Widgetized Section

Go to Admin » Appearance » Widgets » and move Gabfire Widget: Social into that MastheadOverlay zone

Auto Bailout

By
December 2, 2008

Ford is proposing as condition for government bail out, its top executive would get a salary of $1 for next year, and would sell off most of its branches and dealerships,

http://usnews.rankingsandreviews.com/cars-trucks/daily-news/081202-Auto-Bailout-Big-Three-Make-Second-Pitch-to-Congress

Instead, how about Congress subsidize half the workers salaries up to 15,000 a year of whenever the auto companies sell off. And after 90% is sold off, the automakers employee’s salaries would also be guaranteed for the rest of the year.

The problem, with today’s bankruptcy laws, is that the assets stay frozen for months until the bankruptcy court decides what to do about them.

If in the future, companies before they declare bankruptcy should be able to declare themselves distressed and get some benefit for selling 90% of their assets. Even a small family owed company where there are no eager to work heirs, could be encouraging to stop functioning in such a way that the work they perform continues. The going out of business laws in this country should be changed to allow someone to take over what they do, and use of their equipment and facilities instantly.

Whether or not any of these ideas work, I hope to start a discussion of changes that might work, to discourage unused assets and property of remaining dormant while the lawyers and courts decide what to do.

Richard Kane of PA or
RichardKanePA

One Response to Auto Bailout

  1. woody188

    December 3, 2008 at 4:11 am

    Funny how Ford claims it has liquidity to last into 2009 out one mouth, while begging for a handout out the other.

    GM and Chrysler appear to be in immediate danger with GM claiming they would be forced into Chapter 11 filing by the end of this month if they don’t get their bailout.

    Here’s an idea, fire Wagoner, Mulally and Nardelli, and their corporate boards and make them return their pay from at least 2005 as it was apparent back then they were in trouble and they did nothing then when they could have done it. Use their salaries to pay union workers. Wagoner’s 2007 compensation package alone totaled $15.7 million. Mulally’s 2007 package was $21.67 million. Someone needs to be held accountable.

    Sell their American plants via financing from their portion of the $25 billion to companies like AFS Trinity that have already designed better fuel efficiency but the Big 3 refuse to license their tech. So why not let AFS Trinity directly build using the plants and workers from the Big 3? The Big 3 seem hellbent on leaving manufacturing in the US for overseas areas anyway. Like GM’s new engine plant in India. Or Ford’s new state of the art factory in Brazil. If we bail them out, they’ll just invest it into more overseas production.

    I see no reason to allow the same people that have failed consistently over 30 years to continue to fail on tax payer dollars versus investor dollars. But we don’t need to allow their workers and plants to shutdown when we can have the government loan AFS the money and create the deal to transfer the capital and workers over to them. Workers should be offered profit sharing, stock options, and ownership stakes in AFS should pay cuts be required. It would hurt for a few years, but it could pay off huge in the long term.

    Keep it going, more ideas!