditions have finally caught up with them and they will now have to change that mind set or die. I for one do not want to see them die but rather would like to see a change in that mind set that would allow these companies to become great once again.

 

[Richard-H]

they will now have to change that mind set or die.

You mean the management will have to change their mindset or the workers will die, right?

At $12.5mil/yr. win or lose, I don't see very much incentive for the management to change their mindset.

(Hope you answered my poll entitled "How Long")

 

[Skull Pilot]

For the most part, Americans don't want to sacrifice anything anymore.

Americans have devolved from a people that used to believe that they had to work, save and sacrifice to get what they wanted to a people that feel entitled to success, wealth and happiness.

In fact people today are downright, dare I say, jealous of successful folks.

Have you ever heard someone say, "They're so cheap but they have more money than God." ?

Have you ever answered that by saying, "They have more money than God because they are so frugal."?

This whole attitude that somehow people who have become successful by making more sacrifices and working longer and harder than others somehow don't deserve their money is exactly what got Obama elected. He tapped into that jealousy and vindictiveness of people who feel entitled to the big house and the new cars and the expensive vacations even though they've done nothing to earn them and quite frankly can't afford them but buy them anyway.

So don't expect any employee (and certainly not any union) of an automaker to take a small cut in pay or scale back benefits fro the sake of keeping their employer in business. These people would rather bury the company and be out of work because they have to get what they "deserve" in pay and benefits no matter what the cost.

It doesn't matter that the guy who does nothing but install 2 screws and a nut all day long gets paid more than a teacher or a person with a masters' degree because he somehow deserves it. He won't take a pay cut or a reduction in benefits even if it means he'll lose his job. God forbid he thinks about taking a second job to make ends meet because he deserves to not work more than 40 hours and he deserves 6 weeks vacation and time off and sick time and personal time.

Well these guys will get what they deserve. An out of business employer and a spot in the bread line.

 

[editec]

Yeah, those people standing in the bread lines are certainly selfish people.

Imagine expecting a fair break in America?

What are they...communists?

 

[Skull Pilot]

Fair break?

How do you define that ed?

Is a fair break having a job that pays more than a lot of jobs and then saying "No concessions" even if it means the company they work for goes out of business?

Is a "fair break" buying a house you can't afford and then getting a government bailout?

Is a "fair break" taking money from responsible people who don't spend more than they make; money that responsible people could use to take care of their own families and instead give it to companies and corporations that should fail because they practiced poor business?

Is that "fair" Ed?

 

[Richard-H]

For the most part, Americans don't want to sacrifice anything anymore.

Americans have devolved from a people that used to believe that they had to work, save and sacrifice to get what they wanted to a people that feel entitled to success, wealth and happiness.

In fact people today are downright, dare I say, jealous of successful folks.

Have you ever heard someone say, "They're so cheap but they have more money than God." ?

Have you ever answered that by saying, "They have more money than God because they are so frugal."?

This whole attitude that somehow people who have become successful by making more sacrifices and working longer and harder than others somehow don't deserve their money is exactly what got Obama elected. He tapped into that jealousy and vindictiveness of people who feel entitled to the big house and the new cars and the expensive vacations even though they've done nothing to earn them and quite frankly can't afford them but buy them anyway.

So don't expect any employee (and certainly not any union) of an automaker to take a small cut in pay or scale back benefits fro the sake of keeping their employer in business. These people would rather bury the company and be out of work because they have to get what they "deserve" in pay and benefits no matter what the cost.

It doesn't matter that the guy who does nothing but install 2 screws and a nut all day long gets paid more than a teacher or a person with a masters' degree because he somehow deserves it. He won't take a pay cut or a reduction in benefits even if it means he'll lose his job. God forbid he thinks about taking a second job to make ends meet because he deserves to not work more than 40 hours and he deserves 6 weeks vacation and time off and sick time and personal time.

Well these guys will get what they deserve. An out of business employer and a spot in the bread line.

The idea that the people who work the hardest get the most is plain laughable.

The people who work the hardest and make the most contribution to society get the least.

The wealthiest people in America only work at sucking up all the money they can, without making the slightest contribution to the wealth of society.

Even the educated corporate managers push the responsibilities down to low level workers whie retaining all of the decision making authority. Most of these people couldn't make a common sense decision if their lives depended upon it. It's the low level workers that always have to compensate for the incompetence of management by working harder.

You obviously have never worked in a factory and don't have a clue about what workers do in a factory. I doubt you've ever actually created a physical item in your life.

If there are to be cuts in compensation, let's start with cutbacks in executive compensation.

 

[Skull Pilot]

The idea that the people who work the hardest get the most is plain laughable.

The people who work the hardest and make the most contribution to society get the least.

The wealthiest people in America only work at sucking up all the money they can, without making the slightest contribution to the wealth of society.

Even the educated corporate managers push the responsibilities down to low level workers whie retaining all of the decision making authority. Most of these people couldn't make a common sense decision if their lives depended upon it. It's the low level workers that always have to compensate for the incompetence of management by working harder.

You obviously have never worked in a factory and don't have a clue about what workers do in a factory. I doubt you've ever actually created a physical item in your life.

If there are to be cuts in compensation, let's start with cutbacks in executive compensation.

You have No fucking idea where I have worked so here's a little Skull Pilot Bio for you.

Raised by a single mother after my father who was a Navy pilot was killed in a crash when I was 2

Mother remarried an abusive asshole who bruised and bloodied me more than a few times

Straight A Student who skipped 2 grades

Got my first paper route at 10 had the biggest route in town at 13

Worked 40 hours a week since I was 16 Did asphalt roofing, worked a loading dock, worked construction, painted houses, drove delivery trucks

Put myself through college working a full time night job and running a house cleaning business on days I didn't have class

graduated with a 3.9

Flash forward two years ago my wife and I risked absolutely everything we had to start a business. If it failed, we would have been sleeping in our car.

So don't whine to me that I don't know what hard work is.

In fact, I am still putting in 70 hours a week.

And you want me to feel bad for some union hack who turns a screw for 8 hours a day and probably gets paid more than I pay myself right now?

Sorry if I don't feel bad for some whiny asshole who cries that he needs a fucking bail out with my money

 

[PeterS]

Yes, it would require some sacrifice on the part of EVERYONE that works for these once great companies, but I ask you is it not worth the effort to make a sacrifice , so that future generations of Americans can enjoy the benefits that these companies have given us and the ones they are yet to give?

And if Toyota can make an M1 Abrams for half the cost in a plant in Tennessee? Wouldn't this be a greater benefit then the Big Three could, or would ever, give? I shudder to think of the initial consequences of the Big Three going under but not at the thought of the enormous benefit of what will, in the future, replace them...

 

[Navy1960]

You mean the management will have to change their mindset or the workers will die, right?

At $12.5mil/yr. win or lose, I don't see very much incentive for the management to change their mindset.

(Hope you answered my poll entitled "How Long")

What I mean Richard is the entire mindset at these companies need to change including the workers. The mindset from the management persepctive , producing automobiles that are behind the market curve, poor quality or perceived poor quality, unbending in or slow to respond to market trends, and poor engineering trends as well as others. From the workers perspective, would be that the wage/benefits/healthcare package that they enjoy, would be adjusted so that the company can compete on a level without being behind the cost curve because they are saddled with labor costs so high it precludes them from competing or forces them to produce high cost automobiles to recoup those labor costs. If peope are upset with the high salaries of these CEO's then they should point their anger at the board and the stock holders that approve them. While these salaries and benefits for these Senior management people are out of line when a company is not doin well and I completely agree need to be adjusted, there are many people that own stock that do not bother to vote at share holder meetings or sign proxy statements and allow this to happen. It would seem a better idea to tie a CEO's salary to the performance of the company they run.

 

[jillian]

The point of the post though was to more or less to advocate that that the benefits of an American Industrial base especially with these companies cannot be measured. It was also to point out that these companies need to change in order to compete and in order to keep that Industrial Base and long history alive it takes some sacrifice on the part of everyone that is involved there. There has been a mindset at the Big 3 for many years that is hard to break out of, but time and economic conditions have finally caught up with them and they will now have to change that mind set or die. I for one do not want to see them die but rather would like to see a change in that mind set that would allow these companies to become great once again.

Thank you for the information. I really hadn't thought about the military issue at all. Certainly an incredibly valid concern.

Mostly, I think we need American manufacturing or we can kiss the middle class good bye.

But I have never heard of a corporation asking for money without at least a 5 year plan indicating seriousness of purpose and allowing for risk assessment.

The arrogance of the CEO's was staggering. I'm glad for the workers' sake, that they'll have another chance to make their case. But can you imagine going to a bank to ask for money and them asking what it's going to be used for and your response being not much more than "I dunno".

Just p'nuts.

 

[Zoom-boing]

If there are to be cuts in compensation, let's start with cutbacks in executive compensation.

Why does it have to be 'either/or'? Why not have the cuts/changes be made to both the executives and the unions? Seems to me that both are culpable. If they both made the effort maybe they could meet in the middle, restructure, and not go belly up.

 

[Richard-H]

As I said, it should start with the executives, not end there.

What we lack in this country's economy is LEADERSHIP. Leading by example, taking the most risk instead of the least.

We've grown to accept the notion of the blue-bloods that are better than we. They are not expected to take responsibilty or loss, no matter how well they can afford it.

Instead, like the turn of the 20th century British, the upper class holds all the power and authority, but it is the commoners who pay for their mistakes.

Competence in leadership is all but dead in American economics.

The place to start to turn around this economy is with the leaders of industry. If they can't change, then nothing else matters.

 

[Zoomie1980]

For the most part, Americans don't want to sacrifice anything anymore.

Americans have devolved from a people that used to believe that they had to work, save and sacrifice to get what they wanted to a people that feel entitled to success, wealth and happiness.

In fact people today are downright, dare I say, jealous of successful folks.

Have you ever heard someone say, "They're so cheap but they have more money than God." ?

Have you ever answered that by saying, "They have more money than God because they are so frugal."?

This whole attitude that somehow people who have become successful by making more sacrifices and working longer and harder than others somehow don't deserve their money is exactly what got Obama elected. He tapped into that jealousy and vindictiveness of people who feel entitled to the big house and the new cars and the expensive vacations even though they've done nothing to earn them and quite frankly can't afford them but buy them anyway.

So don't expect any employee (and certainly not any union) of an automaker to take a small cut in pay or scale back benefits fro the sake of keeping their employer in business. These people would rather bury the company and be out of work because they have to get what they "deserve" in pay and benefits no matter what the cost.

It doesn't matter that the guy who does nothing but install 2 screws and a nut all day long gets paid more than a teacher or a person with a masters' degree because he somehow deserves it. He won't take a pay cut or a reduction in benefits even if it means he'll lose his job. God forbid he thinks about taking a second job to make ends meet because he deserves to not work more than 40 hours and he deserves 6 weeks vacation and time off and sick time and personal time.

Well these guys will get what they deserve. An out of business employer and a spot in the bread line.

People in this country used to save and pay cash for most things they owned. My folks borrowed only to buy a car and the house we lived in. They paid cash for everything else. To this day, my father owns no credit cards. Wish I had followed his model because I'd be retired by now. But I've seen the light. I now live a lifestyle based on less than half my income dictates....

I have constantly scratched my head at why anyone thinks they "need" a 6000 sq ft home for a family of four.....especially when they only made about $100,000/yr..... Why do your kids need Blackberries and XBox 360's and $150 sneakers? Why do you think you need a BMW Z8? So on and so forth, but such was the mindset that has basically driven our economy for the past 30 years....rampant consumerism, most built on unsecured debt because we could not wait, we had to have it NOW.

 

[Zoomie1980]

Why does it have to be 'either/or'? Why not have the cuts/changes be made to both the executives and the unions? Seems to me that both are culpable. If they both made the effort maybe they could meet in the middle, restructure, and not go belly up.

That's exactly what is happenning today. Never before in my lifetime have I seen executive compensation come under so much scrutiny. Today's CEO is now the most despised human being in the country, and they brought that all on themselves. Executive pay MUST be brought under control and their compensation has be brought back into line with at least historical norms for the past 100 years. Same with Big Labor. Big Labor, as it has been known for decades is dead and the notion of a "Pension" along with it. So yes, both cultures, both a culture of ENTITLEMENT, have to end. Execs have to come back to earth, and big labor is going to have to settle for what the rest of working America gets....a 401k and a free market wage....

 

[BaronVonBigmeat]

The best way to insure that CEO's and workers are getting realistic market wages is to let the market work. Which in GM and Ford's case means bankruptcy and reorganization.

The defense issue is a non-issue. Firstly, we are really the only country that can project a significant force over vast distances, so it's not like we're under threat of invasion.

Second, any WWIII type scenario is pretty remote due to nukes and so forth.

Third, the only conceivable rival in any military sense is China in say, 50 years. And they are interested in trade, not starting a cataclysmic world war against it's best customer.

Fourth, you'd still have foreign car companies building here, and their factories could be commandeered in some hypothetical emergency.

Fifth, the bailout money will be a burden on thousands of other companies, some of whom will have to eliminate jobs due to the higher tax or inflation burden.

 

[Navy1960]

The best way to insure that CEO's and workers are getting realistic market wages is to let the market work. Which in GM and Ford's case means bankruptcy and reorganization.

The defense issue is a non-issue. Firstly, we are really the only country that can project a significant force over vast distances, so it's not like we're under threat of invasion.

Second, any WWIII type scenario is pretty remote due to nukes and so forth.

Third, the only conceivable rival in any military sense is China in say, 50 years. And they are interested in trade, not starting a cataclysmic world war against it's best customer.

Fourth, you'd still have foreign car companies building here, and their factories could be commandeered in some hypothetical emergency.

Fifth, the bailout money will be a burden on thousands of other companies, some of whom will have to eliminate jobs due to the higher tax or inflation burden.

Baron, my original post was not to advocate a *bailout* it's intention was to point out that these companies history are not just mere makers of cars. They are in fact a very important strategic asset to this countries indudtrial base and have been for a very long time. Do I think Chapter 11 is the answer, Yes , it is one of several in fact. IMHO these companies do not cease to exist in the case of Chapter 11 they in fact become leaner and better able to respond to market needs and compete with foreign car companies. There are in fact many solutions that can help these companies become better able to compete, among them is a change in the over all way in which they have done business in all sectors, engineering, marketing, labor/healthcare, and even the bloated dealer networks they have. As for the *bailout* money we can debate the merits of it till we all come to seperate conclusions , and I tend to fall on the side that *bailouts* do nothing send the wrong signal to poor business practice. However, the reality of the situation is that they have already received one so called bailout to the tune of 25 billion. It is more than likely that they will receive another one.

As for your assesment of the American Defense Industry , I can assure you that most weapons systems built domestically as now the United States Military purchases quite a few systems from other nations, are very much dependant on the supply chains that intermesh with American Auto Industry. Up until 2000 they American car companies were heavily invested in the defense industry but have for the most part in the construction and bidding of systems divested themselves to Boeing and Lockheed Martin. However from a tooling standpoint, for systems like the Humvee, Stryker, M1-A2 Tank, and the thousands upon thousands of Vehicles both tracked and wheeled depend on those very same supply chains and even subsystems designed, developed, and built by the Big 3. To assume that the domestic foreign builders who's capacity is 1/4th that of the Big 3 can somehow pick up that slack not to mention the massive number of National Security issues you would be dealing with would preclude that option. While the United States is at this moment quite able to project power worldwide and do so rapidly, several nations have increased defense spending on a massive scale , China and Russia so that ability will be matched soon. We are engaged in many operations worlwide and are doing so with hardware that is sometimes 50 years old in the case of the B-52, and with and average age of 18 years. In order to keep this ability this nation will have to replace these harware systems and without a healthy heavy industry to do so, we will have to outsource that ability and expose the United States security to the whim of other nations which I am not willing to do.

 

[editec]

The best way to insure that CEO's and workers are getting realistic market wages is to let the market work. Which in GM and Ford's case means bankruptcy and reorganization.

ACtually I agree with that, but not in the way you imagine.

The defense issue is a non-issue. Firstly, we are really the only country that can project a significant force over vast distances, so it's not like we're under threat of invasion.

Yeah, this decade. That's going to change so fast you won't believe it, though. That ethnocentric arrogance keeps getting us White boys into trouble, ya know.

Second, any WWIII type scenario is pretty remote due to nukes and so forth.

Our nuclear umbrella is about as useful as teats on boar. Or haven't you noticed that the game has changed, yet?

Third, the only conceivable rival in any military sense is China in say, 50 years. And they are interested in trade, not starting a cataclysmic world war against it's best customer.

They are going to turn on us the moment they don't need us...which if our economy doesn't improvbe, is going to be by 2020.

Fourth, you'd still have foreign car companies building here, and their factories could be commandeered in some hypothetical emergency.

Yeah? So their assembly plants are commandeered. What about the plants that used to make the parts? They're long out of business here in America.

Fifth, the bailout money will be a burden on thousands of other companies, some of whom will have to eliminate jobs due to the higher tax or inflation burden.

There's some validity to that complaint, to be sure.

These bailouts are being designed to fail, I think.