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chaloobi
SFN Regular
1620 Posts |
 Posted - 11/21/2008 : 06:04:03 [Permalink]
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Originally posted by Dave W.
Originally posted by chaloobi
I'm not just thinking of their US employees, but also their Japanese employees where much of it's staff is located. Note that Toyota does give decent benefits to it's employees in the south, but it's work force is very young and it doesn't have a lot of US retirees, so those costs are low. I don't think that's a fairness issue, of course. But again if the US had a sensible medical care and retirement system there would at least be competition that wasn't automatically lopsided in favor of newer players in the market. |
Well, Toyota isn't building cars in the U.S. at a loss. I mean, building them here, paying U.S. workers and U.S. taxes is obviously cheaper than building the cars in Japan and shipping them over. Or, the company obtains some other benefit that's worth the added expense. |
Definitely not at a loss. I read some years back a comparison of pay and benefits - they do get paid a little less and I don't believe they have a traditional pension plan and the rest of their benefits are light compared to the UAW so I'm sure those costs are comparably low. They also don't have the absurd work rules to deal with forcing far more staffing to run a plant or building than is reasonably necessary. Considering what the economy is (was) like in places like Alabama, those jobs are very appreciated and I'm not surprised at all that the UAW hasn't been able to organize.
| What would have happened if GM tried to move its plants south during the good times? I bet the unions would simply have shut down all production up north, leaving GM no U.S. production at all for years (until the southern plants were built, staffed and started - all without help from long-term employees). |
Hell, they might as well move them to Mexico where the labor is very cheap and the people work their asses off. I wonder if GM could have pulled off something like that - what would the public perception be? The UAW is much despised in the US these days, so I wonder. Would it be breach of contract? They'd have to let the old contract run out first I'd guess. And I'm sure it's not so simple as just building factories down south - there'd have to be other huge complexities to deal with...
| I guess you could say that the fact that we don't have good universal healthcare or government-provided pensions - thus priming the market for the formation of unions - is an example of the U.S. government being unfair to its own citizens. |
I think it's a national embarrassment. |
-Chaloobi
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Gorgo
SFN Die Hard
USA
5310 Posts |
Posted - 11/21/2008 : 06:14:03 [Permalink]
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| They have started to move to Mexico. |
I know the rent is in arrears
The dog has not been fed in years
It's even worse than it appears
But it's alright-
Jerry Garcia
Robert Hunter
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| Edited by - Gorgo on 11/21/2008 06:46:42 |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 11/21/2008 : 07:58:10 [Permalink]
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Originally posted by H. Humbert
I don't know for certain, but I'm guessing that's a result of imposed import tariffs, not undirected market forces. |
I'd have little doubt that import tariffs were strongly lobbied for, in Congress, by the Detroit automakers, as a way of establishing "fairness" in pricing to the consumers, while short-sightedly saying, "they'd never build a plant here in the US, and if they did, it'd be up here in Michigan so they'd have to cozy up to the unions, too." Maybe.
Then again, how long ago did Japanese car makers start building plants in the U.S.? 50 years ago? |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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chaloobi
SFN Regular
1620 Posts |
Posted - 11/21/2008 : 10:57:43 [Permalink]
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Originally posted by Dave W.
Originally posted by H. Humbert
I don't know for certain, but I'm guessing that's a result of imposed import tariffs, not undirected market forces. |
I'd have little doubt that import tariffs were strongly lobbied for, in Congress, by the Detroit automakers, as a way of establishing "fairness" in pricing to the consumers, while short-sightedly saying, "they'd never build a plant here in the US, and if they did, it'd be up here in Michigan so they'd have to cozy up to the unions, too." Maybe.
Then again, how long ago did Japanese car makers start building plants in the U.S.? 50 years ago?
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Here's something:
Foreign transplants have increased their share of North American motor vehicle production from virtually nothing to more than a quarter of the total in 25 years, as shown in Figure 7 and, in more detail, in Appendix Table 2. Volkswagen was the only foreign-based producer in 1979, when it produced 175,000 units at its plant in New Stanton, Pennsylvania. That plant proved to be unsuccessful, and has since been closed, with subsequent VW production in North America located in Mexico. By 1990, most Japanese manufacturers had vehicle production facilities in North America. Some transplants were built in direct collaboration with the Big Three, but most of the production came from plants independently designed, built and operated by the Japanese-based producers. The initial decisions of Japanese manufacturers to locate in North America was in part a function of U.S.-Japan trade relations, as will be described in a subsequent section of this report. But whatever the cause, by 1990, more than two million vehicles were assembled each year by the transplants in North America, and more than two-thirds were built in the United States.
This total doubled to more than four million annually by the end of the decade. Moreover, while Big Three output dropped by 1.6 million units between 2000 and 2003, transplant output continued to increase, despite the economic slowdown: from 4.1 million to 4.7 million units assembled in North America, with all the net gain coming at U.S. plants. The Japanese producers were joined by BMW and Mercedes Benz, which opened their first North American production facilities in South Carolina and Alabama respectively in 1994 and 1997. The German manufacturers'confidence in the ability to assemble world-class vehicles in the United States may be indicated by exclusive production of certain models in these plants for distribution to both U.S. and worldwide markets.
A close examination of the transplants' data in Appendix Table 2 also shows that the more profitable or higher-volume transplants have been those that were started up by the foreign-based companies themselves, rather than those that were developed in conjunction with the Big Three. Honda's plants in Ohio, Ontario, and, most recently, Alabama, were all initiated by the company on its own.38 Nissan's plants were also built and operated on their own, as was the large Toyota plant at Georgetown, Kentucky, the largest of the transplant operations in North America, in terms of annual vehicle output. The one major exception is “NUMMI” for New United Motor Manufacturing Inc.). This was a closed GM plant in Fremont,
California, which Toyota reopened and has successfully managed as a joint venture with GM (and with UAW-represented workers).39 By contrast, the plant built by Mitsubishi in the “Diamond-Star” alliance with Chrysler in Normal, Illinois; the Ford-Mazda “AutoAlliance” plant in Flat Rock, Michigan; and the GM-Suzuki
CAMI operation in Cambridge, Ontario, have all been more |
-Chaloobi
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Hittman
Skeptic Friend
134 Posts |
Posted - 11/27/2008 : 22:36:42 [Permalink]
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| Personally, I think they should let one of them fail and sell the departments and factories to smaller car companies trying to start up in the US. |
You sound like a…a…{shudder}…Capitalist! The horror, the horror…
| I'm not sure that we need to talk about how one union is too strong, I wonder rather if we need to talk about how the rest of them aren't strong enough. |
I have done contract work in union shops, several times. I could write a couple of books on what I've seen.
| The only one that was bailed out before was Chrysler, with government loans, and they paid back all their loans with interest. Why is that bullshit and why should Ford and GM be punished for it if it was??? |
It's bullshit because that's not the government's job. If Chrysler had been allowed to fail, the other car companies would have learned from it (probably) and been in a better position to deal with union extortion.
| You know and I don't, then. I had this discussion here with someone about a local GM plant where we heard all kinds of stories about people playing cards all day. My guess is that for every union person actually playing cards there were four management people on a distant golfing trip. But, I don't know that. |
I've seen people doing jigsaw puzzles, reading Harlequin romances (one woman made her own cubicle out of them. It was a pretty impressive feat of engineering), and watching movies on portable DVD players.
I had one contract job for a unionized government office where four of us were given six months to image and install fifty computers. (To put that in perspective, I did another contract for a bank where two of us were hired for one month to image and install 90 computers, and that was just about right.) We worked as slowly as we could, and still had them all imaged and ready to go in less than a week. Then we found out what our real jobs were – we were there to do the job of the unionized help desk workers. One of them was busy building his Amway downlinks. Another was working on patenting an invention of his. Another was intent on mastering computer Othello at the highest level.
We were getting paid about 2.5 times to going rate for similar jobs. We were working for an employment agency, and they were taking a nice cut too. And the union "workers" were getting their full pay and benefits too. All on the taxpayers dime.
Unions were necessary, once. They played an important part in helping to create the middle class. But they've now become leeches that companies (and government) can no longer afford.
The idea of us getting shares of the companies taxpayers bail out sounds good, but wouldn't it be the government who would own them? Do we really want the people in charge of FEMA and AMTRACK telling companies how to run their businesses?
How about this – the bailout money is converted to shares, which are then handed directly to the taxpayers? It's our money anyway.
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Dr. Mabuse
Septic Fiend
Sweden
9688 Posts |
Posted - 11/28/2008 : 08:00:13 [Permalink]
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| When I read about your experience of unions it sounds like something from another planet. I guess it's a cultural thing fairly unique to USA(?). |
Dr. Mabuse - "When the going gets tough, the tough get Duct-tape..."
Dr. Mabuse whisper.mp3
"Equivocation is not just a job, for a creationist it's a way of life..." Dr. Mabuse
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Send them unarmed civilians for target practice..
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Kil
Evil Skeptic
USA
13477 Posts |
Posted - 11/28/2008 : 11:12:20 [Permalink]
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Hittman:
You sound like a…a…{shudder}…Capitalist! The horror, the horror… |
Painting all unions with the same brush, and a very broad one at that, is a mistake. Remove them all and let's see what happens to the conditions for the labor force. Obviously reforms are needed in some cases. It does not benefit a union or the companies if its members are all unemployed, if you get my drift. And then there are the suppliers and all the people they employ, whether they are union shops or not.
As for capitalism, we are in a recession and facing deflation and a possible depression. The loss of possibly millions of jobs is not acceptable under the present conditions. So capitalism be damned. It's very easy to stand up for some (choose your) ideology when you are not the one who will lose your job.
I am not a union worker, and I am still caught watching my industry tank. We need people working or I will be directly effected. We are already experiencing serious damage by the credit crunch. How far should this go in the name of capitalism?
Certainly the big three need to do better. But sending the country into a downward spiral, do to a serious increase in unemployment in the midst of the worst economic downturn since the great depression is just plan crazy in my opinion. And oh my gosh, that doesn't even touch on what it will do to an expanding health care and housing crisis.
This is not a simple correction that we can absorb. If I sound like chicken little its because the sky is falling on me. I have not had a call for work since the market tumbled, mostly do to bad actors who took exactly what they could get away with because the markets were too free. And I am beginning to deeply resent those who have jobs and think of the current crisis as capitalism in action, and resent all bailouts. Those are my taxes paying for the bailouts too, you know. But the feds wont be getting any taxes from me if I am unemployed.
Screw ideology. We can deal with that later...
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Uncertainty may make you uncomfortable. Certainty makes you ridiculous.
Why not question something for a change?
Genetic Literacy Project |
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Hittman
Skeptic Friend
134 Posts |
Posted - 11/28/2008 : 14:01:14 [Permalink]
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| When I read about your experience of unions it sounds like something from another planet. I guess it's a cultural thing fairly unique to USA(?). |
From what I've read of overseas unions, I don't think so, but I can't say for sure.
I don't want to portray every union worker as a do-nothing lazy bastard. In the state agency I mentioned about half the people there put in a good day's work. It was the other half who made their life difficult, and made it just about impossible to get anything done. But the point is none of them had to work, because no matter how much they goofed off the union would come to bat for them. Collecting a paycheck didn't involve working, it merely involved showing up.
| Painting all unions with the same brush, and a very broad one at that, is a mistake. Remove them all and let's see what happens to the conditions for the labor force. |
We've done that in most industries, and the conditions for the labor force are just fine.
| It's very easy to stand up for some (choose your) ideology when you are not the one who will lose your job. |
I lost my job three weeks ago. If there were enough real capitalism, and less government interference in the economy (which caused this mess in the first place), I'd be looking at a far more robust job market.
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When a vampire Jehovah's Witness knocks on your door, don't invite him in. Blood Witness: http://bloodwitness.com
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Kil
Evil Skeptic
USA
13477 Posts |
Posted - 11/28/2008 : 14:17:33 [Permalink]
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Hittman:
... If there were enough real capitalism... |
Do you mean true Laissez-faire capitalism or what? What do you mean by "real capitalism"? The government has been deregulating for over 25 years now. What government interference led to the current crises? |
Uncertainty may make you uncomfortable. Certainty makes you ridiculous.
Why not question something for a change?
Genetic Literacy Project |
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Hittman
Skeptic Friend
134 Posts |
Posted - 11/30/2008 : 21:03:20 [Permalink]
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Real Capitalism is allowing businesses to conduct their business without mandates, and with regulation limited to preventing fraud.
The current mess started with the Community Reinvestment Act put in place by Carter. It required banks to give mortgages to less qualified applicants and in rotten neighborhoods. Banks managed to handle it, though, and some even made small profits on it.
Then Clinton put the program on steroids. Banks were forced to ramp it up. They came up with things like no or low down payment interest only mortgages with big balloon payments at the end of five years, and "liar loans" where they didn't even check applicant's employment. This increased demand for homes enough to cause an artificial spike in demand, which in turn caused an artificial spike in housing prices. Although only about 5% of the loans were CRA loans, the madness spread across the entire industry, and spiraling housing prices made it seem like any loan was a good bet, because even if the buyer defaulted their collateral would have appreciated so much that the bank would still make a profit.
The banks spread their risk by selling it. They created market instruments, and derivatives of those instruments which were so complicated no one really understood them. They bought and sold them back and forth like the proverbial housewives who got wealthy taking in each other's laundry. Although they were really selling insurance they called them "credit swaps" to get around the insurance regulations that required them to have enough funds to cover losses. The SEC screwed up by allowing them to do it. In other words, the legit regulations to prevent fraud were ignored.
The mark-to-market rule, a fairly recent SEC requirement, made things much worse. It says that any market instrument must be valued at the price of the last sale. So when a bank raised cash by liquidating shares at a discount, everyone else had to report those shares as being worth that much less.
The pebble that started the avalanche was the CRA. The traders threw boulders on the mess. The SEC ignored what was going on and made things worse with mark-to-market. So there is plenty of blame to go around. But without that pebble, without the CRA, without the government stepping in and demanding banks give loans to people who were lousy credit risks, it never would have happened.
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When a vampire Jehovah's Witness knocks on your door, don't invite him in. Blood Witness: http://bloodwitness.com
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Mycroft
Skeptic Friend
USA
427 Posts |
Posted - 11/30/2008 : 22:21:16 [Permalink]
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Originally posted by Hittman
The current mess started with the Community Reinvestment Act put in place by Carter. It required banks to give mortgages to less qualified applicants and in rotten neighborhoods. Banks managed to handle it, though, and some even made small profits on it.
Then Clinton put the program on steroids. Banks were forced to ramp it up... |
Wrong.
I was on the front lines of the mortgage business during the rise and fall of this sub-prime fiasco. I can tell you first hand these banks were not lending money because Jimmy Carter told them too or because Clinton forced anyone to ramp anything up.
No, they were making these loans because it was very very profitable to do so. They did it because for such a very long time property values only went up and up and up...and they figured that would cover the risk of loaning money to people with bad credit. They figured that if a few of those "liar's loans" they (and when I say "they" I mean "me". I put together plenty of those loans myself) made for people who didn't want to verify their income came back to them, that the increased value of the property would cover their costs of foreclosure.
I was there. These people loaned the money because they wanted to, they wanted to make lots of money and because there was lots of money to be made, not because any liberal president forced them. |
| Edited by - Mycroft on 11/30/2008 22:23:13 |
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Dave W.
Info Junkie
USA
26022 Posts |
Posted - 11/30/2008 : 23:04:58 [Permalink]
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Originally posted by Hittman
The current mess started with the Community Reinvestment Act put in place by Carter. It required banks to give mortgages to less qualified applicants and in rotten neighborhoods. |
The CRA forced banks to offer loans in the same places where they were willing to take deposits. If they didn't want to make loans in "rotten neighborhoods," all they had to do was say, "sorry, we're closing your savings account, here's your money." If banks were willing to extend one service to a particular area, they had to extend all services to that same area. So far as I know, banks are still free to discriminate based on ZIP code; geography doesn't make for a "protected group." |
- Dave W. (Private Msg, EMail)
Evidently, I rock!
Why not question something for a change?
Visit Dave's Psoriasis Info, too. |
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BigPapaSmurf
SFN Die Hard
3192 Posts |
Posted - 12/01/2008 : 07:23:29 [Permalink]
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http://www.whitehouse.gov/news/releases/2003/12/20031216-9.html
It was Bush's American Dream Downpayment Act of 2003 which really did the damage. It made it far easier for low-income people to purchase a home they couldnt afford and far easier for the loan givers to put their morals on the back burner, after all the president says it is every Americans right to own a home.
Still I blame the lenders first and foremost. |
"...things I have neither seen nor experienced nor heard tell of from anybody else; things, what is more, that do not in fact exist and could not ever exist at all. So my readers must not believe a word I say." -Lucian on his book True History
"...They accept such things on faith alone, without any evidence. So if a fraudulent and cunning person who knows how to take advantage of a situation comes among them, he can make himself rich in a short time." -Lucian critical of early Christians c.166 AD From his book, De Morte Peregrini |
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chaloobi
SFN Regular
1620 Posts |
Posted - 12/01/2008 : 08:16:15 [Permalink]
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Originally posted by Hittman
| The only one that was bailed out before was Chrysler, with government loans, and they paid back all their loans with interest. Why is that bullshit and why should Ford and GM be punished for it if it was??? |
It's bullshit because that's not the government's job. If Chrysler had been allowed to fail, the other car companies would have learned from it (probably) and been in a better position to deal with union extortion. |
First, the conventional wisdom that so many people have spouted recently that the government has been bailing out the auto companies again and again is non-sensical horseshit.
Second, the idea that a loan from the government that was paid back with interest and that kept tens of thousands of people working good jobs for thirty years was somehow a bad move because current economic conditions are killing the industry isn't just bull shit, it's stupid.
Third, it IS the government's job to safeguard the economy for the benefit of it's citizens. That often means curtailing the reckless stupidity of unregulated capitalism. Too bad for all of us the Bush Administration forgot what it's job was. |
-Chaloobi
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Hittman
Skeptic Friend
134 Posts |
Posted - 12/03/2008 : 08:28:20 [Permalink]
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I was on the front lines of the mortgage business during the rise and fall of this sub-prime fiasco. I can tell you first hand these banks were not lending money because Jimmy Carter told them too or because Clinton forced anyone to ramp anything up.
No, they were making these loans because it was very very profitable to do so. They did it because for such a very long time property values only went up and up and up...and they figured that would cover the risk of loaning money to people with bad credit. They figured that if a few of those "liar's loans" they (and when I say "they" I mean "me". I put together plenty of those loans myself) made for people who didn't want to verify their income came back to them, that the increased value of the property would cover their costs of foreclosure. |
And why did those property values escalate? Because of increased demand. And why was demand increasing? Because government interference made it too easy to get loans, creating an artificial spike in demand. So yes, they were making tons of money toward the end of the bubble, and that led to the credit swaps and other shady deals, and that turned a turd into a shitstorm. It was the direct result of government policies.
| The CRA forced banks to offer loans in the same places where they were willing to take deposits. If they didn't want to make loans in "rotten neighborhoods," all they had to do was say, "sorry, we're closing your savings account, here's your money." If banks were willing to extend one service to a particular area, they had to extend all services to that same area. So far as I know, banks are still free to discriminate based on ZIP code; geography doesn't make for a "protected group." |
So if Joe Dirtbag from Slummerville puts ten bucks in a savings account, the bank now has to finance depilated buildings in his neighborhood? Brilliant!
| It was Bush's American Dream Downpayment Act of 2003 which really did the damage. |
Thanks, I wasn't aware of that piece of the puzzle. Another boulder tossed on the avalanche.
| Still I blame the lenders first and foremost. |
I blame them foremost, but not first. The problem was started by the feds, the lenders just made it much, much worse.
| Second, the idea that a loan from the government that was paid back with interest and that kept tens of thousands of people working good jobs for thirty years was somehow a bad move because current economic conditions are killing the industry isn't just bull shit, it's stupid. |
My argument has nothing to do with the current situation, but with the morality and unintended consequences of the government stepping in.
If they hadn't, if Chrysler had been allowed to fail, the people affected wouldn't have been out of work for thirty years. They would have found other work, or the same work with a different company. Meanwhile, the surviving companies would have had leverage to use against abusive union contracts. Some of Chrysler's assets would have been purchased by their competitors. Foreign car makers might have built US plants sooner. It would not have been the end of the world for anyone.
I just got laid off, along with about 20 of my co-workers, because my company wasn't profitable enough and failed in their quest to find additional investors. Why shouldn't the government bail them out? How about if it were 40 people? Or 100? I just heard that a local company that makes and repairs railroad cars and engines is closing, laying off 175 people. Shouldn't they get a bailout? What's the cutoff? How big do you have to be before the government throws taxpayer money your way?
If it's right to do it for a big company, it's right to do it for a small company.
| Third, it IS the government's job to safeguard the economy for the benefit of it's citizens. That often means curtailing the reckless stupidity of unregulated capitalism. Too bad for all of us the Bush Administration forgot what it's job was. |
The best way to safeguard the economy is A) prevent fraud and B) get the hell out of the way. Bush neglected A. Carter and Clinton ignored B. And the result is today's disaster.
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When a vampire Jehovah's Witness knocks on your door, don't invite him in. Blood Witness: http://bloodwitness.com
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Killing the car companies
