I heard on the news (always a reliable source of unbiased truth, of course) that the federal government is considering expanding the “reward for bad decision” ‘bailout’ to auto-makers. This latest national socialist move was virtually demanded by Nancy Pelosi and others with a national socialist bent. Their reasoning, as far as I can tell, is that they feel that those companies are “too important to let fail.”
Why are they losing money (if indeed they ARE actually losing money, as opposed to simply not making enough billions to make the CEOs happy)? The reasons are manifold.
Could it be that in a time of record gas prices, the US auto makers have put themselves in a situation where they rely on enormous SUVs and huge pickup trucks for the majority of their sales? While Japanese car companies have for years been deluging our markets with small, fuel efficient, and relatively cheap cars, our auto companies have focused on SUVs larger than most third world houses, and pickup trucks in which most people never put more than groceries? I saw an ad on TV today that you can now buy a Cadillac SUV for the low low price of $57,000. Excuse me? People are losing their jobs, homes, and retirement accounts, and Cadillac expects us to buy a gas-guzzling giant SUV for $57,000? The US auto makers are trying to sell luxurious land yachts with DVD players, 120G hard drives, and automatic everything, that won’t easily fit in the average modern driveway and takes $100 to fill the tank; and at the same time, the average US car BUYER is eagerly looking for a rough equivalent of the Ford Pinto.
Gas was over $4 a gallon for a while. Anyone who doesn’t think it can get that expensive again is foolhardy, to say the least.
Why do the car companies think they can ask that much money for a car? Could it be that the US car companies pay their workers, on average, $30 more PER HOUR than Japanese auto workers? Could it be because retirees get bigger pension checks than a large portion of the American public who work full-time jobs make on their weekly paycheck?
An interesting personal anecdote: My wife bought a Chevy Tracker, which is actually a Suzuki with a Chevy emblem on the grill. Anyway, there is a small electric fan that cools the air-conditioning condenser, that failed on her car. I called around to find a replacement. The cheapest I could find it from any GM dealer was $479! For a small electric motor with a small (10″ diameter) plastic fan attached. I called a Suzuki dealer, and found that I could get it for $225. It was the same part, but if it came in a box with “Chevy” printed on it, it almost doubled the price. Do we have to wonder why the US automakers are in trouble?
Now that union auto workers risk losing their jobs, the Democrats, who have long been the doting guardian of the unions, want to take our money, and hand it over to yet another “private” industry. National Socialism by any other name still reeks, and this stinks to the stars.