Autonation Should Know: Mike Jackson to FBN: "There Will Be a Deal."

Hi Liz, I don't understand how you can compare the money crisis with impending bankruptcy by Detroit auto makers. We all use money. If not for some very unusual actions by the government, the whole notion of money would have just gone away. So many people and businesses operate on the basis of borrowed money rather than cash in hand that without a functioning credit system the whole economy would come to a halt. The results would probably include empty gas tanks, barren grocery store shelves, and a lot of very miserable people. The misery would stretch from every nook and cranny of the country to every other one. A bankruptcy at GM just doesn't come close to this level of disaster. The stockholders would lose their investment (or what little is left of it). The (Mis)manager's stock options would be worthless. The union contract would be broken. And yes, some jobs would go away. In the end, I believe a stronger auto industry would rise from the ashes. I don't believe the "Worst case" story that millions of jobs would be lost. This assumes that everyone who has anything to do with the auto industry would be unemployed. It assumes, for example, that failure of GM means failure of Ford. In the world I understand, loss of competition from GM would make business better for Ford rather than worse. Demand for cars would not be reduced by bankruptcy in Detroit. Perhaps the mix of new cars purchased would change, but people would not return to horse and buggy to go to the store or to work. If not for the Democratic Party having so much power in D.C. nobody would consider the idea of using taxpayer money to bail out a failed auto manufacturer. This kind of Socialism is just not the way our Capitalist economy is supposed to work.

Liz thanks for your great interviews with Buffet. wonderful job. I hope to be up and see you after the first of the year. Have a blessed Hanukkah and Christmas.

This excerpt is from Houston Clear Thinkers blog. I hope you will discuss this on your show. The points are well taken. Would you buy a car from Congress? The W$J's Holman Jenkins continues what should be Pulitzer Prize-winning commentary on the problems of the U.S. auto industry: None of [Congress' complicity in the auto industry's problem] was mentioned at four days of congressional bailout hearings, because Detroit knows better than to suggest Congress has a role in the industry's problem. . . . . . The tragedy of GM and Ford is that, inside each, are perfectly viable businesses, albeit that have been slowly murdered over 30 years by CAFE. Both have decent global operations. At home, both have successful, profitable businesses selling pickups, SUVs and other larger vehicles to willing consumers, despite having to pay high UAW wages. All this is dragged down by federal fuel-economy mandates that require them to lose tens of billions making small cars Americans don't want in high-cost UAW factories. Understand something: Ford and GM in Europe successfully sell cars that are small but not cheap. Europeans are willing to pay top dollar for a refined small car that gets excellent mileage, because they face gasoline prices as high as $9. Americans are not Europeans. In the U.S., except during bouts of high gas prices or in the grip of a Prius fad, the small cars that American consumers buy aren't bought for high mileage, but for low sticker prices. And the Big Three, with their high labor costs, cannot deliver as much value in a cheap car as the transplants can. Under a law of politics, such truths were unmentionable in last week's televised circus because legislators are unwilling to do anything about them. They won't repeal CAFE because they fear the greens. They won't repeal CAFE's "two fleets" rule (which effectively requires the Big Three to make small cars in domestic factories) because they fear the UAW. They won't hike gas prices because they fear voters. [. . .] We hate to admit it, but the only good idea from the bailout debate is the proposal for a new "auto czar." Along with disposing of Chrysler and downsizing Ford and GM, his job should be to confront Congress with its own policy cowardice and failure. If saving gasoline and Detroit are both worthy goals, let's ditch CAFE and institute a gasoline tax to make consumers value the cars government is forcing auto makers to build. If Congress doesn't have the tummy for that, at least ditch the "two fleets" rule so Detroit can import small cars to meet the mandate.

Nonunion people never figure the details of a union member's pay check. Where each dollar goes. Some is returned immediatley to the various government entities. some is sent to wall street and various insurance and other entities. If you are an "academic" or are not acquainted with the following workers, it will be impossible for you to understand some simple concepts about business and the economy. Police, Fire, hospital, construction, factory, clerks, city state and county employees, movies, tv, stage,transportation, NASA and more. Nonunion workers ride the coatails of union standards and make much more per hour than they would and can almost lead a decent life BECAUSE of the structure established by unions. Next step: think about job safety and the zero chance a nonunion worker has for that.

Jackson should be the "CarCzar" because he already is a "carwiz" Thanks for asking him the crucial question of cost per hour of Labor. You don't need to listen to any other expert, this guy has it (the truth)

Dear Liz: God I hope there is a deal, what on are these people thinking. Apparently the "right" people don't have a financial stake in the Auto buisness, because the anti labor (union) or not talk, is unbeleivable, and the loudest since Reagan. If congress and both the presidents don't save the auto companies, this country will go into a serious depression, that we will be years comming out of, and could cause a new government to be formed. Why are we Americans so chavenistic as to think it can't happen here?