Let GM and the other failed auto giants go under

Time

Creative Commons License Photo credit: davetrainer

Trevor Reichman over at TreeHugger asks why GM and the other corporate giants in the auto industry seeks $50 billion in public funding, while no one mentions help for public transportation.

Reichman points out that the demand for fuel in USA is decreasing and that an increase in travellers on public transportation shows that "Americans are willing to drive less". So why should the US government even think that a "wasteful and economicly demanding invention from last century" is needed when there are other and better alternatives available.

"Instead of handing over 50 billion dollars to an industry that cannot be sustained at its peak level, public funds can be better used to fund rails, buses, and bicycle pedestrian projects that have already been engineered, already been proven, and are just waiting for funding. While GM and friends seek roughly $165 per American, there is no clear or specific plan for how that money will be used to benefit the public or save jobs."

Reichman says that the "automobile giants have successfully lobbied to derail mass transit infrastructure around the world for many decades", and that "now is not the time to further subsidize them."

"Commuters have spoken, through actions, that the use of public money is better spent on public services than on private industries. Shifting jobs from the automotive sector to the public transit sector may hurt the elite few who sit at the top of a decades long monopoly over transit infrastructure, but the millions it would almost immediately benefit is something to consider before a decision is made."

I completely agree with Reichman.

GM and the other auto giants that now face a financial crisis and their own impending death have themselves to blame. These auto companies have resisted and done everything in their powers to stop stronger compulsory MPG and CO2 emission standards, denied climate change and their promises that they could cut their greenhouse gases voluntarily have all failed. As a result the average car sold in USA today is less efficient than the Model T Ford from 1908.

In Sweden the auto giant Volvo is also facing a financial crisis and many people are loosing their jobs. The Swedish Government foolishly tries to help by pouring tax-money into these doomed companies. They all ignore the fact that these companies are failing today because they have for year's resisted sane technological change.

The best thing for everyone is to let these "foot-dragging, planet-eating spongers" to go under.


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Simon Leufstedt
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Guest Ken Clive

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They don't need to go under. GM, Ford, and Chrysler need to downsize. I understand that would take away a lot of jobs, but it's better than not having them at all. The managers, engineers, etc. at these companies need to realize that the American age of extreme car dependence is over, and do things in fresh, new ways that not only benefit consumers but also profit the companies and make the world a better place.

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Guest Claudia

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If they would stop production and sell the inventory they have at least it would generate income. These companies are well run and profitable, at least they have been in the past. It seems like a waste to watch everyone from Ford, to DHL to Polaroid quit when there's still a demand. Why not restructure instead?

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Ken Clive: Yes it's always sad when people loose their jobs. But, things change, and mostly to the better. Other companies will replace these "big three". In Sweden thousands of people have lost their former jobs in the car industry. Lars Ohly, party leader for the Left Party, says the car factories should be transformed to making wind power stations instead. That is something companies and governments around the world should really consider. The green sector will create millions of new jobs. Claudia: I don’t know if you can call GM "well run" when their vice-chairman spreads global warming denialism while promoting their new eco-friendly car.

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Guest Jeff - ScienceSays.net

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GM's CEO is just protecting his profit margin, I can't believe that he really believes that. Then again, imagine where his company would be today if they'd stayed the course on electric cars in 1998 instead of smashing them and committing to a whole new line of SUVs...

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Are you kidding me? Yes, the Big 3 share the bulk of the responsibility for their actions. I rather despise them for the situation they are in. They rested on their laurels, built large SUVs, innovated little, and lobbied the government to keep them from regulating any real change. It's disgusting. But the government also shares blame for this. For them to hand out billions and billions to financial institutions, after the government was largely responsible the crisis, and then completely demonize the automotive industry and the problems the Big 3 have, that once again the government had a hand in creating, is absolutely absurd. For anyone to sit there and hope the Big 3 come to an end, to be blunt, you are truly ignorant. I'm sorry, but you are. You clearly have no idea the number of jobs that are connected to the Big 3. I fully understand why you want them to tank, and a part of me does, too. But the bottom line, if we truly want change in this country, we will not see it if the Big 3 fold. The automobile isn't going anywhere in this country. I completely agree and am for mass transportation everywhere. I am also against the disgusting urban sprawl that has made mass transit impractical. But the bottom line is if the Big 3 fold, a HUGE manufacturing sector of this country will implode. We need this to truly make a transition; we cannot do this if millions of people are jobless. We need to scale back automotive production and scale back our disgustingly lavish, impractical, and wasteful lives. But this needs to be a gradual process. As the economy dips down, people are being forced to scale things back. Hopefully we'll all adjust, and then gradually we can shift to more responsible and sensible means and livelihoods. This will be greatly delayed if the Big 3 go under. At least that's my opinion. We need a focus on renewable, clean energy and transportation. I just don't see how we can do this if we're in a major recession, much more considerable than our current state, and that is what we'll see if the Big 3 implode. I think we the right leadership we can make a move to more reasonable lifestyles without needless suffering and hard times. I do understand, though, that another way of thinking is that these hard times are necessary to produce the results I've spoken of. And it might not necessarily be that bad to knock us all down a notch and put us back in touch with some harsh reality. We are so removed from the recession of the 1930's and so spoiled we don't know how good we have it. But to sit there and root for this, I do not know why anyone would. I would root for change out of necessity; that's not lasting change at all. We should be hoping for change from the desire to do so. That's the only hope we have of saving ourselves from out current entanglements.

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You are calling me ignorant? If there is someone here who should be called ignorant its the rich bullies that think they can get away with all of this without even making a single personal sacrifice. These failed bosses will continue to run their failed companies and continue to make $8000 every hour and can keep all their 8 personal company jets. And the workers and the ordinary people will always bear the burden. But nothing will change to the better if we allow these "foot-dragging, planet-eating spongers" to continue. Henry Ford II once explained why the US automakers prefer to make gas-guzzling cars, he simply stated that "minicars make miniprofits". And John Z. DeLorean, former GM executive, have said that: "When we should have been planning switches to smaller, more fuel-efficient, lighter cars in the late 1960s in response to a growing demand in the marketplace, GM management refused because 'we make more money on big cars' ". Now back then people already knew how stupid and inefficient private motorism was. But they all ignored it because otherwise their profits wouldn't be so high. Bradford Snell once stated in a famous report to a US Senate committee that: "motor vehicle travel is possibly the most inefficient method of transportation devised by modern man." But nevertheless the central US national transportation policy during most of the twentieth century has been a corporate strategy geared towards the high profits that comes with private motorism. Wasteful federal funding for highways has been added with declining government subsidies for public transportation. And its not just the US government that should be blamed here. GM and the other major auto companies in USA deliberately dismantled US earlier mass transportation system. GM and the others (also with the help from Standard Oil and Firestone Tire) systematically bought up many of US electric streetcar lines and converting them to busses. As a result the number of streetcar lines dropped from 40000 in 1936 to 5000 in 1955. At the same time GM used it monopolistic control over bus production and the production of locomotives to ensure the growing displacement of bus and rail traffic by private motorism. They essentially undercut themselves in intercity mass transit in order to make higher profits off increased private motorism. And so USA today have to rely more than any other country in the world on private motorism and trucks for the ground transport of people and goods (with disastrous consequences for the environment). Private motorism today in US account for the insane 90% of all travels. These ignorant car companies don’t deserve the people’s money. Let's not waste our money on easing their pain. It will just prolong their pending death. But sure, I agree with you that if we weren't in this financial crisis, created by the capitalistic greed that exists in these failed auto companies, the choice here would be so much easier.

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Guest john renyolds

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I say let them fail they have gotten away with over charging people for to long and people are tired of it thats why, toyota is the #1 automaker in the us because they dont overcharge for their product and there reliability outlast gm, Ford, and chrylser any day, another factor in this is that gm and ford have to many brands why do they need many eight for gm and five for ford. Let me ask you this how many brands do toyota, nissan and honda have, EXACTLY. the only thing keeping gm alive is europe , europe holds eighty five percent of gm sales. they derserve to fail while they were wasting money on e85 ethanol which there are only a few select place that you can get it I.E. nowhere within 400 miles of where i live. Toyota, Nissan and honda were moving to gas electrics. gm also when they saw the gas prices going up instead of increasing the quotas for big gas guzziling suvs they should have decreased there qutoas. another problem is they pay there workers three times more then toyota honda and nissan do. i have to agree with simon they are ignorant. what many people dont know is theve had the technology to make fuel efficent cars since the 70's but have chose not to use it . also many people dont know this but in the early 90's saturn yes saturn came out with a fully electric car but gm wouldnt sell you this car they would only lease it to you so people would bring there car in for service and gm would just take it without any warning gm took all of them and crushed them. they hade the infrastructure too in california charging stations and everything but gm wasted all they money. moral of the storsy gm, ford and chrysler deserve to be in the situation they are in because the have managed there money poorly common principle if you spend more then you make youre in the red, in the red=bankrupt they deserve to be there gm, ford, chrysler sucks buy toyota, nissan and honda

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