I have not seen any indication that the proposed bailout of GM and Chrysler will do anything to resolve the conditions that would soon lead to their bankruptcy without a bailout.NYTimes.com FORD appears to be in better shape and might survive without federal money. At most, the current bailout package delays the inevitable for three months or so at a cost of 15 billion. The intent is just to kick the can down the road a few yards. There is no doubt that the auto companies are more deserving of a bailout than Citigroup and AIG. But this is not saying much because Citigroup and AIG certainly deserved to fail (I am using deserve in a moral and equitable sense) I understand and sympathize with the argument that the economy is too weak now to withstand widespread job losses in the auto industry, their dealerships and parts suppliers. I would also have to agree with my Republican Senator Bob Corker, who I did not vote for, that nothing has been promised or done yet to address the capital and cost structures which would render these companies viable. The UAW is still treating the situation as if they were back in the 1950s and dealing with the highly profitable American auto companies who then had no meaningful foreign competition in the U.S. auto market. GMAC appears to be toast.Yahoo! Finance GM is already a debt heavy corporation burning cash in billion dollars piles, similar to Citi and AIG in that regard. Chrysler is a basket case that can no longer justify its independence. At some point, a decision needs to be made to let companies fail that deserve to fail. But I suspect that in modern day America, failure will often be rewarded, the consequences for failure will frequently be shifted to those who did not cause it, and the repercussions of bad decisions are not suffered by those who make them. The auto companies and the UAW complain that they are the victims of a few months of very high gas prices and the last couple of months of dismal sales. I have a question, if the UAW's labor demands over the years, largely assented to by the companies, and the management decisions had nothing to do with the auto companies current crisis, then why can they not survive a few bad months like other large American industrial corporations? How many industries have job banks where a laid off worker receives up to 95% of their compensation for 1 year?
For a good discussion on labor costs, seeNYTimes.com and the conservative reply UAW Workers Actually Cost the Big Three Automakers $70 an Hour