Sen. Chris Dodd was on Charlie Rose for the hour tonight (11/26). If you missed it, it’s really worth watching. He also stressed the need to regain confidence. I think he realizes we’ve been lied to so much that confidence will be slow in returning. He doesn’t seem to get it that we don’t care to hear anything from Bush or Paulson – the consumate liars.

I still think Paulson/Bush’s refusal to help GM/Ford/Chrysler is a political thing; retaliation for the UAW campaigning so strongly with money and work for Obama. BushCo do not give a rip what happens to the industry, the millions of jobs involved, the cost in tax revenue, the hungry people, or anything else. Paulson let Lehman Bros. fail because of a personal vendetta.

Sen. Dodd is concerned about the further damage that is possible between now and Jan. 20, ‘09. It’s not too late to impeach the entire executive branch. It won’t happen, but it should.

and
3. Intel abandoned semiconductor memery production (it had invented it) and concentrated on micro processoes — producing the 386 in 1985(?) which made them rich and successful (by their own hand!)
4.After the (”floating point error” in the original Pentium led to a megamultimillion dollar voluntary (after some waffling) recall.

Government action was absolutely essential to the surivival of semiconductor mft in the US. Today, in most years, Intel’s profits exceed the sum of profits of all semiconductor mfrs in the US and the world. Well worth saving.

Government protection (big tariffs, gradually reduced) was essential to the survival of Harley-Davidson which sells lots of hogs at huge prices in Japan.

Government protection in the form of a 17% tariff for small trucks was essentialto the survival of that industry, but Nissan and Toyota burrowed under the tariff wall in plants in Tennessee and Kentucky. Toyota exports some American-made models to Japan. US ow has a Hyundai Plant in Georgia.

Low US labor costs,Sec. 14(b)of the NLRA (allowing states to forbid union security clauss, and huge state inducements were essential to attracting BMW to S.C. and Daimler Benz to Alabama. Eachof these plants was soon surrounnded by parts and service companies. VW had a Rabbit plant in Pennsylvania.

So much for the glories of free trade.

So, yeah, Chapter 11 does indeed “mean curtailment of services”. Also, the term “bailout” is a fraudulent misnomer. GM is asking for a simple bridge loan that will be repaid. Similarly, their current “business model” is actually much improved already, they simply need a chance to continue implementing the changes already well underway.

I am not proposing to close down the Big 3. I clearly wrote that “I am rooting for them to succeed under Chapter 11, so that they can give the Japanese carmakers a run for their money and the car buyers will ultimately benefit from better cars.”

However, I do not believe that a direct bailout is the right way to help them either. Much of the Big 3’s troubles are self-inflicted – they are victims of their own incompetence. Even if they are bailed out but they do not fix their business model, even most American car buyers will continue to buy Toyotas, Hondas, even Nissans and Kias.

As a poster in another forum wrote: Going through Chapter 11 doesn’t mean curtailment of services. The whole point of rehabilitation is to temporarily protect the company from its creditors so it can prioritize its cashflow to critical areas.

Chapter 11 will force the Big 3 to become efficient, or close down.

Patents (intellectual property) will go to whoever is first in line in any number of scenarios, if the Big 2.5 fail. That means that all research done on the Volt, for instance, falls into the hands of the Chinese (or whoever gets their hands on them).

That would very likely make it more difficult, going forward, for the US to produce quality, viable electric autos — because we’d have to pay the patent owners for every single use (of every single patent) for the new electric vehicles.

Clearly, there are large forces who would prefer to get their hands on these patents, and then charge us to use them. Other forces would clearly prefer that we remain wedded to oil-based transportation, so it’s in their interests to see the Big 2.5 go under.

Sen Richard Shelby of AL seems to be a handmaiden to those forces, all of which present obstacles to retooling toward a greener economy — which GM is clearly attempting with the Volt, on which it currently holds key patents.

Without insulting any non-US companies or citizens, from a practical point of view it is extremely important to keep the companies afloat and the patents in US control. Or at least, that’s the way it appears to this onlooker.

EW has a detailed post here:
http://emptywheel.firedoglake……nt-mi-now/

Everyone makes mistakes.
It’s when people fail to own up to their mistakes that I lose all patience and my urge to ridicule kicks in.

I hope Sen Shelby becomes a public mockery, a defrocked, humiliated public example of what happens when a person continues to entrench themselves by lying.

Must be hard to have had all kinds of people curry favor with him, boost his ego, and now that the meltdown is in full force he’s evidently utterly incapable of even an iota of taking any responsibility.

Pathetic.

Admittedly, this is a domestic political issue in the US due to the prospect of people losing their jobs. But would the US bail out Toyota if the latter was also in a similar situation – I don’t think so.

Nonetheless, I think Obama is making a mistake pushing for the bail out of GM, Ford and Chrysler. Doing so will be rewarding poor performance.

I agree with those who propose to let the Big 3 file for Chapter 11 and go through the difficult but necessary steps to rehabilitate themselves and become truly competitive. Harley-Davidson’s turnaround success story was not because of government support. Rather, it was the result of a deep internal corporate soul-searching that led to a firm resolve to reclaim lost glory.

Unless the Big 3 fix their broken business model, a bailout is just throwing good money after bad. I am rooting for them to succeed under Chapter 11, so that they can give the Japanese carmakers a run for their money and the car buyers will ultimately benefit from better cars.

I have already cited the turnaround success story of Harley-Davidson. Let me add another one.

In the late ’80s, the global electronics (specifically, semiconductor) industry was dominated by Japanese companies. In terms of market share. NEC, Hitachi and Toshiba comprised the top 3. Only three American companies were found in the top 10 – Texas Instrument, Motorola and Intel. The rest were Japanese or European (Philips).

Intel is fortunate to have a golden product portfolio of microprocessors. On the other hand, TI and Moto realized that for them to remain in the top 10, they had to make drastic improvements in quality and cost. TI strengthened its enterprise systems and partnerships with her vendors. Motorola focused on quality improvements and leadtime reduction.

Both American companies rose to the challenge of the Japanese dominance in their industry. They made great strides in quality – Motorola was the first winner of the prestigious Malcom Baldridge Quality Award (twice actually, in 1987 & 2002); TI won in 1992. Their programs also resulted to better on time delivery – a must in a very competitive market with extremely short product life cycles.

By the middle of the ’90s, the top 6 semiconductor companies in the world were three Japanese, Intel, TI and Moto – not necessarily in that order. Except for Intel who became numero uno because of the success of Pentium, the rankings from 2-6 often changed and were mainly due only to forex conversion. In short, the two American companies gave the Japanese a run for their money.

TI and Moto succeeded because they worked on their weaknesses, had a clear plan and strong desire to compete and fight for market domination. They did not ask for any government bailout or funding.

In the case of the Big 3, US House speaker Nancy Pelosi put it very succintly: “Until they show the plan, we cannot show them the money.” At this point, my stand remains – a bailout is throwing good money after bad, given the past financial performance of the Big 3 and lack of strategic initiatives they are offering for the future.

Chapter 11 will take away the crutches and force the Big 3 to compete for survival and eventually, dominance – if they really want to fight.

Looks like this current mess took root and became bloated on his watch.

My state (WA) just announced last week $700 million in cuts to Higher Ed.

Compare that to the $400 MILLION that Citibank’s paying for “naming rights” at the Mets’ stadium.

I want to have a huge, screaming fit every time I think of that. Why, oh why doesn’t the “Invisible Hand” that’s writing those checks to Citi demand a “credit” for the $400 Million that Citi clearly doesn’t “need”?