Bailing out the Big 3 – A Plan

Today Congress asked the Big 3 to come up with a plan for how they would use the $25 billion of taxpayers’ money they are asking to be allowed to transfer to the UAW.

I do appreciate the whimsical entertainment these executives of, temporarily, billion dollar companies provided by going begging in Washington without a plan in the first place. I wonder if that’s how they approve new car designs, without plans? I’m equally impressed by the fact that our elected representatives gave them dozens of hours of attention before raising the point. Still, just before they boarded their private jets to fly back to cloud-cuckoo land these captains of corporate welfare had the temerity to say, “We’ve all got our own strategies, you know, and there’s only so much we can make public in view of the fact we’re competitors.”

The answer to this is, “It’s obvious we don’t care what your secret plans are, you dolts. If you could come up with any kind of coherent plan it would be news to all of us. The only planning we’re interested in is how you will reduce the ruinous costs you incur as poorly run Health and Benefit Administration companies. Your secret plans for your sideline, building cars, are worth less than options on your stock.

Just to prevent confusion on your part, here’s an example of what would constitute “A Plan” –

We will reduce our overall cost of labor and benefits to the levels of successful auto manufacturers. At minimum we will take a 30% across the board reduction in total compensation. That does not mean an average, that means every employee, executive, Board member and pensioner. We will further reduce executive perks by 75% and we’re willing to let the UAW decide the specific reductions. Their leadership will similarly reduce their perks at our discretion. Money saved here will go directly to support pensioners’ benefits.

Any and all contributions from the Big 3 and our Unions currently being made to political parties, PACs, “causes,” or lobbyists – including the salaries of all employees engaged in lobbying – will redirected to sustaining our pensioners benefits. These payments will be maintained at current levels for 5 years, at which time we will ask Congress to review the necessity.

We propose that Congress redirect the $25 billion already approved to help us retool to meet Congress’ draconian CAFE standards into annuities for our pensioners. Whatever exists in current pension accounts will be added to those annuities in addition to amounts mentioned above. Any shortfall in the required funding will be made up from perpetual options to buy our stock at 2 times the closing price on December 1st, 2008. We are sorry promises made to the people who built our companies cannot be better met, but this would be a deal superior to what they’ll get if we liquidate. In any case, since they helped build this mess, they will have to help solve it.

Finally, should this plan fail, we ask that a further $25 billion be allocated to provide unemployment benefits and/or retraining on an equal dollar basis to all employees who would lose their jobs as a result of liquidation. That is to say, a lump sum payment to each employee to be used however the employee wishes. It’s not that we expect the Federal government to do a good job administering this, but it would obviously, and sadly, be better than anything we could come up with.

Meanwhile, as the useful bits of our physical assets would then necessarily be parceled out to Honda and Toyota at even less than they’d bring now, and the replacement parts manufacture industry would explode, we urge those companies that benefit to learn from our example. Also, we beg forgiveness in advance from our stockholders and from the American people for destroying hundreds of billions of dollars of our societies’ wealth.

In return we ask that Congress and all regulatory authorities allow us to build cars as we decide to build them. All regulation enacted since 2006 is frozen. We desire no turnback of safety, emission or mileage standards, simply that they will not be changed by government until at least 2018. If we are still capable of innovating, let us do so. If we are not, let us fail.”

That would get my vote, and my assistance in a “structured bankruptcy” to bring it about. Otherwise they can have an unstructured bankruptcy.

Comments