Detroit vs. Wall Street

All of this misses the whole point of either bailout. We didn't bailout Wall Street because we felt sorry for billionaire CEO's. We did it because letting Lehman Brothers fail caused a lot of hurt to the whole country. We bailed out Wall Street to help Main Street.

So, the question for Detroit is not "does the GM CEO deserve a bailout". The only relevant question is "will bailing out Detroit help Sioux Falls, Saint Louis, and Kenosha?".

The disproportionate anger was basically just....stupidity.

Wall St. got an astronomical amount of taxpayer money, after CAUSING the meltdown in the first place through reckless and idiotic behavior. People should be outraged over this mess, people should be marching in the streets, people should be dragging those bastards into the streets for beatings. It was, and is, the biggest ripoff in the history of man. All total, the Wall St. bailout is in the TRILLIONS.

The measly auto bailout does not compare, not in any way. The political posturing was ludicrous!

The difference, of course, is that Wall St., banking, the mortgage industry, Fannie and Freddie, and the real estate complex in general give HUGE amounts of money to the politicians, to keep the bastard incumbents in power. It's disgusting, it's wrong, it's criminal, and nothing is being done about it.

First of all, a LOT of us did not support the Wall St. bail out either. But that said, the difference between the Wall St. bail out and a bail out of Detroit is pretty easy to see.

W/ Wall St. there was a sudden crisis which threatened to take down our financial industry before anyone could try and fix it. If nothing else, the bail out was supposed to buy us some time to fix the problems of Wall St. so they could move forward as solvent entities. I never believed for a second that the bail out would actually help the economy, but at least it should prevent anymore massive failures.

W/Detroit the supposed crisis has been going on for a couple of decades now. They haven't been able to get their s**t together in the time it takes for a human being to become old enough to get their driver's license. Now they want to say, "oh, but we were just on the verge of getting our crap together within the next 5 years and now this crisis is threatening our survival." Gimme a break. We'll give these bozos the money and they'll still be in danger of massive failure.

These two situations brings to mind Tolstoy's comments about unhappy families all being different; there may be formulas for success in the business world, but there are a myriad of ways to fail. These two industries are failing in different ways and have completely different prospects for recovery. And that is why we react to them differently.

John,

Your Volvo, if it was built since 1998, was built under Ford ownership. So you probably should car.

Also, Rod, how old is your Ford minivan? They stopped making them in 2006 altogether, you know. And did you also know that Toyota and VW are responsible for the most vehicle recalls this year, last year, and the year before that? Not GM or Ford. Did you also know that the quality AND reliability gaps have closed, almost to a statistical dead-heat for vehicles 3 years old and newer?

The Camry V6 and Tundra pickup have been removed from Consumer Reports's Recommended list this year, because of transmission failures in Camrys and camshaft failures in Tundras. Both Toyota and Honda have issued major recalls in the last few years due to engine sludge issues, and total transmission failures, as well.

The fact of the matter is that the Chevy Malibu midsize sedan, 2008 NA Car of the Year, and winner of JD Power's Initial Quality survey for midsize sedans (The Accord and Camry haven't won this survery for almost a decade now), gets the same mileage as Honda's new subcompact 2009 Fit. 33mpg highway. The Fit does it with a manual. The Malibu does it with an automatic, 500lbs more weight, and 800ccs more engine displacement.

GM and Ford did make crapfests in the '70s, '80s, and '90s. Not anymore, though. And while it'll take awhile for the public perception to catch up to reality (and deservedly so), they're doing the right things now...and have been (in GM's case in particular) for about the last 5 years.

Our country has had little problem bailing out the steel companies, shipping, rail, and the farm industry. Wall Street gets a blank check and ZERO accountability (and there is NO reason to think they'll be more responsible in the future than they've been recently), but the auto industry, because of the mistakes it's made that affect consumers more directly (there's branding involved), the autos get crucified, no matter how much they've done in the last 2-5 years to turn around and build competitive products despite their cost and trade disadvantages in their own market.

anon,

1) The auto industry has a multiplier effect that is extremely high, as well. The autoworkers who lose their jobs, their dependents and retirees who lose their benefits and pensions, the increasingly sick supplier industry worldwide who is dependent on the largest automaker in the world for components (and who also supply the foreign manufacturers), the trucking and rail industries, the steel, nickel, copper, zinc, rubber, plastic, and glass miners, refiners, and manufacturers (of which GM is the largest single purchaser worldwide), etc., will either be dealt a crippling blow and incur massive layoffs, or go out of business completely.

That's a few million people in this country that go from contributing to the tax base, as well as purchasing goods in their local economies, to becoming DEPENDENT on it. That's a twofold loss that the rest of the American taxpayers would have to front.

2) TARP wasn't used to buy troubled assets in the end. It's become a private slush fund for banks to tap, no questions asked - as long as they ask Hank Paulson says it's okay - and for us to buy equity in whatever banks Paulson sees fit to...and with no oversight from anyone else.

3) The Big 3 are managed by excellent leaders who (in the cases of GM and Ford) have not only negotiated a new labor agreement that gets the UAW close to parity with the foreign transplants (set to take effect in 2010), but have turned up the quality, reliability, fuel economy, design, and driving dynamics of their vehicles back to competitiveness (in some cases, outright leadership) with the industry leaders...and all in about one full product life cycle-worth of time. And all with the monkey on their backs that is their current cost structure.

The reason the Big 3 are at the table right now is because a) idiot foreign, energy, and fiscal policies allowed the price of oil to skyrocket faster than ANYONE (especially Toyota, who introduced about 3 vehicles this year that went BACKWARD in fuel economy) thought possible, killing sales of the only vehicles their costs structures would allow a profit on (trucks and SUVs), while b) the same idiot look-the-other-way cronyistic fiscal policies made it easy for well-connected CEOs to utterly scuttle the finance industry, while they parachuted out under a golden glow. And there's STILL no accountability for them.

But everyone goes into apoplexy when GM and Chrysler want a tiny fraction of the money we've allocated with ZERO oversight to a few financial firms, and we make them give everyone in Washington a deep tissue massage before the legislation stalls. Twice.

The Big 3 wouldn't have needed this money if fuel prices and the financial industry had stayed stable.