Suze Orman: How To Be Smarter Than The CEOs

CEOs are not smart. They are greedy. While ordinary people know they have to make ends meet, CEOs try to fill their pockets as soon as possible. So do politicians and evangelists. They rarely practice what they preach.

Smarter than the Auto CEO's? ? ?

Dems are bailing out the Unions for Votes when you boil it down.

CEOs are "smart" in that they cleverly find loopholes in how to get as rich as possible before they either get caught or go bankrupt. Notice how the CEOs still get to keep their personal fortunes even though their companies are about to get blown up.

CEO's are BAAAAAAAAAAAD

UNIONS are GOOOOOOOOOD

Bailout for Democrat votes.

People who are rich are evil

People who are poor should hate them.

Nice message you are projecting.

I say, out with the old in with the new!

If we knew that we would run out of, say, ketchup in 5 years, would we hire Heinz to make our mustard for the future. NO! The automakers have totally botched their primary responsibility, to remain competitive while developing alternate fuel. They didn't so let's suck it up and clean house. American ingenuity predicts that a new industry will emerge within 5 years that will benefit us in everyway possible. AND without the hangover from the "Big" 3

If you take a good look at the work force and Unions for the Big 3 and compare them to the other auto makers, you will see a huge contrast.

$40.00 an hour at Lordstown to push a broom and break up cardboard. Than you complain that you don't have internet in the break room and couches for naps while on the job.

I'm pretty sure the guy at Burger King is getting paid like $6.00 an hour to do the same job.

Dang those greedy CEO's My pickup cost $45,000.00

Instead of flying pvt jets they came in Hybrids to take away Billions of free money. Did anyone of them check if the Hybrids have towing capability ?
This money will be of no use whatsoever. If our president elect is smart, he should stop utilizing the gas guzzling Chevy Suburban and ride in a hybrid or electric car to signal a real change. (Ofcourse, personal security overrides national security.. what's new).
Personally, I would never drive an American Vehicle even if you give it to me for free. Tell this to the Auto CEO's.

YES! Finally someone says it out loud!

If we collectively do what Suzy Orman advises, we will all have some money in the bank but a good portion of us will be out of jobs. The small amount money in the bank or the lesser amount of personal debt will not put food on the table or avoid foreclosure after being out of a job.

Unusually, the startegy that will lessen the impact of the reecession or help bring us out of it is if we all maintain some regular levels of spending. Thsi is also why government needs to spend money and not increase taxes at this time.

Americans have been buying inefficient cars, it is hard to blame detroit for that. Last year GM still shipped more cars than any other manufacture. What mileage does your car get Suze? A lot of high end luxury cars get worse mileage than SUV's. Last year many of the foreign manufactures got on the Large vehicle craze, tundra, armada...

I still can't understand why their management don't step down, after the failure, they don't have any remorse they come to the congress for billions but no of them is responsible or step doen of their position yeah... I'll work for 1 dollar a year .. when everyone knows the CEO get cray stock options..... I mean really.

Larry,

I have a simple question; why aren't we looking for the shareholders to bail (their) car company's out? it's their investment, not mine...Why do taxpayers have to clean up everything?

As much as I think Rick Wagoner deserves to go, he seems to be the one the Government should work through in navigating the big 3 through the changes they're about to go through, the other two do not have the experience and should be relieved of their duties immediately without compensation. I don't think they'll suffer too much.

I am a recent retiree of the auto industry and, yes, much of what you say is true. However, it seems to me that the auto industry is getting harsher treatment than the banking industry...which did not ask for the bail out, but got one, the auto industry is only asking for bridge loans [ however the bail out may come later ]. We also seem to vent on the CEOs and their dominion over the industry, where we should be attacking the Board of Directors for both of these industries. Bonus money, perks at all apart of the compensation....no matter how unrealistic they appear to the common person...it has been said that peasants shouldn't audit kings.....may the boards should have.

I don't necessarily disagree with Suze, but I wish she would have explianed how she thought all the changes she suggest could have been done while dealing with the legacy costs presented by unions refusing to negoatiate. Saying they "should have" is very easy (and they should have been pushing the oil induistry for more supply as well) but making it happen is not.

Shame on those big 3 auto exec's!!!!! The U.S. deserves better leadership than those self serving crooks!

I have Suze to thank for the encouragement to build an emergency fund last year. I was laid off in August, while expecting, and that fund helped my husband and I cover expenses and not stress out while I looked for a new job. I'm lucky to have found a great new job in this economy, but I'm putting my first paycheck right back into building that fund again in case anything terrible should happen again. Thanks Suze!

I think all the Auto Company CEO's should be fired. How can any of them justify their jobs after letting their companies fail? As a taxpayer, I am tired of bailing everyone out...........no one will bail me out if my company fails. All this bailout money should have been given to the middle class. That would do more for the economy than anything else. Sixteen years ago I had a car that got 40 + miles a gallon. Now they think they are giving us something terrific with a car that gets 24 miles a gallon? Ha. Ha. Ha. Let alone a car with no quality. Fire them all.

I think she is wrong about not doing holiday gift giving. Of course, you need to stick to a budget, but there is such a thing as Money Karma...I have seen it in action. The more you give away, the more you get back. So you can GIVE and not have to worry about not having money later. It will come to you. Just be smart about it.

I LOVE Suze Orman. Straight-talking, knowlegable and down right correct.

I am confused about how pursuing fuel efficiency more than they already did would have prevented them from running out of money. It seems like that would have cost them even more. Suze's essay sounds like she has been listening to Democratic talking points... I expected her to come out with fiscal responsibility and competitive advantages and things like that. Disappointing how this issue has been so politicized... basically means more of the same and nothing gets accomplished.

Perhaps it is time to include some average people with common sense in the actual decision making processes of large corporations. And certainly it's time to limit executive compensation to more appropriate levels. After all, if it wasn't for the person on the assembly line, drawing board or machine, the executives would have no income at all. Employees at all levels need a more equitable share in the organization.

Auto CEO's may not be so smart but they are laughing all the way to the bank. With a history of multiple millions in "bonus" (for failing?) they have done well.
What concerns me is that every year the proxy statements come to the shareholders and every year there is a vote to "approve the ammended Executive Compensation Package" and every year the shareholders approve it. Why? Is it because the executives (and their buddies on the Board) own a controlling share of the stock? I always vote NO on these but have yet to see one turned down. Any thoughts in this direction of true responsibility for executives?

I wonder how well versed Ms. Orman is about the domestic auto industry. Does she understand the multiple variables that affect it. Is she aware of the fact that foreign auto makers also make SUV's and large trucks. Why is the new Toyota truck plant in San Antonio idled? Most domestic cars are now on a par or close to being on par with the transplants. And if you're talking about CEO's, look at the financial sector that does not produce anything viable, yet those CEO's collect much more in bonusis than the CEO's of the bring three could wish for.

Susie, Why are you delaying the inevitable . . . these behemoths need to break up into to lean mean fighting machines, and instead you want to allow them a slow death, with my taxpayer money! Why doesn't anybody have to pay up, face the the consequences and learn to adjust????? Now is not the time? when is the time, when you've blown 35B of our money ? It's going to be painful. I know, I grew up poor, and have fought my way out of poverty. But I'm stronger and wiser for it. Will anyone be wiser after this? I think not, not as long as we are bailing out our entitled, snotty, stubborn children. PT

Unfortunately we are seeing this a little too often now, when these CEO's and supposed "leaders" of America's infrastructure fail to plan for the future in the attempt to line their own pockets a litlle more and they expect to be bailed out by other people. The government cannot exactly say no to them because, as Suze said, it would be detrimental to our jobs that are already being lost left and right.
It is time for a serious wake up call in our country, we all need to realize that financial responsibility needs to be our number one priority on a personal, corporate and economic level if our country is to survive.
We can all be blamed to some extent for the situation the country is in now, and we all need to take responsibility. We need a different plan and we need to put it into action before the consequences become too severe.

They say power corrupts and absolute power corrupts absolutely. That is what I see with this current group of CEO's, and the labor unions. Everyone wants a bigger piece of the pie, CEO's with their insane bonuses, (because they can), and factory workers making $100/ hr (because they can),
The workers union are just as bad as the CEOs, they have a job bank where they sit for up to two years doing nothing and collecting 96% of the wages (because they can). At least the CEO has to go to work.
Who pays for this, us the customer-correction us the taxpayer.
Personally, I got tired of eating the cost of repairs because they saved $0.15 on a bolt or head gasket. They actually pick inferior parts, at a higher cost because aftermarket repairs are so profitable for them.

Buy Toyota/Honda, they may not be perfect but at least they don't boost their profit margins by dumping the cheapest part they can find into the car. That and they don't pay their workers wages 3 times higher than the average American.

My only question is after the CEO's of the auto industry have recieved all this critisism (not saying they don't deserve it), I wander what makes the CEO's and executives for all those banks that we baliout any better. Those morons ran their company's just as recklessly and irresponsible as the car makers. Lets hold everyone's feet to the fire not just the people that look for help after the initial shock!

Ford already makes the kind of cars that people want, they just do not SELL them in the US! They do not even have to be invented! They are already in Europe and Asia. All the people who refuse to buy American cars, like me, would be happy to tell them what they are doing wrong, but they never ask. They are too busy patting themselves on the back in their private jets.

The questions I have are: (1) What were they investing the companies money into if it wasn't better fuel efficient cars? Where did the money go? (2) Do they have a plan better than before, and if so, how could they come up with a plan in one month when to date its taken them twenty years? (3) Why should we have employees laid off when the top folks in the company, who have not produced any direction or viability, continue to have salaries AND benefits that could keep X times more jobs if the executive salaries matched their actual work? In other words, these folks get paid way to much money for what their employees and United States are getting in return. I am dismayed to think, like athletes, executives are getting paid way too much money for work they are not doing.

This 'sin' factor of greed runs through the blood of every human being. It is something that is alive and very difficult to master. Suze has four points of fortitude and foresight are words of wisdom that everyone can benefit from. I hope these words don't fall on deaf ears!

The problem is that the stock market structure of these companies force them to yield to quarterly progress vs anything remotely long term. Anyone suggesting high growth 5-7 years out, but profits would look grim in the short term... they would be out of a job in no time.

Pay down your debt FIRST. Then worry about everything else. If you do not believe this just take a look at any company. We are in a credit crisis not a financial crisis.

Bob Lutz, GM vice chairman of global product development didn't even know there was a talk about a Car Czar, and stated this morning that GM would need more money next year. On top of this, the UAW has not made any concessions and refuses to do until everyone else does.

Yet, we pander to the wealthy and continue to use our tax dollars to save a failing business while they commit collusion? Didn't anyone notice all 3 came at the same time?

The only way to resolve this is by bankruptcy. If this was any other business, they would be able to get a loan. InBev got 51 billion for the takeover of Budweiser, but GM can't raise enough to save itself? If you where truly an HONEST FINANCE ADVISOR you would tell GM the same thing you would tell any other client – declare bankruptcy!

They don't want to declare bankruptcy because they are afraid it will hurt their image. Well, I have got news for you – this whole "bailout" has ruined ANY image GM had left. Expect huge sales decreases and more excuses next quarter with all 3 companies coming back to Congress with bigger hats.....

What Suze says is plain common sense. Can it be that so many Americans don't have any? Common sense allowed my parents to make it through the Great Depression and taught me how to live my own life. I don't owe anyone any money, I have no credit card debt and never buy anything until I can afford it. Also, I don't need to impress others by living above my means. I live in the now and I'm free and happy.

My hope is the new Administration will insist our schools teach youngsters the basics about money, how to keep and balance a check book ; and that parents start their kids early to earn their own money. Leave the video toys for free moments on the bus.

Actually I think they weren't greedy enough. If they were greedy they would have wanted to make more money, for them to make more money they would have needed their companies to succeed, for their companies to succeed they would have had to innovate. I would rather they be more greedy, it was greed that built these companies, it was their stupidity that destroyed it.

lostemperor, you scored a direct hit, segment of our population is scrutnized for getting welfare, these socalled highly trained minds, the best and brightest what an irony

I would like to think that for once many of us will face the music and either make the changes necessary to rid ourselves of our misdeeds of the past or die on the vine like our auto industry.

We need to save more, spend less and stop living a champagne lifestyle on beer budgets.

This is the beginning of what will be a very tough period. We have yet to hit the looming spectre of medicaid and social security.

I am very annoyed that the government is NOT taking steps to cut spending in other areas to show that were just not giving away the store on the taxpayers back.

Suze,
While I agree that the Big 3 CEO's have had their heads in the sand for decades, do you really think the current management wanted to pay union jobs bank employees full wages for sitting and doing nothing?
The UAW would not even talk about eliminating the jobs bank until GM threatened bankruptcy and bail out. Now that congress is involved, maybe some of the blame will be put squarely on the non-competetive unions where it belongs. Hopefully they can break the UAW and get us competitive once again.

Kudos to Suze. CEO,S are like the Politicans, all they worry about is themselves and to heck with everybody else, just take a look at how they are throwing our money around .

I agree w/ you Suze, about the "head-in-the-sand" approach by the Big three CEO's. I can only hope that if and when they approve this bailout, which I strongly oppose (why bailout a failure?), that the money comes with a few stipulations. Mostly, let's get some new people running these companies, because those in place now obviously don't know how to lead a company through a changing marketplace! And what's so bad about bankruptcy? The airlines did it and they're still around. Sure, some jobs would be lost, but then they could re-negotiate those poisoned, benefit rich union contracts.

Smarter than the Big Three CEO's? I guess anybody would qualify. Greedier: that would be a real challenge.

You dont have to be "smart" to be a CEO. You have to be aggressive and ruthless and step over anybody who gets in your way, like taxpayers for instance.

Intelligence has nothing to do with CEOs - there is little or no correlation between corporate rank and intelligent decision-making. The evidence supporting this statement should be highly visible now in the financial wreckage we stand in.

These guys are the buggy-builders of the 21st century. Their unsold buggies are filling up acres across the country. Time to get off the road and onto the Internet - who wants to keep buying hay and cleaning stables for THESE horses?

Why give them money, when they'll just do what Kodak did with digital imaging - deny everything until they're mostly dead?

I wonder if anyone will really learn these lessons.

The CEOs are smart, they just put way too much emphasis on the short-term in order to cater to fickle shareholders who want profit RIGHT NOW. In a way, their greed is a reflection of our nation's sense of entitlement. We feel we deserve to have a rich life and an easy retirement and we can only do that if our returns are high. Nobody thinks about the cyclical nature of economies.

First of all the auto industry has lots of problems, but the biggest reason they are having problems is not their product or ways of doing business its the recession. Everyone says US autos are inferior in quality to the Japanese – that just is not true anymore. The Malibu & Fusion actually have better initial quality ratings then the Camry and Accord. Ford is said to be on par with the Japanese in regards to quality. The Big 3 has made great strides with the cost of labor also with the new UAW contracts. As far fuel effeciency, go look at the car lineups and see all the 30+ mpg vehicles that are offered with even better hybrid/diesel/electric vehicles soon to be released.
I just wish the media and Congress would get their facts straight before presenting them, we are not in the 80's or 90's anymore, the Big 3 has made great strides in a short period of time. I'm not sure how Congress feels they should ridicule anyone as far as running a business, look at our deficit. As far as all the ridiculous rhetoric coming out of Senator Shelby mouth, look at all the payments that Alabama made to foreign car companies. These were not loans, but incentives. He definetly talks out both sides of his mouth. Something I've never heard mentioned also is our National Security. If we loose all of our manufacturing capabilities, where are we going to build our tanks,planes,etc. if we ever get involved in a large scale war. I guess we will send that work to China. (hopefully we are not fighting against them)
Bottom line, if the Big 3 goes under alot of us will probably be working together building roads under some government program.

I'm yet to hear a single talking head ask what the UAW's role was, is and/or will be in all of this. What concessions are they willing to make before they're all thrown out in the street?

this woman obviously knew nothing about the big 3 before jumping on the negative bandwagon w/ the rest of the country

Behind every CEO there is a board of directors. These are the people who make the policy decisions. Lets put some of the blame on them.

Amen Suzie! I worked for Lucent Technologies and watched Pat Russo and Rich Mcguinn run that company in the ground with their ignorance. The truth is that the higher up I reported in the company the nuttier it got! Corporate governance is a joke in this country and companies do NOT self-regulate themselves.
We need to save the jobs but please place some sort of oversight on them. The banks have taught us that coporations do not work and play well with others. Treat them like the five year olds they act like!

Big Three are turning French.
Amazing how quickly our dear executives are turning socialists ….

I remember those years, I was graduating from College, where there wasn’t any management unless if was American. It was the years of MBO – Management by Objectives, the real heroes were Peter Drucker, Paul Samuelson and al.

Gone, long gone are those times. It is so much more fun to make a $ billion a year by gambling other people’s money and be recognized as a hero, and a role model. Greed has replaced competence.

Where are those “industry projects” MY heroes were talking about? Is there anybody around caring about industry or creating value?

Tons of manufacturing jobs are gone. And we blame the Chinese!

Let an Indian kid buy GM for 1$ in a bankruptcy court and he will turn this company into a new success story before you know it.

It is pitiful, and so sad. I want to believe this can change – quickly.

Suze Orman is great for people who are struggling financially, but what about people who have already built a nest egg or are approaching retirement?

I think it would be great to have a retirement distribution expert on - someone like Ed Slott from that PBS show - I see him in a lot of newspaper articles, watched his show, read his books... the guy is phenomenal!

suze orman is overbearing–she is not a cpa and she gives all this advice.

What I find astounding about this entire mess is how so many companies are failing because they did two things any reasonable individual investor would know never to do. What moron bets everyone on one sector like this? Everyone knows you have to diversify, yet these companies shoved as much weight into the short-term profitable areas as they could and they got killed when just one sector, morgage-backed securities, crashed. And, they leveraged everything to the wazoo. A tiny drop resulted in a massive loss; the big drops became losses so large they threatened the entire US economy.

I am annoyed that there are people, such as, GM CEO's, that have the audacity to ask for a bailout when they themselves are living in the lap of luxury. Where is the common sense? Companies today are being run by overpaid educated idiots. I know and have met many, and I'm not yet impressed with any of them concerning their knowledge of the company they work for, the stability of the company, or one that is, at the very least, concerned with employees that do the actual work.
What is sad, those in charge of running the company, are there for the prestige and paycheck, nothing more, while common people, such as myself, work each and every day with hopes of making enough to pay simple bills, put food on the table, and hopefully, just hopefully have enough left over for the upcoming holidays, birthdays, etc. So, to the CEO's, stop whining about the financial crisis you have helped to develop, take a paycut for the next several years, work more, and you just may see a change in the way business progresses. Personally, I don't want to buy a new vehicle knowing that I'm helping to put more into your luxuries, while depleting mine.

CEOs were once ordinary people and got to their position by being smart. But power and money can change you. So before anyone bashes a CEO you must think could that happen to me, and more often than naught it will. And if you are living beyond your means you are already just like them and just as much to blame.

I have worked for a Fortune 100 company and watched while the CEO got a raise while laying off 1/3 of the company. Unless you are talking about someone like Lou Gerstner or Steve Jobs the only thing a CEO can affect is when to cut and when to add. Any person who can read a P&L can do that so these salaries and bonuses are more a function of what they perceive is their right to extraordinary compensation.

Until investors allow the CEOs to look beyond the next 90 days and stock prices following quarterly reports, companies will take the short view instead of the long view, and they will fail. The speculators are driving the stock price, and the stock price and quarterly earnings (not 5 and 10 year planning) drive the company. Our financial system is just nuts!

What people fail to realize is that the BIG Oil Companies and the car manufacturers have been in bed with each other for decades. Big Oil dictated (with the subtle help of the two Bush administrations) what the car manufacturers were to make so Big Oil would continue to sell their product unchecked.
You ask, where did all the billions in oil revenue profits go; answer – to provide kickbacks to the BIG THREE plus pad politician pockets, starting from the top down.
You ask, why doesn't the present administration do something about the fuel efficiency situation; answer – the biggest campaign contributor for both 2000 and 2004 was Exxon/Mobil.
You ask, what ever happen to all the fuel efficient carburetor systems built over the past several decades; answer – the patents were bought up by the BIG Oil Companies. I believe that the president-elect should declare a state of emerency due to national security and revoke the patents and stipulate that these systems be installed immediately.
Why is Congress so eager to bail out the BIG THREE; answer – so many of them have stock options and monetary ties to these companies.
The problem with our country today is GREED; numerous individuals feel that they are owed millions of dollars for doing very little, while the vast majority of us, which are the backbone of this great country, survive by doing what we know is right, which is helping our fellow man.

You are a simpleton. If the CEOs threw billions down a hole trying to find some magical fuel free car, the companies would be bankrupt anyway and they and their staff would be fired. If it was feasible and practical to have cars that don't run on gasoline, they would be here by now.

The reasons the companies failed is because it costs $2,000 more per car to pay employees of US automakers than to pay employees of foreign automakers. Blame the union heads. Even now, looking into the abyss, they are only willing to "postpone" the massive and overly rich retiree and pension benefits that no other employees can dream of.

If the Big Three declare bankruptcy, void the union contracts, turn over their pensions to the government, get out from under the terrible dealer laws, and have their labor costs in line with the rest of the industry, I guarantee you that they will put out products that compete and even exceed anything done by Toyota or Honda.

Shall we forget the EV1? The electric vehicle that GM created and then taketh away when the oil companies (and the government) decided they wanted to focus on fuel-cell/hydrogen technology? A technology that will NEVER be a proper replacement to traditional gasoline-fed vehicles. Ask a middle school science teacher and they will tell you that.
These are the guys who claimed that Toyota would never turn a profit on hybrid technology – that they would "lose their shirts". Well, we see how that turned out. Stupid, stupid indeed.
They need to clean house up in Detroit – put in some innovative thinkers with proven track records of radical transformation. As someone who has worked on the inside – nothing short of a dismissal of 90% of their white collar employees will work. They're the victims of status quo thinking.

CEO's may be smarter than most but almost all of them lack common sense. I've noticed that the higher up a person gets in an organization that they have less common sense than they did before.

The CEO's of the big three are no exception. All they could see for the last 10 or so years was the profits to be made by building and selling SUV's (especially GM). They only think about how to maximize profit for tomorrow – to heck with where the company (and profits) will be 2 – 5 years from now.

Part of this problem is caused by the investors who think that they should make 10% or more per year, every year.

If we are going to bail out these companies, the CEO'S need to go!
We should not reward failure.

So, if you employ enough people, the government has to be willing to bail you out?? Let them restructure through bankruptcy. This is ridiculous. I am also offended that you put partial blame on government not regulating more fuel-efficient cars – give me a break!! Other companies had figured it out and are not going under! That's why management is supposedly get paid the big bucks – To be forward thinkers... That's capitalism – survival of the fittest, right? High risk – high reward.. There has to be real risk, though. Not high reward or be bailed out by tax payers if you are wrong. I'm tired of all of this. I expected more from Suze Orman.

CEO's of the Big Three have received enormous benefits from their companies in the past that have set them up for life. I am upset that we are really buying into them crying Wolf. They have this down to a science and are calculated in this concept of getting free money from us. Have you bought a car lately? They sure do not give us any breaks from their over priced cars. I say if we give them money it should be with the same interest rate we get when we purchase a vehicle.

How on earth am I supposed to save 6 to 8 months expenses when I live paycheck to paycheck? I'm so sick of "financial advisors" who assume that everyone makes a six-figure salary! How about some REALISTIC advice for us ordinary folks!

I like Suzie-but i am tired or here saying live below your means and save for retirement-wow that's great.But that is really basic and not really helping in this current downturn.If she is so smart why was she not appointed to oboma's new team.Please Suzi give me something to work with
-xavier

Thank you Suze. Well said!

Being a CEO of any company does not make a man or woman smart. I does however show what they are made of how well they think. It shows if they can make decisions and if their judgment has any value. It shows that being greedy multi-millionaires will do most anything to show a short term game to get bonuses and stock options and to increase his or her take home pay. It shows they will also buy politicians to pass laws that make it easier for them to shaft the public. It shows they will also shaft the nation from its rightful amount of taxes so the rest of us are burdened with making up the difference.
it shows they have no regard for the long term affect of their actions on the economic viability of this great nation and its people.
We idolize those in high places and those in the movies, and those who make millions playing sports and we teach our children to idolize them by our actions. Even when they are using drugs and steroids to enhance their ability to play well we still idolize them and we in the end get what we are now getting a terrible recession because of greed and our inability to demand honest and forthright actions of our so called leaders of the biggest corporations and our leaders in government.

While I agree with the analysis of the auto situation, the recommendations for individuals shows the same sort of denial of reality, for the common man, that everyone in Washington is guilty of.

None of them, have the foggiest idea how the ordinary person lives, what it means to live on minimal subsistence, nor what it is like to never be able to save anything, much less have anything, in life.

Ms. Orman has just demonstrated, that she has no more connection with ordinary people, than Washington does. That is simply because once you reach a certain income level, you become totally out of touch with the reality of the common man, even if you came from a common family.

Ordinary people struggle to make ends meet on a daily basis. Most of them trying to live within their meager means, but no one can do without everything, all their lives. Now and then they are compelled to indulge themselves in something, no matter how modest that might be.

For us, it is going out to breakfast in a restaurant that actually has a nice atmosphere, about every 3 mos. Yes, we spend an extra $5-$6 when we do that, which can certainly be considered an extravagance, but when you consider we never go to a movie, rarely go on a vacation of any kind, drive our cars until they are ready to fall apart, and purchase all of our clothing at off-price stores, when it is on sale.....I don't think that one little extravagance matters much.

We both have advanced degrees, but hers is in teaching, and she couldn't buy a job in DFW, after we relocated here, so she has been forced to take low paying retail supervisory jobs, and I couldn't find a decent job doing anything, and was forced to fall back on what I did previously as an independent business person, for a medical college.

Our incomes have never been good, and we saw little opportunity, in our careers and lives. I think many other people in our age group, have experienced the same kinds of situations. We were caught up in an economic cycle, that prevented us from ever getting where we wanted to be.

Basically, if you come from humble origins, and not those of silver spoons, no amount of education, nor effort, will necessarily bring you any success in life. You are still "the little people", who are shown no concern, by those with money and power.

The haves, vs. the have-nots, have always been and will continue to be. Unfortunately, the haves, have never learned what it is like to NOT have.

If Joseph Stalin was in charge, he would ship these CEOs to Siberia and tell the others to get working at half-pay with better vehicles or they would all go to Siberia too. This would get the automobile industry in line fast.

It"s really appalling what passes for "commentary" these days. Suze Orman should remember that ALL the car companies are doing poorly right now–even the supposedly forward-looking Toyota. For example, Totoya's and Honda's sales are down about 32% in November 2008 compared to November 2007. Nissan is down 42%. Ford is down 31%. Yet reading simpleton like Suze Orman one would believe that it's just the US carmakers that have problems. Plus, I'm sure she would have done a much better job running the companies, ha ha.

I've already done all that...I have my "ducks in a row". No debt except for my fixed mortgage and I drive a 14-yr old car (a Toyota because Detroit still doesn't get the hint in the last 20 years as to what we want!) I'm mad as hell and I'm not willing to take it anymore! Oh sure, I can have the cleanest books in town, but now I have to clean up after CEOs who walk away with MILLIONS of dollars and I gross less than $30,000! As Thomas Jefferson once said, revolution is good every now and then....I'd almost like to see them all collapse for being so greedy.

I don't know that you can blame it all on just the CEO. Shouldn't the CFO have been screaming bloody murder? Also, there is a standard acceptable business model for R&D funding that, while needing tailored to your needs, gives you an idea of what you have to spend to be competitive. Of course choosing what to fund is important also (where the auto companies didn't do so well).
I'm not an expert by any means, but really, it couldn't have all been the fault of just one person.

Ms. Orman, as usual, is right on!

This clearness of thought and focus on the facts is exactly what we need right now. The "Big 3" are broken companies and need more than just a cash infusion. The current economic situation exacerbated an already serious problem for these companies, created by their leadership.

I must say that I feel for the employees of the companies but hopefully with the great wages and benefits that they have enjoyed, they have assets to carry them through.

It is amazing to me how certian units of these companies are profitable in other countries; Opel, Holden – and offer products that are superior to their US equivalent.

Any bailout needs strict oversight.
Leadership needs to be changed.
New product development needs to be tied to the money.

i been working on the retail parts sales for years and american made cars ford crysler and gm need parts very often , many of my customers drive cars made in americaalso but a honda or toyota brands almost all the time this cars only need filters, oil , and cleaning products.. they are realy made to last ....

We should hold the Board of Directors responsible too. They are the ones that appoint the CEO. CEO's are responsible for vision and direction. Seems to me they are all at fault!!

Thank you, Suze, for sharing your clear thinking. This should be required reading for all taxpayers. ♥

EXCUSE ME?

Suze Orman the former pitchwomen and flack for BUICK telling us about automaker CEOs?

Clean out your own closet first, sister!

This is the same woman who advised people to buy a "new used" (late model secondhand car) and keep it forever.

Then GM hired her, and suddenly, buying a new Buick made perfect economic sense!

Perhaps she is just mad at GM because they fired her.

CNN, you need to VET these people better before giving them a platform like this!

The Big 3 have spent the last 20 years building and selling what the American people wanted; SUVs and big trucks with V8 engines. More power is what they wanted and that is what they got. Look at the sales figures for those vehicles. Look at the fact that Toyota, Nissan and the other foreign makers stepped up to the plate and made the exact same vehicles. Why? Because that is what Americans were buying. Susan Orman and others can try to blame this on the automakers and their CEOs however WE are ALL to blame.

Suze Orman made her fortune being what she tells people to avoid, a financial advisor. Her job is to sell advertisement, not give people sound advice. Anyone that tells the entire nation to sell all of their investments when the market has lost 30% of its value is not looking out for your best interests. If investing was easy everyone would be millionaires and there wouldn't be any financial advisors. The Big Three are almost bankrupt from the UAW, not mismanagement. The UAW requires the companies to pay for jobs that don't exist. And the market determines what vehicles are produced, not the CEOs. If given a choice between a Prius and an Escalade, 90% of Americans would choose the Escalade. Wake up people!!!! Start thinking for yourselves!!!!

I have one thing to answer.
"Think before you act!"

The fact of the matter is that corporations are only accountable for short term profits. That is the way our stock market is designed to work. Information technologies have just exacerbated the short-termness of it. Things like Enron have caused laws that have increased accountability, but it's really just more accountability for short term profits. So, if you're only accountable to short term profits, SUVs which were selling fine give $10,000-$15,000 per vehicle in profit while cars are break-even, which do you base your profit model on??? Spending money on next-generation research and development is not a profit model, unless it can produce short term profits.

The real fix is to change our laws and the system significantly. Tax individual stock trades. There is absolutely no reason Apple stock prices should fluctuate significantly on the rumor of Steve Jobs having unconfirmed health problems. Stocks should be a long-term investment based on sustained knowledge, not something to be traded every time the wind wavers. This is the only way to encourage companies to plan for the long-term and invest in their future.

I agree with nearly everything in the article, except this:

"...And in the process they turned off Americans, who refused to support products that they now judge to be of inferior quality...."

Virtually every one of my neighbors drives a huge honkin SUV or truck. All of them had ample opportunity to buy smaller vehicles, but they chose gas guzzlers instead. The American consumer also had 20 years to consider dwindling gas supplies, but continued to buy oversized tanks for trips to the grocery store. The auto industry has focused on short term profits, ignoring long term realities–as have the overweight and pampered American public.

The dumbest comments I have ever seen. Being a CEO of a company's financials is a "little" more difficult than being the CEO of the typical american's family financials. Easy to sit from your perch and tell the automakers everything that is wrong with their companies in hindsight. Suze, you're another example of a finger pointing financial propagandists. People if you want financial advice, go to a financial advisor with credentials, not a TV personality.

Dear Ms. Orman–

Thank you for a well written article and good common sense!

Happy Holidays.

I think Suzy is one of the better financial advisors out there. However, didn't she shill for one of the big three just a few years back???

First, let me say that while CEOs are not all genious level intelligence, I would challenge you to show me one who has an IQ below average. In general, CEOs are smart.

However, they also tend to be self-serving (which is a far different thing than not being smart), somewhat narcissistic and have huge egos and an inflated sense of self-worth.

As far as why they made decisions that "fill their pockets now" that isn't dumb either, from a sefl-serving perspective. They are well aware of the time value of money. A dollar today is worth more than a dollar next year. Plus, add the old adage about a bird in the hand being worth two in the bush.

The blame really lies with the boards of directors who approve compensation packages that reward short term performance over long term success. Personally, I believe that the solution to this is to tie approximately 75% of CEO and top executive pay to long term performance. One way of doign this would be to provide compensation in the form of 10 year restricted stock options. Options given in 2008 would not be transactable until 2018. Then the executives would have more incentive to plan for the company's long term success and less to focus on this quarter's profit.

I agree with Suze Orman. What were these CEO's thinking? I left Michigan in 1980 because the economy was going downhill. Farmers were going bankrupt and losing their farms, the labor unions and workman's compensation laws were driving factories to the southern states and foreign countries, and the real estate market was slow. I also saw then that the foreign automakers were making fuel efficient and smaller cars and wondered when GM, Chrysler, and Ford would start doing the same. NOT! I don't feel sorry for the "Big Three". I do feel sorry for all the people and jobs they affect. I would not loan them any money, not unless they guarantee that they will restructure their plants to build the fuel-efficient vehicles!

I am a major airline captain. I have been with my company over 20 years. Prior to that I served in the USAF for almost nine years. I defended America while the Corporate-Legal Elite learned the art of the rip-off. The saga of my company is one of the great failures of American capitalism. I took a 47% pay cut. My pension was liquidated. My benefits are a shambles and a shadow of what they once were. If I retire today the PBGC will provide almost nothing to support my family. Thirty three (33) senior executives, including CEO Leo Mullin and CFO Michelle Burns, absconded with millions of $$$$ directly from the company treasury in bankruptcy-proof pension plans. The company treasury was even raided to pay their taxes. Legalized theft! We restructured under Chapter 11. Where is the fundamental fairness? $25 Billion? Why was there never a bail-out for us? Why were we in the airline industry left to twist in the wind? Shouldn't Circuit City be bailed out, too? Why didn't the auto industry retool, redesign and remake itself or was getting in bed with the oil industry and resisting mileage improvements just too cozy? I never again will have any faith in American capitalism, which is seriously broken probably beyond repair, and the omniscient, all powerful Corporate-Legal-Political Corporate Elite.

CEO’s do make obscene amounts of money. Why is it that we are so much more focused on the CEO’s of the car makers than any other business? The bank CEO’s make absurd amounts of money who is looking into that? We (the tax payers) are paying them that. CEO’s are not smarter than us just craftier. Is Congress worried about what is going on in the banking industry? I think we need a major over hall on all of this. If banks were not lobbying on Capitol hill (I think it should be outlawed as it is a form a deception and really has no ethical place in government.) I am sure that there would be more attention brought to the wasteful spending.

I don't know Suze – Bob Nardelli got paid $200M for getting FIRED from Home Depot. I have a decent job and make ~$120K but if _I_ get fired for incompetence I would get exactly SQUAT so it would take ME 1,666 (somehow the last three digits seem appropriate) YEARS of actually doing my job WELL to make what he got for getting FIRED. to put that in perspective for me to have made that by now I would have had to started my paltry $120,000 job around the start of the decline of the ROMAN EMPIRE!!!

CEOs seem like frakin' genuises to me...

If these car companies have shown they aren't making products people want, why should we continue to give them more money? If I do a bad job at work, I get fired. That's how it works. Money represents resources, and the market determines how resources are allocated. If you make something no one wants, why should you get any resources? The big 3 have been bailed out multiple times. What makes you think this time will be any different? They need to be allowed to fail. Someone willing to make what people want will come along.

CEO are smart , because the take their share first, then what ever is
left is for the average joe. Goverment will bail them out because is
biggest spender of somebody else money.

Always remember it is very easy to spend money that i s not your.
Let them go down, COMMON SENSE will step in and consumer will
be buying toyota, nissan, honda,mazda etc. hence that mean they
will have to hire more people and build more plants.

Remember what happen to AUTHUR ANDERSON when they went
out of business, yes the rest of the accounting firm take up the
slack.

average joe

Thanks Suze. I'm definately doing all the things you've outlined here; I'm seriously working on cutting down my cc debt. I'm also taking a loan out of my 401K to pay off some of my debt. Do you think its a good idea?

Not only has their short-sightedness and greed put them where they are today, their response to states like California trying to show them the way with laws mandating better fuel economy was only met with lawsuits against those states.

I can't imagine that them forcing their bailout down the taxpayers' throats, via our equally corrupt and inept politicians, is going to induce anyone buy their cars. I know I'd be even less likely than ever to buy from them after seeing what they've done.

Thank You Ms Orman!

CEOs are smarter than the rest of us...they aren't going to be worried about retirement, are they? It's not just CEOs who are clueless...it's all leaders, in industry or government. Ron Gettelfinger and his cronies are just as much at fault. They knew that quality was lacking, and they kept insisting on more benefits, until they earned far more than their non-unionized peers and priced themselves out of being competitive. They knew this day was coming, they just hoped it wasn't on their shift. I live in Detroit, and it will totally s*ck if the Big 3 fail, but in the long run it's better for consumers, taxpayers, and the industry. This morning Bob Lutz admitted on TV that the industry in N. America isn't viable at 10-11 million cars...somebody has to fail! And Chrysler is a private company that hasn't showed Congress it's financials yet, and they are considering giving them money???!!! The stupidity is so comprehensive it's unbelievable!!!

No they are not smart.

Any company associate worth their salt knows that when they have a problem, they go to their superior with the problem AND several suggested solutions. Afterall, if the associate recognizes the problem, they sould have an idea how to fix it. The Big 3 CEO's weren't even smart enough to do that.

They want help saving the auto industry, their industry, and they flew their corporate jets to Washington. Not smart.

I think the idea of appointing a 'car czar' to oversee the administration of the funds is an excellent idea. The CEO's just aren't smart enough.

Alfie

Alan Mulally has his masters in aeronautical and astronautical engineering, as well as an advanced degree from MIT, so he indeed probably is "smarter than you."

I am so sick of no-nothing national talking heads like Orman suddenly popping up as experts on the American auto industry. How about less grandstanding and more nuance, Suze?

The Big Three disaster has brought out the worst in our country, from publicity-seeking vultures like Orman to grandstanding politicians, everyone is pouncing on the corpse of this industry.

As someone who grew up in southeast Michigan, I can tell you that pretty much everyone there, no matter what side of the equation they are on (labor or management) believes the problem is more complicated than just saying "these CEOs are so dumb!" Let's talk about trade agreements, UAW wages and the face that Americans were buying gas-guzzlers in droves.

Most of the dialogue surrounding the crisis has been advanced to serve agendas; true experts on the auto industry are barely consulted.. .that would mean less airtime for blowhard infotainers like Orman.

No they are not smart.

Any company associate worth their salt knows that when they have a problem, they go to their superior with the problem AND several suggested solutions. Afterall, if the associate recognizes the problem, they sould have an idea how to fix it. The Big 3 CEO's weren't even smart enough to do that.

They want help saving the auto industry, their industry, and they flew their corporate jets to Washington. Not smart.

I think the idea of appointing a 'car czar' to oversee the administration of the funds is an excellent one. The CEO's just aren't smart enough.

Alfie

Carl Justus - your comments are so well-stated. Please, go buy a "Punctuation for Dummies" book, so that it doesn't take us so long to understand them. I'm serious - on both points.

The auto ceo's are smart. They are damn smart at making themselves rich at any cost. Their failure is not a question of intelligence, but of integrity. Alan Mulally got paid $28 million for his first 4 months of work in a company losing billions. So where is his incentive to do well for the company?

I believe that if the Big Three CEO's were really smart, they'd be thinking about merging companies into one, spending more money on battery technology for electric cars and trucks, and spend less on those stupid "tough truck" commercials!

How about taking the billions of dollars the big three are asking for and aggressively investing in new long term opportunities for Michigan? If there was any financial bright spot with those companies someone would have loaned them money or bought them buy now. If the government bails out the big three it will hurt us more long term than it will help. Michigan needs good roads, schools, and hospitals and they need good companies to bring jobs to the state. Michigan has always put all their "eggs" in the auto industry's basket and look at where it has gotten them. Bailing them out is only delaying the inevitable.

People buy what they want, and high fuel efficiency is not on the top of thie list unless gas is above $3 / gallon. The automakers build what people will buy. Look at Toyota, who recently built a new plant in Texas to build big trucks and SUV's (which are less fuel efficient than the Detroit maker's). Check the facts on JD Power quality survey, you'll find the US makers near the top (and European makers toward the bottom). Folks like to look for a scape goat to blame when things are going poorly – look instead at your own buying habits. Do you really support with your dollars what you say you believe in?

Whose to say they're not smart when they know the government will bail them out as long as they beg hard enough. When you know that will happen, why worry about making the right choices to be competitive? All they care about are themselves, just like you and me. Sounds pretty smart to me.

THANK YOU! and yet, congress is, as i write this, contemplating how much to give to this failure of leadership in the auto industry. further, not only do they continue to beg, but made a point that they will be begging for MORE once the new administration takes command. the worst may be that they have the audacity to deflect responsibility, play dumb, blame everyone except themselves, and still command a salary of several zeros greater than their leadership warrants. to the average american, this is disgusting behaviour, it is criminal, it is negligent, it is malfeasance, and they have no right to what they ask, unless they were to ask permission to voluntarily commit themselves to prison.

I guess I missed the part where the auto makers were forcing everyone to buy their big, overpowered cars. The only reason bailing them out makes sense is because we kept buying their products and voting for politicians who would not create a realistic energy policy.

"Government" Oversight and regulations... explain that to me? How is that going to work and who is going to run it? Our government's regulations have put American companies at a disadvantage to foreign businesses. The last thing our govenment needs to do is to get into business! Tell me what was the last good "program" this government has put forth and run sucessfully? Welfare? Medicare? Social Security? And if Dodd wants to start firing people he can start with himself as the as Mr. Chairman of the Senate Banking Committee... Tell me he doesn't have any responsibility in the banking failures!?! The evil businesses are easy to tear down... it's a weak argument and doesn't require any thought! But our our elected officials are never held responsible for their failures!

Ms. Orman argues that a bailout is necessary for the auto industry. But when will bailouts stop? Who will be next in line for a government subsidy? Instead, let's allow our economy to 'reorganize', based on the market and not on the whims of stiff-necked CEO's. No, no more bailouts!

Also, although I would agree with Ms. Orman in principle on our choices, her logic is questionable. She says we should save 6 to 8 months of living expenses. Yes, right! But shouldn't we tackle that credit card debt first? No sense in paying 15-20% on debt while saving at 3% in a MMA! First, get rid of that dumb credit card debt. THEN start saving the 6-8 months of expenses.

I am anti-bailout, across the board. These industries - auto, insurance, mortgage, etc. - have always existed on the backs of American consumers. Instead of maintaining healthy, mutually beneficial relationships, many of these industries became greedy parasites that spited the very consumers that supported them. They should be allowed to fail - yes, it will be hard for all of us, but it will be a good lesson for future generations of corporations and corporate leaders. Americans will support your companies if you do right by us, but you can't be allowed to abuse us, and then ask the government to force even more money out of our wallets and into your coffers. That seems anathema to everything capitalistic and American.

A lot of comments, and this article, are just bitter and crazy. CEOs are smarter, more ambitious, and harder workers than most people. Thats how they got their jobs. There are many, many factors into why the Big Three are struggling. In fact, Ford's CEO is the reason it is so much healthier than the other two.

And in spite of disastrous performance, the CEO of GM expects a $10 Million bonus. Is he delusional or simply stupid?

I personally think we should vote our congress, house and senate, out and start over. They seem to take from Social Security, and many other perks, but do not contribute, and we have to pay them the rest of there lives when we need to take care of our own by paying and hope to receive when we reach retirement!!! We need to get back to "Common Sense" practices in business and politics. It also couldn't hurt to but the 10 commandments back into the schools along with prayer. In previous years when we walked closer to God we were a very properous country, but through the immoral and illegal acts of our leaders we have definitely seen a downfall of our nation.

But what are we getting by "saving" or bailing out the big three? I do not believe it will be a more competitive American auto industry. This bubble will ultimately burst – and much harder than if we simply allowed the market to correct itself and for non-profitable businesses to fail.

Suze – great article – BUT – are we (the taxpayers) throwing good money after bad – the union has to jump into the ship – they are as greedy as the CEOs – everyone taking and no one thinking about the long term consequences – they have jam there poor quality, high gas consuming vehiclesdown our throats for years and NOW they coming crying to us – BS – sometimes tough love is good love – let them fail

Suzy for Senate in New York!

Perhaps Walmart should start selling cars. They are one of the best run companies in the world.

Some of what she says is true, but her comments about quality are 20 years out of date. Detroit's main problem is that they developed, marketed, and sold large cars because that was easier than fighting the unions for wage concessions that would allow them to build small cars profitably. It was a reasonable strategy until oil spiked again.

On the one hand, they should have known that. On the other hand, they probably needed a crisis like this to get the wage concessions. Beating up on the unions and the franchise cartel during good times wouldn't have been politically viable either.

So, Ms. Orman, what can we - as stockholders and taxpayers - do to wake up the CEOs and Congress? Complaining and grumbling just compounds the gloom and doom that surrounds us in every newscast and newspaper. How can we as individuals be part of the solution? Who do we write to? What specifically do we ask for?

No one will probably read this, but GM, Ford and Chrysler could help their respective situations by following the Japanese model; a standard line of vehicles and a luxury line. For instance, GM should perhaps keep Buick and Chevrolet only. Ford should drop the Mercury line since it is essentially the same thing as Ford. And Chrysler should dump all the other lines and just keep Chrysler and Jeep. The cost savings would be huge.

You know all these tips are good but I have to admit trying to accomplish any of them is becoming increasingly difficult. With rent, car payments, insurance payments, student loans, and credit card bills every month, followed up by utility and food costs, at the end of the month there is barely enough for me just to get down to living life. I am a 25 y/o male, graduated from college, I have a stable job that if I had several years ago would pay more than I would need but now......Everyday I have to check my bank account to make sure I am with in my daily budget, and at any moment I get the glimmer of hope of saving maybe a hundred dollars a pay check, it is immediately dashed by the fact that some other expense pops up and snatches my money. So I would like to thank all those who made that possible, Bush, Chenney, Rove, Auto-CEO's, Lehman Bros, stupid people trying to afford houses they should have known they couldn't, stupid banks that instead of practicing smart banking were out to make a quick buck, all the conservatives who HAD to vote Bush into office a second time even though catastrophe was starring us in the face 4 years ago. THANK YOU, I HOPE YOU ALL GET WHAT IS COMING TO YOU B/C YOU DESERVE IT!!!!!

I am an auto guy, Orman is a personal finance gal. I would love to get on Larry King Live and ask her 10 relatively simple questions about the auto industry. Bet she can't answer more than 2 questions correctly. So Orman has an opinion, everybody has an opinion. I am not sure what her's is based on, but it can't be accurate. So are we gonna take her stock tips based on facts or her opinion? Neither for me, I have somebody who knows what they are talking about.

Sorry Suze, but the Big 3 need to go bankrupt and clean up their mess themselves. We don't get bailed out when our businesses fail. The only way to learn a hard lesson is to deal with the consequences of your failed actions and planning. They didn't save for hard times, they didn't pay their debts, and they didn't tell their workers they couldn't afford them. Giving them money is only stringing out the inevitable on my hard earned tax money. Writing from Michigan–and a town hit hard by layoffs–I only see people wanting the status quo, rather than innovation.

I do not blame the CEOs at all for this mess. The board of directors, managers, and mostly the unions hold most of the blame (and the guy that approved the design for the Pontiac Aztec). During the last 15 years, trucks and SUVs have been the must-have for many consumers. The big three had the market cornered on trucks and big SUVs, demand was extremely high, and so was profit. If the big three didn't supply this market, there would have been outrage, disgust and bankruptcy ten years ago. If it's 1999 and gas is $.99 a gallon and people are lining up to buy SUVs at a $13,000 profit, why build Geos that yield only an $800 profit? The Japanese already had the small-car market cornered anyway. SUVs/trucks kept the big three going until a few years ago. The main problem lies with the greedy unions and the cowardly directors that didn't stand up to their extreme demands. Paying an average of $73k a year to uneducated assembly line workers, paying them not to work, and paying them pensions for 40 years after they get an early retirement is the quick way to bankruptcy. I've been on the Ford Rouge truck assembly plant tour and I'm sorry, but there's not a job on that line that a trained monkey couldn't do, with a few exceptions in the body/paint dept. When no one is buying profitable trucks anymore, the big three can't afford to pay all of it's workers' benefits anymore, it's that simple. Yes, the big three didn't see the gas crisis coming, but they're in business to make a profit and appease shareholders, not to run a union charity. Why do you think all the foreign manufacturers in the southern US aren't asking Congress for money? It's because they haven't made massive concessions to greedy unions.

Suze – I totally agree on your personal advice but bailing out Detroit is wrong for several reasons. If you want to save jobs, then 1) put the displaced workers on an adjusted unemployment upwards closer to a better take home that resembles their same role in a US based Toyota or Honda company but not a UAW based company with inflated wage controls. Take them off the company payroll but let them work with the management really feeling the pressure 2) develop a compreshensive strategy with dealers, suppliers, energy delivery, etc. to build fuel efficient, non fossil fuel burning attractive cars – set deadlines if they can't make it like their foriegn competitors they fail but the workers get paid 3) Tell Congress to grow and stop acting like children and trying to lie to the American public. Gas prices need to go way up – phase them in slowly and use them for transer taxes for massive changes in infrastructure. Provide solid and transparent relieve to taxi drivers, truckers, and other transportation or car based industries. threaten wrongoers with massive fines, lost licenses, sized passports, jail, etc. Congress needs to stop saying that everything is for free and the good times never stop. 4). Put an oversight panel in charge including regular citizens and run messages by them – there is no working "elevator speech" because that is what politicians think they have to do. Tell them to stop it, engage the public and talk through this mess. We can make this work and every American wants to make it work and every American will help pay for it but not until the tone from the top becomes truthful and realistic. A bailout of Detroit right now, as is, is a flagrant slap in the American face. Detroit has plenty of assets too – pull their balance sheets and mention federal sentencing while you are at it. That will get some cash. And their jets are worth something too. Just my $.02

I myself never bothered to look at a domestic-built vehicle. I have a foreign car, paid off now, which gets fantastic mileage and should last another 5+ years. I really have no faith that a bailout will light a fire under the domestic auto industry to get its act together - not until Big Oil steps out of the way. Does the oil industry really want green cars? Let's examine who really runs the auto industry (and, for that matter, Congress).

Ms. Orman's diatribe does not address or even acknowledge some of the very real issues facing the auto industry today. No surprise there.

Ford, GM and Chrysler had already developed electric vehicles in the 1990s: The GM EV1, Ford Ranger EV Pickup Truck and the Chrysler TEVan. Consumers weren't exactly lining up to buy those cars back then and when gasoline finally returns to below $1.50 most people will have forgotten about "fuel efficiency".

Most CEOs probably land their jobs not because they're smart or because they've earned it but rather cause they were given the jobs by their buddies...You don't hear just any American becoming CEO its usually someone already making millions.

You can't generalize all CEOs and major companies based on a few. There are a few bad apples but there always have been and always will be. If these major corporations didn't exist America wouldn't be the wealthiest country on earth and have the highest standard of living. Competition drives innovation, if there wasn't the opportunity to make a lot of money there woulnd't be any incentive for developement. Who would want to run Microsoft for $50,000 a year? No one with the ability; if you invest the time and money to get an MBA you should be rewarded for your effort. CEOs aren't always necessarily smarter than the average person, but they have taken the time to learn the principles behind running a business and making it profitable. How much do you think the CEO of CNN makes, I bet it's a pretty penny, but no ones complaining about that. And what about the CEO of Ford offering to work for $1/yr for the next three years? Sure he's got enough money to last that long and more, but if all CEOs were really that greedy then he wouldn't be giving up his salary and stock options, he'd be giving himself a raise with this bailout money.

It is just amazing how much arrogance the corporate world is still wearing on their sleeves in this miserable economy...particularly the auto execs. They want an immediate bailout because they claim they can't make it through the end of the year without an infusion of money. Hey, this didn't happen overnight...if they couldn't tell at least 9 months ago what they were facing, then please tell me why Rick Wagoner deserved the $16 million salary he was paid last year. They should have come to Congress much earlier instead of waiting. Wagoner says he won't step down...even after 8 years of negative stock prices; and Bob Lutz thinks he's the only one who could act as a "czar" but unfortunately for the American taxpayer, he's still employed! My gawd, I think these two actually believe they can walk on water! I think that not only should the first couple layers of corporate management be replaced (with men and women who are willing and able to take on the positions with a considerable salary reduction), but so should everyone on their Boards be replaced particulary their compensation committees (as most of these board members are most likely "buddies" anyway!).

I worked in the auto industry, inside the mfg plant. I've seen assembly lines and understand those lines are set up for quick change. I find it hard to believe those plants didn't change over to newer models sooner. Instead, they chose to milk the market for consumers wanting gas guzzling vehicles. Then the gas crunch put them on the skids. They lose because they settled for it, they don't deserve a bail out.

I believe that big time financial guys also called "CEOs" are basically bean counters who know nothing about invention, reinvention, or technology. They are good advertisers who are heavily paid and contribute nothing to progression of the product but rather play the numbers game along with their cohorts also called "accountants" on the Wall st. Their engineers are the smart ones who are litteraly treated like lackies and are given no or little representation at the table. I bet if you put your engineers in command and train them in a business school they would be better any day than the bean counters. And one more thing about these high flying CEOs; most of them are either product of Ivy league schools who got into these schools in the first place because their parents have unruly sums of money or kids of politicians. They come in with recommendations but with no brains. Most of the inventions are by either drop outs of Ivy league schools who have seen the futility of their educational system and have done well by taking their inventions to the streets. I can name quite a few from B. Gates to Einstein. American educational system has to wake up before we lose all the smart ones. Please admit only qualified individuals and not the sons and daughters of rich men, CEOs, and politicians. America was founded on pioneers and not the Ivy league idiots!

What would one do with a $10,000,000 bonus?

I would like to know where you stand on the incompetence of the financial wizards on Wall Street. Why have they been spared the humiliation that the auto execs faced in Washington? The Auto execs are asking for loans, not handouts. Having worked for an Auto company, I can certainly attest to some poor management decisions, but if they took the foolish risks that Wall Street took (on someone elses dime ) they would have gone bankrupt 50 years ago. They have a business model that doesn't work due to the large number of retirees thay now support, a problem the newer companies don't have (yet). Most of us are well aware that you don't solve money problems by throwing more money at them, yet that is exactly how these financial firms have been treated (no Harvard MBA required here). Being in the financial industry are you afraid to voice an opinion that may be unpopular?

Suzie,

Absolutely right, they are not smart! I am glad you point that out, so people can understand it is necessary to always be open minded and not take what groups feed us. These CEOs just don't cut it. We do need a product that can compete with the foreign market. Right now, they are beating these companies because they have fuel efficient cars. These CEOs have such strong ties with oil, they do not want to give up their personal interests. Even if it means trying to fool the consumers and employees, while bringing their companies to their demise. They only want to fill their own pockets. Well we are catching on. Thanks!

CEO pay structures are the problem. We have to disconnect CEO pay from share price. What's good for driving up share price in the short term is often bad for a company in the long term. I blame company board of directors. Measuring to share price is easy. But doing a full analysis of long-range strategies and planning and then deciding compensation is difficult. The boards took the easy way out and ultimately these companies paid a high price.

I ask every day, why do these people still have their jobs? Why are the leaders of AIG still walking around and are not in jail, along with many others that need to be in jail. Why not put them all on an Island, along with criminals that we are paying to keep behind bars. Let them be together and do what they will. These people are going to get to keep their jobs, live lavishly, and the rest of us poor slobs are looking everything. These people are laughing at all of us, especially at the law and government. Anyone else would be behind bars. I will pray for us all.

"What is needed is that these CEO’s finally get their heads out of the sand and make the known changes that have always been needed and start running these companies like this is 2008 not 1958."

What is really needed is that any government bailout offered come with one precondition: the CEO of the company receiving the bailout is to be replaced. Let the board of directors decide if they would rather receive government help, or stick with the person who got them into the mess to begin with – not both.

There is plenty of blame to go around...let us look at our culture as a
whole....Investment bankers making billions...CEO's making billions
Wall St speculators shafting the middle class.....People buying huge homes they cannot afford.....ringing up huge credit card bills they cannot
repay......college tuition so expensive the average student is not able to
attend......the manipulation of the oil market...its unbelievable to me what is going on....from 4.11 to now 1.99 per gallon?......Bush-Cheney are manipulating the oil market....Cars too expensive w/ too little quality to justify their price tags....the new Chevy Volt (electric car) coming in at
40,000 dollars....this is a travesty......we as a nation have to form a new reality....we are all in this together......its time to replace the we can have it all now mentality w/ a new paradigm...one based a new sense of values and morals

I think the regulations and conditions, including restrictions on management pay, that the auto industry must meet to qualify for government/taxpayer assistance is entirely justified and essential to prevent further squander on the part of the industry. Does it strike anyone strange that we gave Wall Street more money with fewer strings and allowed their CEOs to continue their delusional self-aggrandizement?

If nothing else, you would think these CEO's would not want to humiliate themselves and embarrass their families. Their grossly inflated salaries and bonus' are more important than dignity???

...the CEO group are as worthless as oats after they have been thru the horse.

Forget Congressional mandates on executive compensation. Let the Big 3 go bankrupt. The stock holders will do more to the CEOs, CFOs, Board members, and other high ranking executives than Congress could ever do.

If we really want to have more responsible corporate executives, maybe we should amend the corporate laws to remove senior executives' exemptions from corporate liability. If these CEOs and their crony high placed executives knew that they could be personally sued for incompetence (and lose all that bonus money they "earned"), then maybe they would think twice about the decisions they are making.

I read a study once (wish I could find the link) that the average IQ of a Fortune 50 CEO is somewhere between 143-150 (I understand that the small population size leaves a lot of statistical noise). The high end of that spectrum means they're "smarter" than 99.9% of the population. Maybe they're not as smart as we wish they were, but it is hard to fill the positions with smarter people. Now that said, we should be able to write contracts better to get these smart people to do what we want them to (i.e. not just line their own pockets), but we don't.

The problem is not that CEOs are not smart, it is that they are really not all that interested in the long term value of the companies they manage.

Their compensation and their bonuses are not tied to making good decisions that will insure the long term viability of their company. They are tied to metrics that produce short term rewards at the expense of future value.

If the ship you are steering will hit an iceberg and sink if you stay on the course you are currently on but you know that you are getting huge bonuses to stay on that course and a helicopter will pick you up moments before the ship crashes, where is the incentive to change course?

The big three did what we wanted. When gas was cheap, they made the large SUV's with big margins. We bought em. Now, we blame them. The big 3 do make fuel efficient cars. Its just that conventional wisdom is they are not very good. I don't know. I suspect conventional wisdom is alot like being a republican or democrat. You just are, regardless of the quality of the candidate. Maybe before you buy yet another camry or accord, check out a fusion or malibu. You might be surprised. And oh, you might save somebody's job down the street. And yes, the other poster said it well, CEO's are greedy, but thats capitalism. We need to adjust the concept of corporate fudiciary responsibilty and make boards accountable. Not just check writers to their buddy the CEO.

I could be a CEO of a major company and I wouldn't do half bad. These guys are sure out of touch with the rest of the nation. Companies that deal with a union have it hard. It's time to kick the union out of Detroit and out of the government. It only hurts the business. Doris you're lucky that you live in this country, because if you didnt your head might be chopped off already.

If those three worked for Donald Trump I can hear the Donald's voice now: "You're fired!" And they should be – no bonuses – no golden parachutes – nothing. Hit the road and look for a job.

As a european now living in Michigan for the past two years, I am totally amazed why G.M and Ford haven't switch to manufactoring the cars I see in europe as leading salers.

If I was the CEO of G.M I would do the following.
1. Use the time engaged with congress to reduce the price of diesel to the same price as gasoline.
2. Start making the Opel Astra(small car), Corsa (mini car ) diesel versions here in Michigan. They are great cars, just build them to a higher quility level than the Japanese. They get 40-50 mpg with there eyes closed.!!!

All in all the electric car is still years away, and this would be the best intermidate step. Just change out a few gasoline pumps to diesel.
Done deal, however I know small cars don't make big profits, however some profit is better than nothing. Wake up. Philip

I would hope that our government sees the C.E.O.'s for what they are: greedy. The Chrysler C.E.O. who asked for a $10 million bonus should be told by the government to stuff it. I would hope our government bailing out the auto makers puts a provision that the C.E.O.'s and upper management lessen their fat paychecks and bonus' and stock options. I hope we save all those auto related jobs but that the C.E.O.'s and upper managements suffer like their employees meaning less pay and benefits. Everyone I know feels the same way.

These guys are smart--"like a fox". Carl has such a good point–those we idolize make millions. I hear the Brittney Spears concert in Pittsburgh is sold out. I'm sorry, but if she was performing free across the street, I wouldn't go. People (some) make too much money and the whole scene is out of whack. But as long as people continue to allow this, is just going to happen. And people arent' going to change, in my opinion. And CEO's don't care about you and I, but their pocketbooks. They don't care if the car companies go under because of us, but because of their gravy train.

I dont think its fair to make a joke out of these ceo's for begging and "not being able to make the right decisions" Yes they are partially to blame they did focus on large suv's for way too long. But its a no brainer im not buying a car because i dont if i'll have a job tommarow not because these cars are less fuel efficient or lower quality. The blame lies on the current administration for running our economy into the ground.
Also on a side not the greedy banks and credit card companys are getting huge bailouts of our hard earned money yet noone is talking about that its only the evil automakers that are to blame and be made a mockery of!!

Why does everyone keep parroting this false premise that US auto companies are in trouble due to not having enough hybrid, electric, or otherwise fuel efficient vehicles?

A few basic points:
– No one has made any money on electric vehicles
– Gas prices have come back down and gas has been relatively affordable for years
– Toyota makes no money on the Prius
– Americans love buying trucks, SUVs and other large vehicles. That is why foreign auto manufacturers have been trying for years to introduce new large vehicles here.
– The "big 3" have had small, efficient cars as part of their lineups for years. Chevy Cavalier anyone?
– Auto companies make more profits from selling SUVs than coupes.

Try to process all of these. Perhaps it is not because of this silly "fuel-efficiency" canard that the big 3 are in trouble. Perhaps it is a perception of low quality vehicles and a significant cost disadvantage due to UAW labor contracts? Perhaps it is the union and lawsuit friendly environment in America that is not so... corporation friendly?

Those reasons may be a little too complicated for a personal finance expert. I suggest that Suze sticks to small scale finance and leave the issues of large industries to the experts!

While CEO's are responsible for the decisions and actions made by the company, the real decision makers are the vice presidents and executives under the CEO. It is those individuals who should be scrutinized.

All this talk about bringing other businesses to Michigan. . .simply won't happen. The tax burden is FAR too high. Until the state changes that, it's Auto Industry or nothing!!

I agree that ALL these CEOs and boards begging the government for our dollars have poorly managed their operations.

I also believe, though, that we forget that all the corporations and companies are made up of people. How can so many people agree to reward such behavior for so long?

For years I have taken issue with the short-term mindset of American business–do whatever now to reap the benefit now, to hell with the future. Finally, the moral of the story has come home to roost. Are we going to pay attention?

How could so many people agree to such a system? To me, it points to a downward spiral of the importance of values in our culture. Once we get to the point where we're placing people first, doing the right thing first, we will have long-term stability.

I'd much rather have a clear conscience at night that a fat wallet.

In some corporate structures, if you are in the way they don't move you out, they move you up.

People aren't buying anything because –
– consumer credit has dried up
– 1/2 the country is threatened with imminent job loss
– credit card companies are routinely hitting people with 20 to 25% credit card interest rates and high fees
– oil speculators just drained everyone of any extra money

The car companies are doing poorly because –
– people think foreign cars make them look sophisticated
– they need to sell high margin SUVs and trucks because of labor and health care costs
– nobody knows what kind of car to buy due to fuel price craziness
– nobody knows what kind of car to make due to fuel price craziness

This whole auto crisis has little to do with fuel economy. American-made cars are right in the mix as far as fuel economy goes.

They bail out and reward all this company with our money. It would be great if this companies now pay for our health care out entire life.

This is not only the fault of the CEOs of automakers. Its also the fault of the American people. We've all known since birth that oil is a finite resource, yet millions of Americans continued to buy gas guzzling cars and trucks for decades now. If we don't buy gas guzzling vehicles and also stop viewing the pursuit of alternative energy sources as some liberal loony scheme, the automakers will have no choice but to change their ways. We are all responsible for what happens in our country.

The problems relate to this:
– During periods of high profitability the big three wasted a chance to invest in themselves, their product and quality.
– What they did was this:

Paid big dividends.
Ford bought Volvo, Jaguar, Land Rover, Aston Martin and a controlling interest in Mazda.
GM bought SAAB, stakes in Suzuki, Daewoo, and Subaru. Don't forget the FIAT fiasco.
Chrysler bought Lamborghini.
They refused to invest in basic quality for their cars. Why spend big money on a chrysler mini van to only have to put brakes on it yearly, replace the struts yearly and then the minute you pay it off the electric goes out, the windows fall into the doors and dash lights stop working.
Or you buy a Honda....and after 100,000 miles you have only replaced the tires.
Seriously.

Alas, CEOs really are smart people who have mastered the arcane knowledge of how gigantic organizations are structured. They also can make large numbers of decisions quickly, a skill beyond the reach of most people who learn early in life how to avoid responsibility for anything. Everybody wants to be the invisible power behind the throne offering sound advice - very few want to be out front. This is why CEOs are paid such obscene amounts of money....

Like on so many other subjects, Suze is WRONG! Detroit built what American's wanted. We wanted SUV's. Making or trying to sell anything other than what your customers demand, is suicide as any business owner (which Suze is obviously not) can tell you. That the price of oil changed those wants overnight is not their fault. Dropping quality *is* their fault but is peripheral for the discussion (as is cheapening of products to meet the blackmail of the labor unions). The big 3 never where great stocks to own, nor did they pay stellar dividends.

Suze, climb out of your freaking bubble! People living paycheck to paycheck cannot "built up a warchest of 8-9 months of income". Nor can they pay down their credit card debt acquired trying to survive.

Now, if you are referring to that portion of society that bought houses they couldn't afford, maxed out credit cards getting flatscreens and toys, bought new Hummers on credit to impress the neighbors, etc... YES, they are the reason for the current recession. Those who enabled their greedy, immediate satisfaction, ways like Detroit, Fannie and Freddie, etc. were just providing what their clientele demanded, because if they didn't, someone else would.

Quit playing the anti-business card, absolving the real culprits of their undeniable guilt.

Let companies and individuals who took the risk, fail. Anything else will just prolong the inevitable.

THANKS, Suze!

Pleasant holidays to you and yours too.

From what I see at this point is that it's the american people that started all of this. Aren't we the ones that vote these people into these offices and year after year they say one thing and do another. I would like to know when are the people that vote will finally say thats enough and get these peole out. All of this could have been prevented if the all the senate congress, etc. would have done something so the auto makers could have gone on to building more green cars and the pres and all his goons could have prevented the fuel cost but no thats because those people are nothing but full of GREED.

CEO take jobs because of the huge salaries, bonuses and benefits they will receive. Most are not interested in what they do for the companies they head, but what will they take with them when they leave. Most want big stock bonuses, gold parachutes, and benefits for life. The are greeedy, just look at the banks, mortgage companies too.

First off,
We are not in charge of multi-billion dollar corps. So I have no idea how we can act any in way shape or form in the same manner as a CEO. I think that Ms. Orman really should stick to what she knows best and stay away from the rhetoric. It is easy to say pay down credit card debt., A monkey could repeat that phrase. Ms. Orman has always given obvious advice and never given helpful advice. I have no respect for people who criticize events of which they have no knowledge of. Ms. Orman fits this description. she has no idea what difficulties these CEO's have faced i.e. a greedy Union to a finicky consumer. The facts are that GM has more cars that go 30mpg then anyone. The quality standards that plaqued the big 3 in the past are not as prevelant today. The big 3's issues come down to value based economics. People see no value in American cars. The automakers should create an American value to their product "Made by Americans for Americans" "Quality you can trust." I remember a saying that my grandfather always used to say to me. "When you point a finger at someone else. There are 3 pointing back at you." Now is not the time to point fingers or give ourselves a pat on the back. Now is the time to be innovative, determined and loyal. In other words be Americans.

OK, these guys aren't so dumb. They obviously see that the problem with the car companies has been the management, especially the executive management. So when downsizing which employees should be let go first? I think even they can figure it out.

The real issue here isn't the three letters CEO, it's UAW. There is a reason Michigan has the worst economy in the U.S. It's because for 50 years Michigan has had the largest union presense in the U.S.

You forget that General Motors (with the CEO everyone is beating up) still sold more cars last year than any car company in the world! You can't say they are in their current position because of their product line. They make cars people buy.

Because of the cradle to grave union contract liabilities they have, though, their expenses are hugely out of whack with their competition. Union salaries and benefits are not, and never have been, "middle class". They have created a class unto themselves, transfering huge amounts of wealth from the normal "working class".

This is what happens in the end when you compensate people way more than the value of the product they produce. In a free market, they fail. This is why unions go to any lengths to prevent non-union competition. They can only succeed when they have a monopoly on the labor force. This hasn't been the case in the auto industry for the last 25 years and the writing has been on the wall for all that time for anyone willing to read it.

I believe in putting your money where your mouth is. Support local, buy local, goGREEN etc etc. However I own a honda civic. Trying to personally cut down on emissions and strech my own dollar. But with my two kids, one in a car seat and one in a booster seat- we are sardines! My knees are in the dash, my sons legs have to be bent so my husband can drive, and there is no room in the back let alone for groceries/stroller or needed items to go anywhere.....
What Im saying is, if I- an intelligent consumer trying to do my part cant fit into a car- better believe my next purchase will be the mini van or SUV. So yes the demad for the larger cars are needed, but auto makers should make more hybrids, better fuel economy for the larger cars etc. Because no matter how much I talk the talk and walk the walk of living more efficient...I hate my civic.( Just commenting on anothers -about if we truly want changes in the auto makers we have to stop buying the big cars...wish I could...wish I could)

I read today the article about some GM VP named Bob Lutz. He is all in the news today. He advocated for the 10-cylinder Dodge Viper (a super gas guzzler) and he believes that global warming is a joke.

If he is the prototype of management at Detroit, they – the big 3 – are doomed regardless of how much money we the taxpayers throw at them.

This reminds me of Enron and the Harvard-educated Jeffery Skilling who didn't know what was going on either.
Since Congress has done such a great job recognising what's wrong with the auto manufacturers, perhaps they can look at Social Security again in the next few years before its too late.

Why is all the emphasis on the automaker CEO's and not the financial institutions CEO's? They are still asking for upwards of $10M bonus' for 2008.

Also yes the CEO is responisble for the company but look at the US gov't. Years back after the gas crunch in '77 there were a few congressmen pushing a bill that would have required the average MPG to be 35 with it having to be 40 by either 2015 or 2020. It got shot down, the american people forgot about it, bought their large cars, and history repeated itself.

GM tried investing in alt. engery and had the EV1 back in the early 90s but the general public didnt want the electric car then and it was only seen in California.

The general public has a false idea that foreign cars are better in many ways (gas mileage, reliability etc) when in fact i would bet that the US cars are just as good. They have always have cars with good mpg that match and sometimes beat the foreign competition but the fail when they are rumored to have bad quality.

Also as stated, people are in fear of loosing jobs so they arent spending money right now so that hurts them even more.

What can you expect from ceo's who make 20million a year they automatically assume it could never happen and it did. I know america needs these jobs and this bailout but it is not fair. I know for a fact if I drive my family's restaurant into the ground no one is going to bail me out its just unfair and the ceo really dont care they already got 50million in the bank please see the light people I can gaurantee even if they get a bailout it will only bandage up a open wound that wont heal and it wont mostly everyone i talk to says they will never own another america car ever. Believe me there telling the truth

Unions are a product of the 1930's. They should ban them altogether, get rid of the dead weight union morons who hide behind the union to hold their jobs, and let the people who want to work, work. That would put us back out front of the world for quality and it would create more competitiveness. I am surrounded by useless union workers all damn day and they are first-class whiners who just want to be catered to and given high salaries. Granted, not EVERY union person is this way, and many are required to be in unions, but keep the solid workers, get rid of the driftwood, and watch America rise once again.

Just remember, in order for these auto makers to pay back these loans, we, the people who loaned them the money, have to go out and buy their products as well.

I'll say this to all that buy foriegn made vehicles, This is america if you quit buying american then we can say this is japan, china, etc. Look how many u.s. made companies have gone out because americans have let them in. So in all right doesn't that mean that we ourselves have detroyed the u.s.

Suze, you're my girl!!! I think you should be the one to over see the
so called big 3. Then we all would know they would be running correctly, efficiently and most of all profitably!

I work for a generous company that provides every employee with an opportunity to earn a bonus every year. The bonus is based on the employee and the company satisfying specific performance goals. The bonus must be EARNED, it is NOT A GIFT!

What I don't understand is why companies (not just Chrysler, Ford, & GM) provide their CEOs with seemingly unconditional bonuses. From what I understand, these companies have not only been consistently missing their profit goals for years, they've in some cases been operating with substantial losses for years, yet they still reward their CEOs multimillion dollar bonuses! What incentive does a CEO have to improve his company's performance if it apparently has no bearing on his own compensation?

To all simpletons: The financial crisis started by Wall Street and the Federal government is the cause of the auto industry collapse. The indictments should be handed down to all those who were complicit in the largest financial rape in American history. The hypocrisy of Senator Dodd and Barak Obama to suggest that Detroit 3 management teams should step down is astounding. Senator Dodd presided over the Senate banking, housing, and urban affairs committee and Representative Barney Frank over the House financial services committee while the single largest housing and banking fraud transpired. How can it possibly be legal to provide trillions of dollars in mortgage loans to people that have no capacity to repay them, bundle them up into a slick new security product, fraudulently rate them as AAA securities, and then proceed to sell them to investors? Where are the hearings? Where are the indictments? In absolute dollars this crisis will likely turn out to be the largest fraud in the history of the world and it all happened on Senator Dodd and Rep Frank’s watch. How can you not view these two congressmen’s complicity as criminal? Their two committees are the legislative watchdogs over all the institutions responsible for this grand larceny. The domestic auto industry is in a free fall collapse because of the financial and economic meltdown caused by Wall Street and the Federal government. Now these victims of their ponzi scheme are showing up at their doorstep looking for assistance and they have the audacity to berate and blame them? They are the victims of these financial rapists. I am absolutely appalled at the treatment our American auto industry leaders are subjected to by the very individuals who were either actively or passively a party to this financial rape. They have the nerve to demand management changes at the companies victimized by them and Wall Street? It is absolutely unbelievable that the American public believes these co-conspirators. According to a recent CNN poll regarding the auto industry loans, the poll unbelievably shows that over 60% of Americans don't believe they should receive assistance. Obviously these 60% do not understand that it was the government, ratings agencies, banking industry, Insurance companies, Fannie Mae and Freddie Mac who caused the automotive industry crisis. Admittedly, the auto industry was not in great financial shape to weather a massive economic meltdown because they are saddled with huge costs providing millions of American employees and retirees with heath care and pensions. No foreign auto company has these costs in any significant amount. All foreign auto companies are in countries where the government provides health care and retirement. Most also receive huge research and development subsidies. All our government does for the auto industry is provide endless CAFÉ and NHTSA regulations with no subsidies and now public ridicule. So if the Detroit 3 emulates Toyota’s cost structure by dumping their health care and pension obligations on the Feds, which congressional committee is next to belittle and scold them? Foreign automakers the world over are approaching their respective governments for assistance to weather this storm and they are all being treated respectfully and patriotically. Not here, where ironically the problem was created. I am thoroughly ashamed of our government and beginning to believe that not even Obama can re-brand America when most of the legislature is morally bankrupt.

Let the big three file for bankruptcy so that they can get better. Jobs will be lost for a time but things will get better. Jobs will come back. The glory days of the past few years is gone. Time to wake up and face the new tomorrow.

With the exception of Mr. Wagoner, these CEO's are not to blame for the errors the industry has made in the past. As newcomers to the industry, they have seen the need for change and have already achieved major milestones in turning these companies around. I geniunely believe Mr. Wagoner has also seen the error of his ways. Yet, our economy is in a tragic downward spiral. Most responsible people can't even afford to remortgage their house right now, let alone buy a car. And the industry, along with it's partners and connected industries is extremely interconnected. A bridge loan is absolutely necessary to preserve the middle class and to curb further economic deterioration, regardless of whether or not you are a fan of the products made by the big 3.

Tous chez on the tie in towards personal fiscal responsibility, but if you want to place blame, make sure you place the blame where it belongs. Most of those people are still working in their banking jobs, trying to give themselves $10 million bonuses while their companies recieve billions in TARP funds, while the rest of us still can't get approved for a loan for a house or car.

Good advice, Suze - nothing new, but good. Doesn't anyone care where bailout money comes from? Most of the money we pay in income taxes goes to 'service' (pay interest on) the national debt. It is projected that next year we'll be maxed out on that interest only loan. That's correct, against Suze's advice, we the people now have a ten trillion dollar credit card debt. And we have been making the minimum payment (interest only) since Andrew Jackson was president (1837). Read webofdebt.com - amazing.

We live in troubled times. And as a whole all of america has to share some of the blame for this finacial deasaster. From the CEO to the union worker the gread is the same. No one stopped long enough to see the long term effect. Now we have to find a solution. Does a CEO need to make 20 million dollars a year or does a union worker need t make 40 dollars and hour?. If we want to survive NO! We need to look and restructure our work ethics. Their should be no big pay outs to executives if they are not doing their job. Their is none for the working class man who does not do his job . And if you need a bonus while making over 500 thousand a year, I think you have a money managing problem.

Bail out would mean something if Americans are ready to buy American cars? Are we going to buy? When I look around the neighborhood, I see only Japanese and German cars. Even Korean cars seem to be doing better. Heck.. even the car rental agencies are renting Japanese cars. Even if we (the consumers) want to rescue these great American brand names, and buy from one those ever changing models, will there be parts available years down the line? Unless these basic questions are addressed, bail out would be foolish. In 1997 I wanted to buy a pony Pontiac. Edmunds openly said "don't go anywhere near the GM". I didn't buy, and don't even know when that model vanished from the scene. I don't see anyone driving. Hey, Accord is still around. And, what happened to that goofy design of Taurus Ford came up with in 98? Prior to that many police cars were Taurus. They killed a superb model with some idiotic design. Well, those are just two examples. We all know many more.

I think anyone over the age of 25 has grown up believing foreign cars are better – it's literally part of our culture at this point. Ford/GM/Crysler could make a car 10 times better than Honda or Toyota and the American public would still say foreign is better. It's just too late.... No one wants to invest in America anymore.

Great article Suze. The bid three do not deserve any bailout for the same reasons that you have stated. They remained indifference to the competition and they should pay the price. The loss of jobs is obviously regrettable but other Americans from small businesses continue lossing their jobs right and left. Yet nobody is bailing them out. After the big three, some other company will show up and life will go on.

Suze, I'm sorry but that is some of the dumbest crap I've ever heard. You need to stick to personal finance and leave economics to people with a little higher I.Q. than what you're sporting. And as far as your personal finance advice goes, that some dumb crap too. The average American doesn't have one week of salary saved up for emergencies, why did they spend it at the local bar?, no, they've been trying to keep their houses, keep their bills paid and keep their children fed.

The auto execs are brilliant: they awarded themselves huge salaries and bonuses; paid workers exorbitant salaries and benefits to suppress complaints; and got the govt to bail out the company to award their greed! Now who is stupid?

Hindsight is 20-20. Americans have been buying SUV's and trucks as fast as Detroit could crank them out for the last 10 years. In other words, they were turning out the product that consumers wanted. The government was not providing incentive to anyone to move toward smaller, more fuel efficient vehicles. Now everyone is blaming Detroit. Another example of a free market system that doesn't work.

I 'd like to know why the auto makers recently began producing cars that are fuel efficient, when Nissan, Toyota, and other Asian automakers have been doing this for YEARS!

ARE THE ASIAN AUTOMAKERS PLEADING FOR BAILOUT MONEY FROM THEIR GOVERNMENTS??

WHY DON'T THE AMERICANS INVENT AN ALTERNATIVE TO THE IPOD AND THE Wii????

Where was Suze when the Wall Street firms were given 20 times as much money as the Big 3 is requesting? Have all of her years at Merrill Lynch and Prudential clouded her judgement into thinking that the those CEO's are "smart?"

A bailout of any firm by our government with taxpayer money is wrong. Let them all fail as they should and the strong who have made the right decisions will survive.

Why has not a single person in the media brought up the fact that American automakers have a greedy union on their backs which has completely hindered their ability to compete? Politicians as well–labor costs are of incredible importance when running a company and they are much higher for the American automakers. How much do those Honda, Toyota, and other foreign car manufacturers pay their employees that do the same jobs? This is such an important issue that has been neglected. The automakers cannot and will not return to building competitive cars until their costs are similar to those of their competitors. Otherwise, we're just going to see the Big 3 fall again.

Let's be very clear here, the union deals that were made that allow some people to get paid over 50k a year NOT to work is one of the symptoms of this increasingly challenging problem.

Our public officials are letting us down every day and we decide to be upset at the manufacturers solely? This is an American failure; we are all to blame. Yes, we should bail these companies out, yes we should require significant changes in the union rules (or go to war with them and decertify all unions involved with the big three – this is an antiquated organization anyway, if state and federal policies are up to date no unions are needed...but our democrats will not fight the union in my lifetime), and yes these CEO's are very intelligent and capable people who are attempting to tackle a larger problem then most of us will ever fully understand.

Bail them out, force them to make more efficient and green cars (as long as demand remains), and get the unions and government out of their backyard as soon as possible. This is a recession; maybe even a depression, but it too will end and if we do not make the right moves now we may crush an American economy that we all need.

But really, what do I know...

Suze,
Try and follow the logic. Oil prices were overly inflated by wall street. Gas prices skyrocketed. People stopped buying SUVs and trucks. The automakers sales dropped 30-40% within a couple of months.

THE WORLD HAS NOT RUN OUT OF OIL. It's not going to run out tomorrow or in our lifetime. The only reason we should get away from using oil is to protect the environment and reduce our reliance on certain parts of the world.

I am by no means a fan of any of the CEOs of the big 3, but if your business lost 30-40% of their sales, would it survive? Would any business? Why would a CEO steer his company to pump money into products that make less of a profit, when the products that make the most profit are flying off the shelves? A fuel efficient vehicle brings a profit of a few hundred dollars, while an SUV or truck brings in a few thousand.

If you look before gas hit $4 a gallon trucks were the better sellers. Your logic seems more faulty now that the gas prices are so low. (Did we find more oil?)

Fortunately or unfortunately, companies are in business to make money. For these CEOs the best and easiest way to do that for the past few years was to pump out more and more high profit huge vehicles, becasue that's what their customer's wanted. How can you say that was bad leadership? People are always looking to make a fast buck, that's why oil prices went so high and why the big 3 sold trucks. Besides, can we really expect a corporation as big as GM to turn on a dime? Don't say they've seen this coming, becuase that arguement isn't relevant.

You know why I have a Honda? It's reliable, dependable, efficient and it looks good. I have run 2 Hondas to close to 200,000 miles and they still ran well when I traded them in for my next Honda. I have had 3 Chryslers and they all had serious issue after two years. Head gaskets and transmissions had to be replaced. When the US car makers consistenly make a car as good as the Honda ... I'll buy it!

I 'd like to know why the American auto makers recently began producing cars that are fuel efficient, when Nissan, Toyota, and other Asian automakers have been doing this for YEARS!

ARE THE ASIAN AUTOMAKERS PLEADING FOR BAILOUT MONEY FROM THEIR GOVERNMENTS??

WHY DON'T THE AMERICANS INVENT AN ALTERNATIVE TO THE IPOD AND THE Wii????

Larry and Suze,

You can see the kind of vitriol that the CEOs engender with their consistent lack of disregard for the middle class, upon whose backs they build, buy and bankrupt their empires. You can see it in the reactions of Congress to CEOs that take separate corporate jets to hearings, with absolutely no concept of the impropriety of their actions, or the CEO who has the chutzpah to demand a bonus in addition to huge compensation that would easily pay the salaries of the laid off workers for a year after running a company into the ground, or the Bank that cuts off credit to a manufacturing co so that they can't make payroll to comply with the Federal WARN Act when the Bank received TARP money.

No, I am not spending big bucks on Christmas, my husband and I agreed that we would not exchange gifts for Christmas, so that we could give the kids a good Christmas. The oldest needs a new bike, because someone took his old one. I guess they needed it more and they are welcome to it. The youngest will get a nice package for the oldest's first bike to make it cool like the one in the store, with streamers etc.

Last year's Christmas was lean as well, since I had been out of work for 2 months by then. We got the best present ever, a very good job offer, in the week before Christmas. There were not so many expensive gifts, but Santa gave us the means to provide and health insurance.

And meanwhile, I have an excellent job that I hope to hang onto, after two layoffs last year, because it's a good company, holding strong in this economy. I am saving until it hurts, because I don't want to be caught with my pants down again. We just passed the 2 month mark on savings, which we put together in just a few months and we are keeping going. (I did say it hurts.) We are definitely preparing for the worst and are also stocking up on canned goods and other dry goods, planted some winter lettuce in the kitchen window and other changes.

We do have a housekeeper that comes in every two weeks that's become a stretch to afford, but he has a family to feed and is hard hit by housing issues, so we make cuts to keep him in work and save bottles for his family to redeem. It's not charity, but it helps another family. Even in his own dire straits, he and his family are helping others with clothing their families showing a generosity of spirit, thriftiness and respect for the resources that God provides that is definitely lacking in today's CEOs. My husband and I made a conscious decision to make other cuts and keep this humble man employed. It was just the right thing.

Capitalism + Industrialism = the fall of human society

Suzie, we will NEVER be smarter than those CEO's. They used OUR money during good times and our money during bad times ...... try taking a cent from THEM .... then please give me a call.

Another huge aspect of this is that people pushing this bailout use the recovery of the credit markets as an argument for bridge loans. The bottomline is that the credit markets are not going to recover, and probably should not recover, to the point where people can afford to buy a new car every two years. If it does recover to this point, then we are just setting ourselves up for another disaster like this in another 10 years. People need to live within their means. Does that mean no credit system? No, but it definitely needs to be reigned in. People need to keep cars for longer periods of time. They need to purchase homes they can afford. It is inevitable for the car industry to shrink and jobs will be lost. We need to let market forces dictate which companies prosper and which ones fail. Taxpayer money will not stop this, and we will make things worse by directing this money to try to stop the inevitable.

While there is plenty of blame to go around for the failings of the US automakers, the solution lies in the pricing of fuel. President Obama should immediately impose a federal tax, yes tax, on gas at the pump. Use the current cost of oil the day he takes office as the baseline then add 10 cents per gallon per month until the price reaches somewhere between $4 and $5 which as we've seen, is the price where people start to take notice. The margin between $5 and the actual cost goes into the infrastructure projects needed for jobs and our own well being and national security. Rather than create profits for the legal profession through extended bankruptcy procedures, why not have the US government take controlling interest in the US automakers, if not buy them outright at their current bargain stock prices as Michael Moore somewhat facetiously suggests? Since the government is likely the single largest buyer of US vehicles, they can mandate fuel efficiency stardards through their purchasing contracts while controlling the manufacturing end to assure the new standards are met while tooling up to produce the hybrid, electric, hydrogen or whatever sort of vehicle that the world must use going forward if we are to escape the corruption, pollution and wars that have always surrounded the oil industry.

Down with ALL CEO's in ALL industries. I am sick of them screwing all of us and crying in their beer over this and that. This has been going on for years and I am happy at least that people are starting to WAKE UP!

There are 2 things need to happen in Auto industry.

1. They need to change their attitude about making cars. It is shameful to be begging money while non of the Japanees car companies have no complains even when the economy is down. I believe they manage their workforce efficiently and make better vehicles. American automakers needs to learn from Japanees auto makers on how to manage auto business.

2. Unions have gone evil and it must be changed. It seems like people are getting paid for doing nothing because of the union contracts. Unions are good to protect labor rights but they can go very inefficient if not regulated properly. And I do not think unions are necessary in free market capitalistic society as we have in America.

I find it really apalling that the Big 3 basically have the govt held hostage to provide these bailout loans etc. If the govt doesn't help and all of them go under , many Amercians will b out of work and that in and of itself will have huge reprocussions .

If they really want to be successful, they need to focus on priorities, like producing a quality product and not being bullied by a union that has required that the workers get paid 3 times what a comparable job is worth. Maybe spending their advertising $$ on quality?

I don't think that it is unusual to think that if you buy an American car you can expect to fall apart within the first 5 years and be worth nothing when you trade it in . That's really sad .

Not to defend the Big 3 CEOs, but the article is so very thin, emotional and superficial. There is plenty of blame to put on Detroit, but none of it is found in this article.

Fact is Americans bought SUVs and trucks as fast as they could be pumped out, and they are the best margin vehicles that come out of Detroit. If Detroit did not do that in past years, the complaint would have been that these same guys were not delivering what customers wanted. Then the stock suffers, the consumer goes to another brand, and Detroit shrinks.

Why did a hybrid or electric vehicle not come on the market from them? Since we are talking economics, the economics of the much touted Prius just do not stand up in financial terms.

Consumers have not been willing to pay the price of technological change, and to accept new technology at a price where it is profitable for a company to deliver it.

If we step past that issue and magically we all have an electric car in our driveway, where is the power generation and the grid capacity coming from to top up those batteries each day? That has to come from taxes, such as the $4 per month for each household in Texas to build the grid for the wind farm Boone Pickens is behind – that alone is a $17 billion program just to transport, not generate, the energy.

Government at all levels has pumped money into foreign brands to build in the US, to the disadvantage of Detroit.

Clearly, there is change needed. Consumers deserve a better product but they must be willing to pay a fair price for it. Historically, that has not been the case.

If Detroit is smart, they will use this moment as an opportunity to reinvent their industry – shut down the lines that are pumping out moderate product and come back to the market with vehicles like the Volt and others that can be generated.

And for anyone thinking that since oil is in the $40s that all those energy issues are past – get real. Oil prices will come back and go well past the highs that were experienced this year; just give it a couple years.

Suze, you're the expert, right? Get to the core of the issues, not the superficial chit-chat.

I love this article. I hope that every CEO reads this and learn something from it. There is a lot to be said about the words honesty and truth as far as your self goes. Get em' Suzie!!

Hi, I was wondering-if they get bailed out are they going to take a pay cut? I mean geez that one guy I saw on television is getting paid my dream of a check.

Auto manufacturers are in business for one thing, to make a profit. They don't owe anyone anything. The fault lies squarely on the shoulders of Americans who knowingly buy cars that destroy the environment, just to induldge in ego-driven status symbols.

People who drive foreign cars don't think it makes them look sophisticated, they just want a car that isn't going to crap out on them, a product that is up to foreign (higher) standards in terms of impact on the environment, and probably, smaller cars because the tanks are driven by often aggressive, self-serving jerks.

The American guzzlers have a market. Nothing will change until there is "buy in" from all of the U.S. sub-cultures... and some humility, which we desperately need.

bail out the banks, bail out the auto industry......who is next? If we bail them out then all those CEOs should be fired!!!! Bottom line...they screwed up.....If we do nothing a lot more people will be jobless...bail themout but fire the people in charge...and no more bonuses.......

Susie - You are once again NOT qualified to be passing your narrow minded judgement on the public - when you have been EDUCATED and have WORKED in the areas of business that you give ADVICE on - then your words are worth considering. You should not dispense advice in matter of business that you ZERO working knowledge of. Your advice has proven to be in poor taste in the past. Your advice renders fear in consumer and your are contributing to the spiral effect of the economy with your words - be a more positive person!

All these people now saying that the Big 3 were stupid for not making fuel efficient cars need to wake up. In the most recent past (say mid 90's to 2005) what were the best selling cars? Gas guzzling SUV's. Why is that? Because the public wanted them! Everyone praises Toyota and Honda and VW for all these small 'economical' cars. I'm sorry, did someone forget to tell all you hypocrites that these same companies also made SUV's? If there precious econo-boxes were selling so well why would they have made SUV's? Oh, right, because people bought them.

This reminds me of the housing crisis in which the CEO's take all the blame meanwhile the Average Joe's who purchased houses beyond their means are the 'victims'. Get real, people. The worst thing to happen to this country in the past 25 years is the lack of personal responsibility assumed by the average person. It is, frankly, pathetic.

Big three automakers have big investments in Europe where they produce competitive cars, but just for European market. Here in US they have to be paid by the people to sell the right car to the people. Is this right ?

I am sure many people also realize that these CEO's, and their sales and marketing staff, go to college and study business. They learn about the success stories but learn most from business failures. Many of them will be aware of what happened to the British motorcycle industry in the 50's and 60's. (complete failure of the entire industry after being left behind by the Japanese who produced innovative and high quality competing products).
Thus one of these two things is true;
They ignored what they were taught or
They were not taught very well.
Clearly these are the wrong people to remain in this industry. They need new people as well as new money. Money will not solve the problem.

Aside from what seems to me to be poor management skills on behalf of most CEO's as far as running the respective corporations on a successful profit margin . One would think that the heads of the auto makers would have had some sort of an eye on the energy market to position themslves to respond accordinglly to fuel supply ,cost. And how the fuel situation would effect the sale and manufacture of auto's . At the same time if these folks were worth their salt , they would have been watching the credit market, again to try and stay ahead of the curve to keep their companies profitable .
But no , it seems the only thing they were concerned with was getting the most $ for their own personel financial portfolios . So if these companies are to "bailed out " at our expense , then the CEO's should have to put some money on the table as well and I'm talking a million or so apiece at the very least with strict guidelines as to CEO salaries with NO provisions for bonuses.
I cant help but think that we'd be better off dividing all the bail out money up and sending every tax payer a check for the amount . At least we know that the average guy is going to go out and spend it , there by supporting our economy . We are going to have to pay the money back , why not make use of it .

Where can I apply for a "bailout?" If it's the taxpayers money bailing them out we should be entitled to something from the company, and I'm not takling a tax cut or any of that type bs. if bailing out automakers, I want a car, at an affordable price, not this $20k+ range that I've been seeing new cars go for.

This just shows our younger generations that it's ok to own a business, run it to the ground, then expect uncle sam to fix it for you. Why don't the taxpayers have any say in who/what gets bailed out? it is our money after all, and I haven't seen any kind of a vote put to us, as to who gets what kind of money.

The Big three didn't seem to have any problems until uncle sam started throwing money around, now look what happened.

If this is my money can the goverment tell me I have to loan it???

What a bad suggestion, but what do you expect from Suzie, she has no formal training or education in finance or economics (with the exeception of certifications accessible by your typical high school grad). She is NOT an economist.

This is how the economy works (the free market economy), when organizations fail b/c of bad decisions, other more efficient firms purchase their assets at a discount, and pretty much do what those failed organizations did, just at a much higher quality and lower price. We won't lose jobs.

Toyota and other more efficient competitors will buy GM and Ford's assets and do what they did, just better. Heck, we still need cars. The sad thing is that these firms will get subsidized loans, they will get the bailout, b/c they are a powerful special interest group in the pockets of our politicians. Mancur Olson was right, the increasing power of special interest groups will be the demise of America and other developed nations.

Is it that difficult for people to understand that if the 3 auto companies die, Americans and mostly the middle class will be in the crapper for years to come? Those that aren't in favor of the bailout do not consider the consequences that ultimately will affect them. Also, there has been a DEMAND for fuel efficient cars and that's why Japanese auto producers are benefiting. Why aren't we competing against them? BECAUSE THERE WAS NO INVESTMENT IN FUTURE DIRECTIONS. CEO's, emmission policies, lobbyists, and lack of government direction allowed for these companies to fail!

It's not that hard to understand that investing in new technology will create jobs. If we invest in green policies, it would create jobs because it forces companies to adhere to different standards. That's why it's called an INVESTMENT. Companies that change with the times usually can rebound and further their returns if any of their lines were to fail. Ever heard of evolution? Those that can well utilize their assets won't die...hmmmm....that idea has been around for a long while.

So those that think having to invest in different technologies results in a lost of capital, please look at what's going on now. People no longer want gas guzzlers..so look whats happening. And those that blame union workers...puuuuleeeaseeeee. CEO's and executives get paid 400 times more compared to their employees. These guys are living in excess while the little ones can't even afford to make a living. Everyone should be within their means and that INCLUDES the CEO's and execs.

POST CNN!

I love the commercials touting 34 mpg. My 2000 Saturn gets 27mpg. The difference, my Saturn is paid off, why would I want to spend 20k on a car that saves me a couple bucks a week at the pump. I want these CEOs out of their glass buildings and on the streets telling employees and consumers why we should trust them and what they plan to do. Of course if they come out of their glass buildings they'll need the National Guard for protection.

It's neither left nor right. In reality, it's the same question the Founding Fathers grappled with when they put the USA together: "How can we set it up so that men may govern themselves rather than be governed by a monarch or a dictator?"

The 'Righties' would say: let the free market work. But ... our current financial crisis is ample demonstration of what happens when we go down that road.

The 'Lefties' would say: let government make things equitable for everyone. But ... we've seen what happens when government gets into the act – Katrina, for example.

As always, the answer lies somewhere in between the two extremes. The real questions is: "Are the Republicans and the Democrats willing to stop protecting their political turf and work, instead, for a solution that benefits the greater good? (Can you spell 'compromise'?)

Sorry if I sound sarcastic – I've lived long enough to see the same old crap over and over and over ...

CEOs ARE smart. How do you explain someone making 1,000 times more than you do and always seem to have the ability to be paid no matter what: I get fired – pay me. The company goes bankrupt – pay me. CEOs ARE smart. The better question is are they ethical?

It seems that when the dust settles on this economic crisis, the only people who will be held accountable will be the taxpayers.

Taxpayers made mistakes. We (just generally speaking) did not balance our budgets. We bought expensive (gas guzzling) cars we didn't really need. We went on vacations we couldn't really afford. We spent all the equity we built in our homes thinking the market would continually go up. We bought into the notion that we could afford the homes we were in, when logic would have said "Can I really afford this? What happens if the market takes a downturn?"

These are all things "we" will be accountable for. All those bills and debts we owe will have to be paid.

However, the same is not true for big American businesses. They play by different rules. They can make poor business decisions and just pass the buck along. They can accept a taxpayer-paid bailout in one hand and then demand immediate payments for debt owed by taxpayers in the other.

If one, two or even three of the big automakers went under, it would not lead to the apocalypse that those CEOs would like you to believe. Remember, this is a free market. Another company will rise up among the others with an auto solution that the people actually want. They'll be able to buy up the abandoned factories cheap and hire those laid off employees as well. And, for once(!), we might not just have to accept whatever piece of metal rubbish is pressed out of Detroit since there is no other "domestic option." Maybe we'll actually be able to buy a car th

And since when is she an auto industry expert? CNN will always find someone to support their agenda.

If Americans do not want to buy trucks, then why have pickups been the #1 seller for decades? If Americans want small cars, then why is their profit margin tiny, whereas the profit margin on trucks and SUVs are HUGE? If the big 3 stopped selling large vehicles, they'd be out of business 20+ years ago.

Toyota does not make a huge profit on the Prius, so hardly would that save the Big 3, and they are not far behind on hybrids anyhow.

To CNN, "Americans" are the people they know personally – people who live in large cites and do not need large behicles and perhaps take public transportaton. CNN needs to get out of the liberal bubble that they live in – there's a big country outside of Atlanta, DC, and NYC!

Great article Suze!! You have the gift of hindsight!!!

Suze is correct. These are profoundly mismanaged companies that chose to completely disregard the ever changing marketplace in which they function. American designed cars are of inferior quality to many of their foreign counterparts and we are rejecting that lack of quality. If I have to spend 30k on a new sedan, I will by the base model BMW or Saab knowing that they are well documented for lasting 200-300k miles without major work – some even go to 400k.
The problems lie in the design, quality, and longevity of the vehicles, the absurd cost of the workforce via the unions, and the indifference and greed of the management. The only American vehicles I buy are older trucks – the one thing that these companies know how to build are trucks – but even they are beginning to show their lack of durability and longevity in the new models.

Unions are anti-American. Is it right to tax the average worker making $28.50 to bailout workers whose labor cost is over $73 an hour.

"Failure is simply the opportunity to begin again, this time more intelligently" – Henry Ford

Let it never be said that we are not a socialist country. Where are all the capitalists with their "free market" rhetoric now?

As much as we want to believe that we are a true capitalist country. We are not because we are too fearful to let the economy do what it does when the markets are truly free.

Adam Smith would be rolling his eyes at us right now.

Why did the big 3 refuse to build fuel efficient cars? Simply because, they are in the back pockets of the American oil company's. Fuel efficiency means less profits..... Every time gas goes up, we talk fuel efficiency more and then gas goes down to stop us from thinking that way... So we buy gas guzzlers.... get locked in to a five year loan for a $40K plus vehicle because we can afford the gas and then a year later, the gas goes up again. Too bad, you're stuck with a gas guzzler and a big monthly payment and the oil compnany's and the big 3 are laughing all the way to the bank.... This is nothing short of brain washing the American people.... The CEO'S of Toyota and Honda who live in Japan can tell the American oil company's to put it where the sun doesn't shine so they can build better fuel efficient cars at a lower cost to us.... Amazing isn't it? So simple a child could figure it out....

One earler commenter mentioned that the Big-3 are not the only auto manufacturers suffering right now–Honda, Toyota, and Nissan are also experiencing losses. Another commenter implied that the Prius is not a successful product becase Toyota doesn't make any money on it.

I think both of these comments are as short-sighted as an American CEO. First of all, while the Japanese manufacturers are indeed experiencing hard times, their year-to-date losses are no where near what the Big-3 are experiencing. In fact, Honda's sales are down less than 2% from last year. Also, none of these companies are talking about going bankrupt, and none of these companies are looking for a goverment handout. Second, the Prius is demonstrative of a forward-looking company that is putting an investiment in the future of its business. Like any worthwhile investment, there is always the risk of failure. But even if we assume for the sake of argument that the Prius is not a money making product (which I don't believe to be true, at least not since the first year or two of its introduction) there is no doubt that it has lured buyers from competitors, improved the reputation of its parent company, and advanced the knowledge base of its engineers–all results that are well worth the investment.

The Big 3 aren't in trouble because they don't have fuel-efficient vehicles. Ford, GM and Chrysler were already well on their way to supply more fuel efficient cars to the fickle American public before the credit crunch hit.

They are in trouble because buying a car is usually the second largest expenditure a person will make (after buying a house), and people aren't buying cars in general as they are fearing for their jobs in this economy. The Big 3 were tooled up to supply their share of the 16 million cars Americans were supposed to by this year, and now we will buy maybe 10 million in 2009, 2010 and 2011.

The automotive industry relies on huge capital investments with very little margin. When sales drop like they have, they can't simply sell off plants and tooling to make up the difference. Who would buy that stuff?

The Big 3 are all begging to be saved and I realize that there's a lot more at stake than just them. However none of them deserve to be in business due to the fact that they all neglected to to do the obvious and that's do it right the first time and put a clear effort into improving quality. They had to have known that when for example Honda or Toyota have a problem they make it right with the customer and then fix the problem so that it's no longer an inherent problem during the next 8 to 10 years of a model build (eg. ONLY !) Dodge Ram front end issues 1994-2002 . Ford & GM are guilty of doing the same yet the union leader still has the gall to say on TV. they want the people to get out an see their vehicles and try them out to see how they're building a quality product. People have no trust any more. What really surprises me is "not once" in all of these debates with the Big 3 have they actually been asked outright buy the government what are they planning to do to to really deal with the quality issue in order to deserve this money. The consumers aren't the ones responsible for this loss of faith in car companies, banks,etc. it's the CEO's and they should all be rounded up and truly be made accountable. Someone caught stealing food to feed their family would pay dearly for it while these CEO's have all taken part in robbing the "world" and nothing is being done eccept hand them over 750 B plus so they can have another go at it.

Get the CEOs and Board of Directors of the big 3 to acknowledge their plan is awesome and the turn around will work (which they believe).

Now that they agree, their turn around plan is solid, have them invest 25% of their personal wealth to their turn around plan, we the tax payer will pay the rest.

No one asked them to put their own personal wealth (ie: from their savings account) on the line. Now they came in hybrids, but will be buying a new state of the art private jet out of Washington back to their Montana ranch. Thanks Congress – you were so tough on them!

I know if I wanted to start my own business or invest in my own business – I would have to tap into my savings. These CEOs should also!

Why do we have an American big three? The big three used to consist many smaller auto companies with much more driving competition in the market place. If we had twenty small and agile American car companies still in existence today, would American car companies be stylish and fuel efficient and profitable?

One more thing.

Conspicuously absent from the bailout begging table are the Japanese auto manufacturers such as Toyota (my favorite), Honda, and others.

Why? I know. They are foreign but perhaps its because the Japanese know how to make better products that the market is willing to bet (buy) on.

Something to think about.

The pattern is obvious.... It is called DIVIDE and CONQUERE....

When stock holders do not have a say in the company, and the "board of directors" who are appointed by the CEOs in most cases, are just "rubber stamping" company executives, you will find that there is no more "check and balance"....

It become a case of "I (CEO) win if we win, you (stock holders/tax payers) lose if we lose" mentality

Bush's administration sat on their behinds and let the economy crash. THEY were in charge: The GOP! They wanted the power to run the country. With that responsiblity comes the praise or blame. Period. Take the blame like adults, GOP.

Please do not listen to certain advisors and spend, spend, spend this will not only fuel the economy but would also put people in enormous debt. This country unemployment rate is almost 7%, if this unemployment rate was calculated using the formula of the great depression it would mean an almost 17% rate. Please people, be smart and take Suze’s advise, in the long run it would be better for our children and great grand children, and what can be more precious than them?

Thanks for reminding us of the simple but very true facts Suze. We, as Americans spend money as if it mysteriously appears each day. We need to learn how to save and spend wisely. The retail stores need to budget properly, so they don't depend on Black Friday and the Christmas shopping season alone. The Big Three need to build better cars. This is all common sense, but unfortunately we live in an era of emotions instead of common sense.

WOW!!!Common sense being put forth on money....Not that most people will listen. As for CEO's and the boards that put them in place: We all get told that hard work and a college dregree can bring you more. Well we need to change the college degree thing because in to many industries/companies that mantra is if you have a college degree you can manage people and more and this just is not true. Most people that have a college degree are not even in a company/industry/position that their degree is in. Iworked in electronics before the first down turn in 2000-2002 and i worked with engineers that had automotive degree's, and english degree's and a few others. when we would ask for help on an issue they could not help us because they were only hired because they had a degree and then after a few months to a year they would be really unhappy because nobody asked them any questions or cared what they did because eveyone had come to a conclusion that they were worthless to us. they were nice people but in the wrong job. As are alot of managers and people in the upper ranks. A job should be based on knowledge and merit not on politics that end up srewing up more bllsht than it fixes or enhances. also just because your degree comes from a supposed better college does not make you any smarter than someone else with the same degree, the other person could have a lot of hands on and real world brains that you do not have. Everyone needs to learn to live within their money not within what your friends and relatives think you should have or need stop bowing to peer pressure at all ages of life and start seeing and living for your own happiness and not for everyone elses.

@Eric: People buy pickups because the US auto industry has been promoting the values of "BIG. TOUGH." in their advertising for decades. They could just have easily been promoting "SMART. INEXPENSIVE. Take the money you save on gas and go to Tahiti." But there wasn't as much profit in that. So they pushed Congress to give them a free ride on competing against imports (import restrictions in the 70s and 80s), pushed against seatbelts, pushed against fuel economy, pushed against crash protection, *everything*.

The Big 3 has invested a lot of money in trying to keep the auto industry from changing for 40+ years. The chickens have come home to roost.

Other than that, Suze's advice to us is decent, and to the extent we can afford to do these things (I've done or am doing several, and my 45 MPG Prius helps me have a bit of money to pay down bills and put stuff aside), we should.

Oh, C'mon Suzie, you know as well as I do the CEO's clients aren't their customers – its their stockholders and board. They couldn't care less about what customers want. They call them "consumers", much like cattle consume hay. Well, "hey!", we're "customers" and we're mad as hell.
The disconnect between every CEO and reality is legendary and the subject of many documentaries (which they either didnt watch or laughed at). Not only should they work for a $1/year, but should be forced to give back all their options and pay for the last 5 years! They'll still *only* have millions left to get by on.
Bailout – feh! – only because they're big, they can't fail? What about the little guys failing all around us? My brother's company had to fold recently because he couldnt get a short term loan to make payroll & payments while waiting on payments from his customers (purely a cash flow issue that faces all businesses). So now there's a dozen more people on unemployment because of the same people, the same attitudes, and the same short-sightedness.
geesh...
Maybe we really don't need them anymore.... it'll be painful, sure – but it's going to REALLY painful later when they do the same things they do now and run their companies even further downhill – after we (taxpayers) have spent billions. Like I trust other millionaires (congress) to really hold them accountable.
double geesh...

The only facts I know and have tried to live by: If I can't buy something paying cash then I am not buying it; For major ticket items such as house, I'll buy what I can maintain – physically and financially; Cars – I only buy 1-2 year old used cars paying cash; drive it until it reaches at least 100K miles.
I came to this country with 20 dollars in my pocket and I live debt free now; not because I made so much money, but because I saved living a frugal life style.

Every American, including the government, should ask themselves: How do people around the world manage with lot less resources – be it money or gas or oil or water or any other type of resources. I think there is a lot of wisdom in observing other people and nations.

To further discount the intelligence of the CEO's–when they arrived the first time, they didn't even have a plan. They couldn't tell the committee why this time, they would be successful or what they would do differently, if only they could have billions of dollars right now.
It was pretty sad, but I knew those guys felt they were above all that-no need to justify the free money.

You can't talk to Ford's CEO, Alan Mulally, about how wrong Ford has been the last 20 years. He has been the CEO for around 20 months! He is turning the company around now and changing dumb policies. That would be like blaming Obama for Reagan's economic policies.

It is all politics. I will bet anything that lobbying from "Big Oil" companies have to do with automakers not researching aggressively towards a new vehicle with an alternative fuel and Congress was in no no need to force them, either.

Big Oil lobbyed and automakers and Congress obliged.

That is what I think.

Thanks Suze! I have been agonizing over whether to take a really good paying job for six months that I will hate, or a really low paying job for six months that I won't. As I have credit card debt, you've convinced me to take the higher paying one and pay off the debt. Not having that debt hanging over my head will make me happier in the long run. Merry Christmas!
Paul

CEO's are smart. However, their only goal is to maximize their salaries and stock options. They don't care about the effect long terms. They only need one or two years worth of options and they can live for life.

I've been waiting and thinking any day now, any minute, I'd hear someone mention Lee Iococca. An extraordinary man of many talents. He played a leading role in the design and development of the Ford Mustang and the K-Car of Chrysler Corporation. Mr. Iococca, an inspiring man of vision, action and determination. With endless hours of hard work and very little personal salary up front, Mr. Iococca laid out, if not a blueprint, a great example of how to revive an auto company. With inspiring attitude, strong principlesand management skills, he saved Chrysler from collapse. After, and only after Chrysler succeeded, did he receive a deserved, great, personal monitary gain.
Of course the Big Three should get help, but what's up with these CEOs taking huge.....huuuge salaries up front, and when they can't pay the suppliers and workers, we are asked to chip in?!?
If you're worth it, proove it.
How about a reasonable salary based on resume, understood. End of the year...company shows a profit...you get a bonus/dividend...call it what you like, just don't call it a free pass.
Sure these CEOs will work for a buck, with their expense accounts and other perks...who wouldn't? They've already sifted enough off the top to retire comfortably several times over.
Get rid of them!...Go find Lee Iococca!!

"ARE THE ASIAN AUTOMAKERS PLEADING FOR BAILOUT MONEY FROM THEIR GOVERNMENTS??"

Actually, get your facts straight. Japanese companies have a reputation for having close relations with the government, and some private-sector projects receive public money, especially those for clean energy. Since 2001, the Japanese government has intervened repeatedly in currency markets to artificially devalue the yen by upward of 30%. As a result, Toyota and the other Japanese automakers receive a $4,000 to $14,000 subsidy on every vehicle they export to the U.S.

Well, at least it appears the CEOs are smarter than "DJ". Unfortunately, based on the comments by DJ, it wouldn't seem to take too much to have a higher IQ.

First off Suze is right about the emergency fund, living on a budget, getting out of debt. Once you do those things and live on a budget you will have plenty of money for giving and whatever else you need. For those who think that is not possible check out Dave Ramsey's website or radio show.
As for the CEO's of the auto industry saying they would work for a $1.00 a year if they get the money..........I would ask why are they not already doing that? A small business owner that sees a significant drop in income reduces the pay of who first? Him or herself.

Get out of debt, get on a budget experience real freedom.

Orzman has a point: the current market conditions we're seeing didn't happen overnight.

The corporate culture of these firms is broken. It is monolithic, arrogant, and it is not open to change. Their mantra for fifty years has been "people will buy the cars we tell them to buy." Even now, in the midst of this adversity, this attitude has not changed.

Let them fail. The companies that rise up from their ashes will be more mobile and adept at meeting market demands.

Most of these posted comments are just laughable...as an employee of one of the Big Three I find it hilarious that all of you think you have the simple solution when 98% of you haven't a clue. It's frustrating that it NEVER gets mentioned that, over the course of the past three years, there have already been massive waves of layoffs in the industry, labor re-negotiations that bring us in line with the foreign manufacturers (effective 2010) and a drastic shift of focus from gas-guzzlers to fuel efficient vehicles (better than the foreign competitors in many instances). Then I read these comments where people are still spitting the same anti-domestic one-liners that have been regurgitated for years, most of which aren't even valid anymore.

Those CEOs are brilliant. Imagine being so slick and cunning to command millions of dollars in annual salary, perks and more when they don’t know anything about business. In a capitalistic arena, if you do not run your business well – that is, give the customers what they want at a competitive price – you lose to the competition. Business 101. That is what drives the system (excuse the pun) and creates incentive for innovation. Why do the company and shareholders tolerate such ineptitude? These guys do not have what it takes to run a business; therefore they deserve nothing but pink slips.

PS: Any legislator that votes for giving these losers my tax dollars should be have their individual investment portfolios investigated to see if they own stock in Detroit!

EVERYDAY PEOPLE DO NOT HAVE THE RESOURCES TO SAVE 1 MONTH'S PAY MUCH LESS 6-8. WAKE UP AND SMELL THE COFFEE. ONLY RICH PEOPLE CAN AFFORD TO DO THAT AND THEY DON'T NEED TO DO IT-BECAUSE THEY HAVE MONEY. MOST PEOPLE LIVE PAYUDAY TO PAYDAY.

the big 3 and also the rest of the auto makers have only themselves and the goverment to blmae for poor MPG.Back when Carter was president a bill was passed to make MPG's higher on all automobiles. At this time the automoblies would have to be anywhere from 40-60 mpg's. But in all the wise moves of the time of "are you better off now" the incoming Reagan administration and the GOP controlled goverment said this is wrong and it is not needed and would be a hardship on the big 3. lets get real people having business control our goverment is bad and wrong and we need to take it back. lets hope that obama can start to turn it around for the people and make it by the/ for the as it was at first and if not then the citizens need to take it to the peaceful street for a take back our lives revolution.

Andrew in Dearborn MI:

So it's someone else's fault then. It's not that the Japanese have made the better product for the last 25 years...or that they have been more in tune with consumer wants....or that they run their companies more efficiently. No Sir. The big three's failures are a conspiracy between the car companies and the government that includes free R&D money as well as currency manipulation.

Spoken like someone who lives in the middle of car country.

I agree that the automakers haven't done a great job. However they have made huge strides in improved quality and have been retooling for years now to meet the needs for future transportation i.e. the "Volt".
What I can't understand is why didn't AIG, (they got money twice) and the lending institutions get the same grilling as the automakers.
Atleast the automakers produce a tangible good, and employee a lot more of our citizens.
I'd also like to thank the United Auto Workers Union for finally making some long overdue concessions.

Suze, you are my hero!!! Your words reflect what my parents and grandmother have always told us. They lived through wars and the depression and yet they are not only solvent but thriving financially. We are spending less this holiday and my daughter and son are making their own gifts for the family which means more to me than any junk from China every could.
My best to you and your family this holiday and I look foward to "hearing" from you in the new year!!

Diane, New York

Their smarter than you think-they ran their companies into the ground robbing, stealing, and thieving-and now they are gonna put the taxpayer on the hok for the bill

Everyone is so quick to bad talk the auto companies. Who converted all their plants during the world wars? they helped save the freedom of our country.......we should help them out now. It's not as if they are asking for 700B. Yeah, CEO's are overpaid but that's the same for all large corporations. GM is one of the largest providers of health insurance in this country too. If these companies go under people don't realize the ramifications that it could have on our entire society. Millions of people will be out of work. We also must realize that with safety, that everyone wants, comes added vehicle weight. This equals less fuel economy. I know GM and Ford both have more hybird cars than any of the competition out there. I also know that foreign companies are being supported by their governments (not that I really care about them). Look, we can't afford to lose these types of jobs. There has to be some manufacturing going on in this country. It's part of the backbone that makes this country up. Give them a chance.

“ARE THE ASIAN AUTOMAKERS PLEADING FOR BAILOUT MONEY FROM THEIR GOVERNMENTS??”

Also, the European auto industry called for an EU government handout worth about $55 billion. Britain's car manufacturers are also demanding access to government funds put aside to bail out the banking sector.

I think Suzie has always had some of the most basic, yet profound adivse for EVERYONE – bottom up/top down.
I really Hope President Obama consults her and also Warren Buffet, and between them will be able to influence congress to turn around the thinking of money in general. From personal to government, and accountabiity for handling other peoples money and what the constitution was orginally set up as.

This has been a crazy ride and process, and i for one am glad it has finally hit a brick wall, it will be tough, but for the next generation to survive and be healthy, this past "borrowed money" thinking has got to stop. We have to plan and prepare and I am guilty as some, but know why we stay in "poor thinking" and then want to be bailed out, by parents, by family, by society – why no – the leaders have been doing it.

I EMBRACE THE CHANGE

Bail out money is not going to solve the fundamental issues that exist in the Big 3.

1) CEO's need to be paid a reasonable wage – not the crap that has gone on for the past few decades. A simple comparison between the Presidents of Toyota and Honda to the Big 3 would provide an interesting comparison for most people.

2) Union benefits need to scaled back to a more reasonable 40% of base wage – not the current 100%.

3) Union wages need to be more reflective of fair market value for service – janitors should not be costing $100k/yr to the company (see Delphi bankruptcy comments from CEO).

4) We need a more effective Heath Care system in this country – per Time magazine we have the highest cost per capita in the world with a lower life expectancy and infant mortality rate than most industrialized nations. Health Care costs have over doubled in the last (7) years and people live much longer (see Legacy Costs below).

5) The Big 3 need to shed their "Legacy Costs" – this is where the government should pitch in. You cannot run a company, carrying (3) retirees for every (1) person working.

At the end of day it is the average Joe and soccer mom that bought the Expedition / Suburban / Durango – the Big 3 did not impose this on anyone. Over 50% of the vehicles in NA are Trucks and people need to get over the love affair with the V8 engine – statistics around these issues are mind boggling to the rest of the world.

The auto makers should not get one red cent of taxpayer's dollars. I don't care if it is a loan. The only way these companies could possibly restructure enough to return to profitability would be to declare bankruptcy. Then, and only then, will they finally be able to get the monkey off their back that is the UAW. Another thing I believe would be the only way we could possibly salvage any form of an American Automaker would be if they merged into one company. The market has been flooded with so many superior foreign cars that there is really no room for 3 US based companies building inferior products. Merge into one company and focus on quality and economy and people will buy them. Heck, Chrysler already owns the rights to the perfect name for the new company: American Motors Corporation.

As for the people saying how "American cars rank just as high as Japanese car in initial quality". Think about what you are saying. INITIAL quality doesn't mean a thing. Anyone can build a car so that it feels like a quality product for the first few months. The Japanese companies can build a car that retains that quality for a decade or more. So while the 10 year old Honda/Toyota/Nissan is still running just as well as the day it rolled off the assembly line (sometimes even better than that day), your 10 year old Ford/GM/Chrysler is more often than not languishing in a junkyard waiting to be crushed for scrap. People need to stop looking at initial quality, and start looking at longevity.

The guy making $10.00 per hour is asked to bail out the guy making $40.00 per hour!

While I agree that we shouldn't be running up credit card debt or buying extravagent presents for more people than we ought to, to not buy at all is as fiscally unsound as buying too much. Many of our retailers depend on end of the year sales, and need the economic stimulus.

I admire your four points; however, I'd like to point out that most are impractical at this time. I've just spent 8 years in economic uncertainty - I didn't work at all in 2001 due to the telecom crash - and only sporatically since. My savings, everything, went down the tubes quickly, and only a friend's intervention helped me keep my modest home bought on a VA loan. With many people barely able to afford food, enough gas to get from work to home, utility rates going up, and jobs so uncertain and especially, no bonuses or raises likely, while it is nice to be able to put money aside, for many it isn't practical. If you are already working two jobs just to pay the bills you have, saving is not something that comes easily. I'm fighting to keep my modest home from foreclosure, and I'm better off than a lot of people.

From your lofty apartments in New York or Washington D.C., your six-digit salaries, your celebrity status that gets you all kinds of goodies, I'm sure it is easy to formulate these "common sense" savings plans, but those of us barely making it don't have the luxury of following them, even when we know they are a good idea!

Many factors drive consumer behavior. There are a series of tactical and stratgic mistakes that the big 3 auto made over the last 20-25 years that got them here. And Justin, they're not related to the electric cars...

Electric and Hybrids are expensive to produce and yes, Toyota actually LOSES money everytime they sell a Prius. But you don't need to buy a Prius to get 30+mpg in your car. The Germans, and Japanese all managed to put out high quality, fuel efficient entry level small cars out there that gets great milage. Even my Audi gets 33mpg on the highway and it has 4wd!

Anyway, that was a tangent, let's focus back on the main question – how did the big 3 got to where they are today?

I attribute their problems to several structural and managial issues, some are interrelated, others are not, below are the ones I think are the most serious:

1. A big structural issue that drives consumer behavior is that Gas prices in this country is artificially low and allowed to fluxuate wildly over the years. If our government is serious about makeing people drive smaller car and increase demand for fuel efficiency and mass transit, they should tax gas more and create a price floor in which gas prices will not be allowed to go under. Just look at the current price fluxuation – I was seriously considering a Prius back in June when gas was 4 dollars a gallon, and I am now thinking about a Jeep now that gas is under 2 dollars a gallon. It's simple math and can really help stabilize consumer demand so the big 3 knows where to invest and what cars to make in the future in order to maximize profitability.

2. The idea of maximizing profitability is what actually got us here in the first place – Those big 3 CEO arn't dumb, they're just not the hotseat to perform and blow out their number given by wall street analyst all the time. What would you do when you have anywhere between 12-18 months to show you can perform and meet and surpass Wallstreet expectation? You maximize short term profitability! in the case of hte big 3, they choose to invest and built more of the higher margin, higher profit Large Trucks and SUVs instead of the low margin, low cost entry level small cars. As to hybrids (which they'll probably at best break even or loses money...)? Ha! Wall street and the shareholders will have his head if he even dare to make and sell a car that loses money! So American corporate governence culture and our overly reliance on Wall Street quartery earnings report is part of the problem. It drives company to continue to maximize short term profit with total disregards for long term strategic interest. This is why the big 3 embraced SUV with more velocity and strength than their foreign competitions, this is why the big 3 did not have high tech, high out put fuel efficient small engines in their lineup (Honda can sqeeze 240hp out of a 2000cc 4 banger, every detroit engine that makes that kind of power is a V6 and at least 1000cc bigger.) While in many industry that is a good thing – but in the case of the Auto Industry, it ignores a fundermental marketing problem.

3. Here is the #1 managment blunder – There is one thing we know about consumer behavior when it comes to buying cars – brand loyalty actually carries a lot of weight. If a consumer bought a Ford as his or her first car out of college and was happy with the experinence, chances are that he or she will buy another Ford when he or she is ready for his or her next car. The Germans and the Japanese knows this very well – Why is BMW and Audi and Mercedes, dispite carrying the premium auto status, continue to drive down market with smaller and cheaper models? Why did the Japanese not invest heavily and retool and convert their american product base to bias heavily on large trucks and SUV (Honda didn't even have a truck in their line up until last year!) when gas was cheap and consumer demand for those large gas burners were sky high in the 80s and 90s? These foreign car makers understood that the entry level car is what anchors and drives consumer behavior for YEARS to come. This is why BMW spends majority of their resources on the 3 series to make it an exception car with extremely high value and desirability and is trying to go even further down the market with the accquition of the Mini and the 1 series. This is why Honda anchors their entire marketing strategy around the success of the Civic and make damn sure every Civic they put out on the market leads in quality, performance, design, and reliabiility. I can virtually guarentee you Honda civic's profit margins are VERY low, certainly when compare to a Chevy Tahoe.

4. Finally, the very last, very inexcusable management blunder is this – When it comes time to retool and it is clear to the big 3 that the high margin SUV strategy they have all been pursuing will get them into trouble fast. They've decided to either sit on their butt (like Chrysler), cry help, and try a bunch of very stupid things like merging with Mercedes Benz. Perhaps they've decided that the transfer of technology and knowhow from a premier german automaker will help them make better cars in the future? Unfortunately, they don't have much to show for it. Or the likes of GM, who instead of learning from their successful European subs like Opel on how to built desirable small cars, they've decided instead to buy up foreign car makers like Saabs and Subarus, and proceed to reap in those profits, instead of doing cross platform sharing and technology transfer to try to reinforce their core brand like Chevy. Of the big 3, only Ford got it partically correct. The Ford Focus was a hit with the US market precisely because it was engineered and designed by Ford of Europe. The new Taurus? – the European Ford Mondeo. It is no suprised that of the big 3 that went beggint for money last week, Ford was the one that didn't really need it.

These CEOs are incompetent and do not deserve their salaries let alone bonuses. They need to be fired. They should have prepared a strategic and tactical plan to present before congress complete with timelines and measurements on how the actions will impact the bottom lines. They are out of touch as evidenced by showing up unprepared in 3 separate private planes. Their boards should also be replaced for supporting them. This industry has been deteriorating for years not just because of this economy and they didn't manage the business properly. They just kept making cars that no one was or is buying and yet they continue to make them. They should stop making them and sell their inventory even below cost in addition to reducing expenses. The buck stops with the CEO. There are thousands of new cars on lots everywhere unsold and they still keep making them. They also approved all union contracts and bonuses for years they were losing profits. If congress can't see this, then they also are blind. This industry needs new management desparately. I am tired of bailing out incompetent management and yes it is a bailout because even the banks won't lend to them anymore.If the banks see you as too risky, so should the US taxpayers.

Funny that some are blaming the unions.
All the unions did was ask for the moon. The CEOs are the ones that signed the contracts to give it to them.

So yes...the CEO were pretty stupid.

Instead of down-sizing by laying off thousands of low-end workers, why not fire about 10 top executives? The financial savings would probably be the same; but the benefits to the company and the country would be tremendous.

I wish our gov't reps and company execs were half as smart as Suze, but maybe we can just hope that they maybe listen to at least some of what she says or others that are as knowledgeable and helpful.

I have to chime in again on this. I am a little upset with the Big3. They have all of these plants and they keep laying people off. What if, and this is just a thought, they manufacture other products and diversify themselves? I mean these robots can surely be reprogrammed to make something else right? Solar panels, appliances (which GM actually used to make), the list could go on they just need to think outside the box. I would say pay their employees less but they are actually doing that per the last collective bargining agreement.

So why weren't there strings attached to the banks bailout, which was 30 times more money? The bailouts are a scam, plain and simple.

What a joke our government has become. Well, I voted third party, so my conscience is clean...

I understand about wanting to help the employees.But the auto companies need to pay them the same as Honda,Nissan,Toyota employees.One of the problems are the unions.
It doesn't take A brain surgeon to realize that the democrats are in the unions pockets.It's really sad.

Thank you Suze Orman for throwing light on "critical thinking or lack of it" offered by CEOs of Ford, Chrystler and GM to earn a big fat salary and bonus for last 20 plus years. They set a very bad example which is on my top 10 list of "not to follow".
What a practical guide line you gave to all "us non CEO community members" for Christmas shopping! Thank you! Thank you! and Thank you! God bless you and America. We all will have to do lots and lots of thinking, acting and praying!

So Ms. Orman, since you had this on your dashboard the past few years, where was your editorial then? And your persistance? I agree with the above comments in regards to hindsight, experience in the industry, and, for the scope of it, "Your all morons"' comments. You are really off the mark.
Also – thanks for pointing out to US that WE need not make these mistakes. Do "You" offer any seminars, or profess at any universities? I think you have it all figured out.
You speak well from up there. Thanks for sharing it with us idiots down here.

"Happy Holidays"

For the last eight years, the tone set by the leadership of this country which only a president can do. And, we see the results of chosing the wrong leadership. Greed has run rampant with a free for all. Everyone got in on the game with a green light from their leader. Grab as much as you can as fast as you can.

This is not a democrat or republican issue. This is a national issue. The very fibers which hold this country together is the patriotic duty to do no harm to the nation which the people created long ago with much sacrifice, struggle and devotion. That has all be destroyed by a president who is a liar, a thief and a selfish out of touch man who has no clue to the damage he has done and how the future of this nation is irrevocably weakened in the eyes of the world.

Record winfall profits by the oil companies.

How about some credit or tax break to the oil companies if they lend the auto industry the money.

I'm sure the oil companies would find a way to make even more profits by lending the auto companies the cash.

This is soo simple. Let the private companies work out the details.

Suze obviously understands little about the economic crisis or its origins. Heads should roll allright and we should start with Barney Frank and Chrissy Dodd, and then the indictments should be handed down to all those who were complicit in the largest financial rape in American history. The hypocrisy of Senator Dodd and Barak Obama to suggest that Detroit 3 management teams should step down is astounding. Senator Dodd presided over the Senate banking, housing, and urban affairs committee and Representative Barney Frank over the House financial services committee while the single largest housing and banking fraud transpired. How can it possibly be legal to provide trillions of dollars in mortgage loans to people that have no capacity to repay them, bundle them up into a slick new security product, fraudulently rate them as AAA securities, and then proceed to sell them to investors? Where are the hearings? Where are the indictments? In absolute dollars this crisis will likely turn out to be the largest fraud in the history of the world and it all happened on Senator Dodd and Rep Frank’s watch. How can you not view these two congressmen’s complicity as criminal? Their two committees are the legislative watchdogs over all the institutions responsible for this grand larceny. The domestic auto industry is in a free fall collapse because of the financial and economic meltdown caused by Wall Street and the Federal government. Now these victims of their ponzi scheme are showing up at their doorstep looking for assistance and they have the audacity to berate and blame them? They are the victims of these financial rapists. I am absolutely appalled at the treatment our American auto industry leaders are subjected to by the very individuals who were either actively or passively a party to this financial rape. They have the nerve to demand management changes at the companies victimized by them and Wall Street? It is absolutely unbelievable that the American public believes these co-conspirators. According to a recent CNN poll regarding the auto industry loans, the poll unbelievably shows that over 60% of Americans don't believe they should receive assistance. Obviously these 60% do not understand that it was the government, ratings agencies, banking industry, Insurance companies, Fannie Mae and Freddie Mac who caused the automotive industry crisis. Admittedly, the auto industry was not in great financial shape to weather a massive economic meltdown because they are saddled with huge costs providing millions of American employees and retirees with heath care and pensions. No foreign auto company has these costs in any significant amount. All foreign auto companies are in countries where the government provides health care and retirement. Most also receive huge research and development subsidies. All our government does for the auto industry is provide endless CAFE and NHTSA regulations and now adds a public ridicule service. So if the Detroit 3 emulates Toyota’s cost structure by dumping their health care and pension obligations on the Feds, which congressional committee is next to belittle and scold them? Foreign automakers the world over are approaching their respective governments for assistance to weather this storm and they are all being treated respectfully and patriotically. Not here, where ironically the problem was created. I am thoroughly ashamed of our government and beginning to believe that not even Obama can re-brand America when most of the legislature is morally bankrupt.

There are so many reasons that companies fail its not funny. Here is my take on the current downturn.

Around 2000 we have low interest and new laws that allow families to have credit and buy homes.

Too many are convinced to buy beyond their means (a broker makes money regardless if the debtor defaults, so he sells for as much as he can). Some are refinancing some are new homes. Both are pushed to make the broker money, nit to protect the consumer.

Banks and lenders are more than happy to give you that money. What's the worst can happen? I repossess your house and I have a few fund groups to back me up. I simply resell the house and move on.

Developers see this as the bell ringing to start developing; borrowing more money. Eventually to be purchased though bad decisions and other mistakes.

Now because of the sellers market, prices rise, values rise and so do taxes.

The other foot hits the ground. People default for various reasons. High taxes, ARMS catching up with higher interest. Clearly most because of overspending. Lenders can't lend. Sellers can't sell and the collapse starts.

Banks will not lend because of their losses and business is not as brisk because of the downturn. Companies are not getting operating capital. Investors are selling off, removing even more capital and the layoffs and closings begin in earnest. And oh, did I mention energy costs soaring? Mo money, mo money.

Interest has gone down, but no one is lending. People are scared to death and they are not "consuming". This is hitting all industries.

The auto industry is hit on many sides. Suppliers, factories and other industries are taking hits. Big3 starts closing plants here and there and start consolidating. Bad time because this only adds to the national problem. Add to this poor planning and you have a mess.

I put a lot aside for retirement, and most of it is gone now.

Why does the gov't pay to bail out these industries that made a mess of everything (banking and auto), but they won't bail me out of my debt? It's my money they're spending.

So what we are to do is now believe in socialism and communism and throw away capitalism. The goverment will now own the car industry, and banking, and insurance. Good bye fair market capitlalism, I will remember you fondly.

Irrespective of what Suze says or what the current time demands...The fact of the matter remains – "This is a viscious cycle...don't break it "..

Markets will go up and down and up again..
Governments will come and go
people will retire and new people will join
things will continue to run the way they have run all this time..
Human mind is restricted by boundaries..and we don't tend to venture outside or against what the mind tells us...

Suze preaches getting ahead by saving and making good purchasing decisions such as buying higher quality things within one's means. I fully embrace this line of thinking. I do remember that Suze was pitching new GM cars within the last year for which I sure she was well compensated. I wonder if a new DOMESTIC car is really what she would advise most of us to buy considering their rapid depreciation. I know this does not build wealth and actually makes people poorer. I have no problem with people buying new cars but leased and financed cars don't jive with the common sense dear old dad drove into my head. Pay cash for what you can afford and take care of it like you want it to last for longer than the payment book has coupons.

GM has ~250,000 employees, 73,000 of which are UAW, Ford also has ~250,000 employees, of which 54,000 are UAW. Look up GM or F on your favorite financial site, to verify the "profile" number of employees, then look up Ford UAW workers or GM UAW workers to verify.
So, ~70% of GM or Ford workers are non-UAW.

Also, look up "GM unfunded pension". GM is hurting because they underfunded the pension when times were $$$$$, now they have to pay the price.

I think Suz needs to check her facts. The Big 3 did have the forsight to start producing fuel efficient and hybrid cars...that is what bankrupted them. They don't even break even on the cars that everyone forced them to make. They make money on SUVs...that is their bread and butter. They were selling like hotcakes before gas prices went up. Nobody was complaining then. A lot of the backlash has to do with well-placed uneducated Americans (Suz Orman) pushing their uneducated opinion on the naive public. You put 3 wealthy men in front of Congress and everyone gangs up on them to feel better about their own situation. Not that they weren't wrong in some regard, but everyone needs to look themselves in the mirror first before throwing stones.

Why didn't the Wall St folks have to go begging for a bailout? Could it be discrimination against blue collar workers, who will be most affected if the auto industry goes down?
The CEOs of the Financial firms that got a free bailout, no begging required, are just as pitiful, if not more, than the CEOs of the auto industry.

2 of the 3 CEOs have been there about a year or less. Nice job researching. That's awesome that you blame the 2 new CEOs that just started for failures over the past twenty years.

Typical Orman.

Two last points.

First if they are going to get any money they should require them to file bankruptcy so that they can void the union contracts and see if they want jobs at $28.hour as opposed to $40.+.

Okay, now for all the whiners a other lazy or dumb people saying it is not possible to save 6-8 months salary up.

First off you got yourself into debt in most cases due to your own financial irresponsibility. Second take a second or third job, get on a strict budget and forget about the daily Starbucks coffee. People are doing this and winning as I have also.

Divorced, in debt close to 30K and spending more than I made until I finally wised up. Now living on a budget, debt free, 6 months cash in the bank, and living a happier stress free life. Did it suck working my ass off to get to here? Absolutely! Was it worth it? YES! Smartest thing I ever did. Stop complaining, get focused and get out of debt.

Where was Suzi'e wisdom when Banks were being bailed out?
Auto CEO's are not as bad as the bank thieves we have. If not for the
financial meltdown created by the banks, the auto comapnies will not be in this postion.
Keep in mind if right now GM made the best most fuel efficient car, people will not have the money to buy it as they are without jobs.

I couldn't have said it better. Yes, we need to make sure these CEOs make changes to the car industry and soon.

GO FORD!!

Chrysler LLC is owned by Cerberus Capital Management, which has plenty of cash on hand. If Chrysler has a reasonable business model and is a viable company, then why isn't Cerberus pouring money into company? Since Cerberus is not investing more money into Chrysler, then shouldn't Congress 'get it' and avoid pouring money into a automaker with a failed business model? Also, why is Congress even considering a bailout for a privately held company?

The CEO’s of the “Big 3” got what they deserved. After years of opposing better safety and fuel efficiency standards they now have no choice but to embrace them in a hurry. Even if that happens, though, it may take a while for the general public to warm up to the American car makers and their products and it will only happen when the quality and efficiency of these vehicles matches that of the Japanese cars.
As far as the assembly line employee pay is concerned, there’s nothing excessive about that as compared to what AIG or big financial institution employees are being paid. How come they were not asked to accept cuts in pay when the financial bailout was first announced? They make way more money than an average auto assembly line employee makes. We should support the unions not try to tear them down. They fight for a fare share in company profits and for the dignity of the work force. I hope there’s more legislation in Congress to make unionization easier in these United States of America.

It's easy to criticize the CEO's in charge. Yes, the bonuses do seem ridiculously lavish. And it doesn't make sense to achieve a bonus in a year when your company loses money. However, these are all well educated, experienced businesspeople. Alan Mulally of Ford was the one who led Boeing's Commerical Airplanes division to its recent success a few years back by increasing their market share over Airbus. Obviously, this guy knows how to run a business. He only took over as CEO a couple of years ago. It's hard to blame someone for things that had transpired before his time. He also brought them their first profitable quarter in over two years. This is more than a leadership problem.

I'd love to buy an American car. As soon as they make one as reliable, well-equipped, and economical as my Prius, I will. Every time Congress talks about raising the CAFE standards, Detroit complains. As if it'll take us 12 more years to average 30 MPG. Give me a break – I've been getting 50 MPG for the last two years. Throw the Detroit CEO bums out and put people in who'll take a serious look at what tiny Tesla Motors has done.

While I agree with most points, we must remember that part of what the Big Three did is exactly what many Americans wanted... bigger, badder, cooler SUVs.
So, Suze is partially inaccurate when she says...

And in the process they turned off their main client: Americans, who refused to support products that they now judge to be of inferior quality.

But, I do agree that they were not smart about managing their business and continually re-working their business model to suit the world.

I agree that we must bail out the auto industry, however fire the CEO's without their huge financial packages. They were instrumental in this big mess, get people in those positions that will be an asset.

I believe the federal government has existing laws in place to cover exactly this type of bailout situatuation: it's called bankruptcy. Further, shouldn't there be a constitutional challenge to creating a law specifically for one entity that doesn't apply to the rest of the populace?

When the rest of us can't meet our debt obligations, we file for bankruptcy. Record numbers of Americans have lost their homes this year, record numbers have filed for bankruptcy, and we're being told the big 3 are special for some reason I can't fathom?

someone please explain why CEO's get a 15 million sign on bonus before they ever work one single day and then have the nerve to ask for an additional 10 million bonus after having received a government bailout – aka Merrill Lynch

I think businesses would be better off without CEO's 🙂

Haven't we already bailed out the car industry before?

Simple answer is to have the Oil industry bail out the auto industry. I seem to remember the oil industry making $1600 per minute last year.

I'm tired of hearing we should bail out the big 3 automakers because "we won't have an auto industry". We will! Toyota and Honda are both built here in the states.

WELFARE...funny how the tables are now turned.

Suzie:
I'm seriously disappointed by your advice that we, the Great American Taxpayers, should support the Big Three. I have not done so with the most important tool in my arsenal, the wallet. I don't care about GM, Ford or Chrysler. I do care about Toyota (ISO 9001-2000) and Hyundai (ISO 9001-2000). Why? Because they build quality products and when they are broke, they tell me about it. The problem is that we are worried about millions of people (I don't know where you got that number from) that are employed by three companies that don't care about the customer nor quality. I will state this: "Let them fail." We failed to learn from the Chrysler disaster of the early 1980s which that company has not recovered from.

How much will unemployment and welfare checks for 2 million out of work auto-industry workers cost taxpayers?

Why not cut the pay of the workers to the same level as Walmart employees and give the auto executives the same as what a middle tier Walmart executive would get, then give them stock options such that if the company prospers they would makeup the difference between what they used to make and the Walmart level pay? That would align the interests of workers and management with the interests of the health of the company. Under that scenario we could give them the loans. That seems fair. And that is exactly why it doesn't have chance of happening.
Happy holidays everyone!

After all of this, the way these companies are failing, and now getting a large sum of money that the population in general opposes, how are these companies going to make a come back when America in general is upset at them for stealing billions from the people.
How many people are going to buy their products, when they have handled their businesses so terribly, even if there is a change in quality in the future?

The American worker has been sold out.
Common people worship wealth, power and fame. The reality is the wealthy, powerful and famous sit at the top of heirarchies none of us will ever acsend. We are suckers to think that if we make things easier for them through tax breaks, legal benefits and free market economics that they will do the smart thing with the money and create jobs and wealth. Rubbish! They take the money for themselves and export the jobs overseas to take advantage of cheap labor.

First of all, Suze, 20 years ago oil was between $8 – $15 a barrel and it stayed in that range for the past 15 years. Oil has been overpriced for the past 2 years and it shows today at $40 a barrel. The world economy can not support $150 oil.

Second, if the big 3 fall, millions will not lose their jobs, stop trying to scare everyone. There will be job loss, no doubt about this, but as the big 3 restructure, millions will have their jobs, just at lower wages. This took place with the airline industry, they seem to be turning a small profit.

Third, way don't you mention the UAW health fund, and the billions the Big 3 have to contribute to this. These types of benefits is way a car is costing us $35,000+. What if home builder formed a union and demand terms like this, the average home would go from $180,000 to $500,000 overnight.

Suze Orman from wikipedia

She was an undergraduate at the University of Illinois at Urbana-Champaign, from which she holds a B.A. in social work. In 1973, she moved with friends to Berkeley, California and lived for three months in a van on Hearst Avenue. She soon became a waitress at the Buttercup Bakery on College Avenue. In 1980, a longtime customer gave Orman a loan of $50,000 to help her fulfill her dream of opening her own restaurant. Orman invested the money at Merrill Lynch, but four months later was broke again, after she was swindled by her stockbroker.[9][10]

Congress, Suze, and anyone who will listen: Do not bailout Detroit Automakers. You said it yourself that they refused to listen to the American people. Why will they change now that they are getting these "loans"? Gas is back below $2.00 a gallon. They won't change, they won't retool, and anyone who drives cars knows that with a few exceptions American cars are grossly inferior.

Will anyone be surprised when they are back in Washington in three months asking for more money?? Let nature take its course.

No Bailouts!

Yes, we should all be mad and annoyed that we have to bail out these companies that have been run with an indifference to tackling what is known. My hope is that at the very least, any federal aid will come with serious requirements, oversight and regulations. What is needed is that these CEO’s finally get their heads out of the sand and make the known changes that have always been needed and start running these companies like this is 2008 not 1958.

I would like to hear you comments about the AIG and banks CEO's.
Tons of money was handed out to them. Detroit is just looking for a loan. Not bail out.

The unions are just as much to blame as the CEO's are in my opinion.
More money, more money, more money. And look where it has driven the car companies now. Unbelievable pensions and unreal salaries. Absolutley ridiculious! And they wonder why Right to Work states are getting new factories instead of Detroit. Go figure, that people in the Right to Work states make good livings, without the unheard of perks that the unions have demanded for decades. Both unions and car companies have got away with it for as long as I can remember, and will keep milking tax payers dime as long as we let them. An overhaul of the unions and car companies are necessary. You don't see Toyota or Honda's CEO's asking for our money? Maybe we should use them as a model?

she never has anything new to say. She makes way too much money writing the same book and saying the same thing over and over again.....

Suzy Orman does for the world of finance what "The Undertaker" does for the world of ballet....

I must say: Right on the money Suzy. So true, except for one thing.
We should brace ourselves and let the car companies fail.
They are going down anyway. It's the fastest way to re-tool.
New companies making cars for the future without all the expensive BAGGAGE. IT'S THE ONLY WAY !!- Then, we can stop giving all our money to other countries for oil and begin to re-build our economy and pay our deficit.. THE SOONER THE BETTER !! Let's bite the bullet !! C.mon !
Morrie

It comes down to what is rewarded behavior. These days, in public corporations, high level execs are not rewarded for managing according to sound financial and business principles, they are rewarded by generating short-term stock market spikes. They are not rewarded for improving a company's fundamental health, but by generating short-term stock value, often at the expense of long-term growth.

A related problem is related to the American workforce, especially the white-collar workforce. No longer are employees treated as long-term assets. Companies expect us to have the same loyalty as our ancestors did in the fifties. To be a 'company man' or 'company woman' but that just doesn't happen when they can cut our jobs just for a short-term stock jump, pretend that a 401k is any kind of replacement for an old-school Pension, and wonder why we leave after three or five years for greener pastures. If corporations would go back to the model of taking care of their employees, then the employees would go back to taking care of the company. You'd have less wage-inflation at the top levels, and people could afford to retire based on the work they put in during their working years. Sure it's more expensive. That's why most companies have eliminated pensions and bonuses and such. All to make the stock go up this quarter, or this fiscal year and not to make sure that the company grows steadily and healthily over decades.

No one should get 10 million dollars in bonuses for any reason whatsoever. No one should get even one million in bonuses. The top paid job in any firm should never exceed 10 times what the lowest paid employees make, bonuses, perks, and golden parachutes included. The old saw about extraordinary risks is complete bunk. These guys aren't taking THAT much risk. The worst that could happen, unless they break the law, is they lose their jobs and have to pick which of their X number of homes to live in. Big whoop. That's not nearly the kind of risk that a blue-collar worker faces in these economic times, when that next paycheck means their children can eat for one more week.

Smarter than you. They get 15B for free.... pretty smart.

Smart? Let's call it what is really is: Greedy. Maybe lazy or complacent but certainly money hungry is their main motivation and that is what has caused them to make unwise decisions. But let's for arguments sake use "smart." Anyone who got themselves into a subprime mortgage and now can't make the payments. Well, I dare say would put them in the same category as these CEOs. Ouch. People motivated by immediate results instead of looking at long term impacts. So, heck, we are as "smart" as they are...

Great article Suze!! You have the gift of hindsight!!!

If the Democrats are caring about the union men and women who make $60-70K a year, God Bless them. It's not their fault. They just make the cars the leaders of the industry tell them not to. It's the GOP that, in my opinion, is trying to break the union. Period. When you see the southern senators like Shelby on TV, all they talk about is bloated union contracts. You never here them talk about the greed and bloated salaries of the honchos. Example: Toyota makes billions in profit, but its CEO only makes $1 million a year. Ford loses billions and its CEO makes $21 million. That's where the problem begins...not with the unions.

You won't catch me driving a SMart car sandwiched between 2 Escalade's on the highway and I'm sure 90% of the population feels the same way. The US auto industry DOES make fuel efficient cars! The problem is that no one wants them. We all want our trucks and SUV's! The top rated fuel efficient car in the US is manufactured by one of the big 3. If your going to comment on something, at least be educated on it before you comment!

suzie ormans is a joke.

If Suze Orman wrote article about collapse of auto industry a year ago, we could give her some credibility. I remember her in 2007 giving advice to buy a real estate on some TV program, anyone can find it on youtube. She makes statements when things are already obvious to everyone. She is not smarter than those CEOs either.

Can we honestly expect a spineless, fuzzy-headed Congress that has rolled over and allowed the Patriot Act and innumerable other rapes of American democracy to take place with its support to actually impose serious oversight, standards andsafe guards on the auto industry?? Paulson and company didn't even ask for voting shares when buying parts of the poorly run banks (in contrast to the UK model) and Congress let this go through. Congress right now is a bunch of dummies as dumb as the CEOs of the auto companies.

My transmission on my 2004 Avalance went out three times! And I don't even haul or tow anything! Guess what I sold the Chevy and bought a Toyota!

Before any talk of bailout, The whole room should force the ceos to watch "Who killed the electric car?'" and let em explain themselves.....
maybe follow it up double feature-like with "Tucker"

Didn't the banking sector just receive billions of dollars to recapitalize and allow for new loans to be made? It sounds as though these two industries are a perfect fit for each other. Have the auto companies go to the banks for their bridge loans. If the banks won't lend the auto makers the money, than you know that the auto industry is in such bad shape that they are not worth the risk. And if that's the case, then now way should the federal government be loaning them the money. NO BAILOUT!

The automakers could seek bridge loans from one of their closest business partners who happen to be swimming in cash these days, the oil industry.

I always wonder why people bash CEOs for getting paid big money to decide the fate of thousands of employees and billions of dollars....

when we don't complain at all when someone pays nearly the same salary to some fool who can throw a baseball very, very fast.

Stock options are only good when your stock goes up, not when it tanks 80% of its value.

Private jets are nice, but being on-call to media, stock-holders, and panicky board members 24/7/365 is not.

Can anyone out there honestly say their job, thier comapny, their sanity would not be at risk if 40% of its customers vanished within 2 months?

what happen to my comment????

With the blame game in high gear, let's not forget who forced the auto makers to build and sell gas-guzzling vehicles – THE CONSUMER. If the auto makers tried selling fuel-efficient cars – they would have sat unnoticed on the lots for months. For those of you that spent $40,000 on your super-sized SUV just so you could waste as much of the world's resources as possible, I'm glad the CEOs of the automakers and oil companies got rich with your money!

The japanese car companies are only ahead because their government funded development of the hybrid batteries. What did our Republican controlled government do? Reclassified SUV's as light trucks and gave massive tax breaks to people that bought them. That is what electing two oil men as Pres and VP will do for your country. "the american public is addicted to oil"-W Things would have been a lot different if the supreme court had not decided the 2000 election.

Blaming the overpaid Union workers. If you really think the union workers make $75 to $100 an hour – I got some swamp land to sell you. This is with insurance, pension, holiday and yes, the companies share of social security all added in. Do your math – figure this out or ask your employer what your "real" hourly wage is – you'd be surprised. Please read on and remember – LABOR COSTS – isn't just hourly wage and benefits, it's also the cost of the retirees and their benefits. This is taken right from CNN money website
The real problem for carmakers isn't the workers in the factories. It's the retirees. Before the 2007 negotiations, domestic automakers paid more than twice as much per worker hour in labor costs than Japanese competitors making cars here. But the actual hourly pay for workers was very nearly the same. (Remember Labor Cost – is not the hourly employees wage it's every thing added together including retirees)

Domestic manufacturers have been making cars here much longer. That means they have many more retirees. The cost of health care for them is a big part of what drives up the overall hourly cost. And having been here longer, the Big Three have more experienced workers who command the top pay range. (not from CNN) Some of the jobs in these factories do require skill – maybe not something that you need a college education for but things that require years of running the machine.

In the 2007 round of contract negotiations, retiree health-care costs were shifted to an outside fund so that after 2010, those costs will not be reflected on the automakers' books. Carmakers are now also allowed to pay new workers a lower hourly rate than current workers. That will save substantial costs in the future, with more future savings with further concessions.

(This next part is not from CNN) – In the coming years as foreign auto makers start having older employees in the US they will also see their labor costs go up due to pensions and possibly older employees requiring more medical treatment.

Suze Orman doesnt know what the hell she is talking about. And any of you on her side-how often is she correct on her investment choices? She is an entertainer, just like Cramer. Maybe we should blame all the Americans that think they are entitled to something for free, like a gauranteed job/pension. You have to work these days, and maybe you should focus on taking care of yourself instead of pointing fingers at execs. Wake up! They have ALWAYS been overpaid. Get with it!

Hard to believe the amount of emotional comments in response to this article. Why are most people just followers??

It's so simple and clear !!!

We gave all our money away for oil ! We are now broke ! We must stop doing that !!

Start new companies to build vehicles that use alternate fuel sources!
Don't bail out old companies with pensions and debt that amount to producing more expensive inferior product. get it?
It's the same trap. Over and over and over...

First of all we all need to stop buying gas guzzling SUV's and pickups. The Big 3 churn them out and we still buy them. If no one bought them I'm sure the Big 3 would get the message loud and clear.

It wasn't until gas hit $4 a gallon that everyone got all up in arms. We, the American people are as much to blame as the Big 3. I'm no exception, I drive a Ford Mustang GT convertible. However after a recent major tuneup I'm getting 24 miles to the gallon. Not bad for a muscle car.

Bottom line, the Big 3 needs to retool and make more fuel efficient, hybrid or all electirc cars and we the American public need to start buying them. That's the only way to start turning this economy around. Now if we can only gets the banks to give us credit again....

It's sad to see so much greed in this world, and how it affects all of us. The junk in our food because it's cheaper, longer shelf life, the junk the American car companies want us to drive, gas prices, mortgage scams, ... the list never ends.

What these people fail to realize, is that when you die, there is no more fame, no more power, and no more money. All that you are left with is your soul, and if you don't work on that, then you have nothing.

The decline and financial meltdown of the American car manufacturing companies may have been helped by patriotic Americans who continued to buy crappy automobiles because they had the American label; such behavior encouraged these companies to believe no matter what they made there'll be a market for their products!

Not so sure I'm a lot smarter than the CEO's but common sense tells me when you're losing money, you better do something about it. Now you can let your bad decisions fall by the way side and have someone else pick up the tab. Like you and me due to a Government bailout. So, is there a single American car company that has actually competed well with foreign cars? Maybe we need some smarter "foreign" CEOs?

Suze should know better than to think the federal government would ever let the automakers fail. We've bailed them out before, so the CEOs knew they didn't have to make major changes. The CEOs were correct and wise. Voters are stupid for not stopping it. Now, the federal government might buy $2billion worth of GM stock. As long as the government owns the stock, the government will have even more incentive to keep GM afloat. Hence, future changes are even less likely and future bailouts even more likely. Why would they change when a huge stakeholder (the federal government) has an unlimited budget to keep them in business?

The bailout money should be used to re train the auto workers for other industrys because these car company's don't deserve it and won't be around much longer.

Just remember in the late 40's (1940's after the WWII) Richard Gosser and Walter Reuther wanted pension plans that could be portable for workers. It would be spread amongst business and employees. That way if a worker switched jobs the pension credits would go with them. If a company went bankrupt their retirement would be safe. But Charlie Wilsons and the like did not like that. Hindsight is truly 20/20.

I guess Socialism was scary back then, huh.

CEOs and Entertaines (sports, tv, news) are all well ovepaid. I think Suzie Ormand probably makes more than she deserves. He comments above are not all accurate. GM sells more cars in the US than anyone else. GM sells more cars worldwide than anyone else. This current problem isnt related to quality. GM won truck of the year, green car of the year, car of the year, European car of the year. The Japaneese car manufacturers are failing also, and have seen sales drop 30-40 percent. Most foreign governments are helping or consideing helping their auto industries as well. The problem that the auto industry is dealing with is a world wide recessin that could turn in to a world wide depression, and it is difficult to sell cars in a saturated market during a recession. Two out of three of those big three CEOs have been there for two years only. Wagoner at GM has been there for longer, about 9 years. They have just been selling you the cars and SUVs you asked for. If it is about cars and trucks, tell Toyota to stop selling one of its four truck models...

Janitor at Toyota $10/hr
Janitor at Honda $10.50/hr

Janitor at General Motors $22/hr plus 6 weeks vacation, healthcare paid in full, retirement and 401k contributions, and if you get laid off, you get paid just the same for over a year!

Why do they make so much more at GM? UAW Union!

Average cost of 1 employee at Toyota and Honda (incl. benefits) – $35/hr
Average cost of 1 employee at Ford, Chrysler, and GM $78/hr

Why do they make so much more at GM? Answer: UAW Union!

Somehow, it's the "dumb" CEO's fault for not being 'green' enough!? Isn't gasoline back down to $2/gal? I guess you've forgotten about the numerous UAW strikes at these compaines the past few years (despite loosing Billion$) when they tried to cut the over inflated wages to compete with foreign automakers. Perhaps this is why they've been making an inferior product, duh! I'm sick of these 'spoiled' union workers bilking us consumers out of our money (you pay labor costs for everything you buy). It's time they got pay and benefits similar to the rest of us! Now if we could just get rid of the Teachers unions, maybe we can all get some property tax relief too!
I say blame the greedy "Big" unions for shooting themselves in the foot. They should have seen it coming when world economies went global. This is so obvious. I don't know how so many (including Suzy Orrmann) could be so blind!

One of the Big 3's defense was that, they simply made what the people wanted – it was just too bad that people wanted gas guzzlers.

Well ... well ... well ... I guess after the Big 3 receive their bail out money, they can start making cars will installed free porn films. Hey, that is what people want, right?

From this point forward, hopefuly some pundit will begin to drill on the point of "corporate ethics" from a different perspective – sustainability, not just the "I love mother earth" green thing, but sustainability of product / marketing decisions that will ensure the company does not die later, or drag down the country with it! Make products that don't just gratify short-term excitement, at the expense of future collapse.

(Speaking of "giving customers what they shouldn't have - here in Texas lots of the domestic truck drivers are rude, using their powerful big engine vehicles to terrorize other law-abiding drivers; cut in and out of lanes. Besides creating gas-guzzling money wasters, Big 3 also help US drivers to become more belligerent ... something else that shows how little GM/Ford/DodgeCrysler think about downstream effects of their products!)

Let's put the blame where it should be placed...

Politicians

If they're Repulican's, then they allow corporate greed. This allows boards of directors (who are supposed to look out for the shareholder – you and I) and corporate officers to line each other's pockets, and then feed this to the Republican's to look the other way so that they have a war chest accumulated to get re-elected.

If they're Democrats, then they allow the unions to pilfer the corporations and promote mediocrity with rules that are outrageously absurd. Promotions/raises are not for a good performance, but rather the amount of time spent on a job that may be outdated. Need a loan and don't have the money, talk to a democrat and get the banks to give it away and cause a financial meltdown. Hey, its all good for the sake of a vote right?

I have an idea...Why don't we do away with congress all together and vote via our PC's? We can't do any worse than our elected officials who take greed to a level we can't even imagine.

Suze orman, still the master of the obvious. Yes she gives sensible advice but alot of it is impractical or undoable. How long did it take her to lose her perspective, as soon as she found out her net worth was over $1m?
Many people are desperate now and unlike suze orman, im a paycheck away from being one of them too as are millions of other people.I hate to say it but if her advice is too late, maybe you can get a copy of "10 years of living in cars" from amazon which would help you get back on your feet if nothing else. I have a copy and thats the only really practical advice i've read lately, almost everything else is just a broken record.

I hate the idea of baling out ineffient industries. It is against all sound business sense. The fundamental problems must be fixed, something no amount of taxpayer billions will fix. There are some great automoblies being sold in Europe that get 50 to 75 mpg, and guess who makes them: FORD and GM! Why oh why are they not sold here?? (Because they are diesels and we hold ourselves to harsher emission standards than the rest of the world). Anyway, before giving the baleout package, how about having all executives return bonuses of the last 5 years and hold it in escrow. If they reach targets they can have the money back, if not, it goes to the taxpayer to offset the baleout. Let's not kid ourselves, the end of this sorry mess will be the money will be lost.

I don't own a car but I still think this is adsurd. The CEO's have lived the life of a king while the common man slogged to put food on the table. Their actions can never be justified whether they fly or take a hybrid to DC. We as taxpayers shouldn't have to pay for their sins. These three are out of my list of car brands I might purchase in my life.
Suze has been right all along, I watch her every saturday and she really tells the truth and give suggestions for regular people. Her take on emergency funds is true and although I dont have one, I am trying to build it as this economy will effect no one else but regular people like us. So people, listen to here!! There are ways to save around you!!

Why those smart CEO guys cant see the obvious is amazing to me...meantime the millions of dollars of past years bonuses are in their bank account, why not using some of this money to bail themselves out?

We have the highest-educated business executives in the history of the world...and yet none of them have the ability to do common-sense budget practices. If they got us here, why do we insist thet can get us out of the mess?

It is time foe Executives, living behind glass-walls to face Bankruptcy like the rest of us. And you know, it should STAY on their Records just like a Bankruptcy does for everyone else. Try 7 years. Let's see then how 'smart' some of them are.

The other thought is too chilling to imagine...that not one them really know what is wrong.

I consider myself to be a patriotic American. I would love nothing more than to buy an American made car and support our country. But I cannot stand the thought of buying from companies that make inferior products and charge higher prices. I said I was patriotic, not stupid.

The days of the American automotive oligopoly are over. The reputations of these companies are so badly damaged (especially over the last month) that chapter 11 won't make things worse, and might even be tremendously helpful for all.

The ONE mistake that the american 3 CEOs are making is that they insist on making cars for americans... a decreasing demographic due to Immigration/VISA policies of the last quarter century. Then they wonder why they are loosing market share.

And YES, the asian industrials and automakers, are getting bailouts from their governments... Japan is the land of bailouts... look it up.

I love you Suze!!!! Great advice. It's time we get honest and serious about our money. Cheers to you.

Here we go again with the bail out PR
Why the big three are going down
– Ignorance excutive and management team.
– lousy design and qulaity control
– ridiculous package from Union mafia.
Bail out means we giving them the money to continue their comfortable high standard living style with full package of benefit. Now the regular average American hard working workers with low paying, little coverage have to paid for these jerks.
Everyone knows they are jerks but they will get what they want because they are the back bone of Democrate party and Obama.
Meanwhile millions of workers with no jobs or reduce working schedule will get no bail out. The answer is they did not join the Union Mafia so they will stay in the cold.
The big three and their union are truly blood suckers!!!!!.....

I am as angry and frustrated as any other American that our tax dollars are being used to bail out this failing economy. My question is, why is there such a negative attitude toward the auto industry when the financial sector has recieved so much more of our money with almost no accountability? Americans needs to realize that there are many factors that led to our current position and establishing who was wrong won't fix the country. It's too late. The auto industry made mistakes sure, but they didn't give foreign automakers hundreds of millions in tax breaks to build factories here that can pay workers half of what the UAW has strangled Detroit into. The foreign automakers sales are down too. They may not be asking us for money but aren't the subsidised by the Japanese and Korean governments? Detroit built trucks and SUV's because that what people bought. If Americans didn't insist on driving gas guzzlers you would't see Toyota and Nissan launching new full size truck campaigns so recently. Of course they built what people are buying. That's how a business is prfitable. If the banks and auto industry fail, we'll have a lot more to worry about than who's fault it was and most Americans are so angry (and rightfully so) that they don't think it will affect them. Guess what – it will. By the way, why is the media so disinterested in pointing out that the GM produced 17 models in 2008 that get over 30 MPG, That Chevy Malibu gets better gas mileage than Accord or Camry, that GM (for example) has 6 hybrids on the road, that the Cadillac CTS won the Motor Trend Car Of The Year Award for 2008 or that the 2007 Chevy Silverado was Motor Trend's truck of the year? Those all come with 100,000 mile warranties by the way. Wake up America.

I say the blame is on both sides of the fence. The Big 3 for building over sized gas guzzling crap and the idiot American consumer who bought that crap along with tons of other ego enhancing bling they can't afford over the past two decades. I love this country and my family has fought and died for it, but something has to give. We are quickly becoming a nation of obese, financial morons who's mantra is to spend, spend, spend, drive a Surburbacursion with 22 inch chrome rims and 9 LCD monitors all by your lonesome to work, only to return home to a mortgage that's well beyond your means (but hey, the bank said you could afford it a couple of years ago, so it must be OK). Wake up America and start thinking past next month! We have become targets to indulge companies who take advantage of our spending nature telling us that we need more this, bigger that. Until we learn to live within our means and provide our children with good values and an education, this cycle will only repeat.

Well gee, Suze, glad to see you're so clairvoyant. A year ago, SUVs were what the buying public wanted and couldn't get enough of. The Big3 made small cars, but they weren't selling. So if you were CEO, what would you do? Sell the SUVs of course. Everyone is criticizing the Big3 for not making small cars when they couldn't sell them.

$4 gas woke everyone up and then small cars were hot. Then the credit crunch and nothing is hot. Toyota/Honda etc are all shutting plants and laying off workers.

Shame on the USA for the lack of a national energy policy (that kept gas cheap and wasteful) and for the lack of financial oversight (that might have cooled off the housing/sub-prime bubble).

Shame on Congress for more hot air in letting the financial industry get by with a hand slap.

We have seen the enemy and it is us!

First, Chrysler is now foreign owned, so why is it being given status as an "American" company? We complain about the profits of foreign cars going overseas, yet being built here, but they're doing the same thing. If Toyota, Honda, et al asked for bailout money, we'd give a huge thumbs down, but Chrysler is categorically the same.

Second, given the combination of the downfall of the housing market, and the over abundance of houses in the Detroit area, the UAW workers should be willing to concede to a pay cut to get thir pay in line with the level of work they actually do, versus what the contract people have negotiated. They'll still have plenty of money to buy the houses, which are at least 50% cheaper than they were in their hayday.

I agree with Suze's comments, and several of the comments regarding the big oil companies.

With all the BIG OIL company WINDFALL PROFITS of the last few years, seems pretty obvious that the companies that benefited most from the big 3's failed policies are in the position to supply ALL the money needed to set the American car industry back on track.

Larry, Suze...let's start a discussion about ways the oil companies can step up, clean up the mess they helped create, and take the burden off the taxpayers.

People who think they have a "patriotic duty" to spend like sailors to fix the economy – think again. Sound economists like Krugman – and like Ms. Orman – know better. We have had a "consumer bubble" where consumer deficit spending drove the economy, but the consumers over-leveraged their borrowing ability. That's how we, the people, contributed to the current collapse.

Now, we need to be sensible and recover. We can ramp up our spending gradually as our security improves, but government needs to be the spender now – investing in public goods and growth engines for the new economy. The new economy will have real innovations to export and public as well as consumer goods to sell at home. It won't need to be driven by consumer excess.

For the short term, we consumers should all tighten our belts and strive to remain independent so that the government or charity doesn't have to bail us out.

Listen to Suze . . . she's a smart cookie . . . we should hire HER to clean up all these freakin' messes!

Pandering to the UAW is what has hurt all 3 of these companies.

If you look at other major Union groups IBEW and others, they are still providing what unions are supposed to provide – better workplaces for their brothers.

The UAW has become a business that is almost as bad as a large corporation. Look up the anual salaries of the top UAW execs – they are pretty close to what the higher execs in GM are making.

If the Big 3 go down, it's only a matter of time before the UAW goes down as well. That, and the threat of the Big 3 declaring bankruptcy (as this would void the current UAW contract) are the only things keeping the UAW begging congress for the bailout right alongside the Big 3.

No offense to Suze she's a nice enough person. But really honestly truthfully the advice for us was kind of crazy and out of touch. First off where is the money gonna come to do all the things she wants you to do. Save for 6-8 months of living Pay off credit cards and save for retirement. I think you get 1 of the three with the left over money for savings if your living in a sizeable city. Its like the finance community don't get real everyday Americans wages and how much they make.

Also they didn't turn their backs on Americans they gave Americans what they wanted and that was SUV's. These companies were very profitable with SUV's because that's what you wanted. Now their not the only ones losing all of the car companies are losing it just the lost hurts them more because they have more retirees they have to help. Why don't we ever look at really how we got here and stop taking scape goats out.

amen, amen, and amen!
we need more people like you, Suze.
the reason they call it 'age old wisdom' is because it has stood the test of time...we need more age old wisdom taught and followed – individually, corporately, and as a nation.

GO BMW

It is interesting that when the auto makers are living in the "good times" they scream at anything that smells of government interference in their business. Yet, when times are bad, they are happy for the government to take on a "Socialist" nature and bail them out.

I assume that when the profits start rolling again the auto makers will gladly hand those over to the taxpayers as a way of saying "thank you" to us.

Capitalists rant against "socialism" but isn't that where we are heading with all of these bailouts?

Is Iacocca (sp.) involved in this process?

I have the emergency fund; I have no cc debt. I own a rental property that is cash flow positive; I own my personal residence; I make great income...and I'm scared out of my mind.

Then to hear that John Thane of Merrill Lynch wants a $10 million bonus... I'm angry too.

Not making apologies for the auto execs, BUT, the Big 3 made vehicles that the American public wanted. You can easily look at the list of cars that the domestics have produced over the years and small cars simply did not sell. The foreign car companies were able to undercut their pricing for several reasons, some of them fair (lower labor costs), some of them unfair (e.g. dollar manipulations). Bottom line is, the domestics could not make money on the small car market so they marketed toward the truck and SUV market – because thats what buyers wanted and they could make money there.

Other thing is that, apart from Waggoner, the CEOs are really quite new to their positions, came from outside the automotive industry, and have been making good progress in moving their respective companies forward despite the short time they've been there. Most big companies take a good deal of time to make systemic changes. The automotive industry is no different – design cycle for new cars, 3 year contracts with the UAW, etc.

So...rather then continually beating up on the guys, let's figure out how to address the situation. AND by the way, the main reason the domestics are in trouble is not fuel prices, its the credit crisis caused by banking and finance.

I would much rather listen to Dave Ramsey on Fox Business. Everynight @ 8pm. I use to listen to Suze, but her "Go Girlfriend" sexist attitude turned me off. Dave gives common sense advice and doesn't pull any punches.

As for this whole auto bailout, I'm not for it. Once UAW gives up someting (wages, insurance, benefits = $70/hr for employees.. not bad money without a college education), and the big 3 restructure to meet the needs of the consumer (not SUV's) I then might support it.

Chevrolet is building a new pick-up plant....in St. Petersburg....no, not FLA......Russia. How much of the bailout will be putting Russians to work?

The bailout is not going to fix the basic problem: for years, the big three (soon to be two) have managed their businesses to maximize "shareholder value" – which they translate to mean daily stock price. This short-term thinking has led them to bankruptcy. Giving them billions of dollars when the inevitable downturns occur in this cyclical business will only encourage them to continue these practices.

If the government does NOT bail them out, many jobs will be lost.

If the government DOES bail them out, many jobs will be lost because they will use the money to maximize shareholder value, not save jobs.

Suze My Dear, I used to respect your opinions, but to support ANY type of bailout is ridiculous and reckless. Let's give a drunk the keys to the liquor cabinet. If the big 3 fail, then great. Other auto makers will
fill the gap and provide jobs. If not, the country can use the bailout money to better the infrastructure and provide jobs. These bailouts are a bunch of garbage.

Suze, you are uninformed in so many ways. The US auto industry has weathered many disadvantages that the competition doesn't need to worry about:

1) Foreign competition that gets health care paid for by their government,
2) Foreign competition that gets subsidies from their government,
3) Foreign competition whose government spends billions to keep their currency cheap, making their cars cheap in the US (until they put us out of business),
4) Foreign competition that gets subsidies from OUR STATES,
5) Foreign competition that gets tax incentives from our government to buy their cars,
6) People like you who don't know the quality cars we now make, but just regurgitate the "American is Bad" mantra,
7) A government who will not create demand for small cars by raising the fuel tax, which is why Toyota and Honda make them in the first place,
8) A domestic press that will never acknowledge anything done right by us, or wrong by foreign competition.

Our competition is laughing all the way to the bank; no other country puts so little value on their manufacturing base. Just wait until they take over the US market completely and they can JACK UP THEIR PRICES!

John Stewart I have an 03 Silvarado and I have never had a transmissin problem and I tow and have 90,000 miles on it. I had an 01 Chevy truck and I never had a problem and I towed. I know more than 100 people who own similar vehicles and have never had a tranny go out. I have had other cars and trucks, and the one that gave me the most problems was my Toyota pickup. Did your transmission go out three times after the warranty ran out, on a truck 5 years old? If it happened even once under warranty, then you qualified for the lemon law. You must have been under warranty once. Did you have more thatn 100 thousand miles on your vehicle?

"People who are rich are evil

People who are poor should hate them."

Where does it say that? Where is it even implied?

Reading comprehension GOOOOOOD.

Try to see the documentary "Who killed the electric car?

GM DID!!! It's very sad, but GM actually had the solution in 1992, if not for its capitulation to big oil!

I was once told that Einstein said "A problem can't be solved by the mindset that created it". If this premis is true then how can any bailout work without replacing the people that created it? For to many years the CEO's and the government have worked together to create a society of the wealthy few. Lets go back to the free market that we are supposed to have. Get the federal government back to doing what it should and stay out od what the state should be doing. The conservatives have promised us smaller governments and lower taxes, but have never delivered on the promise. If the democrats think the more you give away doesn't create a society of people dependent on the government, they are just plain stupid. As long as the government doesn't create income and depends on the taxpayer we will have a political system and not a government. Congress has failed in its responsibility to the public and a change there is what is necessary.

While I can understand (somewhat) the reasoning for not letting the the "big 3" go under, I am extremely annoyed that we are actually considering and looks like actually going to give Chrysler a bailout.

Chrylser is owned by a private investment firm whose history is shrouded in secrecy when it comes to its finances and whose top management Geko's greedily enriched themselves. And now these same arrogant xxx's have their hands out because they made some bad bets?

A resounding NOOOOOOOOOOO.................................

As for GM & Ford, oust the top management, force them to build more factories in the US (if Toyota & Honda can, why not them?). Whoever had the sayso in terms of building efficient, quality cars missed the last boat and stupidly gave us clunkers that couldn't compete with foreign automakers nor planned for the inevitable rise in oil prices.

I'm tired of the so-called MBA brains not being held accountable and getting away with murder.

If I tried this where I worked, you can bet I would be fired, given no severence, no bonuses and would be hard pressed to find another employer who didn't know my past.

Let these CEO's get nothing and let them feel what so many hard-working Americans are going through right now. No jobs, no homes and no health insurance!

Dan,

Lee Iacocca is retired and no longer involved with the auto industry. In 1979 Iacocca secured a low interest loan from the federal government. It was something that needed to be paid back. What we have now is a give away to try and save our largest manufacturing industry. 🙁

This is a great eye opener. Thank you so much. Every time I am feeling the itch to run to the mall, I will think of my retirement and my kid's college.

Sing it Suze! You're right on the money.

The Big Three Automakers deserve to fail, file bankruptcy, and be bought up by more innovative capitalists who could actually re-structure and re-organize this industry into one that can actually compete in a global market, as well as focus on alternative energy power sources.

Thanks!

When Toyota brought the manufacturing plants to USA , our 3 major USA car makers took most of their manufaturing plants outside the USA. Saying they will be saving labor and parts costs.. Cannot understand this equation and what went wrong here..?.

Well said Suze....I just hope the rest of America gets what you are saying. I bought my first Toyota back in 1986 because I knew back then that the Big 3 made crapping cars. 22 years later, I am still driving Toyotas and couldn't be happier.

Put back 6 to 8 months pay? Right! Get rid of credit card debt? Right! You're obviously in another tax bracket from the "middle" class. Actually we don't have a middle class anymore. We have the "HH" class (Homeless and Hungry), the "WTJ" class (Working Three Jobs Class), and the "Lexus" class, (CEOs and managers running America into the ground and getting sky high bonuses for doing so). Honey, if we could all afford to put 6 to 8 months of income back for emergencies, there wouldn't be any economic meltdown! GET REAL!

This makes me angry because our nation will not let these historic industries car industries fail. This isn't the first time domestic auto companies have been on the chopping block in the US. This should be an outrage to the American tax payers because we are paying for the domestic auto market to FINALLY change their ways. There is far too much overhead in American car manufacturing. The UAW has completely drained the companies and now, finally, the money is running dry and we are supposed to bail them out? This isn't fair when I can go to Honda, Toyota, Nissan, etc, and buy a quality car for half the price. The Ford's, GM's, and Chrysler's are FINALLY revamping the companies and thinking about the longevity of the companies when they need money...Doesn't seem right.

The only thing that worries me is strictly relying on foreign auto manufacturers and this large industry failing and the loss of 3 million jobs. It would be detrimental, but I don't know why we have to pay for the mistakes the big 3 have made over the course of 25-30 years.

Stop with the excuses; we are not idiots. We understand that no bailout would be a BIG deal.
There just comes a point in time where I DON'T CARE. What, free market is only for little folk? What happened to supply and demand?
Oh, there is plenty of blame to go around, Congress not excepted. Yes, it IS premeditated, or blatant ignorance....or arrogance.... perhaps....the "big three" knew they'd never go under as cozy as they are with money-givers.
I still say NO BAILOUT, NONE. NoNoNONONOOOOO!

E is exactly right. The Big 3 Automakers do make fuel-efficient cars in Europe, which they should be selling here in the U.S. Part of the reason that the Big 3 make money selling fuel-efficient cars in Europe is because of the gas tax that exists there, thus making gas expensive. The price of gas in Europe does not fluctuate like it does here in the U.S. because of the gas tax they have that keeps the price of gas high (and relatively constant). If the U.S. government fixed the price of gas at $4 per gallon, the Big 3 would know to make more fuel-efficient cars, partyly because there would be a higher demand. Granted, the CEOs should've been calling for more fuel-efficient cars to be built long ago. Look at Honda and Toyota. When we think of fuel-efficient cars, we think of the Japanese car companies, which make the Honda Civic and the Toyota Prius. What kind of fuel-efficient, environmentally-friendly cars do the Big 3 make? The Chevy Volt? That isn't even supposed to come out until 2010.

Fixing the price of gas is something the government should've done a long time ago (Tom Friedman of the NY Times suggested we do this after 9/11). Unfortunately, with the economy being so bad, raising the price of gas would be too big of a burden on Americans. The government should wait for the economy to get better before instituting a new gas tax.

While the CEOs deserve most of the blame for this mess, the UAW is not blameless, either. I myself am (usually) a pro-union, Democrat, one who believes that unions do some important things, but they do overreach at times, as well. The workers for the Big 3 make more money than do the non-union workers of Honda and Toyota. (I would assume the workers for Honda and Toyota still make sufficient wages.) On top of that, the health care costs are killing the Big 3 Automakers, making the case for government-run healthcare. Some people have suggested, that because of health-care costs, it costs the Big 3 $1500 more per car because of its obligation to pay for its workers' health insurance.

We need Suzy Ormond to tell us this? Why is this woman's simplistic financial twaddle so popular? Everything I have ever heard her say about financial issues I could learn in about an hours reading. I dont get it.

Be smarter than most Americans too, buy a GERMAN car.

Suze,

I have listened to you for several years now. You have always been honest and always been correct in telling people to get out of debt, live more financially conservative lives and save more, both short term and long term. Once again, you hit it, sister.

Happy holidays to you and many thanks for the advice that got me out of debt and put money in my bank accounts, IRA and 401k. My bills are paid in full each month, 10% goes into retirement savings and 5% into short term savings. We have everything we need and most of what we want. God bless you for sharing you experience and insight.

pay off high interest credit cards and save money. How profound! How do you get her job?

Based on all the good capitalist, conservative "survival of the fittest" opinions on this blog, I assume that you all voted for McCain and believe we should cut taxes and reduce social programs.

Just kidding. I think the majority just want the benefits of liberalism without bearing the costs.

People seem to forget the auto execs job is to keep their share price high to make stockholders happy. They must focus on the current quarter, not long range. Americans were happy buying large vehicles including SUVs and light trucks, and the auto execs were happy to sell them. They were highly profitable for the big three. Why wouldn't they build and sell what was highly profitable for them? It was only when gas prices went off the charts this past summer that SUV and light truck sales ground to a halt. Perhaps the loans should come from Exxon and other oil companies. After all, these are the companies that made record profits while virtually every other industry suffered.

If we had a national health care plan, the health care legacy costs would not be a factor for the auto industry. The big three could then use those funds to purchase higher quality components for their small cars and could then compete in quality with the foreign car makers.

Toyota and Honda build quality cars in America, using American workers. So it is not the American worker that is turning out an inferior product for the big three, it is inferior components, used to cut costs.

The same talking heads on tv that are calling for the firing of the heads of the big three for doing their jobs poorly, are the ones that make incorrect prediction son a nightly basis as to where the election was going, where the economy is going, and so forth. Let's fire them as well.

It's embarrassing to see disinformation continue to be propagated about the auto industry.

First, the fact that the big three sold pickup trucks does not explain their financial difficulties. For years it's been reported that pickup trucks had higher profit margins than small cars. The truth is that the big three sold gas-guzzlers because (a) the public wanted to buy them and (b) they made money that way.

Second, the big three also make very reliable, fuel efficient vehicles. Look at the Ford Fusion / Mercury Milan. This is a safety top pick, a reliability top pick, and the thing gets 30 mpg. Look at the Ford Escape Hybrid – this thing is one of the most fuel efficient small SUVs around.

Suze – shame on you for perpetuating myths and misinformation.

Isn't that the tax payer will pay for bail them out? They used all their money, now we must pay for them, I think they are very smart to know where to get money from!

It is not fair for the tax payers to bail out the auto industry when everyone knows that they are really bailing out the UAW. The UAW killed the US auto industry with their golden demands and maybe they should be the ones to bail them out. But you know that will never happen for the congress will make the tax payers do it. It is not fair and everyone should take note that when a senator or rep vote yes on this, they should oust them when they come up for reelection. I think that the american people are not going to gain in this at all. There is no way the auto industry can survive with the legacy costs they have. The auto companies need to be run like 90% of the rest of the businesses in the US, (not counting the wall street bail out which was wrong too). God help the tax payer on this one for our taxes would be better spent on social security and a medical plan for everyone. This is a total waste of money to bail them out.

Hhhmmm. How to be smarter than a CEO. First thing that comes to mind is to binge drink and smash your own head with a hammer until the pain stops. I'm just glad my tax dollars are helping to keep the already rich CEO's rich. There is nothing more noble than sending jobs overseas, disrupting the lives of employess, so a CEO can make a few extra million dollars. There must be hundreds of items you can buy if you make 20 million dollars per year that you JUST CAN'T AFFORD if you make a paltry 15 million dollars per year.

GM had built and leased out 10,000 electric cars.After a lapse of time they decided to recall these cars from the lessees although many of them begged to be allowed to buy their leased vehicle.GM refused , recalled and GM DESTROYED THESE CARS. This is the Company which the taxpayer is asked to save??I say let it go down the drain.All that baloney about jobs s just that.If it suits them they will fre as many workers as they please.FOR MANY YEARS NOW THE CEO WHO FIRED THE GREATEST NUMBER OF WORKERS WAS GIVEN THE HIGHEST AMOUNT OF BONUSES AND WAS MUCH IN DEMAND BY OTHER COMPANIES. We must establish a ratio average pay of the worker/average pay of the executive e.g. 1/10 or whatever s just and reasonable.MAKE THE GREEDIES JOBLESS AND HOMELESS.

It's so easy to blame leadership when something goes wrong – after all, that's what they're there for. Just out of curiosity, where were you when Greenspan and the Clinton and Bush administrations were deregulating the financial industry – that led to the creation of the mortgage bubble – that led to sales of exotic mortgage products – that led to the collapse of financial banks – that put the big 3 in this mess? Why weren't you kicking and screaming back in the 90's/2000's for some better busines acumen on the part of our leaders?
Hindsight is perfect, isn't it?
As for whether the auto industry should be bailed out, that's over and done with. The senate hearings were a dog and pony show designed to entertain the masses. The bailout will happen and was never in real doubt. The question is – who's next in line to get some tax payer handouts? Is Sears and Bestbuy considered "too large to fail"? How about Time Warner? Are they not also "part of the American fabric?" I'm part of the American fabric too, maybe I should go to Congress and beg for my share.

Wow,
lady, you think you know what you talking about, you are so very wrong.
so are most of the other people who made comments. you all are just basing your comments on emotion and just want to see someone burn for this countries economy. I have to agree that Ford and Chrysler CEOs are just greedy. Rick Wagner has done the best job out of any auto CEO.
So to all of you who know what goes on inside that business, or actually learn anything. keep your comments to yourself.

Suze is the greatest! I trust her and her finacial ideas. I always live by what she says on a finance level and it works and I'm much happier! Thank you Suze!!!

Making a million a year or two is pretty suffice, right? Why go for more than 5 million dollars a year? What about us? We invested our money and it goes into CEO's pockets for lavishly things; showering money for parties and exotic trips?

As for myself...making 50,000 a year is good. Million dollars? For what? More hand jobs?

Letz

The ignorance displayed on the majority of this page is staggering.

Take a few minutes and do some genuine research on the subject before posting. I know that many posters are upset about the bailouts. I am too. What we are talking about for the Autos are LOANS that are to be repaid. It's important to note that in the long run, the healthcare costs to the taxpayer if GM were to go out of business far exceed that cost of the proposed bridge loans.

It's hard not to be jealous of highly compensated CEOs, but don't let your frustration color your judgement of the issue at hand. CEOs are paid relative to their worth. Based on the grammar and reasoning of most of these posts, the majority of you would fail miserably at an executive position with responsibilities far below that of these CEOs. Sometimes, the truth hurts.

Please ignore the media's biased message and take a look at the FACTS. The automotive business is one of the most complex and dynamic industries in the world. It's an industry that Suze Orman apparently doesn't know a thing about. Don't be like Suze Orman. Educate yourself before broadcasting your opinions to the world, so you don't look like a fool.

PERHAPS! Fed should buy these 3G and give them to the MILITARY...they can manage them better than CEO's....
CEO's must resign as soon as possible...Goverment should take over these Companies or let them bankrupt and take care of employees until you create a new jobs for them...this is cheaper and safer than bail out....

Those CEO are not stupid and , I think, they saw what was coming, BUT, MONEY. expenses for workforce are double compare to Toyota (unions).
Where else worker with no experience can get starting salary $22/hour or more. They didn't have enough for new developments, they couldn't force workers to push for quality (union limitations). There is impossible to run GM like small business, by constantly looking for profits.
For me there would be better to bankrupt all 3, deunionize them and start all over again.

I love the way you talk and how you say it !!!

I am an accountant from a very smart frugal family. Everytime you say something I find myself smiling because I am trying to do just that...My friends complain how to them I am so cheap and me and my child are not dressed w/ the latest trends but you know what ...I am trying to not ask for a bailout.

Signs...unemployed !!

Hey, this article by Suzie goes right to the heart of the problem. Reality, hard cold reality is the only thing that will get us through this financial mess that the Republicans have left us with. We all have to fend for ourselves and shame on all the big companies that are lining up to get bail out. Us middle class citizens are considered the serfs of the world in the eyes or the Ruling Class. Perhaps, just perhaps we will be lucky enough to win back some of our independence and confidence with the leadership of President Obama. It's time to help each other make through the next few years.

To Susy Q: Get real, have a 6 to 8 month savings plan, are u kidding? Most people that work everyday and have a family and are trying to make ends meet cannot possible save that kind of money. It's barely impossible to do and meet every bill and obligation on time. When you don't get pd time off work when you miss then that's not an option. It would be great if we could get some really real useful tips to help poeple in our wage bracket.

I'm tired of all the holier than thou "American cars are crap" people and "CEOs are stupid" comments. Why did they make so many SUVs? Because American's were buying them left and right. They were hot when gas was cheap, and may be again in the next few months if gas remains cheap.

So CEOs were going where the money was and giving their customers what they wanted. Doesn't sound like such a terrible strategy to me.

About holiday shopping and credit card debt:
If everyone tighten the belt, where would economy go, because it based on consumer spending and debts. Our goverment wants us to spend.

Really, really stupid article, it confuses two issues, quality and environmentally friendly cars. The Japanese and Germans have (until a few years ago) produced cars of a higher quality than their US competitors. That is no longer true according to some independent research firms.

The auto execs should have been investing in the production of small, fuel efficient cars? Americans, as a group, had no taste for small cars up until about May of 2008. How many hypocrites complain that the US auto execs are stupid for not producing tiny vehicles, then drive away in an SUV, truck, or large sedan? The auto companies would have gone bankrupt a decade ago if they'd produced all small efficient cars that NO ONE WAS BUYING.

The CEO's are greedy but just as greedy as the Senate and everyone in DC who are making laws that hurt Americans. If the CEO's need to step down than so do the Senate CEO's (Pelosi! Barney! etc!). This is stupid and the American people keep falling for it.

You know Suze, no one was ever forced to buy those gas guzzlers, were they? Americans themselves should be partly to blame for buying all those SUVs, Hummers, etc. They also have known for years that oil is a limited resorce, that much of that money could have ended up in terrorists hands, that Americans should have started building a high speed city to city rail system years ago. Also, this arguement that America is too big to connect with trains is ridiculous. Regions can be connected together--look at New York/Boston. Why didn't we Americans connect the big cities in every state with high speed rail 20/30 years ago? It's not just the car execs-although they are also very much to blame--but it's also Americans not wanting to give up luxury, convenience & over consuming! In other words-irresponsibility!! Gluttony!!
Also, this arguement with capitalism vs. socialism seems a bit absurd. Why is it that in BOTH the USA (capitalism) and Russia (communism), the top 5% of the population controls the wealth. Is that supposed to be a benifit to democracy-that 5% of the richest people control the wealth? We should take the emphasis off what figure people can earn when they get out of college, and put the emphasis on "what beneficial way can I help society"-and then pay people based on that! In Japan, an executive is only allowed to earn only 20 times the amount of their workers. That's seems a bit more realistic, doesn't it? And it's still an incentive to earn 20 times the other guy, isn't it?
Also, as Americans, we are always looking for somewhere (on someone) to put the blame on for our state of being-–we should also be looking in the mirror from time to time. Responsibility--don't buy something you can't afford! These people with credit card problems and foreclosure problems are at least partially responsible for their own fate! Why didn't Obama send a message like that out as he was campaigning?
These days, whenever I turn the TV on in the states, I feel like commentators have just become plan rude to their guests (because people like that?). Wasn't the golden rule for newscasters to remain non-biased?
Or when you turn the TV on, and you see that someone is trying to just plain rip you off. When did the "free market" system become "How can I rip someone off"system?

Why don't the oil companies bail out the big 3? They are making ridiculous profits and the big 3 is a huge contributor to that profit... I haven't heard this mentioned, ever. Seems logical. They probably have more cash than the government by now too.

There is so much misinformation out there concerning the auto LOANs. First of all, the foriegn car companies are receiving money from their home governments. They are also receiving tax breaks from local governments here where they have built plants. The foriegn car companies have closed their markets to U.S. autos. Last year the U.S. auto companies sold 4,000 vehicles in South Korea. The South Koreans imported 700,000 here. Yes, they made some money doing that. No surprise to me. The Federal Government needs to level the playing field or the U.S. auto companies will never be able to compete.

The U.S. auto companies were going along fine. The market was working. Plants were being closed. Plants were being retooled to make new products reacting to the market. The problem for the auto companies came with the credit crunch. Most people get a loan to buy a car. When that was not available sales dropped.

The Congress is in my opinion the cause of our financial meltdown. They directed that loans be given to people that were not qualified to get them. I see it as nothing more than trying to buy votes on the backs of the taxpayers. As they defaulted the banks needed help, which they got with no strings attached. The U.S. auto companies are asking for a LOAN from Congress to get out of the situation that was caused by Congress. Sounds reasonable to me.

Many people are saying to let the U.S. auto industry fail. The shock wave that will send through our economy would be devestating. More houses would be lost, unemployment and welfare would skyrocket, and of course there would be a dramatic tax revenue loss. Even people not working in the auto industry would suffer.

Congress should help the U.S. auto industry recover from the problems created by Congress. It is not a bailout as the media often calls it, it is a LOAN.

Also, please do your homework. The rhetoric I see here is mostly very old lines that have not been accurate for a long time. The U.S. auto industry quality is as good as the foreign auto companies. They make good cars and have plenty of models that have excellent mileage ratings.

I will suggest that as you purchase your foreign car consider this...where do the profits go? After 9/11 the U.S. auto companies dontated millions of dollars to keep the economy going. Where were the foreign auto companies? No where to be found. They did not make any contributions. Think about that as you send your hard earned dollars overseas.

Seriously, "...Let the OIL Companies give the loans to the auto companies..."? We are asking the auto companies to increase fuel efficiency dramatically and someone is suggesting to put the OIL companies in a position of influencing the auto industry? Would you easily say "no" to your banker, whose business prospers more if people don't get good mileage?

Think people.

The past is the past. The big 3 were in a great position to sell SUV's, and did because that is what consumers wanted. Even Toyota, Honda et al. got into this market as soon as they could. You can't expect car companies to push vehicles that people don't want. It's only because the OIL companies pushed the price of gas so high that everyone suddenly shifted to smaller vehicles. OK, so the big 3 are also shifting their production to smaller vehicles. It's what the consumers want now. Then banks started to panick and credit tightened up. Auto companies found it harder and harder to get lower interest loans to fund the R & D and production of the products consumers now want because the banks won't lend. Consumers find it harder and harder to purchase these vehicles they make because banks wont lend. Congress took quick action to pump $700 billion into the banks, in hopes that they would lend, and they still won't lend. So all auto manufacturers, foreign and domestic are now forced to look toward their governments for assistance to keep operations going. Our domestic companies are the big 3, that is why they are talking to our government. Toyota, Honda, Daimler, Mercedes, etc. are all talking to their governments too. This is not a domestic issue. The global industry is a risk of collapse because of the situation with the banking industry. The reason it is in our best interest to allow this loan (in case you don't know what a loan is, it is money that gets paid back, with interest) is to protect US business and consumers from the ripple effect a collapse of the global auto industry could have on EVERY sector of the economy. Don't kid yourself if you think the US could suddenly have 1/10 employed workers suddenly unemployed. It would not stop there. Those 1/10 people will stop buying their 1/10 of goods, could lose 1/10 of their homes etc. This will affect bankruptcy in many other business who lose these sales. 1/10 becomes 2/10, becomes, well you get the point. That's why it is important to provide bridge loans to the auto industry.

What everyone overlooks is that government does not want cars being sold that get good gas mileage. The better the mileage the les gas that would be bought. That would mean less $ going into their budget from the fuel taxes. Then the government would have to raise taxes elsewhere else to make up for what they would lose on the gas tax and that would make them lose their re-election bids when they come due. Even though overall we would still be paying the same amount just in a different form.

Obviously American car companies have been behind the curve in coming out with alternative/fuel efficient cars and more stylish cars resembling the prototypes they make routinely. But what I don't understand (and I don't understand much about automotive technology) is how come American cars break down so much? A Nissan doesn't have any major, or minor break-downs in the first 135,000 miles, while a Toyota doesn't even break down in the first 150,000 miles (from my experience), but friends of mine who purchase new and used American autos are always breaking down. Minor problems seems to happen in the first 25,000 miles while major breakdowns seem to occur after 75,000 miles. This wasn't a scientific study, or anything, but that is how I see it. I wouldn't be caught dead spending so much dear capital on a peace of junk Chevy, Chrysler, or Ford. I just can't afford it.

What do the Japanese do to make their cars so unbeatable? Is it in the Materials? Engineering? Manufacturing? Organization? Do American Car companies even know or care why this seems to be the case? I've never heard this debated and why is that?

Instead of a bailout to the Big 3 Automakers, they should consolidate
all three companys into the US Automakers, with three divisions, one for luxury cars, one for enonomic cars and one for trucks.Take the best of the best and get rid of the rest. Once they combine their knowledge and technology, the US Automakers should be the best in the world, now here's a real challenge to them.

I know I am happy for those who can save 6 months of reserve money but not all of us can. My husband and I live pay check to pay check and sometimes we have to decide what bills get paid; some bills don't even get paid. We have over $20k in medical debt (this is with insurance), have 1 car loan (the other car has no loan), only $2k in credit cards and 2 small children. Telling us to put money into a savings means we go without food. My husband a computer programmer and sales so we have to have internet so he can work at home and cell phones (don't have a house phone). Where else can we cut? Electric, propane, gas, insurance, ect, keeps going up! The darn CEO need to spread their wealth around and bail out their own dam* companies and leave my money alone!!!!!!!!

To the auto industry I have to say shame on you, the energy crisis has been in your face since the 70's but greed has made you lazy. Our nation could be the leader in alternative energy and not rely on the Middle East if the you just got off your lazy arm chair. What really needs to be done is an intellectual purge that begins from the top. It's time that you divorce the oil industry and marry alternative energy. Make a car that I like and is going to save me money!

Uh, no. Do this: loan GM the money to buy Chrysler. Shift all manufacturing to GM plants. Re-tool the Chrysler plants for disassembling cars, have the government buy anyone's car for slightly over blue book, and ship all those cars to the former Chrysler plants to be broken down to component parts and recycled. Make Detroit the auto recycling center of the world. This will save jobs at both Chrysler and GM. By giving many people a few thousand bucks for their old cars–often second cars that are hardly used, or old beaters that can't be sold, or project cars that got ignored (or even second cars that ARE used but that people can figure out how to get along without)–it may allow them to continue making mortgage payments for a few months and help them avoid foreclosure. This will give money to the banking industry via those mortgage payments. It will help make the new GM/Chrysler profitable through consolidation, and will start a new automobile recycling industry that will be self-sustaining so long as people keep buying new cars and replacing old ones.

Why the hate on the workers? Are some of you so bitter that you begrudge someone making a good wage . I suppose if you D. J. were offered a job making 40.00/hr you would decline or demand a lesser salary. (and PIGS fly. ) What about professional athletes,entertainers, or physicians. These salaries for the most part are offered. Blame the employers. Plus, if you are able to pay someone a good/great salary....how much are you making? PEACE!

In the not too distant past CEO were folks that worked their way up in the company, that had a history with the company and would never do anything that could harm the company. They worried about the future of the company, did not take unnecessary risks for the sake of immediate gains, and did not live to get as much wealth as possible for themselves.

Then came the high price "turn a company around" CEO's. They promised immediate profits and their salaries and perks were based on how much profit they could make this year. With muti-million salaries and even higher benefits in stock options these guys got ultra rich in 1 or 2 years. Soon everything was how much profit they could squeeze out now. Long-term planning and doing what was good for the long-tern health of the company went out the window. The stockholders also got very excited about the immediate high profits with the corresponding rise in the stock price. Soon everyone wanted those "turn around" CEO's and would pay them anything.

Well the short term is over, now you as a stockholder, employee or bank are left paying for the party. In the end everyone lost except those "turn around" CEO's. The problem is a lack of business ethics and greed. Now the U.S. Government that can't even run the government is buying ownership shares in these companies to "help turn them around". So we go from lack of business ethics and greed to a total lack of all ethics and an anything to get reelected mentality.

Good article... however, I would like to point out that the CEOs of the big three did in fact save up money for the problems that are here now, but the problems have persisted too far. And I would also like to acknowledge that an auto company is an awfully big ship to turn, and in the case of GM, that ship has been trying to turn for 10 years and would be exactly where it needs to be with great new products if not for a massive economic crisis.

These days everybody and their brother thinks they can run an auto company, and I can cite plenty of examples of people who couldn't and lost their jobs quickly because of it. Plus, if anyone feels like tearing apart the auto CEOs for their paychecks, perhaps you should take a closer look at the paychecks going to all of those useless banks we bailed out a few months ago.

Here's a thought ! We've got all this hyp. about electric cars, sounds great until you take in consideration what will they use for batteries that will last considering you're lucky to get 2 yr out of one today compared to 7-8 years ago. How many would an already expensive hybrid require

So the CEOs are dumb because they they didn't follow a political agenda they Suze deems important.

Nevermind the fact that CAFE standards were introduced to force car makers to build cars that consumers didn't want... and because it was politically impossible to pass a gas tax which would have caused people to want smaller cars (more fuel efficient) and the revenue could have been used to fund public transportation projects. All of these are things that the Democrats supposedly want...

Instead CAFE gave a huge advantage to foreign automakers who were already building cars in countries that had high gas taxes... hmmm.

Next, let's overlook the unwavering political support for the anti-competitive actions of the UAW. Targeting a weak company for a strike, securing a favorable contract and then repeating the process with the remaining two companies.

Now we're going to 'rescue' companies that we have tried to kill through ill-conceived legislation and political influence... without addressing any of the root causes.

Oh yeah, let's not forget the idea of putting a political figure in charge of these companies... because the Government is so well run that they need to be 'helping' the private sector.

Our political class is going (or has gone) insane. Of course this will not work... (do people really want the $40,000 hybrid car that has a range of 40 miles... who knows? But we're going to force them to build them anyway!!) Once this fails, do the politicians really think we're not going to remember that they were in charge of this Government-sponsored and backed collapse?

It should be interesting to see how many people will be whining about the bad ole gubment bailout while refusing to give up their fat, worthless SUVs. Because yeah, you NEED all 8 of those 12 mpg cylinders to take a 3 degree grade in a light mist on a suburban road, don'tcha?

I have learnt something definitely reading this article and the comments !!! Both are great, enjoyed reading these. Amen to everything, hope we all survive this great year 2009 yet to come. Learning words like 'buried in the sand and woke up' 'Americans spending on mysterious money' made my day. Thanks all of you.

You work with the UAW and their cost and see how well you do as a CEO.......

As a CEO, they should be responsible for their company. If they are not profitable, no substantial bonus. The % should be that of regular employees. If the market hurts your bonuses, oh well. It will get to a point if the CEO's of the world continue to hurt share holder value, shareholders will start holding them accountable. Legally or otherwise. Often, people will take advantage as long as they know they can get away with it. The time is coming and greed is very disconcerting. Do they not teach business ethics anymore?

HUMMMMMM The big three need help..! What about GMs Factory in China? How's that doing?

Yes! Invest all your money in your 401k and watch it lose 50% in six months.. Don't spend a dime on Christmas!! Buy a great house and watch it depreciate like the titanic! Stay diversified and the only thing you have left in the end is an overpriced SUV and six to eight months worth of cash... by following your advise.

In the end, it doesn't matter... A bad economy destroys everything... period.. and six to eight months of cash will not save the day.. When everything compounds.. You should have ecomic factors to your six to eight months cash (i.e. you may have to spend all the cash to sell the house to move to get a new job, etc.)..

While CEO's may not be the smartest I wonder what will happen with government oversite. The only people worst than the CEO for fiscal responsibility has to be the government.

If American's want more fuel efficient cars and trucks, why did SUV sales increase over 30% in November and hybrids decline 50%? Fuel Economy never sticks with Americans. As soon as the price of gas goes back down, we fall back to where we were. No one was and is holding a gun to people's heads making them buy SUVs. They want to buy them. Do you really think Ford, Chrysler and GM would make cars and trucks that historically did not sell? It was a knee jerk reaction when gas was $4 and now that it isn't...................

RP,

It's only a loan if there's hope of repayment. This is a bailout, it's near certain that it's, at best, delaying the inevitable. It's too bad, but it is this as a result of choices made by the US auto makers, the unions, and the US consumer.

What really burns me though is seeing congress grilling these CEO's as though they were the only problem. Congress is every bit as incompetent and just as much to blame.

When you say that the Big Three build vehicles nobody wants to buy, you must have overlooked that GM outsold Toyota by about 1.2 million vehicles in the U.S. and Ford outsold Honda by 850,000 and Nissan by 1.2 million in the U.S. GM was the world's No. 1 automaker beating Toyota by 3,000 units.

When you claim inferior quality comes from the Big Three, did you realize that Chevy makes the Malibu and Ford makes the Fusion that were both rated over the Camry and Accord by J.D. Power independent survey on initial quality? Did you bother to read the Consumer Report that rated Ford on par with good Japanese automakers.

Did you realize Big Three's gas guzzlers include the 33 mpg Malibu that beats the Accord. And for '09 Ford introduces the Hybrid Fusion whose 39 mpg is the best midsize, beating the Camry Hybrid. Ford's Focus beats the Corolla and Chevy's Cobalt beats the Civic.

When you ask how many times are we going to bail them out you must be referring to 1980. The only Big Three bailout was Chrysler, who paid back $1 billion, plus interest. GM and Ford have never received government aid.

When you criticize the Big Three for building so many pickups, surely you've noticed the attempts Toyota and Nissan have made spending billions to try to get a piece of that pie. Perhaps it bothers you that for 31 straight years Ford's F-Series has been the best selling vehicle. Ford and GM have dominated this market and when you see the new '09 F-150 you'll agree this won't change soon.

Did you realize that both GM and Ford offer more hybrid models than Nissan or Honda. Between 2005 and 2007, Ford alone has invested more than $22 billion in research and development of technologies such as Eco Boost, flex fuel, clean diesel, hybrids, plug in hybrids and hydrogen cars.

It's 2008 and the quality of the vehicles coming out of Detroit are once again the best in the world.

Perhaps Sen. Shelby isn't really that blind. Maybe he realizes the quality shift to American. Maybe it's the fact that his state of Alabama has given so much to land factories from Honda, Hyundai and Mercedes Benz that he is more concerned about their continued growth than he is about the people of our country. Sen. Shelby's disdain for "government subsidies" is very hypocritical. In the early '90s he was the driving force behind a $253 million incentive package to Mercedes. Plus, Alabama agreed to purchase 2,500 vehicles from Mercedes. While the bridge loan the Big Three is requesting will be paid back, Alabama's $180,000-plus per job was pure incentive. Sen. Shelby, not only are you out of touch, you are a self-serving hypocrite, who is prepared to ruin our nation because of lack of knowledge and lack of due diligence in making your opinions and decisions.
After 9/11, the Detroit Three and Harley Davidson gave $40 million-plus emergency vehicles to the recovery efforts. What was given to the 9/11 relief effort by the Asian and European Auto Manufactures? $0 Nada. Zip!

Wow ! I just knew that at some point all this was going to happen.
Everyone is suffering... Everyone is losing... Everyone is in debt...
The BIg U.S. of A. is finally going to see, feel, and live a life that all other countries around the world have been struggling to get by on nothing... Ever since 911 ( World Trade Businesses )... this country and everyone associated with us was going to suffer. I bet and Al Quada and the Talban are just rolling in laughter. This People ! This is how this great country of ours once was... is going down in flames.
Don't get me wrong... I'm an American, a former vet of the Gulf War,
and a dedicated citizen of the United States, but I knew this is how its
all going down. That's what happens when people with power, money, greed, etc. are going to suffer... And I speak for every human being on earth, May God help us all.... Suzi is right ! start saving, teach your kids, forget about a materialistic life, live on little as possible, and most of all... Pray. Pray to God, and hang on tight, 'cause it's only the begining. It's going to get really bad...

People, people, people. Stop the fear-mongering. The world will not end if the Big 3 go through bankruptcy reorganization.

The Airline and Steel industrys survived rather horrific bankruptcy reorganizations. Yes, executives lost their jobs and were replaced, yes, the services and products offered changed, and yes, the unions finally had to fess up and admit they were a huge part of the problem. ($150,000 per year for a pilot to fly 4 international flights per month?... a total of 8 days actually worked each month?....)

This situation is quite simple to resolve.

1. Have Obama assemble a receivership dream team – much as he is assembling his administration – we're talking real engineers, marketeers, manufacturing experts, and financiers. Business people with proven vision and leadership. Obama is proving himself to be a leader that can attract and assemble and organize talented people. Let him have a go at this team.

2.. Perform a ground up, blank page financial analysis of all brands and products. Completely "shake-up" all existing supplier relationships and contracts. Require all suppliers to rebid on supplied materials, parts and services. No more grandfather contracts or awarding business based on greed and corruption.

3. Develop a realistic compensation plan that may reward the leaders who demonstrate exemplary performance handsomely but NOT at a cost of 500 times the average employees wages.

4. Eliminate the UAW. This union is obsolete, antiquated, and quite frankly simply an unnecessary bureaucracy slurping like pigs at a trough filled by extorting dues from hardworking Americans. Paying union members ON LAYOFF 95% of their wages while they sit at home doing nothing? WTF?

At least have these people cleaning windows or bathrooms or sweeping floors in the factorys to earn some of their ill-gotten gain. Here's an OBAMA thought – How about making their unearned salaries conditional on documented community service and volunteer time?

As a sidebar, it is actually ironic that the union fat cat bosses are compensated and perked just like the CEO's they lambast. Can you say hypocracy?

Yes, Virginia, bankruptcy is real. And quite frankly, the best thing that could happen to the Big 3. It would actually be a blessing in disguise to emerge from this with 5 or 6 smaller, leaner, and more competitive domestic automobile manufacturers.

Suze, you are ORANGE!

Why do you give some advice that is actually useful to those who have lost their jobs and don't have cash to invest. Help some of these folks out!

CEOs are very smart – they are walking away with a lot of money while their workers are asked to cut wages. The wall street guys made out like bandits, took money from the taxpayers by way of president and congress and spent it on lavish get aways and bonuses – sounds like very smart people to me.

Why isn't UAW leadership required to testify before congress? There's no way the big three can compete when it costs $2000 more per car to make one at a UAW plant than a similar on in a non-Union Honda or Toyota plant.

Ohh, wait, I know. When Democrats give the big 3 $25 billion, it will pay the workers, whose union dues are used to fund pro-Democrat campaign adds. Basically, the $25 billion was just a federal contribution to the DNC.

Suze,
You're off mark. It isn't an inferior product as you put it but, rather, due to the overhead of the big three. It was more a failed business portfolio that did them in. Review their pensions and union wages and the Big 3's overhead per car is staggering ($2500-3000). Thus, in order to compete with some of the less incumbered auto manufacturers they had to offer fewer features. So, in effect, they provided an inferior product due to the relative accessories offered.

Here's an idea: let them go into a Government brokered Chapter 11. This would allow them to shed the gross wages, job banks, and ridiculous pension plans incumbering their bottom line. There are losers in this but the bottom line is to make them competitive and allow them to reorganize in such a way.

As for MPG, you're fooling yourself. When gas flowed like wine you couldn't swing a dead cat and not hit an SUV. And with urban sprawl many did not anticipate what even an extra $.50/gal can do to the family budget. Before you espouse to know economics, please take a course. Or at least check that the band wagon has all its wheels before you jump on.

I admire Suze Orman for only one thing and that is relaying common sense to the public 'most of the time'. In this case I disagree with the idea that the auto industry or any industry needs to be saved by Government. I believe in free enterprise and the will of the people to succeed. Government intervention (hand outs) only creates dependency. There is no will to succeed if there is welfare. There will be no job losses as the workers from a closed factory will walk across the street to an open one (GM to Honda). Who really cares who owns the company as long as there are regulations in place requiring the manufacturing to be on US soil? The strong will survive and the dinosaurs will become extinct. Government must get out of the private industry or things will only go from bad to you don't want to know.

Suze Orman for Secretary of Treasury!....Seriously though this chick should be in a high political office with all her smarts and financial savvyness(is that a word?). At least she looks at stuff like a real person and not a greedy beneficiary. Keep rockin Suze!

Suze, you are my queen! 😀 (And kind of my king, too!)

Thank you for always saying what people NEED to hear and not what they WANT to.

Per Suze Orman: <<<>>>

Haven't we also known for "YEARS"' that people can contract AIDS from being Gay ??

- Please Do NOT Blame "Detroit" for what any CEO did or didn't do !!! Orman, IF you are sooooo smart why don't YOU apply for the job of CEO ?

I think that in a capitalistic system those who cannot compete should get out of the game. As simple as this. The 3 big automakers are the first to shun government regulations and oversight in the name of free market and free enterprise, yet they are now begging for government support. So, do you want government in or out of your business?
Because nobody can have it both ways.

I don't agree that Americans should have to cover for a failing of a private business. Let them fall. That being said, if the bailout proceeds; which would be absolutely unconstitutional!! But if it does, why don't they just buy each american a car with the money instead of giving billions that will eventually end up in the CEO's pockets. I could sure use a car, even if it will only run for a couple of years. Get your stuff together America! Greed is taking away your freedom!

Riddle me this? Why do all three have to fail? If we consider the basic business thought of supply and demand. If Ford fails, then that would be great for Chevy (GM) and Chrysler (and visa versa).

When a CEO is hired his primary concern is his "golden parachute" . Someone previously said that when the CFO sees finacial problems ahead they should be brought up. Does'nt work that way, they want to protect their jobs too. Short sightedness is a rampant disease in the corporate world. The corporate mentality is more focused on whats in it for me than whats best for the company. Look at the CEO of Merrill Lynch, he thinks that just because he held their losses to 11 billion he should recieve a 10 million dollar bonus. HE'S NUTS!!!!

To Sanjay who said that Obama drives a Chevy Suburban, if you reread your facts, Obama and his wife own a Ford Hybrid Escape and drive it. May'be your thinking of Bush, who drives a Big ole SUV.

Ms. Orman's rant is completely off base in that she is attacking the current CEOs of the automakers, yet she's being critical of decisions that were made 20 years ago. As for Ford's Alan Mulally, he is a straight shooter and admirable leader in this difficult corporate environment who makes no excuses and certainly was not begging for anything, contrary to Ms. Orman's incorrect assertion. Mulally has done all the right things at Ford so far and deserves not criticism, but praise, admiration and respect for many reasons, including the efficiencies he's been implementing and the fact that the man committed to working for $1 – something I'm sure we won't be seeing Ms. Orman do any time soon.

Hummer....who the hell needs a Hummer!

The reason our automobiles are so expensive is because of the UNIONS! It's time to file chapter 11, get rid of all the contracts, restructure wages and move on. We have enough HR Professionals out there that could dance around these dumb UNION People. It's such a scam! Why do people think we still need them? What a joke!

Suze Orman is a smart woman, and she does know how to spin yarn.

So, where did she get the idea that we (average people) look up to CEO's? I sure don't !

And my dear Suze, it is easier said than done, to save up 6-8 months of living expenses in cash for an emergency, if your paycheck has taken a severe beating the last 5 years. Who can save in this day and age? And no, I do not live lavishly, I live modestly, believe me.

I wish I had Suze's cash and portfolio. Then I would not have to worry.

I find it so amusing when these people comment on these situations, and give us "ordinary" people their advice. For example, save up 6 months living expenses in case i get laid off? Are you serious? How can ANYONE do that when they are on a regular (approx 40k) income and have rent/mortgage, student loans, car note, the list goes on. Im sure every last one of us "ordinary" people would love to do that Suze, but without a 80k salary like yours thats quite impossible for the majority of us. So 15 billion dollars huh? They should be allowed to go under. Why should i struggle to pay my bills, then my taxes get shipped off the these massive companies? Is that moral or ethical? Does that even make sense? Yes it will make things worse in the short term if they go under, but wont it make America stronger and more responcible if they do? Bottom line, the 'big 3' are well and truely outclassed in todays car markets, in my time abroad (20 years) ive never seen an American made sedan, spare the odd Cadillac driven by American diplomats. Like John Roberts said to Bob Lutz "you dont see Toyota or Honda coming to the government for money". GM has failed, and they should pay the price, not given a helping hand. Wheres the helping hand for Joe Public when his business fails? Nowhere.

Oh and electric cars are not the answer! Have you seen how many batteries are in those things? And if one goes they all do. Where do those dead batteries go? Duhhhh...

"The hypocrisy of Senator Dodd and Barak Obama to suggest that Detroit 3 management teams should step down is astounding."

No it's not... they are requesting taxpayer money and we get part ownership. Don't like it ... tough. The Big 3 leadership failed to lead. Sort of like the Bush administration.

Barney Frank and Chris Dodd didn't create credit default swaps which are the real problem here. Blame it on the financial services industry and lack of regulation which is a purely republican endeavour.

I'm not concerned with the intelligence of CEO's of companies, who pray for a bailout, of a financial crises, imagined, or otherwise. My concern is this: You can bail, bail, bail out a sinking boat, but until you fix the leak, you've got to keep on bailing. Now, that didn't take a high IQ to figure that one out. Why didn't they fix the leak, when it first started?

Ethel

Here in Brazil we study Economy from books written by American well-known writters. But as I read this text and some of the comments above I come to the conclusion few people (writters) actually understand the Economy in the US.
She`s completly wrong in saying that this is the time for Americans to save. Right now the correct thing is to spend: if you buy, there'll be more production, more production means more jobs, more jobs mean more people being hired to produce more, and the cycle restarts.
The government itself is talking about building roads and spend money to creat income to more people (just like it was done in the New Deal).
So why would you save right now? To see more companies breaking because nobody buys their products? more than 500.000 people have enrolled to receive government help cause they were fired... do you want to see that number increasing???
I agree the tips she's giving are very wise but I think this is definetely not the time to follow them. Once people get their jobs back, and companies survive this wordwide financial crises then please go ahead and only buy what you can afford in as few installments as possible! (just as Japan does)
If you do that the savings you have at the bank can become loans to small and medium businesses to try to expand their production and that would be a sustainable economic growth.
Unfortunately you can't mean when you say: let these big 3 break because I don't want my taxes to go help them.... THEY BREAK, MORE PEOPLE UNEMPLOYED GETTING YOUR TAXES FROM THE GOVERNMENT ANYWAYS!!!!
And someone mentioned quite wisely that it's not only one CEO who's guilty! There are lots of people envolved in that! Or does a CEO tell the Board what to do?
There should be a new "Bretton Woods" once dollar shouldn't have substituted Gold as Keynnes used to believe anyways! Lots of International Government talks should happen to try to create ways to garantee sustainable growth. No more wars to creat jobs and make the economy grow!

In today's reality, people don't make enough money to cover their living expenses and save 6-8 months of their salary in an emergency fund. Most are only barely getting by day-to-day. Not everyone is as rich as Suze is.

Don't spend money on Christmas presents that should go to building my savings?! I'm sure that will be well understood by my 3 year old and 6 year old. I'm not using credit cards this Christmas, and I refuse to feel bad about the cash I'm spending on presents for my kids, because I don't have 6 to 8 months of living expenses in my savings.

Yeah – everyone should be responsible and not lean on luck to get them through. That's why I have a full time job even though I'd rather be home with my kids. But you still have to live. And if you have little ones, that means presents at Christmas. I don't qualify for charities for my presents. Maybe I can find a charity to give me an emergency fund?!

Suze,

I cannot believe they pay you to state the obvious. Your suggestions make for a great strategy.

However, when you are out of work, need to keep the lights on, food on the table, and a roof over your kid's heads, you burn through six months savings in no time. I recently accepted a position with a 70% reduction in pay and no benefits after a multi-year unemployment period during which my unemployment benefits expired along with my life savings.

We still have no bailout for the individuals who suffer from the collapse of the auto industry, the internet bubble, or the financial debacle. Come visit Bethlehem, PA to find out what is in store for Detroit...

Rich

Not everyone who will be affected by the Big 3's mess are union workers. I work as a title/billing clerk at a Chevrolet dealership. We have cut corners and workers. It's scary looking at my future.

Suze is right on with her opinion. We should go one step further though. As a taxpayer, now with a vested interest, I feel there should be some sort of sacrifice by the big 3. The sacrifice is to eliminate one of the big 3 but shift the worker bee's and the most popular car lines over to the new big 2. Say bye bye to the CEO's of the company that does not make the cut. I personally would pick to cut GM. Which one would anyone else cut.

Sad to say I cannot believe they are bailing out these companies. They have been failing and producing below average cars and trucks for years. No bailout! As a tax payer its not my fault greedy CEOs were flying private jets while giving six figure pensions to Union workers. Democrats in Congress should be warn. We did not put you in office to give our money away to these leeches. I don't understand why we as Americans do not wake up and realize that if you have to take out loan or mortgage to by any thing; you should not own it in the first place. It is not right that taxpayers are handing out money to support a failed system of loans.

Get rid of the unions and you'll save millions a year. This organization is so archaic and obsolete there is no need to have them. You mean to tell me that a modern business can't operate with fair labor laws? They have to anyway because it's a Federal law to do so. Somewhere out there in corruption pocket lined government someone is keeping this organization alive for what, I don't know. Look at Toyota, they don't use unions and they aren't begging for free money. That's really the only difference between US automakers and foreign. They can't give the people what they want because the unions decide for them. They can't pay their workers what they want because the unions decide for them. All they do is get in the way. It's just not fair.

Andre, thanks for your comments. FYI, most people who posted here probably never heard of Keynes – they were too busy playing video games or Watching what Paris Hilton was doing.

I read a book a couple of years ago about how the automobile manufacturers, in the late fourties, bought up large portions of the U.S. mass transit systems and closed them. They were investigated by Congress and fined for doing so. I think that now that we have to cough up billions of dollars – they ( Detroit ) should be forced to be not just in the automobile business- but in the mass transportation business.

The problem here is very simple, CEOs are compensated based on short term performance of the corporations underlying stock. They are not compensated on foresightedness or on long term success. Greed has run a muck on wall street, shareholders want returns now and will only compensate on performance now. CEOs have no choice but to make decisions that will have the most profound effect in the short term, as there is a direct correlation between compensation, happy directors, shareholders and short term stock performance. The future is now!!!!!!!!!!!

Of course, she is just encouraging regular people to save and invest. But there are a few little problems with this article that makes me wonder is Suze is on top of the news.

1. Two of the three CEOs are new. GMs CEO has been around since 2000.
2. They did put away money for a rainy day. It just rained too long and too hard. My savings will expire some day as well.
3. Ford and GM did diversify by selling in countries other than the U.S. That's one of the things that helped them stay afloat this long. Chrysler has less presence overseas.

I agree with many people on here that yes, the Big 3 have a union monkey on their backs. There is little they can do about that. Yes, the executives receive ridiculous bonuses, approved by their sharholders, I might add. But we all have to accept the blame for the inferior designs of their cars. Let me explain: for years, we have bought their crappy, overpriced vehicles even though they keep falling apart. If none of us were buying their cars, don't you think they would redesign them so they were more fuel-efficient and lasted longer? What incentive do they have to buy the cow when they are getting the milk for free? And I am as guilty as all the others: I have owned three Fords and now own a Chrysler. But I also own a Japanese vehicle (I traded in the last Ford for it and took a hell of a loss on it). If we weren't buying their $40,000 SUVs and trucks, they would be forced to change their tactics. Meanwhile, people can grumble all they want, but we have caused this problem by investing in their inferior vehicles and we are the only ones who can get ourselves out of this situation by not buying any more of them.

Here is my version of Suze's advice, based on my perception of reality:
-You need a fund of six to eight years of living expenses; that's about how long until jobs will again be available.
-Run up as much credit card debt as you possibly can; the US Government is doing exactly that right now. And the Government is frantically bailing out every institution that ran up too much dept.
-Don't invest for retirement; you savings will disappear in ways that no one can explain.
-The poorer you can appear, the better the scholarship your child can get in college.
I'm sorry to sound cynical, but my advice is based on the reality of the last half year.

I think the auto execs are far more intelligent than the rest of us. They have managed to dup congress into giving them money so that they can keep their failing business models running for a few more years. Those of us that have bought modest homes and have deferred pleasures such as iPhones and flat-screen TVs are the stupid ones who are paying for this debacle along with the rest. I will never vote for any current federal office holder again. The endless series of bailouts will harm this nation far more than the stupid mortgages ever would have.

They had 20 YEARS... Drop the big three's dead weight... They'll get nothing and like it, like the rest of America... Keep the parts industry alive for the 7 or 8 years required to keep those cars running... That's it.. Game over.. GM Ford and Chrysler have been told by the public for years what they need to compete... They played all big and bad.... Now everyone sees the big dog had all bark and no bite.... Give them NOTHING. Instead of worrying about a status quo, they should have worried about inventing and innovating and advancing their product lines..... 25pmg? The WORST import gets that... 25 mpg has been in the Japanese market for 15 years.... Whoop de friggin doo.... Try advancing the technology instead of reproducing long dead numbers as a current business plan... Hell the Yugo got 40-50 mpg, and that was in the early 80's....

Maybe if the line workers at these plants were not making $60 an hour the cars would sell for cheaper allowing people to afford to buy them thus creating a profit for the company. The Autoworkers union is also to blame for the is situation. I say let them go bankrupt and let the employees lose their jobs, greed from both sides is to blame. Lets start over fresh, I know lots of people who would work for half that wage.

This blog posting (with the exception of the personal advice) shows a complete lack of understanding of the situation. The comments tend to be much worse...I won't even get started on those.

Forget that over the past decades, Congress passed legislation designed to have a certain effect; but instead it pushed the Big Three farther and farther into a corner.

Forget that the big research and development (R&D) push–which was lauded by the government if I remember correctly–was for flex fuels. This is due to the fact that the United States has many flex fuel resources. Japan does not; hence, they went with electric hybrids. When no flex fuel infrastructure developed and oil skyrocketed, the Big Three were left years behind the competition. However, one look at the Chevy Volt or the hydrogen fuel-cell F250, and one can see that they are on the right track. You can't just flip an 'R&D switch;' this stuff takes time.

Forget that the Big Three's quality and fuel economy levels are at least on par with the Japanese; Chevy has over 30 models with 30+ highway mpg. The Focus and Cobalt get the same gas mileage as a Civic or Camry. The American public lives ten years in the past when it comes to the automobile industry. It took us a decade of having quality imported cars to realize that fact, too. How many people were driving quality Hondas and Toyotas years ago, just to be sneered at by a majority of the public?

There are many more aspects that Suze ignored and that I would love to cover; but most importantly, WE–the American people–are to blame, too. Until our pocket books were hurt by $140+ oil (and until overwhelming proof of global climate change as presented to us, for some), we WANTED the types of vehicles that the Big Three were producing. They couldn't have stayed in business that long without a demand. Keep in mind, Americans started buying imported cars for quality; not for fuel economy. However, as mentioned above, the Big Three have closed the quality gap, and they did this while managing a much larger overhead than their competition.

Are the Big Three partly to blame? Could they have done better? Of course. But do they deserve the brunt of such ignorant attacks? Definitely not–especially not from the culture and government that was complicit in creating the current situation.

Detroit has been poorly managed for decades and not just by the CEOs who testified. In many ways, they each inherited ships that were mostly already underwater.

Detroit will never be able to complete against Japanese automakers until they reduce their labor costs to be in line with those of their competitors.

I know people in my town who work for Ford. They're complaining that they have to pay $5.00 for a non-generic prescription under their current benefits. Funny, I usually have to pay $15 or $20. More in some cases. Bottom line – if my employer gave me those level of benefits, I'd lose my job because I would have become too expensive to employ.

Bankruptcy with selective affirmations of past debts is the only real, long-term answer here. Everything else is just delaying the inevitable.

The problem is due to all the cars and dealerships out there yet no one is buying. Slash the prices on all the inventory to keep the money flowing. Meanwhile restructure internally to save money. Eventually everything will be fine. Americans will not need to loan money to the automakers and the automakers won't need to go bankrupt. I need a new car but can I afford one? Taking a loss on the inventory will not hurt as bad as failure altogether.

Suze Orman IF you are soooo SMART, why don't YOU take on the job of an automotive CEO ?? and DO NOT Blame ""Detroit" for what any CEO does or doesn't do!!! Take a CLOSER look at Yourself !!

another thing that has to be brought into this is good faith. I have lost the good faith i had for these companies and will not purchase their products or recommend their products to friends and family. If more people think like me even after we bail them out they will still be un-profitable. how long do we keep them afloat. and after a major bailout would be a great time to sell. what if we bail them out with taxpayer money and they turn around and sell to an overseas company. if i were honda i would be looking! then our jobs AND our money is gone.....this is bull

I am driving around a 1996, and a 1980 Toyota. They are both running great! I wonder if they were Fords if they would still be running!

When I hear people say that corporate CEOs are paid relative to their worth, I want to spit up. I have worked for Wachovia and Bank of America in Virginia, at the ops centers in Richmond, VA.. I recall how, occasionally, we were receive visits from upper management folks, who strutted around our operations center as though they were annoited by God and better/smarter than their employees. I say to hell with all of them. Let each of 'em, including Ken Thompson, compete for jobs as cashiers at 7-11. I think the personal assets of these guys should be seized and sold off to fund the pension accounts of the "little people" that worked for them (before they were laid off). Do I sound bitter? You're damned right I am.

Better than bailing out all these companies only to put more money into CEO pockets. GIVE THE BAIL OUT MONEY BACK TO THE TAXPAYER, Now THAT would stimulate the economy more. The taxpayer would have money to pay off credit debt, pay down mortgage debt and SPEND money which would really turn the economy back around. The banks are hoarding the money and NOT giving loans. GIVE THE BAIL OUT MONEY BACK TO THE TAXPAYERS THAT ARE NOW GETTING SCREWED OVER TWICE. Giving back a few dollars as Bush did, only increases the tax amount that will need to be paid the following year. GIVE THE BAIL OUT MONEY BACK TO THE TAXPAYER.

The American auto companies knew fuel efficient cars are needed but could not compete with the imports on quality or price. That is why they exploited the SUV and large truck segment that the imports did not compete in. The bailout is pouring money down the drain as the American auto makers cannot compete head to head against the imports and will fail in the long run.

About 90 per cent of those blogging have missed a few clicks of the automotive wheel. The big three have been producing what the public wanted to buy. They have had some good small cars, but the bulk of the American public wanted SUVs, pick ups with big V8s, and larger cars to sooth their egos. No one foresaw gasoline at nearly five bucks a gallon. Quit blaming the CEOs of the car companies and get a clue as to what started the whole change in our prices for everything, the OPEC bandits and the coming from pure greed traders. What started the downturn in purchasing for the average guy, extremely high fuel prices cut away discretionary income and diverted it to pay for gasoline or diesel or home heating bills. While companies like EXXON, etc, have record high profits, who do you think paid for it, the consumer of course. This is the reason car sales dropped and not just for Detroit. Lots of us are living very close to the line right now because the price for everything shot up for the average bear and he is now loosing his employment because of layoffs or outsourcing. Take it back to NAFTA, and work it forward. There has to be somebody on the lower end to consume the stuff or nothing gets sold. The erosion of income is what is responsible for this whole mess, not the CEOs in Detroit.

I say "horse pucky" to the CEO's.......If the big 3 gets a bail out, the CEO's all got to go! And if they dont, shame on our goverment.

The US can not allow the auto industry to fail. The effects would trickle down to other industries which support the auto industry. At this point it would catastrophic to our economy. There does needs to be concessions made by executives, unions and then we need to insist that better cars be built in the US. We can not continue to support failing industries yet this is not the time to allow the backbone of our nation fail. They need to be closely monitored by a car czar and hopefully those on capital hill are doing their part by looking at everything from all angles. They certainly did not when bailing out the banks and wall street. Talk about a mess! The mortgage companies and banks are responsible for the financial mess we are in. Speak to your banker – ask him if the bank you do business with has applied for any bailout money. I asked and yes mine has. I was told not because they have many mortgage failures but because they wanted to build up their collateral to remain competitive with other local banks. We are giving money to a bank which is in OK shape. The government should be stocking food pantries at the moment – their shelves are bare!

Forget about GM or the others going under because we would have such displacement in unemployed workers our country would be in another depression. All 3 of these companies need to make a hybrid , a hydrogen and a flex fuel car for commuting because we cannot ignore the warnings anymore about foreign oil and sending our money overseas.

Dear Suze-

I would like to see you run the biggest manufacturing business in the United States before you make such claims.

Problem is CEO's/ Board of Directors / those on top feel compelled to please Wall street. It's what led to the Demise of Lucent Technologies. Pat Russo & Rich McGinn made decisions that quarter over quarter pleased wall street, but long term were very bad for Lucent. Same thing to be said about outsourcing American Jobs. great you can please Wall street with these great finacial numbers this quarter – looks great on paper, but long term.... it's another story. Those "In the know" on wall street know how to play the "game". There are many of you that think you are so smart, but you don't even know what you can't ever imagine you don't know. If the big 3 will do what is right for the country, they deserve the $$. Never mind pleasing Wall Street. – the Govt has more $$. maybe others will learn by this, and finally do what is right for the Country, and the people. Can anyone say "Government incentives"?

People forget Big 3 built big cars because that's what American wanted to buy before the $4 gas. Detroit sells mid size cars like the Fusion with 4 cylinder and 6 cylinder engines. 60% of the Fusion bought American consumers were 6 cylinder models.
Toyota also sold a lot of Big trucks and SUVs with gas millage no better than the Big 3. Their sales had dropped as much as the Big 3. In the recent Consumer report reliability survey, The Chevy Malibu is rated as more reliable than the Toyota Camry and the Ford Fusion is judged more reliable than the Honda Accord. Fords cars in general are found by Consumer Report and J D Power to be on a par with Toyota and Honda and better than Nissan and Mazda and all the European brands. Half the cars sold in the US are still made by the Big 3. So it is not true no one is buying them.
The biggest difference between the domestic and foreign car makers is their legacy cost of retirees. The Big 3 have been making cars in the US since the 40's and have huge retiree pension and health care cost, adding $3000 to each car sold. It is difficult for them to compete in small cars with a $3000 disadvantage in cost of goods.
Another problem is that American has a bias against American products. That is one reason why we no longer have much of a industrial base left apart from auto and aircraft manufacturing. The Bush stimulus plan did nothing for the economy because the tax rebates were spent on foreign made goods. It was more a plan to stimulate the Chinese economy than the US. The US cannot be a super power without an industrial base.

Ford has plenty of cash for now. They want a loan in case things fall apart in months ahead. GM and Chrysler need to get their act together. As a matter as fact. In my opinion, the Government should loan out to GM to purchase Chrysler with conditions, not just a handout.

American automakers are trying their best to maximize fuel economy and reliability. Foreign cars are for the most part...too small for many of us. We need safe, comfortable cars to fit our needs, not the other way around!

What Suze should have mention is to find a job when you run out of cash. Any job you get your hands on. It doesn't matter if you flip burgers or bag groceries. Having some money is better than nothing. If you cannot find the job in your profession, look for other fields that may interest you. Otherwise, having an emergency cash is one thing, having no job for many months is another.

Here's an idea; Let the oil companies bail out Detroit. They've been the beneficiary of the gas guzzlers. Right??(and....don't they have record profits??)

I am amused that many think the entire problem is with the union. The CEO's determine the strategic direction of the firm. They are trained to identify market value and to give their companies a competitive edge. Ultimately, the company's edge is their employees. Treat the employees well, and you will make a good product that others want to buy. The CEO's also oversee the negotiation of the union contracts. For those who suggest that people are just jealous of rich people, I would argue that these same people are perhaps jealous of the unions who make $40.00/hr.

The days of CEO's making million dollar bonuses while producing little or no profit is likely over. Blame the unions, but the unions have been decreasing in clout over the years. Without the unions, who else will people find to blame? Here's an idea: blame the CEO's. It is obvious that some want to see unions completely gone and will take any opportunity to scapegoat them.

so...

Japan looks like a nice place to live

amirite?

The bailout money should come from the CEOs personal fortunes first. This will better guarantee that the money get spent correctly. As a taxpayer i refuse to "bailout" anyone with more money than myself.

See my previous comment about OIL bailouts for the Auto industry.... And you think MPG is bad now? Wait until the Auto industry tries to tell it's banker, the OIL company that it wants to dump more $$ into fuel efficiency and see how that flies. Good luck!

I agree with Sovell...let the oil companies bail out the auto industry! Otherwise, they should merge the Big Three into the Big One, use all that advertising money to build electric cars and trucks, create millions of jobs and take America into the future!

Against the wishes of American flag-bearing friends and relatives, I have driven Hondas and Volkswagens for decades because they simply are more efficient. My first cars were Pontiacs and Buicks and I even had a Cadillac Sedan de Ville given to me by an uncle. Ironically, it burned up in the garage fire of the guy who bought it from me and was attempting to restore it. Who can afford such gas guzzlers whose simplest every repair costs hundreds of dollars?! I'm on my soapbox, but fellow beings, we cannot continue to consume at this level of self-indulgence. Meanwhile, CEO's seem to have little conscience as those who work for them are terminated and starving. Time to quit blaming the "economy" and call it what it is–human greed and the need to possess more stuff. Thank you, George Carlin, for making "Stuff" a factor to consider. If only you could have swayed the leanings of the average consumer.

I love to see liberals stand up after all the fires have been put out and say things like, "They should have made more fuel efficient cars." You liberals have no concept of what kind of money and effort the foreign automakers have put into developing their fuel efficient vehicles and yet stand up and same domestic automakers like they just didn't know how to push a button or something.
This is just like when Nancy P says "We need to look at cleaner alternative to fossil fuels like Natural Gas" or when Obama says "we don't need to open up more areas for drilling, we should just drill in what we've already opened for drilling."
Sad to see the most powerful people in the world have no idea what they are talking about.>>>Told you so!
there I said it, now I'm offically qualified to work for the Democratic Party.

It is wrong to judge all CEOs because of what some have done. There are many, many CEOs all across this country for big companies and small ones. Most *do* act responsibly and make wise choices for the good of their companies. Most do NOT receive giant and unreasonable bonuses; they receive reasonable salaries. The good ones are the ones who not only worry about the bottom lines of their companies, but they also worry about each and every employee. They agonize if one person has to be laid off, much less dozens or hundreds. They agonize when insurance benefits have to be cut.....they do the best that they can for everyone because they are part of everyone. They recognize they are only one cog in the wheel that makes a company successful. I know. I'm married to one of these CEOs. I've met many others. Just as all Christians shouldn't be judged by the ones who bomb abortion clinics; all Muslims shouldn't be judged by the ones who committed the atrocities of 9/11; all sports people shouldn't be judged by the ones who use steroids; all doctors shouldn't be judged by the ones who are negligent.....all CEOs shouldn't be lumped into the same barrel as the idiots who have gotten us into this huge financial mess. The bottom line is that most people *are* good and hardworking people no matter what circumstances they find themselves in. The good CEOs are just as angry and upset at the bad ones as you and I are.

I was in the market for a new car a couple of years back and I looked at Honda, Toyota, VW, Mazda and GM. I evaluated each for what they offered for my hard earned dollar, looked at safety features, size and styling ... and I ended up guying a GM. For what I paid for my car I couldn't come close in any way except for perhaps a Mazda; I do a lot of highway driving and just the thought of driving a small car and competing with transport trucks on snowy roads helped seal my decision.

Of all the cars I've driven, for the first time ever, when my lease comes up I am going to be buying the car! I have a car that I like well enough to own !! I think those that think the Top 3 don't make good cars should look at actuarial reports rather then some advertising propaganda they are being spoon fed.

I will never buy anything but North American products whenever I can, cars included, just to save a dollar or two in the short run. And no I have never worked directly or indirectly for any automotive related company. I do, however, do my homework and I think this is a media frenzy who out of habit are forgetting the companies who give the most when something horrible happens (eg 9-11), or when it comes to sponsoring sporting events, etc.

I understand some changes need to be made in these huge corporations in order to compete in North America, but I can't help but ask why the "foreign manufacturers" aren't required to play on an equal playing field as our North American companies? The playing field should be level for all. Do you think Korea or Japan would make allowances for us?

The people who put the cars together are not the ones who decide which cars should be made. The people who put the cars together support FAMILIES, who all CONSUME masses of goods and services. To say that they are paid too much and unions are bad is to say that we should not treat them as we would want to be treated ourselves. Unions allow that these car companies will have employees, who comply with certain standards. put together the automobiles that the Ivory Tower executives think will sell for the most money and create the most profit to the shareholders. So don't blame the workers for wanting to put food on their tables and live a comfortable suburban life with health care benefits for their families. That is what we all want. If we all could do that then our economy would take care of itself. When 1 % of the population controls 50+ percent of all wealth then this isn't possible. Why is it that executives who make bad decisions ALWAYS walk away OK, but often thousands of good people get shafted. They walk away with nothing! It doesn't seem fair that we always seem to privatize the gains and socialize the losses. I would hate to see the big 3 go down in flames because some overpaid people whose fortunes have ALREADY been made, make poor decisions. Let us save one of our Country's greatest national treasures. Detroit came through during WWII for the American war machine. Let us come together and save Detroit before it's too late. With the right leadership a new age of Economic growth can begin.

When I hear the auto companies say that they are building what the American people want tto buy, I am reminded about what I see on TV. Ad after ad afte ad promoting pickup trucks and SUVs have built the demand among Americans, because they provide an incredibly high profit margin for the auto industry. '

I bought a Ford Escape Hybrid to send a message that Americans will buy fuel efficient SUVs, and I love it. The auto industry could have spent their millions of advertising dollars to prepare Americans for the future, but they didn't.

What people fail to realize is this recession we've stumbled into is due to policies in-acted during the Regan revolution. We made the switch from a manufacturing, to a finance based economy. The developing models on just about every business shifted from making the best product possible, to making the most PROFIT possible. The BIG 3 auto makers are just casualties of this philosophy; it's reflective on there product offerings the last couple of years. Gas guzzling SUV's, Trucks, and Muscle cars have higher profit margins, therefore were perceived as good for their companies. The problem with this model is that it doesn't take account real – world scenario's for the present or the future.

Lack of emphasis on Research and Development is also a huge problem for the American auto companies. People tend to scapegoat union contracts for the lack of funding in this area, but the reality is every company dealing with technology needs to be innovative and thinking outside the box to become more profitable in the long run. American companies in general, not just the BIG 3, just don't find R&D profitable because the return is not immediate...and there is considerable risk. Toyota, Honda, and Nissan took those risk – and look at the results.

This article was in general was out of context. CEO's generally are more savvy when it comes to running corporations, and this recession effects just about every market out there. I'm not too fond of Suzy's Financial advise...but she does make a good point about the auto companies turning there heads away from research and efficiency.

Suze says what the CEO's of The BigThree should have known the last 20 years – try 50 years .They were behind the curve then when Japanese autos began appearing on our horizon. The Big Three thought it was a fluke and paid no attention..Today, look at those foreign companies who have built plants here, employed thousands of people and are non-unionized..They did it right – find out what the American people want in an automobile and build it. Detroit never did that – their creed build what we want and the consumer will buy. The UAW shares blame as well, demanding more and more benefits for their membership. Now their membership may have to start looking for jobs in other sectors if, they go under. I for one would not bail the auto industry out – they got there from their own doing. The CEO's need to go they haven't the slightest clue what this is all about – execpt to ask for money to shore them up and come back with their hands out next year for more money. Welcome to the real world.

Do not bail them out. Let the auto company's file bankrupcy and void the union contracts and get the wages down where they belong. The unions are basicly running the company's into the ground along with the greedy CEO's.

It is pretty sad to read these posts blaming the whole thing on the unions and the workers. You all have sure been brainwashed – is this the Stockholm Syndrome in play? Just because you don't have the wherewithal to leave your crummy job with its crummy pay and benefits, don't expect everyone to have a crummy life like you do. Since when is the blue collar working person responsible for the downfall of a big corporation? This is so idiotic it defies description.

Quote from Suze: "We have known for years that oil is a limited commodity." Peak oil has been around since the 1970's, Hubbert's Peak. That is almost 40 years of knowing that oil would eventually become more expensive to extract and ultimately become too costly to even bother to extract it. Detroit continued to manufacture gas guzzlers.
My most incredulous moment during their testimony was the fact that they did not have a business plan to show the government how they would use the money they were asking for. They had to be told to create one!! A Business Plan is Business 101. Why would we give these people anything. They do not know the first thing about running a business.

The UAW failed and has made little or no attempt to organize the employees of these foreign car manufacurtures plants in this country . Shame on the UAW for not unionizing these foreign manufacturing plants in the goood old USA. SHAME, SHAME

Don't forget the blame the unions who have made it impossible for the car companies to downsize or restructure because of their demands. They are stuck between a rock and a hard place. A strike would destroy them. The autoworkers are just as greedy as the shareholders and CEO's. Job banks? Getting paid 95% of their salaries while laid off? AS IF! There's a lot of blame to go around – let's just make sure that we assign it equally.

just be frank.. who's going to buy an american made car? it's probably last about 12 months with all source of problems.. It drinks more gas that I can drink beer.. The democrat of course will bail them out b/c those guys pour so much $$ into the election.. Are you going to bail out a company that will have no chance to compete? we'll know all of the big 3 eventually shut its door... what a scam.. Those CEO should go to jail rather than flight private jet to DC & begging for tax payer $$.. What is so wrong with America? .. ..

Why are the CEO's not "smart"? They cannot compete on small cars because they have $3000 to $5000 of health care costs for the workers included in each vehicle. Many of their competitors don't have those costs. The only way to make a profit (stay in business) is to make larger, more expensive vehicles where the "extra" cost can be absorbed/included/hidden. On larger vehicles, they are not at as much of a competative disadvantage. Come on Suze, the only way American industry can compete, is to level the playing field. Universal government funded health care like most of their competition. (also less unionization) Maybe that is why the Big 3, have increasingly supported Universal Health Care?

Kathy S. – I don't believe you when you say you have never worked for an automotive-related company. It sounds like you are spoon-feeding us. For me the bottom line is that I want to buy American just like you, but I don't want a lemon. Life experience has taught me that if I buy American I get a lemon. I work with a rancher who has a Silverado. The darn thing breaks down every few months, especially when making lots of long trips. The crank case of the four wheel drive goes out every darn summer when off-roading high elevations. My Nissan doesn't. I don't even have to change the oil! It hardly needs oil to run! If it's not his crank case that has him in the shop then its the electric windows that quit working – burrhh cold! Kathy, if you think American autos are better then why do you understand changes need to be made? I won't concede that for Toyota. They don't have to change anything. Can you beat a Prius for fuel efficiency? Doesn't matter that GM has more fuel efficient models when Toyota has one that beats them all.

This may seem so simplistic a solution but what they hey: government helps/bails out industry on the proviso that these CEOs (or anyone else in a failing/closing company) should RETURN bonuses they have been failed on the premise of failure. Plain and simple. They have been rewarded for failure. Everyone is greedy to a point (we want, we want...) but to demand/extract/negotiate bonuses based on failure??? Heads should roll, someone should pay....

DJ

You are clueless! When will you have enough evidence to finally give up on the notion that Washington's deregulation of Wall Street and Corporate America has destroyed this country? Supply side, trickle-down economic theory (Reagonomics) is a colossal, historical failure! Open your eyes!

Bismark

I have bought and driven American vehicles for years, mainly several varieties of GM, but also have driven Fords and others (corporate owned). It really doesn't matter to me if Congress bails out the American auto manufacturers or not because all they make anymore are junk. When I bought my current vehicle in 2001, it was a very low mileage used 1999 GM vehicle with 15K miles on it, it was like new and I have always treated it very well. It only has 88K on it now, which is still low-mileage for a 10 yr old car. Yet, I have had to make several costly repairs to things that shouldn't have gone out (and probably wouldn't have gone out if it had been one of the very well-made and affordable Japanese vehicles). And I was hoping to get 150K out of this vehicle. (Isn't that sound money management?) I can only hope it lasts that long. So, go ahead, bail out these auto makers if you want, but I can tell you that if I ever need to buy another vehicle in my lifetime, there is a high probability that it won't be American because American vehicles have gotten to be a rip-off and I don't do business with corporations who abuse me or discount the value of my loyalty.

Roland
St. George, UT

Smarter than the auto execs??? Who are you kidding? Who got the big bucks for their brilliant performance, also described as putting the auto manufacturers in the financial tank? How do you get much smarter than that? Now us dumb working stiffs get the bill.

i understand the immediate consequences of not bailing out the Big 3. I know thousands of people would lose jobs and states like Michigan would lose a major economic resource. I know this could send our country right into the depression.

But isn't the foundation of capitalism grounded in that the better product wins out? What we're seeing from the American car industry is an inferior product. Why should we dole out money to them when we're not even sure if these companies will change? Who says consumers will change their minds and turn this industry around. Who says these companies won't be coming back to D.C. for more money in the future (which has been already predicted).

Companies have come and gone. It's natural. And when a company goes under, we've seen other companies take charge and make a better product.

Isn't the economy supposed to go through cycles? By bailing out the Big 3, aren't we delaying the inevitable? Also, in saying that, aren't we basically throwing money away then?

I'd love to hear some thoughts, because that's the conclusion I'm drawing right now.

1. Pay cash.
2. Live below your means.
3. Avoid credit LIKE THE PLAGUE (because it is).
4. Save 10% of everything you make (and don't dip into it).
5. Assume Social Security won't be around when you retire (because it probably won't).
6. Make sure you have adequate insurance.
7. Live simply, ENJOY LIFE, and be grateful for the blessings in your life ... because after all, the GREAT things in life are not counted out by dollars and cents.

IHOP – I agree that foreign car companies should have to deal with the Unions just like the American companies, but I believe the U.S. signed deals with Japanese autos and others either not requiring, or not allowing Unions in foreign-owned auto plants in America. I've already written to Obama demanding that Unions be required in all auto plants in the U.S., or something to that order.

For all you American-made auto haters, please list where you work so I can boycott the terrible product/service you produce. After all, if you are American whatever you make or whatever service you provide must be garbage! Also, you might want to turn down all government services since those terrible American manufacturing workers are paying taxes that benefit you!

More of your dollars stay here in America when you buy domestic. GM claims they have more cars that get 30 mpg or better than Toyota or Honda, and they are well on the path of introducing the Volt which will make the Prius look like a gas gusler. They back thier product with a 5 year/100,000 mile powertrain warranty which reflects confidence in the durability of their vehicles.

We won WWII because we produced more tanks and jeeps than the enemy...thanks to the domestic automakers. At times like these we need to pull together and support each other. Fire the CEO's if you must, but help the worker keep his job. America can't survive without a strong manufacturing base...our national security depends on it.

There is no one single group to point fingers at, they are all guilty. Guilty of greed and a lack of imagination. This country became a world power through the developement of the assembly line and the automobile and I'll bet Henry Ford and the like are turning over in thier graves watching the Big Three AND the Unions destroy it. I say let them fail and let Toyota and Honda takeover the plants here and pay a REASONABLE wage to those who were laid off from the Big Three. NO MORE FREE RIDES FOR ANYONE!!!!

"...now is not the time to let the Big Three fail." So when would be a good time?

I'm not going to argue that letting the Big Three go belly up will be good for us. But I wonder what kind of help someone would get if they wanted to start a new car company? And why is it always so critical to help these big companies but when kids are going to school with empty bellies or someone needs unemployment they just have to bite it? How much would it cost to but a biscuit in some schoolkids belly before school? At least those preschoolers aren't spending our tax dollars on saunas and private jets.

The anger directed at the Unions is misplaced and ignorant! The real discrepancy when comparing American to Japanese car companies is in the Corporate compensation. One American CEO makes more than the top 20 executives at Toyota and Nissan combined! The problem with the American cars is that they are inferior and that has nothing to do with Union workers, that has everything to do with design, engineering and management. Lastly the reason it is cheaper to build Ford's in Canada for example is that they have Universal Health Care, like they do in Japan and every other G20 nation! Health Care is an ENORMOUS percentage of the Union workers wages and that is not Union workers fault either! It's time we caught up with the rest of the industrialized world and put Universal Health Care into place here in the USA, that will level the playing fields and competition!

Smarter than CEO?

What are you talking about?

These guys are super intelligent. They sunk their companies, loosing retirements, pensions and life savings for the people that worked all their lives, then walked away with millions.

There's no way you could beat these guys.....

I wholeheartedly agree with everything said. I'm sorry but is it only me that believes they need to pay back some of their previous financial misdoings. Okay, so they take only a $1 in salary. What about the last 5 or 10 years? In some ways, they owe some of their own personal fortunes to build back their companies. Many startups have been built on the personal wealth of the owners this way so I don't see why they are not tasked with the same responsibility. I'm quite sure there's $50-100 million that could be found.

I have a question concerning Citi and wonder how they are accepting billions from us to stay afloat but still have money to pay $400 million dollars for the naming rights to the Mets ballpark and also be a major sponsor for the Rose Bowl on January 1. Something just seems out of whack about all this. Are our congressional representatives just going to let this type of spending slide by without putting restrictions on the bailout receipients? What does this tell us how they will allow the money to the Big 3 to be spent?

I just want to add I am so happy to see that their are some people who actually know what their talking about. All the other countries take pride in being a citizen of their country and take pride to know their products on in America do we demean our fellow patriots. Honestly Who wants to buy a toyota corolla that is UNSAFE. I WOULD RATHER BUY A USED CAR and pay the gas. Also the FUSION, FOCUS these cars were on the market way before all this happened. And the number 1 car in America was yep you guessed it an F150 get out of here blaming the CEO'S.

Suzi, you worked for them selling their products, promoting their products, telling us that we should buy (and finance heavily) their products. Were you just as uniformed then as your comments appear to show you are now?

Our government didn't care if we had fuel efficient vehicles, they were probably getting kickbacks from the taxes! Instead of making fuel friendly it was fuel hogs instead! They and the government did this to themselves, not our fault but we will pay for it!! Sad and mad!!

What about all the IT companies who lay off all the workers and keep the executives so they can pat themselves on the back for doing a great job while collecting huge bonuses. CEO and Executive comp is a huge problem in the US. Federal government needs to start auditing.

Is she kidding me? Not sure, how many would say making millions of dollars is a stupid thing? She is really overrated as a financial planner or whatever else she calls herself. What has she really accomplish as a Market expert? What is her credentials? What investments has she made that made her the who's who in Wall-Street?

John, you wrote:

"For all you American-made auto haters, please list where you work so I can boycott the terrible product/service you produce."

Great John, then lets just not have a global economy. We'll just produce for ourselves. We can be like the Soviet Union – one bra size fits all! Or how about when you go to buy a pen, and pick one up only to find a bunch of other inky pens sticking to it because all the ink is oozing out. We'll be in great condition then won't we?

First, let me say....let's stop the blame game. It serves no purpose.
So many played a part in the mess and it serves no purpose to assign blame. And while I agree the Congress treated the auto makers unfairly compared to the Wall Streeters...that, too, is history.
Time to move forward.

However, I am confused...because the lock down in consumer spending is perpetuating the problem and creating a domino
affect that is racheting up the ramifications of our fiscal crisis. Right?

I understand Suzi's advice. However, the "fear" factor seems to be actually making this problem worse. Shows are constantly hammering home the direness of the situation. Isn't there a balance somewhere?

Let them swing,....... they try to make it sound like it is either bankrupt or bail-out. They all, GM especially need to cut their lines down to one or two nameplates, they should go down, wipe out the union premadonnas, the pathetically spoiled CEO's and do like the rest of us, get by on less. Build back up from there and they will be a much stronger company. People try to say that we would need the manufacturing space in case of a war, were in one now and even if something bigger happened that space wouldn't have vanished and the next world war would be over very quickly anyway.

Suzie-

From the history of massive failures of American corporations, there is no doubt that most of the CEOS of these failed companies must be lacking the right aptitudes for successful business operations. The Y-generation of the business world is definitely smarter than these incompetent CEOS. The irony of the fact is that we all wonder who in this world find the rationality of paying these CEOs such unjustified millions of $$s, without measuring their performance in terms of adding value to financial performance of the companies. Is it not the basic principle capitalism- "pay as you earn" ? Why is it not applied for the CEOs in America? It is so shame! Wake up America and do the right thing for the better future.

I want to give my three children $500 to $1000 for Christmas. What is the best way to do this and to encourage investing and saving on their part?
Thank you, Suze
Theo

I think that money should not be given to any of these companies unless they are stricly monitored so that it is not used for bonuses or compensation of any kind. I also think that the unions are going to need to be realistic in the future and be willing to make concessions, as so many Americans are doing. Also, I saw a Ford truck written up last week and the article implied they were "listening and getting it right" concerning what people are willing to buy. In fact the truck gets 14.5 miles in-town and costs about $43,000.00. To me, given the economic and environmental climates, that isn't really "getting it right."

Hi,

The CEO's are not dumb. They made decisions they were taught to make in their MBA training. Profit maximization. The more complicated the product , the bigger the product, will result in a higher cost product, which produces a larger profit. Problem is that the more complicated and larger the product, the greater the unreliability of the product.

If you sell your product to a customer only once every 5 or 7 years, you and your advisors will opt for the sale that will yield the greatest profit.

If everyone would look at the whole picture you would see the real problem is with Wall Street. They demand annual increases and if they are not me the stock is downgraded. Intrest rates charged to the companies are hiked up because they did not meet the anticipated profit the 'street' figured. On top of this then becomes the overlying reason high profits are pushed for and that is the share options all the upper executive of the companies are awarded. A bit of a mad stupid circle. It is not so much the greed and stupidity of the automotive CEOs but a horrid flaw in the system. Everthing said about auto execs applies equally to the Bankers and everone else that is saddled with the unforgiving ideousy of Wall Street

I do not know Suze Orman and never heard of her till about 3 years ago. Some of what she says is common sense, at least to this adult.
Folks say GM and Ford et al. make inferior products that people do not want to buy. I really think it's more of a north american phenomenon as the largest, most successful retail auto company in China is....GM!!!! That's right! The fastest selling, most prestigious car in China is actually the Buick Lucerne. GM just opened a huge factory outside St. Petersburg, Russia this year. Cost$ $300 million!!!! It's churning out GM vehicles faster than sluice out of a goose. My personal opinion, is GM WANTS to bankrupt north american operations, thus freeing it from any union intervention. Close up ALL union factories in the US and then start importing it's own cars from Asia. Built w/ mega cheap labor(aka no benefits or retirement) plus all the extra cash they can bleed off the US Treasury and these guys would be good to go.

I think the Unions can't shed all the blame. I knew a guy who put on tail light lens for $30 an hour. Does that seem like an honest wage for the job done? I worked for a Japanese automotive parts company for nine years who said they'd shutdown if a Union was voted in. Union CEOs are no different than auto CEOs when it comes to making filling their own pockets a priority. If they don't get their way, then lets all strike and punish the entire US.

1. American made cars today are of much higher quality than twenty years ago.
2. Best selling vehicle in America for many years-Ford F-150.
3. Sales of Japanese makes are down as much or more than US makes.
4. Maybe Suze should run General Motors and let Rick Wagonner have her gig where all you have to do is give advice without being concerned about results. He would probably enjoy the vacation.

"Watcher" is very correct. In 2001, Suze did ads for GM telling us that going out to buy a car/truck/suv for 0% financing over 6 years was to stimulate the economy. Nice job there as a financial planner. She wasn't busy asking if "can you afford it?" back then.

Suze I dont think u smart,this why US auto going down??

The bailout won't work because it doesn't address the root of the problem – unfair trade practices.

When they are help crook and theft criminal from wall street paulson bush conggres so fast without question ..they are reward for being crook and take money from AIG give to big 3.

BLAME US POLITICANS THEY ARE THROW AWAY AMERICANS AND BRINK ALL CRAPS AND TOXIC AND THEY MUST BE HELP BECAUSE BIG 3 ONLY AMERICAN LEFT IN THIS COUNTRY...GOVT KILLING us DO U THINK JAPS PEOPLE USING US AUTO...NEVER !

CAN U IMAGINE WE INVENTED CARS AND WE DONT HAVE ANY BECAUSE WE ARE SUCKER !! NO FACTORY NO COUNTRY NO BORDER NO COUNTRY, 2 MILL JOBS OBAMA SAY ONLY FOR ILLEGAL ALIEN.

When the Japs STEAL every bit of our technology they get it for a zero RESEARCH & DEVELOPMENT cost. JUST LIKE THEIR STEALED OUR TECH ELECTRONICS TOO.

Then, when they pay their workers a buck-a-day, don't pay for healthcare, worker's comp, pensions, or anything else, we can't possibly compete so we get killed at every step.

The only way we can lebel the playing field is by using DUTIES. If they're a foreign car company, they should be paying duties, no matter where the cars are made. Protectionist your ass!

Wake up! Do you really think we don't need protection from these tactics? When the Big 3 go under, a $21,000 Toyota will cost $35,000.

The politicians that can't see this need to get their heads out of their ass and quit taking bribes from everybody and their mother.

Should be No japenese cars in FIRST place, thank to clinton bush with unfair trade

From a Mechanical Engineer and Visionary Businessman.
Here are were I would focus Immediately:
1. Create an Agency – Management Advisory Board to Unite the Big 3 within six months on the Dealership Selling Rights (Unite Dealer Footprint and Cut Retail Costs).
2. Create a Government Incentive of $4K for Cars 10years and older to be replaced with new 2008/2009 Green Cars.
3. Create An American Car Fund that each family would Invest $1K and would get $4k Credit every 3years towards the purchase of a new American Car.

Then I would restructure the Internal Big 3 Operations and unify the expertize and Scholing.
Then the Product Quality.
Ready for the Job.
Then

The bailout won’t work because it doesn’t address the root of the problem – unfair trade practices.

When they are help crook and theft criminal from wall street paulson bush conggres so fast without question ..they are reward for being crook and take money from AIG give to big 3.

BLAME US POLITICANS THEY ARE THROW AWAY AMERICANS AND BRINK ALL CRAPS AND TOXIC AND THEY MUST BE HELP BECAUSE BIG 3 ONLY AMERICAN LEFT IN THIS COUNTRY…GOVT KILLING us DO U THINK JAPS PEOPLE USING US AUTO…NEVER !

CAN U IMAGINE WE INVENTED CARS AND WE DONT HAVE ANY BECAUSE WE ARE SUCKER !! NO FACTORY NO COUNTRY NO BORDER NO COUNTRY, 2 MILL JOBS OBAMA SAY ONLY FOR ILLEGAL ALIEN.

When the Japs STEAL every bit of our technology they get it for a zero RESEARCH & DEVELOPMENT cost. JUST LIKE THEIR STEALED OUR TECH ELECTRONICS TOO.

Then, when they pay their workers a buck-a-day, don’t pay for healthcare, worker’s comp, pensions, or anything else, we can’t possibly compete so we get killed at every step.

The only way we can lebel the playing field is by using DUTIES. If they’re a foreign car company, they should be paying duties, no matter where the cars are made. Protectionist your ass!

Wake up! Do you really think we don’t need protection from these tactics? When the Big 3 go under, a $21,000 Toyota will cost $35,000.

The politicians that can’t see this need to get their heads out of their ass and quit taking bribes from everybody and their mother.

Should be No japenese cars in FIRST place, thank to clinton bush with unfair trade

Why are we even considering a government bailout of corporations? A corporation exists for the sole purpose of making money. If it cannot or will not do that then why should the government loan them more money just so they can default on that as well? The people who are fronting the risk for a corporation are the stockholders. They front the risk and reap the rewards. Why should it even cross anyone's mind to ask the American government for money to continue this losing battle when they have large operations in other countries as well? Why not ask those governments for money? Why not ask the stock holders for a bailout?

Suze, what is the best investment advice for a 50-year old couple with no mortgage and minimal credit card debt? We both have good jobs and are able to set aside a significant savings each month. however, for the long-term what investment path should we follow?

I have suspended my 401-K investment at present due to the market volatility. Please advise.

Okay I am just not getting something, I confess I have only owned Detroit made cars in my life. You all remember that theory buy American support your tax paying neighbors. I am not seeing an inferior product. I love my chevy, My husband weekly brags about his great Dodge truck. My father says this is the nicest Ford he has ever bought, he thinks he will drive it for 20 years, its a diesel. We are not seeing the inferior product line.
Saying that I am a strong believer in capitalism, if they can't make it someone else will be happy to take their place. Maybe the next group will be more cautious of those lovely unions.

So Suze...just how much did Larry pay you for this great advice? CEO's are smart, that's why you're not one of them! For you to give us such wisdom is a joke. Its easy to bash the CEO's but just look at the very Senators and this countries debt...pleeze! Stick with TV and stay away from the Corporate world.

They may not be "smart" as you say, but they are certainly smart enough to get themselves set for life!! These guys will be able to live the rest of their lives without a financial worry despite whatever shortcomings they may have in managing their companies. Even if the Big Three fail, they will be OK. It is easy for you to tell people earning $8.00, $10.00 or even $15.00 per hour to save 6 to 8 months emergency fund, pay off credit card debt, yada, yada, yada. The truth is that most Americans are scraping by on peanuts compared to the modern cost of living..and that is partly because our government and the people of this country have allowed companies to concentrate all the wealth at the top. This is the real problem in America today...consumers have been pushed to the brink by the greedy powers that be!! Someone needs to address that and stop blaming the little guys and gals for all this mess. Those CEOs aren't dumb...they managed to get a life that most people can only dream about.

She says to save for retirement. I want to, but those who have been doing that for years are the ones who are getting screwed the most. So much 401(k) money down the drain. I could have paid off my house with the money I lost in mutual funds in 2008.

My husband and I have been married for 15 years and we have had a simple rule throughout...we have ONE credit card which we pay off in full each month. We buy what we NEED with the occasional splurge (after saving for it). While our neighbors have been conspicuously consumming, we have been investing and saving. Besides setting $ aside for retirement (which has tanked a bit due to the economy) we have nearly 2 years of salary in savings.

Baring unforseen medical expenses, we can all do this, we just have to learn to do with a bit less for a while and really think about what is important. Time to tighten the belt a bit...

Suze Orman's American ignorance is showing through. She reveals the prevailing, yet mistaken, belief that GM and Ford are totally screwed up and are completely outclassed by the foreign brands. That isn't the case – Ford and GM are actually very strong brands in Europe and Australia and compete as local brands. What is screwed up is the American market – consumer's wanted cheap SUVs and that is what they got. Consumers didn't want effiicient, yet expensive, small cars. The credit crunch is destroying the industry right now. But if the price of gas remains low after this subsides, it will be interesting to see just how much the American consumer has changed. Or will we go back to our bigger is better mentality that is so American.

This is only the beginning. I say let these companies fail. Why should the American public have to pay the price for a poorly run industry that has no foresight? If in fact sales are down and people are not buying their product, why should taxpayer be forced into supporting the product they avoided in the first place.

People need to realize that capitalism is not sustainable due to the fact that is ultimately linked to continued growth. In a world with limited space and resources, unlimited growth cannot exist. Markets can only expand so far and consumption will inevitably level off. Let these companies crumble, let gas prices rise, and embrace a conservative banking industry. These factors will only yield a stronger and more efficient economy. It's time that we acknowlegde the scarcity of resources and change our ways before the damage is irreversible. Sooner or later companies will have to realize this and change their ways. Sure they will still be motivated by profit, but it will have to be done in a more environmentally friendly manner. Instead of being forced into buying a whole new computer every year because the software makes it obsolete, companies should sell add on components that can be attatched to the same device. Look at light fixtures for example. There have been numerous advances in the type of bulbs and their efficiency, but they all fit into the same fixture. Instead of buying individually packaged oatmeal, customers should be able to bring in their own reusable container and fill it up everytime they need more. The sooner these companies realize the fallacy of the old ways, the better.

Suze, You Rock. Tell it like it is, and give simple, easy to understand advice.

The reason we don't buy the Big Three's cars is because they are over priced pieces of crap. It has virtually nothing to do with fuel economy and to suggest that does factually wrong. American cars in almost every category have similar or better fuel economy than the competition. In fact if anything the American cars we do purchase tend to be the least fuel efficient models. That wasn't their mistake Suze, that was what we wanted. Their mistake was selling their home market junk and while they made quality exports. They backed down to the UAW which adds a $2-4k premium to our cars vs sub $1k for other makes. Building a car today just doesn't require a very skilled worker, no more so than the people working for Jiffy Lube. I would guess those Jiffy Lube workers get paid paid half a much at least.

To be honest I'm more upset with the government who are entertaining these clowns in the first place. There is a process for dealing with issues like this and our elected officials are not apart of it last time I checked.

I don't think there is any easy answer. In my view, Suzie has very relevant, simple, and pragmatic advice for the everyday person who never learned as a child how to take and willingly accept financial responsibility. For that singular reason, I like what she has to say.

On the other hand, the bailout / loan issue to the Big 3 is beyond my comprehension as I am not privy to most of the facts. All I know is what I read, listen to on the news, and discuss with friends. I am not quite sure how to separate the fact from the fiction. The fact that many people and organizations seem to spenda a lot more than they take in, and leave no margin for error, seems to add a lot of stress to the system. I would rather live below my means, have good friends and family, and be able to enjoy work and family life knowing that I have some margin. That way, I can contribute my time and some monies to charitable organizations and help build a better world.

I think the issue is education, and the CEOs and many others seem to have been schooled to promote themselves and use their expertise to build material wealth.

Suzie seems to me to do a decent job in educating us. It is tougher to learn these lessons at an older age, than when we were young. I was fortunate to have had good teachers and the motivation to learn.

Greed is insatiable and is perhaps the only vice (or value) that can bring this nation to its knees. Kneeling is most always a good thing, as long as we keep our mind and heart in good perspective. The only thing I can control is me.

Let me ask this: Reading in the paper that states that the employees make $71.00 per hour?? Why do they get that much money, when other people get (if they are lucky) $10.00 and have to work harder then these Auto employees. They also have a excellent health benefit and retirement pension ahead of them.

Why don't these CEO's start selling all these cars at a price so that the young folks starting out in life, and also the less then middle class people can afford, and not have to get into such a deep hole debt. Therefore, more cars would be bought and the need for building more cars. They should have to think on how to get back on their feet by themselves, not rely on us the taxpayers. We have to struggle if we don't watch our income vs. spending.

I am driving a 22 year old Honda Accord and love it. It purrs like a kitten. I took good care of it, now it still takes care of me. I still get 24 miles per gallon and would not trade this baby in for any of those three car makers.

To my opinion they work harder on how to get money out of the taxpayers than to find a solid solution for their establishment. What a shame.

The first law of critical thinking: ask yourself WHY someone is making an argument, and WHAT they stand to gain if successful.

You can talk, whine and complain all you want, but there are several facts at play here:

Fact: The domestic auto manufacturing industry has NOT adapted their business model to match the market pressures created by foreign manufacturers.

Fact: The VALUE of domestic automobiles is not competitive with foreign automobiles, in terms of quality, reliability, efficiency and price/performance.

Fact: Although it's easy to blame the CEOs for the current corporate woes (and they definitely deserve to be called out for their demonstrated incompetence), there are other factors at play. Example: dealing with the burden of ridiculous unionized labor contracts and retirement pensions.

Fact: Actually qualifying "domestic made" vs. "foreign made" is difficult, if even possible; GM imports significant amounts of foreign parts and Toyota has factories in the USA. Where do you draw the line?

Either the management of the domestic auto manufacturers are incompetent and unable to adapt their business models to compete in today's market, or the domestic auto industry ITSELF places too many restrictions on US companies to successfully compete. The problem isn't going to go away without fixing the REAL problem(s), regardless of any bailout.

Should the US auto industry be bailed out? I don't believe so. Artificial life support is just that- artificial. Should the Big Three enter bankruptcy? If they can't compete, absolutely. Maybe that's the "wakeup call" that the ENTIRE auto industry- management, labor, domestic, foreign, etc. needs.

I grew up in a city that was dominated by three core employers for decades, until the 1980s. As those companies faced issues similar to what the auto companies face today, dramatic lay-offs and "downsizing" was always the "answer". Tens of thousands lost jobs every year. Did those people starve?

No. The market adapted, new companies and business models were created, etc. Today there are now dozens of companies that
dominate the local economy. Diversity is good.

Fact: The laws of supply and demand will continue, regardless of the fate of the domestic auto manufacturers.

One final fact I do know: the economic laws of supply and demand will continue, regardless of what happens. Even if GM, Ford and Chrysler go under, that won't change the demand for new vehicles. It will just change which companies address the market demand successfully.

The CEO's, the Board of Directors and the other big-wigs of these companies all need to be fired or have their income halved. I will never stand up for them, they have money to survive. However I see so many negative comments about the hourly average American auto workers that happen to belong to a union. They are not running the company down. These are American workers, our fellow Americans. The people saying such negative things about these workers probably support our taxpayer money, $10 million a month, going to support a shiite muslim country and a shiite muslim government of Iraq. That is where our taxpayer money should not go at all, ever.
This auto-loan money is for American companies and America workers, that is justified.
Just my comments from a non-union worker that was just laid off because our company was bought by the Chinese and moved to Taiwan.

I am pleased that I do have a vote in the auto bailout plan. Every time I walk into a car showroom in the future, I am voting on the bailout. I will not darken the door of a showroom for US made cars for a very long time. I am a 35 year union member, but I refuse to reward poor quality.

Hello, this is Denise from California.
My question for Suze is this
I have a first mortgage and line of credit both from Bank of America. They are saying that I cannot receive help from them unless I am 3 months behind. There is a program here called Hope for Homeowners. How do I get B of A to participate? My husband is working and I have been trying to find a job for over a year now. We have used all of our savings and our house is upside down. It is my understanding that Hope for Homeowners works with the banks to forgive up to the current assessed value of the home. Our home has been reassessed by the county. What can I do to get B of A involved? They are not very helpful where other mortgage lenders have been very helpful with other folks. If I have to pay taxes to pay off this bailout why can't B of A help us?
Thanks for your advice.
Denise

HEY MR KING I HAVE A QUESTION, SCENSE WE ARE GOING TO USE TAX DOLLARS TO BAIL OUT THE MAKERS OF GM CARS, MY FRIEND HAS A SHOP THAT WORKS ON GM CARS AND COULD REALLY USE A BAIL OUT, HIS COMPANY IS PRIVATE OWNED AS WELL AS GM, SO MY QUESTION GOES ON TO ASK WHERS THE BAIL OUT LINE LOCATED? MY FRIEND WOULD LOVE TO GET IN THAT LINE TOO.

Hi Larry & Suze, My credit card company sent a letter saying that they have reduced my credit limit, since I don't use enough of it. My question to you is why did they reduce my limit when I was paying off my balances every month regularly ? And will the credit reduction affect my FICO score in a negative way? Thank you.

Of course Obama can't hide himself from his homeboy. I have lived outside of chicago for about 11 years, but still remember clearly how politics works. Everyone from Chicago knew where Obama cut his political teeth, but the national news media really let his past history stay out of the public eye. I am shocked that this is a "scanday". Everyone knows how patronage politics works, so why is the media jumping on this? Don't we remember the pay to play clinton hillary, bill, and brothers with their famous parting pardon that has managed to parlay bill from an indebted, impeached ex-president to a globetrotting millionair. Really. Is this such a shocking "scandal"?

Hi Larry,

Can any of the money be given to Tesla Motors to aid them in producing their version of the Electric Car, i will not buy a electric car from any of the Big 3, they had Elecric Cars from 1996 to 2003 and they destroyed the cars and the technology. So money should be given to Tesla Motors to aid them in producing electric cars for families!, they are woreking on it right now and they want to produce the cars we want!

Its really disturbing to read this quote from someone who claims to be remotely intelligent: ""We have known for years that oil is a limited commodity, yet Detroit did not aggressively pursue higher fuel efficiency (and don’t get me started on the fact that Congress didn’t exactly push them in that direction). ""

THIS ISSUE IS NOT JUST DETROIT'S ISSUE. WHY ARE WE BLAMING DETROIT??? COME ON PEOPLE!!!! GET WITH IT. Just because the American people all of a sudden have a change of heart on not wanting certain vehicles, does not mean it can change overnight...this is not fair.
This automotive issue is not Detroit's fault. It is partially everyone's falut. First off, most cars made are not 100% american and have not been for a long time. Parts come from all over, and they are just assembled locally.
Second, Since when did congress/ politians / and american people DEMAND better? Only few voices have squawked loud enough to get to some people. Where is the education? If you knew this for so long, then why did you not go to congress yourself and demand why the change has not happened? BECAUSE ITS EASY TO POINT A FINGER, BECAUSE BUSH WAS IN OFFICE. CLOSED DOORS FOR LAST 8 YEARS. Ok, so who is to blame? A LOT OF THINGS. BUT STOP BLAMING DETROIT. This industry helped carve our state, but it is NOT OUR STATE. This is NOT a BAILOUT FOR DETROIT. IT IS A LOAN FOR BIG THREE.

Detroiter~

hey!!!! vince in georgia December 9th, 2008 8:29 pm ET
yOU COMMINTED:
HEY MR KING I HAVE A QUESTION, SCENSE WE ARE GOING TO USE TAX DOLLARS TO BAIL OUT THE MAKERS OF GM CARS, MY FRIEND HAS A SHOP THAT WORKS ON GM CARS AND COULD REALLY USE A BAIL OUT, HIS COMPANY IS PRIVATE OWNED AS WELL AS GM, SO MY QUESTION GOES ON TO ASK WHERS THE BAIL OUT LINE LOCATED? MY FRIEND WOULD LOVE TO GET IN THAT LINE TOO.

WELLLLLL....If there is no loan for big three then no worries, me thinks your friend wont have a company to worry about if the three go down!!!

jap cars are good know why? OUR engineers HELPED them produce cars with out the burden of out – dated factories. The first cars were manufactured here...but you have old factories and facilities that are to expensive to just replace...you have people in america that are saying they want hybrids but how many ppl do you see driving them? they are available...right now you all can go out and get one! why not? ask yourself that question and find millions in your shoes..they are expensive. Not many facilities implimented to generate fuel for them and the industry needs political help to see what direction to take with them. When they figure out (with help of congress) which way they want to go with energy efficent cars and stick with it..and follow though with supplying people locations to fuel up ... they can find people willing to re-invest in a good green automotive direction. The industry has to many ways open and no one way has really been choosen for enviromentally friendly cars yet. You worry about buying one car and then they pick another technology to support and do away with others...it is expensive to buy something like a car then find out they are not going to support the technology ...

Larry,

I am writing you to inform you of a new development in Technology, that could be as significant to the automotive industry as what the wheel was to early man.
This is a recently newly patented electric motor that uses a new type of technology that is an ultra efficient and has a very low cost to manufacturer .

This motor because of being made 90% plastic is way cheaper to produce then heavy conventional gasoline or diesel motor. With rising metal cost Low automotive sales and unstable stock prices this could be a savior to the automotive industry as well as the public.

We have recently patent an electric motor that uses rotational levitation to charge conventional batteries.
They seldom need recharging from an outside source. Motor sizes range from 1/10th Hp to a mid range of 300 Hp to 10,000 Hp

With the 10th of the weight of conventional engine
This motor has no fuel injection , emissions, crank shaft, radiator ,oil pan or exhaust .
This motors applications are limitless from heavy equipment, ships, trains, planes, sub marines and etc.

We believe that this motor is ideal for All current products., we would like to license someone to manufacturer these motor and the Big 3 won't give us the time of day.
Please call us Larry and let us show you it works! Larry bring a engineer friend of yours on the show to we can arrange a meeting and demonstration.

Sincerely,

Angel Vela and Henry Johnson
989-239-6324 OR 989-860-8703
ANGEL MARKETING FIRM

Help find Caylee Anthony, TAKE A LIE DETECTER TEST !

Suze, one thing is do not understand is: Have you ever suggested to people that some people could live without a car at all? I have been able to and have saved thousands. Now, I know not everyone can do this but I have never heard you suggest it to anyone. In fact, I remember you told a couple in financial trouble who were going to move in with their parents that they should keep both of their expensive cars because they were still in deep credit card debt. Wouldn't it have helped to sell one of them? I have never heard you mention this way that a family can cut their costs significantly.

By the way, I don't favor the bailout, and wonder: Why don't they shut some plants down now so as not to run up any more expenses? When I am on the bus, I see the Chevrolet dealer have so many vehicles that some of them are parked on the lawn. Why are they continuing to make vehicles no one is buying?

Has any one tryed a psychic or paranormal help in finding Kaylee

Larry, why didn't you ask them about the hair follicle with the death ring around it??? How can they keep on disputing the fact that hair was found in the trunk from a deceased person?? You didn't ask valid question Larry...They must of put restrictions on what you could ask, or you didn't know how to interview people who are covering up for a daughter who knows what happened to her child.. I agree....everyone is enabling Casey...now even you Larry...

You are the best Suze. Thanks for doing what you do – you are priceless!

my question on this is.. If there has many sightings of Caylee then why didn't any of these people ever call the police to come and take a look for themselves. I truly hope that Cindy and George are right and that they bring their little girl home.

My heart and prayer are with Cindy and George. They know Caylee is dead, but now they are tring to help Casey by taining a jury pool. They are tring to put doudt in the public's mind. Nancy Grace has been very great getting the information out on tring to find Caylee. Leonard Padella is tring his best to help them get closer to closing this case. George seem very uncomfortable on your show. You could tell he really wasn't in for doing this, because he would have to follow the lies Cindy was enforceing. I seen where Casey learned how to lie. I can understand they are tring to keep their daughter out of prison. Cindy knows what she did by calling the police let to where her daughter is today. My goodness their grand baby is still gone. I cried for George. Their really looked like a fool sitting there ling. The public is not dumb we seen through all the lies.

Dear Larry,
I thoroughly enjoy watching you show every night. I have a question for Suzy Ormond, if you would please ask her for me. I've never heard Suzy offer advice on AIG stocks. I am 72 years old and have invested with AIG for five years with an interest rate of 5.5% for the first 3 years. After that the minimum guaranteed interest rate is 3%. I'm starting my third year. I've accumulated $6050 for the 1st two years. The withdrawal fee is 7% of premium withdrawn. Should I withdraw to save my retirement fund or is it still pretty secure?
Thank you,
Kathy from Darlington, Maryalnd

What a shame Ford & Alan Mulally are being lumped into these general comments with the progress they have made to turn Ford around... Have you not heard- According to JD Power, quality equal to Toyota & Honda – They have enough cash for 2009...only need a line of credit in case GM or Chrysler bellies up & injures the suppliers.. Open your mind & process ALL of the information available Suze.. Have you driven a Ford lately? Maybe you should give one a try....

i know the CEO's sucks. they get all the bounses and highly paid and shame on them to ask for bailout...shame But how about thoes people who take charge of offices and jobs to serve their country and still don't see what the hill is going on. why couldn't the government control what's happening today.....It is very sad that today its all about me me no humanity left. who knows what else will happen next. what we need in this country is unity not greedyness or selfishness......

Hello Larry,
Love your show. I just want to say that I believe there is life beyound our own. I have never seen a UFO or been abducted, but I would be carzy to think that we are alone in this Universe.

Larry:
I was briefed by the pentagon on Flying Saucers in 1961. There are several races here and some maybe the next step above man, like man is the next step above the Bonobos Apes. Some of them live here in our oceans. This is their Planet...that's why they are scared to tell us, they can't defend us.

ufo I SAW A UFO 1956 .. I LIVE IN KINDE MI .. 74 YEARS OLD .. I LOOKED THE THING OVER , ARE THE REAL YOU BET . WHERE ARE FROM . DONT KNOW .. DOES THAT BOTHER ME NO . IF THEY WANTED ME ,THEY COULD GRABED ME AT ANY TIME .. DID ANY ONE THINK ABOUT THE ANSWER GOD ... GOOD PROGRAM ON UFO . WILLIAM CHAPPEL ..

Both Nye and Shostak always manage to make fools of themselves. Nye is a complete moron. They both talk around in circles without ever really saying anything to support their skepticism scientifically. Neither of these two say anything worth listening to with regard to the vast amount of evidence concerning UFO's. How is it that they get air time? Are there no scientists who can offer well considered information to explain or explain away this phenomenon? Skepticism is one thing, Nye and Shostak simply avoid the discussion with nonsense.

The problem with these two is that they simply ridicule and obfuscate any serious discussion. I have never heard either of these fools put up a good counter argument with evidence. Lets face it, Jeff Shostak is in the BUSINESS of listening for intelligent life in outer space – a phenomenal failure thus far so, why would he even attempt to get his narrow head around the subject? The truth is he's overrated and incapable of discussing this issue intellectually or seriously at any level. As for Nye, I can't even listen to him he's so foolish.

Thank you Larry for taking this subject on.