Would it be cheaper to nationalize or do bailouts?

[Stinky The Clown]

Not specifically the car companies. Any company that has a chance for viability and has gotten in deep shit because of the financial mess.

Would we as a country do better to nationalize the companies, manage them back to health and to a more socially responsible course, and then reprivatize (sell) them in three or five or tens years?

There is precedent for nationalize industries in this country, although, to the best of my knowledge, not for the reasons we now face. In 1917 we nationalized the railroads. There reasons were manifold and complex, but essentially it had to do with World War I and the scores (hundreds?) of private railroads not being able to meet the national demand for rail service. That statement is a gross oversimplification, but it allows me to make my point.

After three years, the feds had made vast improvements in the railroads. Among other things, they standardized things such that rail company A could actually run on rail company B's trackage and rail company C could accept the tickets issued by rail company D, etc.

In 1920, the nationalized rail system was pretty much cut up back into the companies that had been nationalized, but in much better shape,and also under much stricter control by the Interstate Commerce Commission.

Again, this is a GROSS oversimplification of what happened. The essential point is that we have precedent for nationalizing whole industries and it was a largely successful experiment.

Would it work now?

[panader0]

1. Yes

Start with the oil companies. It's obviously in the national interest, even more so than the auto industry.

[ColbertWatcher]

4. I agree with this. n/t

[Vinca]

2. If any of the health insurance companies start to go down,

we should let them go and institute national healthcare immediately.

[ColbertWatcher]

5. And this! n/t

[JDPriestly]

3. No. A better solution is to renegotiated the free trade agreements

so that our exports are balanced with our imports. We should not permit ourselves to import several times what whe export.

Then, break up the companies that are too big to fail by amending our antitrust law to prohibit related companies from working together to prevent new companies from getting a good foothold in markets and then enforcing the antitrust laws.

Also, more money should be made directly available for loans for small businesses.

I'm for more real competition in the marketplace, not less. My stance on the trade agreements stems in part from the fact that sometimes, the companies against which Americans have to compete are owned at least in part by their countries' governments. That puts our companies at a huge disadvantage.

[ColbertWatcher]

6. And this! LOL! n/t

[ColbertWatcher]

7. And, I'd like to add that I think a bailout is dependent on ...

... how the company went under.

If they were just caught in hard times like we all are, then yes for a bailout.

But, if they are "struggling" with a CEO making a hugh sum and a history of screwing up, then fuck them. Nationalization and no bailout.

Good thread, can't wait to read everyone else's ideas.

[doc03]

8. Sorry I don't want to drive a Yugo n/t

[Stinky The Clown]

11. Thank you for your profound contribtion

I now have a great deal to consider.

:eyes:

[doc03]

13. If you nationalize the auto industry that's what you

will get a Yugo or one of those other pieces of junk made in the Soviet Block. I can't imagine what a car designed by Congress would be like. I think they should take the big 3 and break them up into about a dozen companies and let them compete. Same goes for a lot of industries, companies need broken up like they did in the early 1900's with Carnegie Steel and Standard Oil and other monopolies..

[Greyhound]

9. Cheaper and more effective. There are probably three or four industry sectors that

it would behoove us to nationalize right now, I believe.

[mwooldri]

10. Yep, definitely.

WWII - afterwards the UK went on a HUGE nationalization spree from 1946 through 1981. Labour started it, the Conservatives got in on the act too (though they did backpedal some). Then Thatcher happened.

ALL the utilities (electric, gas, phone, water), the coal mines, the iron and steel works, the car manufacturers, public transport (British Rail, National Bus Company), British Aerospace, the shipbuilders, British Petroleum, the Bank of England, Rolls Royce (the jet engine part), all got nationalized. And then there was this stunning creation: the National Health Service.

Everything in the list except for the Bank of England and the NHS has been privatized again, netting money for the government. Even then there has been reversals still...the utilities are highly regulated despite "open competition" in the electric, gas and phone markets. The railway infrastructure was re-nationalized though the train operating companies are still private. Public bus is still private owned, but heavily public subsidized through competitive tendering processes. Some companies that are considered strategically important to the country have a "golden share", this one share which the government owns which trumps all other shareholders decisions. The UK Government AFAIK has a golden share in BAE (British Aerospace), and Rolls Royce (the jet engine company, not the car), and might still have a golden share in BP. Germany AFAIK has a golden share in VW.

Nationalization may however just delay the inevitable. The UK car industry was going down in the late 1960's and early 1970's. Nationalization saved the companies, but they got sold later on and broken up and what was British Leyland in the 70's (itself a creation of other companies) is now in many parts again, generally ending up being in the hands of the Chinese (SAIC/Nanjing Auto), Indian (Tata), German (BMW), Swedish (Volvo Bus), and American (PACCAR) companies that bought bits of British Leyland over several years.

Mark.

[stillcool]

12. How do you nationalize a corporation..

that is global? I must be missing something in all this..

http://www.rediff.com/money/2008/dec/01gm-to-make-india-asia-pacific-hub-for-power-trains.htm

GM to make India Asia-Pacific hub for power-trains

December 01, 2008 14:42 IST

Unperturbed by the Mumbai terror attacks and its ongoing struggle to avoid bankruptcy back home, US auto major General Motors said on Monday it is making India power-trains development hub for Asia-Pacific region.

The company's Indian subsidiary General Motors India has already announced a total of $500 million investments in the country to set up new car and power-train manufacturing facilities and it will be hiring 500 people in the second-half of next year.
"With our engineering facility in Bangalore as the foundation of our business in India, we are making the country the development hub of power-trains for Asia-Pacific region," GMI president and managing director Karl Slym told PTI.

Considering the fact that the hub will cover countries like Australia, China, Korea, choosing India as the location is a significant decision, he added.