Experts: Auto bankruptcy could create snowball effect

Economists say a failure to pass a bailout package for the Big 3 auto companies could spell disaster for Long Island. ?There's something called the multiplier effect,? Hofstra University professor Martin

News 12 Staff

Dec 13, 2008, 1:23 AM

Updated 5,698 days ago

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Economists say a failure to pass a bailout package for the Big 3 auto companies could spell disaster for Long Island.
?There's something called the multiplier effect,? Hofstra University professor Martin Melkonian explains. ?So that for every job lost, there's going to be an additional two, three sometimes four jobs lost."
Some also point to Long Island?s dependence on automobiles as the reason for a potential ripple effect. Brian Schneck, head of Long Island's United Auto Workers union, says if there's no bailout deal, expect to see nearly 1,000 of his members landing on hard times. UAW represents mechanics at most of Long Island?s auto dealerships.
Dealership owner Paul Conte says he?s optimistic Congress will pass a bridge loan, though a plan has stalled in the Senate. ?I don't think we have to go that far to get the parties together and work out a solution,? he says.
Still, car dealers say despite all the sales incentives and lowered prices, they are having the slowest sales period on record since the Great Depression.
Click for more on the American auto market
To see UAW President Gettelfinger's comments on the stalemate, go to Channel 612 on your iO digital cable box and select iO Extra.


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