Originally Posted by CrawfordGene  One way to spread the cost of health care so that it hits every auto manufacturer proportionately—that is Toyota, Honda, and the rest of those manufacturers—is a single payer system. Then the Big 2.5 are paying no more than anyone else through a taxing system.
I know the health insurance industry has been telling us for years Canada has a horrible system, but if you had to deal with the health insurers with their massive bureaucracy and their lies about coverage, why should you believe them about anything? In our many trips to Canada I've never found anyone who would trade their system for ours. Sure it has some problems, what human endeavor doesn't? But compare theirs, or other industrialized countries' systems, to ours. I know the government can really screw things up—especially in the past 8 years—but it doesn't have to be so. For most of its history Medicare was an extremely efficient and cheap to administer program. That has been screwed up too, but can be changed. Certainly the health insurers have screwed up coverage plus 45,000,000 people don't have any insurance and tens of millions more have bad insurance.
The insurance mess allows foreign companies to produce vehicles cheaper by locating in the South where wages are low, unions weak, and other requirements are scanty. The South is the poorest part of the country, so why not take more advantage of the people there? They're happy to have jobs that pay a little better than other jobs there. The eventual result is that wages slip elsewhere in other parts of the country and Americans get less money and less health insurance. If this keeps up, Japan and western Europe will be the richest countries on the planet, not us. Of course, they have the same pressures from the BRIC (Brazil, Russia, India, China) countries whose low wages and lack of decent health coverage make for cheap production. There are solutions to that, but they aren't easy—perhaps all the industrialized countries require certain import controls tied to treating labor well.
Another part of the problem for the auto companies is the lack of credit. People who want to buy cars can't because they can't get credit. Some of them don't deserve credit, but many do. The idea of the $700 B was to provide cash to allow lending to start again, but the banks who have received the money aren't lending, they are either keeping it on the books out of fear or buying other banks. Paulson is encouraging them to buy other banks, but not to lend. Paulson's efforts have been counter to what he told Congress and slow and generally pathetic.
There are many parts to the crisis in the Big 2.5 (by .5 I mean Chrysler) and all parts need to be solved to allow them to thrive. Changing hidebound companies is not easy and even if the leaders of these companies were trying, middle management can screw it up by inaction. Putting Joe Nardelli in at Chrysler amazed me—he was driving Home Depot into the ground and gave Lowe's a big boost by doing such a good job of driving customers away from Home Depot.
There are no solutions to this that don't have ugly parts to them, but we have to swallow hard and get going.
Gene |