Bailing out the Big Three

Sunday, December 14th, 2008

The Senate, last week, narrowly voted not to give State Aid to GM, Ford and Chrysler. Their reasoning or so I read is that the Republicans could not get the UAW to accept a bigger pay cut. I believe that typical track side worker gets around $70/hour and that those of Toyota get between $10 to $20/hour less. I have been to several track sides in my life. Some workers are very busy and some are not; maybe the load has been better balanced in recent times. Nonetheless, both are damn good wages compared to many Americans.

I have just read 'Nickled and Dimed' as US book where a comfortably off writer took a year out to see how she could survive on low paid job like being a maid, a waitress and a Wal-Mart employee. At no time did she earn more than about $8/hour and she worked her butt off too.

Some politicians have voiced their fears that a bail out would not work in the long term and I agree with them. I seriously doubt if these companies will ever change and I include staff and management as well as blue collar. See my blog of October 14th.

But I'd like them to get the money and put off the evil day of Chapter 11. My reasons are entirely selfish. A large number of my shares are in an automotive supplier and I want them to grow.

And whatever, the outcome, I do have to say that the three bosses of these companies have been treated pretty shabbily compared to the banks whose performance has been even worse. The three guys had to face hostile Senate/Congressional committees who were at times insulting and sarcastic. The bankers have faced none of that and they have access to a $750 billion bailout fund. The big three guys have cut their pay to $1/yr; I can see no such gesture at the banks.