"What's good for General Motors, is good for America!"

[MMMMMM]

but Cyrus, those aren't really applicable points to the GM debacle/discussion, because GM went WAY beyond what most would consider good employee benefits and wages. GM paid really really HUGE benefits and high wages and as such the situation simply wasn't sustainable. The health and retirement benefits they offered were simply enormous and very costly to the company on a per-labor-hour basis; sorry I don't have the figures in front of me as I read the article weeks ago.

A different company's mass layoffs might provide more appropriate fodder for the discussion you envision. GM's problems however were simply inevitable because it was so very far on the side of highly paying workers and providing such tremendous benefits.

[Cyrus]

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It's good if you are an executive at GM and you aren't the one losing your job.

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Before someone else mentions it, I will point out that, rather exceptionally, the GM top executives took a forty percent paycut in their salaries this year. Granted, this does not affect their stock options. And, granted, when we are talking about multimillion-dollar salaries, this does not make them paupers.

But, still, they took it in the chin, too, somewhat.

This does not mean, of course, that GM executives or shareholders are affected by the job cuts in any comparable way as the laid off workers! So, the quest remains open:

If "what's good for GM, is good for America", you gotta define "America".

[WillMagic]

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So "understanding economics" means that the best thing for the US is to do what is worst for its workers (ie, let them try to compete against countries that trash their environment and have absolutely no worker's rights)?

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Wow. Well, I guess I have to begin somewhere. First off, understanding economics means, in the way I used it in regard to Cyrus, understanding why protectionism is bad on the whole. Certainly for a few people, protectionism helps them slightly...it will give them slightly more time before they are let go from a job they are being overpaid for. But the net effects of protectionism on the country are devastating - basically, to help those few workers keep their jobs TEMPORARILY, a number of bad things happen.

First, the price of goods goes up for everyone, depending on what goods have tariffs placed upon them. Let's start with, say, textiles from China. Say we were to place a 28% tariffs on all goods from China (something that was seriously proposed by Chuck Schumer and has significant support in the Congress.) The few thousand people working at manufacturing textiles would be relieved of the stress of changing their employment. In exchange, every one of the 250 million people in the United States would have to pay 28% MORE!!!! for their clothes. The standard of living of EVERY SINGLE PERSON IN THE NATION is reduced. Now, do this once, with one industry...and the effect isn't large...but the benefits were smaller. Do it with ten...then you start seeing noticeable effects. People on the poverty line suddenly fall below it because they have to pay $55 dollars for jeans instead of $40, $25 dollars for the new toy their kid wants instead of $20, and so on and so forth. Oh, the rich can afford protectionism, sure. But the poor can't.

Oh, and how about world poverty? Obviously it's a tragedy to put the third world through that, no? I mean, we're so much better off. But suddenly that Chinese factory worker who was making $2000 a year now makes only $1200 - because the factory owners can't sell as many goods, they aren't bringing in as much revenue, so they can't afford any more workers. The more protectionism we use, the more poverty we create in other countries.

But they are foreigners. They don't matter.

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What if, just what if, this belief in liberal economics just ISN'T the best thing right now for the US working class?

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On the contrary. I just established how protectionism pushes prices up and how free trade brings them down. The US working class would be able to get significantly more out of their incomes if we abolished all tariffs and subsidies.

That's all for now.

Will

[WillMagic]

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GM's problems however were simply inevitable because it was so very far on the side of highly paying workers and providing such tremendous benefits.

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That, and the fact that nobody wants to buy their cars.

GM is just a poorly managed company through and through.

Will

[adios]

There are only good and bad choices, not two bad choices with one being worse than the other? GM actually has other choices available. To maintain the status quo at GM IMO will almost certainly require a chapter 11 in the not too distant future. And in chapter 11 ....

GM could "restructure" by selling parts of the business to others and I refer you to previous "restructuring" of this sort for troubled businesses and what that led to. I don't think a liquidation is a practical alternative. American taxpayers subsidize GM employees??? I don't think so. Is Kerkorian's interest in GM real? I would think so but I am certain that he would be much more ruthless in cutting employees and cutting pay.

GM's a sick company, no good choices for a sick company except to try to heal themselves and I'd certainly be interested in reading what alternatives would be better for GM.

[adios]

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Since when is firing people a good thing for GM????????????????

IMO they'd much prefer to be making a profit, growing sales, and hiring new employees.

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It's good if you are an executive at GM and you aren't the one losing your job [img]/images/graemlins/smile.gif[/img]

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I get it companys don't need management, they just run themselves. Ok sure. As Cyrus pointed out GM execs have taken pay cuts.

[WillMagic]

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It won't. The users on this board have put their heart into the philosophy that liberal completely free market economics is inevitable

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I certainly would never argue that. I never count on governments to enact sound economic policies - but then, I never count on government to do anything right.

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and the best thing possible.

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This I do think.

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I have started a few posts on here debating the point that A. worldwide liberalization has NOT always been successful in making some 3rd world countries more prosperous

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Not always successful is a pretty easy criterion to fulfill. Gee, you win on the point that liberalizing trade hasn't brought every single third world country into the first world. Whoop-de-doo. But on the whole free trade has been a massive boon to the third world...for chrissakes, just look at China and India and Southeast asia and South Korea. It's amazing, the economic growth that they've gone through. And you don't have to take my word for it. Check this out.

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and that B. free trade agreements have not succeeded in making the US working class more prosperous.

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Well...you're wrong. Very simply. They have. You can look at the stats if you want - they are also in the previous link. The logical reasoning behind this is in my other posts in this thread.

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Rather than debate these points, most people just argue "free and open markets are inevitable, anything else is bad" without really looking at any of the evidence showing why this might not be the case.

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Golly would I love to see some evidence. Bring it forth!

Will

[adios]

C'mon you know full well that in the USA there are job categories that can't meet the demand from employers. I have stated many times that unskilled, uneducatied laborers are not in demand. Generally speaking in growing nations like China where labor is relatively cheap, the standard of living is on the rise. Why are Americans entitled to a higher standard of living than the Chineese for instance? The answer is that they're not. You may have noticed that growth in the U.S. economy has exceeded 3 percent for 10 straight quarters, the longest string since the 13 quarters that ended in March 1986 and the best performance among nations in the Group of Seven industrialized nations, which also includes Japan, Germany, the U.K., France, Canada and Italy. There are new jobs being created, wages are rising. Why is this a problem? Education and training that provide people with the skills employers demand is the key and I will say that the school system in the US is failing alot of students between the ages of 10-18 inclusive.

[hetron]

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It won't. The users on this board have put their heart into the philosophy that liberal completely free market economics is inevitable

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I certainly would never argue that. I never count on governments to enact sound economic policies - but then, I never count on government to do anything right.

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and the best thing possible.

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This I do think.

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I have started a few posts on here debating the point that A. worldwide liberalization has NOT always been successful in making some 3rd world countries more prosperous

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Not always successful is a pretty easy criterion to fulfill. Gee, you win on the point that liberalizing trade hasn't brought every single third world country into the first world. Whoop-de-doo. But on the whole free trade has been a massive boon to the third world...for chrissakes, just look at China and India and Southeast asia and South Korea. It's amazing, the economic growth that they've gone through. And you don't have to take my word for it. Check this out.

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and that B. free trade agreements have not succeeded in making the US working class more prosperous.

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Well...you're wrong. Very simply. They have. You can look at the stats if you want - they are also in the previous link. The logical reasoning behind this is in my other posts in this thread.

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Rather than debate these points, most people just argue "free and open markets are inevitable, anything else is bad" without really looking at any of the evidence showing why this might not be the case.

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Golly would I love to see some evidence. Bring it forth!

Will

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Ok first in response to point A.

China, India, South Korea, all initially revved up their economies with interventionist policies that eventually lead to their booms. However, there were many other countries in the 70's that underwent a boom, that upon privatization and opening of their markets, subsequently tanked. I present to you basically all of South America as an example. Brazil, Argentina, Venezuela all had substantial increases in GDP in the 70's a lot of which went into the crapper when they began to privatize their markets.

In response to point B., the overall growth in US income has mostly been realized by the upper classes. Here is a link:
link

please feel free to comment.

[hetron]

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Since when is firing people a good thing for GM????????????????

IMO they'd much prefer to be making a profit, growing sales, and hiring new employees.

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It's good if you are an executive at GM and you aren't the one losing your job [img]/images/graemlins/smile.gif[/img]

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I get it companys don't need management, they just run themselves. Ok sure. As Cyrus pointed out GM execs have taken pay cuts.

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They do need management. I didn't say they didn't. I'm just saying it's good you know you won't be lining up for food stamps any time soon.