US Auto Sales Slump to 16-Year Low

This isn't just a recession. It is economic collapse.

U.S. auto sales slumped to a 16-year low in July as automakers failed to keep up with consumers' growing demand for smaller, more fuel-efficient vehicles. While production changes may help that problem, trouble in the credit and auto leasing markets will continue to take a toll on sales.

[...]Automakers were expecting a slide in July as high gas prices continued to cut into sales of trucks and sport utility vehicles and new troubles in the auto leasing sector further wrecked consumers' confidence. July's seasonally adjusted sales rate — which shows what sales would be if they continued at the same pace for the full year — was 12.5 million vehicles, according to Autodata Corp. That's down from 17 million as recently as 2005.

Automakers expect things to get worse before they get better.

A big part of the problem is consumer's have no money to purchase cars:

Low-wage workers in the United States are gripped by increasing financial insecurity as they inch along an economic tightrope made riskier by pervasive job losses and rising prices. Many struggle to pay for life's basics -- housing, food and health care -- and most report having virtually no financial cushion should they stumble.

[...]"A lot of issues that have long confronted low-wage workers are now increasingly facing middle-income workers," who more than ever face the prospect of jarring income declines, and the lack of health care and pensions to support them, said Beth Shulman, a scholar with the Russell Sage Foundation's Future of Work Project.

If those growing concerns translate into political action to bolster the social safety net, she said, it would disproportionately help low-wage workers. "I don't think we want to live in a country where people are working and doing what they are supposed to do but yet they can't get the basics," Shulman said.

Meanwhile, George Bush plays political games and tries to do favors for his oil buddies:

President Bush chastised Democrats on Saturday for refusing to allow a vote on whether to lift the federal ban on offshore oil drilling before lawmakers departed for their summer recess.

"To reduce pressure on prices, we need to increase the supply of oil, especially oil produced here at home," Bush said in his weekly radio address. It was the fourth time this week that he has called for Congress to end the drilling restrictions off the Atlantic and Pacific coasts and in the eastern Gulf of Mexico.