I see the bright lights in Congress have failed to pass a bailout bill for the auto industry. Nice to see that this historic election did nothing to cure greed, short-sightedness and placing ideology above actually helping people. Now to address a few myths.
- The American car industry did this to themselves by failing to make cars that people want. Horse hockey. The auto manufacturers have always done precisesly what the market dictates. Until this past summer when gas hit $4/gallon and above, fuel efficient economy cars only made up 4% of the vehicles sold in the US. This is not because consumers couldn't find economy cars, it's because they wouldn't buy them. Light trucks and SUVs, on the other hand, made up almost 50% of sales. This is why Toyota, Nissan and even Honda (the Ridgeline) introduced new and/or improved full-sized pickups and SUVs for 2008. If car companies could dictate what people drove, then everyone in the early '60s would have been driving an Edsel. Like every other business in the free market, the car industry makes what people want to buy. Period.
- The Big Three can't compete with Japan or Europe in making smaller cars. Two of the biggest selling brands in Europe and Asia are Ford and Opel, a GM brand. The best selling luxury car in Asia is Buick. Seriously. WAY more prestigious than a Mercedes! Europe and Asia have not had the luxury of subsidized petroleum prices, so they have been paying the equivalent of $5+/gallon for years. Therefore they demand more fuel efficient cars, and Ford and GM are happy to oblige. However, the price spike this summer took everyone by surprise and an industry as big as the Big Three can't turn on a dime. They need to shut down their North American manufacturing plants and retool them to make small cars, and that takes time and money. These would be very good loans to make (unlike the bailout of the financial institutions, which doesn't seem to have had any effect on consumers or taxpayers whatsoever) because there is every possibility they would be repaid, and that the taxpayers could even make money on the deal.
- Unions are the problem. Trust me, the current crisis is not because workers at the Big Three are seriously overpaid. The Big Three have inherited a lot of financial burdens regarding retired workers, especially their health care costs. Actual wages, worker for worker, are comparable to what the nonunion foreign car manufacturers pay in this country.
If you really want to help yourself in this environment, do yourself a favor, close your bank accounts and join a credit union. Credit unions are nonprofit. They don't charge ridiculous fees, and they are much more interested in individual account holders ("members") than they are in trading in shady mortgage packages or investing in credit markets that they don't understand.
Put your money in a credit union and let the banks go under.