JayB

Shouldn't you be busy buying puts on the Loonie, eh?

Too bad the US Government insures those pensions and associated health benefits, huh? The bill for paying for it in the event of the big three failing is more than the mooted bail out monies...and somehow, I just can't see the house of representatives voting to terminate the PBGC or the FDIC... Thanks for the humor everbody, please carry on... btw, retooling means throwing out or selling as scrap old tools to buy new ones...it's kinda expensive. The unstated major premise here seems to be that $25-$50 billion will prevent, rather than merely forestall, their bankruptcy.

Original Commercial... [video:youtube] Pre-launch marketing meeting at Hasbro: [video:youtube]

Some concrete figures: http://www.dol.gov/asp/media/reports/chartbook/2008-01/index.htm My evil homonym might find a set of stats that's less susceptible to manipulation than official employment figures in there as well.

You may find that the outcomes that result from so many people out of work living in densely populated areas in the current economic climate a bit more "dubious" than the "what's good for neoclassical economic abstractions must be good for America" idea you're running with. Quite interesting, this newfound disdain for abstraction. What has sustained the average historical materialist for the past 150 years if not economic abstractions? Never seemed to be terribly good for producing food, clothing, or any other output that required coordinating supply and demand, allocating scarce resources that have many alternatives, etc - but you've long sense abandoned your efforts to defend those ideas, or the regimes that attempted to implement them, so let's turn from the abstract to the concrete. Simple question: which country [on this planet, populated with real people, defined by real geographic borders] most closely approximates your ideal society? Once you've tethered your ideals to reality, we can confine the discussion to the concrete differences between the country that most closely embodies all of your ideals, and the country that's most at odds with them. I assume that the US will fall into the latter category. If not, please correct me.

Real product. Real ad. [video:youtube]

Really. In Kentucky, of all places... [video:youtube]

I'd venture that in Seattle, at least, a given person's enthusiasm for the Big 3 bailout is inversely proportional to the probability that'd ever buy a car made by them.

the margins were higher on gas guzzlers so this is what they sold here If they hadn't continually hammered american consumers about how macho and better SUVs are, and instead expounded on the virtues of energy efficient vehicles it wouldn't have been difficult. Americans were a long way to being sold on fuel efficiency after a few years of Carter policies and other people not exposed to detroit pro-SUV advertising, have no trouble with smaller cars and no particular desire to drive a tank around town. False. There nothing arbitrary about taking into account huge subsidies to oil companies (waved royalties, tax breaks, military cost to secure the resource, etc ..) We can be sure that if they had retooled they wouldn't be as badly off as they are today. The rest is speculation. That's far from certain. [Cough, cough "Saturn."] The first iteration of "Retooling" in the 1970's gave us the Pinto and the Vega. Their perpetual failure to make small cars that people were willing to buy at prices above the cost of production since that time shifts the balance of probabilities decisively towards a scenario where hastening to crank out more unpopular vehicles leads to accelerating losses and they implode sooner.

Amusingly they made money hand over fist selling things that people wanted but our free marketers now think that this was a "bad" thing and no government help is necessary. Of course the banks who made money hand over fist selling things that people wanted now deserve a bailout. Nothing wrong with making things that people want to buy. Plenty wrong with the keeping them in business when they no longer make things that people are willing to buy at a price that exceeds the costs of making them. If only people involved in manufacturing buggy-whips and whale-oil lamps had had such ardent defenders back in the day....

How does the fact that GM has subsidiaries or ownership stakes in other car companies operating in virtually all of the places that fuel is expensive (Opel, Holden, etc) factor into this analysis? Also, how would forcing them to retool and manufacture all, or primarily, small vehicles have made a difference if they weren't able to generate profits on the small cars that they were already selling under their existing cost structure? E.g. - if the small cars that they already made were unpopular and often sold at a loss, how would a government mandate to create more of them have made them any better off? If the government *had* arbitrarily changed the market by putting a mandatory floor under fuel prices, what's to say that the increasing demand wouldn't have been captured by the automakers who were already able to sell small, fuel-efficient vehicles that people already wanted to buy even in the absence of such government mandates?

I spent quite a bit of time in the river valleys of the Northeast, and pretty much every river I kayaked down had one drop created by the breaching of a dam associated with a long-deceased factory, the decaying remains of which were often part of the riverside landscape. Once their output rose from a net loss to a zero upon closing and liquidation, the net benefits that they generated for society were effectively optimized. Had a crack team of progressive economists and futurists concocted a scheme to keep them generating outputs worth less than their inputs (the inevitable consequence of ignoring profits), the net loss to society would have been immeasurably higher. The fundamental delusion here seems to be that shifting resources in such a manner that you produce outputs worth less than their inputs, you're playing a zero sum game, and the pool of resources available to society is unchanged. This is no more the case than a lone subsistence farmer can elect to use 100 meals worth of energy rolling a large stone back and forth across his fields, instead of using the same energy to grow 150 meals worth of crops without sustaining a net-loss in the amount of resources available to him to live on. The fact that unlike the lone subsistence farmer, we live in a vastly more complex society where we're both producers and consumers, makes it more difficult for the average person to appreciate this reality, but does nothing to change it. There's a set of resources available to everyone who's laid off already, and since virtually *any* scheme to help them relocate and retrain these workers will cost less than either maintaining the status quo or employing them in the 21st century equivalent of rolling a large stone back and forth down a dirt-road (perhaps with the said team of futurists and progressive economists coaching them as they go), I'd gladly support increasing the benefits available to auto workers over 20 years of state-sponsored stone-rolling.

"Hey! No...Over here! Hey, yeah, look over here! The unions! Yeah, the unions did it all! Hey...hey wait! Look over here. Hey, where you going...hey. Hey?" Somehow foreign auto markers operating in the same market managed to manufacture and scars that sold for more than they cost to make, thereby navigating around the "wall" that you reference. I invite you to explain what accounts for their differing fates in the same market.

If you think profits are expensive, you should compare that with the social costs of systematic inefficiency and resource misallocation. Were these equal to profits, socialist economies that eliminated profits would have been just as prosperous as market economies. If they had a lower cost to society, East Germany, for example, would have been more prosperous than West Germany, and North Korea would be an earthly paradise. Were profits more expensive than waste and misallocation, China and India would have undergone immediate and sustained declines in their standard of living as soon as they began to substitute prices for central control. Profits generated in an environment where supply and demand determine profits represent the price you pay for allocating assets as efficiently as possible under the constraints on information and decision making imposed by reality. Not all decisions made by all persons lead to an optimal allocation of resources - but even when people who (thankfully) have the personal and political freedom to do so choose to buy TruckNutz instead of T-Bills, the overall "cost" of this behavior is a fraction of what it costs society when you take these freedoms out of their hands and transfer it to someone else. In short, things that are immediately profitable and aren't "inherently useful" are quite a rarity. You may not agree with the way the person who wants to use something they buy defines "useful," but on balance they're much more likely to be right than you or anyone else who wants to make all of those decisions for them, and the costs that they impose on society to be much lower as well.

Yeah, been to Detroit lately? I could recommend some photo sites. Not looking like the jobs already shipped out or eliminated were ever replaced to me, despite the "know how", productive capacity, and willingness to work unless you count crime, prostitution, and subsistence farming as job retraining. Thanks for pointing out one of the benefits of organized labor...As far as the last sentence goes, I haven't heard much criticism of a plan that expends criminal amounts of limited resources on an investment class that has taken the economy over a cliff. But goodness me, their distress and anxiety must be something fierce. Given that you're someone who defines "freedom" as the gluttonous consumption of an endless array of nearly identical products designed to become obsolete before they reach home without regard for the conditions under which they're made or disposed of, your bleatings on "finite" and "limited" resources border on obscenity. Your usual rhetorical prowess in service to a complete disconnection from social reality is on full display here. It is your trademark after all. That 3 million people are at risk in a geographically determinate area completely escapes you? In the present economy, is "another company" going to come set up shop in a region that was already economically depressed to begin with? Are these "free laborers" going to migrate to put their auto skills to work? Where? Are we talking about a new generation of Okies? Will they wait? Will the aliens land in the blasted wastes of Detroit when the UAW is finally busted through mass starvation? What's the plan? They got Faygo in New Zealand? [video:myspace]http://myspacetv.com/index.cfm?fuseaction=vids.individual&videoid=20874168 Not sure I could detect an explicit argument in that salvo, but the unstated major premise seem to be that we'd all be much better off maximizing the labor costs required to generate every unit of output. If this is true, then then optimizing the standard of living in any given society would be easy. All we'd need to do is eliminate every single labor-saving device at our disposal - computers, machinery, the lightbulb (let's not forget about all of the candlemakers thrown out of work by the advent of the lightbulb) - and voila! Said society achieves it's maximum theoretical standard of living. If you don't actually believe that labor-saving devices *reduce* the material standard of living in any society where they are employed, then I invite you to explain how labor-market regulations that achieve the same end make everyone better off. As for Michigan and Detroit, the reason that they have been in decline for decades, is that it costs more to generate goods and services there than it does elsewhere. Were labor unions endowed with the magical ability to preserve jobs that you attribute to them, then the decline that you lament never would have happened, and the non-union folks working for Japanese and German automakers in the south would be itching to trade places with their UAW counterparts in the big three. High labor costs relative to the value of the production, and high taxes on what's produced are the prime culprits - and the decline will continue apace until one or both change relative to output such that opening and operating a business in any city in Michigan starts to look like an attractive proposition. Spending billions of dollars to subsidize the production automobiles that cost more to produce than people are willing to spend to acquire them will forestall the inevitable until the money runs out, but nothing is going to save the big three or the UAW other than lowering the cost to produce a vehicle in one of their plants, or increasing the amount that people are willing to pay for them, or some combination of the two that results in something other than a net loss. Sorry. The people who aren't employed after the inevitable reorganization occurs - whether conducted by the government or in a bankruptcy settlement - will have to find jobs elsewhere. It's hard to imagine a government financed severance-and-retraining package that would make less economic sense than subsidizing the status quo in Detroit.

Trial and error. So far, in general, here's what's worked for us: Bad - long routes where I'm at my mental and/or physical limit at some point on the route, there's time/weather pressure, and it's cold out. Good: Short routes at my limit that she can decline to climb or lower off of if the climbing turns out to be no fun, or cruiser routes that aren't mentally/physically taxing for both of us (one exception is slab routes where I lead the hard pitches), there's no time pressure, and it's warm and/or sunny out. Getting the outings in that would suck as a couple, or pursuing hobbies that she's not into (kayaking) when she's got other commitments is also a win-win. Trying to live by the golden rule never hurts.

After 8 years you still need to be convinced? Please describe what principles are being used to disburse the bailout. Go ahead, I dare you. They didn't need a wheel, they had their cronies calling them. Hmmm. Maybe this guy has more influence than we thought. Now it's all clear... [video:youtube]

Given the people who owned the assets didn't know how to value them methinks Helicopter Ben Bernanke and Hank God from Goldman Paulson got conned or were conning us. Occam's razor suggests we gave JPMorganChase $25billion to remake the banking industry, no more, no less. Yes there's pain involved, as there will be for Detroit. Why not give the big 3 $25 billion to buyoff the union 'tards and be done with it? "I don't care how dumb it is" is the order of the day. The inability of any commentator to offer up a non-apocalyptic rationale for a bailout that is looking less apocalyptic by the day is proof - as if we needed more proof that any legislation passed through in a couple weeks under Bush is a steaming pile of shit designed to screw all parties. IMO a $25 billion payment to maintain all UAW employees in idleness until death would be a bargain, and would also make the ultimate outcome of, and rationale for the payment clear to the average observer. Ditto for the steel tariffs that Bush pushed through. Would have been much cheaper to set up every steelworker that lost his job due to overseas competition up for life, and would have had all of the advantages outlined above.

It's much better to shift state resources to support failing companies so they can then use state resources to acquire successful companies as we are currently doing in the banking sector? Seems like most successful banks are more likely to be the ones doing the acquiring, from the news that I've been following. Perhaps Countrywide and WAMU constitute a "success" in some frame of reference. Again, so why did we give JPMorgan Chase $25 billion to buy more banks? Clearly, the folks at the Fed and the Treasury had a "Wheel of Fortune" like device with all of the sectors of the economy on it sitting around in the basement, and after the spin the winner was "Banking and Finance." Less costly than the alternative, would be my guess. Is this still part of the effort to establish the "No matter how dumb, as long as it's "fair" model as a general template for managing the crisis and/or the economy?

We've spent $350 billion to bailout Wall Street and have yet to buy a mortgage backed security. Please, please explain to me why those poor bankers taking home >$1 million are more valuable than the Union smuck making $50k No layoffs, bankruptcies, or acquisitions at banks or finance companies? That's certainly news. The folks at WAMU and hundreds of other enterprises will certainly be relieved to hear it. Much less the guys who made their living securitizing MBS portfolios. Bernanke et al must have concluded that GM, Ford, and/or Chrysler going under would be far less catastrophic than a wholesale financial crisis that enveloped the entire world. This seems reasonable to me, but perhaps a letter to Bernanke and Paulson would be in order if you've got the time. If "I don't care how dumb it is, as long as it's fair" is the argument of the day, I see no logically boundary that prevents me from assuming that you'd support the "No McMansion Left Behind" plan that I've outlined above...

It's much better to shift state resources to support failing companies so they can then use state resources to acquire successful companies as we are currently doing in the banking sector? Seems like most successful banks are more likely to be the ones doing the acquiring, from the news that I've been following. Perhaps Countrywide and WAMU constitute a "success" in some frame of reference.

My goodness. Quite a litany there! Apart from the personal stuff (not that I mind, I enjoy the bombast, particularly when it's directed at me), there seem to be a few specific points about the auto industry that are worth considering, as well as some about economics in general. Most here seem to think that if the big-three go bankrupt, all of their manufacturing capacity will be permanently lost, and everyone that worked for them will be permanently out of a job. This is possible if you assume that: every asset that they own is used to make cars that cost more to make than they can sell for and that no one would buy the profitable parts of the business, that no one employed there could make a living elsewhere or would be employed by the folks that bought the profitable bits, and that no auto manufacturer with operations in the US would take advantage of the opportunity created by the demise of the big three to expand operations here, and that a bankruptcy and subsequent reorganization of whatever productive capacity exists in each of the three companies would lead to the demise of all manufacturing. None of these scenarios is plausible, but this final argument reaches a conclusion so unjustified by the premise that the term "non-sequiter" seems inadequate to describe it. The second assumption is that auto-workers deserve some kind of special exemption from the realities that everyone else in society has to contend with. Each year millions and millions of people lose their jobs for reasons beyond their control, in business that are less visible and less adept at lobbing, but are no less essential for society. Their distress and anxiety when they lose their jobs is no less real than that of the auto workers. However, society doesn't expend it's limited resources keeping them indefinitely employed in enterprises that consume more of society's finite resources than they generate. This isn't for a lack of charity or goodwill. It's due to the stark reality that any society that allocated its limited resources in this fashion would rapidly impoverish itself and ultimately perish, in the same manner that a subsistence farmer who ate more grain than he grew every year would ultimately run out of food and starve to death. Whether you are talking about money or grain, an individual, tribe, or state - the underlying reality is the same. Consume more than you produce, and you can only post-pone the inevitable for so long. What surprises me, given the premises on display here, is that no one has stepped forward to propose a similar plan, and employ a similar set of arguments on behalf of the people who work in the construction sector. In that sector, the McMansion is the rough equivalent of the SUV - yet no one is proposing that we requisition resources from society to keep framers, dry-wall hangers, plumbers, painters, etc at work building McManisions that cost more to construct than people are willing to spend to buy them. Nor are we hearing the same apocalyptic warnings that if we stop paying people to build McMansions, soon we'll be unable to build any structure at all. Neither are we hearing that they'll never be able to find work constructing any other kind of building with another company, much less that they'll be rendered permanently unemployable. And finally, no contention that continuously cranking out McMansions that no one wants or needs is a smart thing to do. Why not?

I personally think it's useful to hedge your bets, learn all of the navigation techniques that you can, and employ them in whatever combination best suits the particular outing. IMO it makes sense to be overprepared and to have a fall-back method or two until you develop a sense of what you personally need to use, and/or what works best for you. You may end up not using a GPS unit, but many of them come in with built in altimeters, and also allow you to enter the GPS coordinates for a series of key points on the mountain while you are sitting at your computer. It only takes a few minutes, and you can keep them there for as long as you keep the unit. I usually logged a few key landmarks in advance for the "what-ifs" and then plugged in waypoints on the way up. Since I also brought/used a map/compass, sometimes I'd draw a couple of arrows with bearings towards the next set of key landmarks on the map before heading out. This may seem like overkill to some, but on most trips on the volcanoes, navigation was a team effort - and we always had more than one map, more than one compass, more than one altimeter/gps, and more than one person involved in all of the tasks that go along with navigating.

Venezuelans, take note...

That isn't a compelling reason? Our industrial prowess is, and always will be, the core of our military strength. If you are speaking of managerial incompetence, well, AIG is prime example of that on a bigger scale. Cigarette smoking union smucks vs. cigar smoking CEOs Using state appropriations to shift resources to inefficient companies that can't figure out how to sell what they make for more than it costs them to build, and ultimately away from those that can - is a surefire way to stifle innovation and degrade the nation's manufacturing capacity. I'm sure the troops in WWII were glad that they didn't find themselves fighting Panzer's with horse-drawn carriages because of Congress's efforts to preserve jobs in the buggy industry...