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Politics : President Barack Obama -- Ignore unavailable to you. Want to Upgrade?

To: Lizzie Tudor who wrote (44891)	11/17/2008 2:26:38 PM
From: stockman_scott	Read Replies (1) \| Respond to of 149317

Hunkering Down For a Fight talkingpointsmemo.com By David Kurtz 11.17.08 -- 8:54AM The military-GOP complex won't go quietly into the night: The uniformed services are trying to lock in the next administration by creating a political cost for holding the line on defense spending. Conservative groups are hoping to ramp up defense spending as a tool to limit options for a Democratic Congress and president to pass new, and potentially costly, social programs, including health care reform. They also like the idea of creating an unrealistically high baseline of expectations for defense spending that will allow them to claim President Obama has cut defense spending. ... There are so many things wrong with this emerging process that it is hard to address the issue concisely. Promoting overspending on defense in order to forestall popular social spending is undemocratic - it creates a false tension between national security and other public policy goals. The informal alliance between the services and conservative think tanks threatens to further politicize the military. The abuse of national security arguments to win political arguments is both morally suspect and threatens the security of the nation by delinking strategic assessment from public policy. Ultimately, the most dangerous aspect of this development is the threat posed to civil-military relations. We went through a similar process eight years ago, and the results were painful and unsatisfactory.

To: Lizzie Tudor who wrote (44891)	11/17/2008 2:44:50 PM
From: stockman_scott	1 Recommendation Respond to of 149317

GM has launched a viral video on YouTube... The U.S. Auto Industry and the Ripple Effect viralvideochart.com

To: Lizzie Tudor who wrote (44891)	11/17/2008 3:15:50 PM
From: tejek	Read Replies (1) \| Respond to of 149317

this implies GM will just go away. I think most that are against the bailout prefer for GM to BK and then dump all this uncompetitive stuff they are saddled with an reemerge. If they need money to bootstrap themselves up after shedding all these labor contracts and employees that sit around and do nothing and make more than everybody else, THEN the public would push for detroit but right now its just throwing good money after bad. That suggests the unions are the major culprit. Too easy. Look to mgmt to understand why GM is in such big trouble.

To: Lizzie Tudor who wrote (44891)	11/17/2008 4:32:08 PM
From: stockman_scott	Read Replies (2) \| Respond to of 149317

It's not about the "Detroit Three" - it's about the "American Three Million" e-bbk.com The Case for Federal Assistance to the Automotive Industry November 17, 2008 - Detroit - The debate continues to rage over federal assistance to the U.S. automotive companies (the so-called "Detroit Three"), but the debate needs to be understood in a much broader context and any loans should be made subject to very specific conditions. If we don't provide support, the losers are not just these three car companies, but three million or more Americans whose livelihoods are also in the balance according to the Center for Automotive Research. It is for the "American Three Million" that we must now take action. The consequences of foot-dragging or outright failure to act are too monumental to ignore. In the current environment, it is unthinkable that the credit markets will provide the financing needed for the domestic automotive industry to restructure, whether in or out of bankruptcy. Moreover, the restructuring required by the domestic automotive industry is so far reaching that no participant has at its disposal the full arsenal of solutions required to adequately restructure. Only through the provision of conditional federal loans, using the full clout of the federal government to ensure a comprehensive restructuring, can we avoid the dual concerns of failed restructurings or the collapse of the Detroit Three. How does one justify federal assistance in a capitalistic country where we advocate letting the market sort things out? It is simply the only acceptable alternative available. The cost would not only be the failure of the Detroit Three, but of shattering of the entire automotive supply base - manufacturers of steel, plastic, and electrical parts. The ripple effect of a collapse would be swift. The supply base - already weakened by volume declines and market share shifts due to soaring gas prices - would not be able to withstand the hit from any of the Detroit Three not honoring their estimated $60 billion of outstanding obligations. An untold number of suppliers would be immediately forced into bankruptcy. And given the credit crisis, how could suppliers arrange financing to operate in bankruptcy? The answer is that many of them simply could not, rendering bankruptcy an ineffective tool for the required restructurings. The many suppliers unable to cope would also impact the assembly plants of other U.S. vehicle manufacturers, including the new domestic manufacturers such as Toyota, Honda and Nissan. And beyond just car companies, there is meaningful overlap between the supply base for the automotive industry and the supply base for the heavy truck, agricultural, and construction equipment manufacturers. It would seem inevitable that they too would be impacted by an automotive supply base meltdown. Can we really afford such an experiment in free market survival? The human impact would be devastating. Roughly 3 million U.S. jobs are tied directly or indirectly to the auto industry through the manufacturers and its many suppliers, not to mention those at the numerous businesses that rely on the auto industry. And let's not forget the significant impact on retirees (who outnumber the employees) that depend on the auto industry for health care and pension benefits. Our federal government cannot stand back and watch 3 million jobs get eliminated in a free-fall situation driven by the failure of one or more of the Detroit Three. This will only exacerbate the turmoil in today's economy. Given that there seems little choice but to provide support, under what conditions should such support be provided? Those of us experienced in business restructuring understand the ramifications of a failed restructuring. Inevitably, it is either a second round of more rigorous and costly restructuring or, in a worse case scenario (and all too often), a liquidation. So it is critical to get this right, the first time. The domestic automotive industry suffers cost disadvantages on a number of fronts: Labor costs, relevantly measured, are simply too high and too fixed in nature to handle the unprecedented volatility in the market place, despite years of diligent and responsible effort by management and labor. Much of the supply base to the domestic automotive industry is financially challenged and in need of restructuring. The Detroit Three need to accelerate the good work they have begun at pruning product lines, building more fuel efficient vehicles, and further reducing capacity. The auto industry has been working to fix these cost disadvantages but does not have the ability to impose the needed changes on its own because of many constraints not within its control. A bankruptcy filing most likely will not provide real world solutions if the constituencies cannot agree on the necessary restructuring actions - this is all too evidenced by the Delphi bankruptcy. Only with the clout of the federal government could meaningful and sustainable change take place - at the rapid pace that is needed. Organized labor generally opposes the magnitude of givebacks that are necessary to bring costs in line with the new domestic manufacturers. While it is understandable to sympathize with their plight, it is imperative that all parties sacrifice to fix the business model. A further reduction of costs is needed, or we face the unspeakable prospect of there being no jobs at all. While support is needed by the Detroit Three, additional financing is critical for its supply base to encourage the efficiency and rationalization that is so badly needed after the loss of market share by the Detroit Three. Some of the funding provided for the industry should be earmarked for consolidating transactions in the supply base. Finally, the Detroit Three must pare its product lines and production capacity down significantly while at the same time the public looks to them to invest in new fuel efficient vehicles and technology. Such rationalization cannot be done cheaply or without pain. A condition of the federal loans should be a plan for the Detroit Three to address overcapacity and match the number of their product lines to the reality of the market. Having worked closely with automakers and suppliers for decades to help them manage their businesses, I know first-hand the challenges these companies face and the critical point the industry has reached. From my perspective on the front lines, I can attest that the warnings being sounded are not posturing. They are indeed real, and without the support of the federal government, we could see the catastrophic consequences. Implementation of a massive restructuring will take time. These are sizable companies with numerous, complex issues. We believe the potential costs of misplaying the current liquidity crisis could be extremely severe and providing financial assistance on an expedited basis is vital. The Detroit Three need a bridge to successfully restructure. The American Three Million need it as well, and they need it now. -Bill Diehl is President and CEO of BBK, a Detroit-based business advisory firm that has supported automakers for more than 30 years in managing their operations for improved performance and mitigating risk in their supply chains.

To: Lizzie Tudor who wrote (44891)	11/21/2008 11:29:16 PM
From: TigerPaw	Read Replies (6) \| Respond to of 149317

throwing good money after bad. I have a hard time supporting any bailout for the auto industry. It's not just that I feel we, as a country, have been supporting them for a long time. The american auto industry has also seemed to try to actively hurt the country as a whole in order to make a few bucks, particularly the way the industry has suppressed public transportation. Few things have been worse for this country, this environment, and this economy than the notion that every person in this country should drive their own vehicle regardless of their abilities, inclinations, addictions, or skill. It seemed that from the CEO to the line workers all of them supported the car at all costs and not only promoted their own interests, but actively derided every progressive idea that came along. I just have a hard time wanting to bail them out. Yes, I know that failure of this industry would be a terrible blow. Still, .... I think they should walk throught the valley of the shadow of bankrupcy. I don't trust any of them to decide their own restructure. Sure, they can argue the case, present their plans, but I would rather see a hopeful neutral judge make sense of the situation than to have the same groups play an us/vs/them game, again. TP