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Does the U.S. Need an Auto Industry?


               
2010 Feb 19, 4:23pm   14,611 views  78 comments

by 4X   follow (0)  

Cited From: http://roomfordebate.blogs.nytimes.com/2009/04/30/does-the-us-need-an-auto-industry/

With its survival, at least in the short term, so dependent on public assistance, it seems fair to ask, do we need a domestic auto industry? Many American manufacturing industries, like textiles and electronics, long ago moved to other producing countries. Why is the auto industry different?

How a Domestic Industry Helps All Americans
Roger Simmermaker, an electronics technician for a large defense contractor and the vice president of his local machinists union, is the author of “How Americans Can Buy American.”

We need a U.S. auto industry because American companies employ more American workers; support more retirees, their families and dependents; pay more taxes to the U.S. Treasury; have a much higher domestic-parts content in their vehicles, and operate far more factories in America than foreign-owned companies.

If the Big Three fail, the American taxpayer will be paying the pension and health care costs for the affected workers and retirees. G.M. spent $5.2 billion in health care alone for their workers and retirees in 2004, for example. That's $5.2 billion foreign-owned firms like Toyota and Honda didn't have to pay because the Japanese government covers these costs for their home companies. That's $5.2 billion American workers and retirees could instead use to contribute to the vitality of the communities in which they live.

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1   4X   2010 Feb 19, 4:24pm  

This post is directed at Toyota, Honda, BMW, Lexus, Mercedes and Nissan drivers....what makes you think you can live in our country and buy foreign vehicles?

2   Â¥   2010 Feb 19, 5:43pm  

Wealth creation like manufacturing line jobs suck. Much better if we were all accountants, doctors, lawyers, teachers, dancers, professional sports players, game programmers, philosophers, firemen, soldiers, gummint employees, etc.

We can continue to have the world ship us their wealth and we can just continue sending them IOUs on our future production of goods and services. Well, mostly services, since we aren't going to have much in the way of intermediate goods this century.

It was rather embarrassingly late in life that I learned about the Three-Sector modeling of the economy.

Wealth can take many forms, but in the end there's only production, consumption, and spoilage, and every economy has to net out these quantities, to the extent natural resources are lost from this cycling of physical goods and human services.

3   Â¥   2010 Feb 19, 5:46pm  

4X says

what makes you think you can live in our country and buy foreign vehicles?

Many foreign vehicles provide design and/or manufacturing jobs, like the Subaru line in Indiana.

But the last car I bought came on a boat and I'll always buy the car I want to drive most, thanks.

If domestic mfgrs want my business, they'll have to build a better car. I'll pay more for the domestic content as a good citizen, but I'm not in the charity business.

4   elliemae   2010 Feb 20, 1:14am  

4X says

This post is directed at Toyota, Honda, BMW, Lexus, Mercedes and Nissan drivers….what makes you think you can live in our country and buy foreign vehicles?

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

From another forum (2k for a prius) 4x say:

…..and i say all of you are anti-american. Buying Honda, Toyota, and Nissan is not a good look for a bunch of arch-conservatives and neo-progressives. I drive a FORD, my wife has a Nissan she purchased prior to our marriage and rest assured when the times come to replace it we will buy American. You cowards have no principles……..all talk, no action. God bless America and her products……because its her products that drive our economy.

Your wife is unAmerican. What makes her think she has the right to buy & drive what she wants?

Oh, yea - the Declaration of Independence, the Constitution of the United States, the Bill of Rights...

5   nope   2010 Feb 20, 3:52am  

We don't "need" a domestic auto industry any more than we "need" a domestic manufacturer of cheap plastic toys.

Obviously we still need cars in most areas, but over time the need is less and less.

We could save a lot of tax dollars by favoring pedestrian communities and co-locating residential and commercial zones. The century old urban / suburban split is bad for taxpayers, bad for the environment, and bad for quality of life.

The irrational protectionism of the auto industry needs to stop. We need policies that favor what's best for the whole country, not what's best for a small group of companies.

4X says

This post is directed at Toyota, Honda, BMW, Lexus, Mercedes and Nissan drivers….what makes you think you can live in our country and buy foreign vehicles?

The constitution.

6   RayAmerica   2010 Feb 20, 5:20am  

4X you are absolutely correct. If you don't own, drive, buy an American car you don't deserve to live here. BTW, what country is your wifey moving to?

7   elliemae   2010 Feb 20, 5:27am  

I'm proud to be able to remain in the US, unlike the rest of you traitors. HA! I say! HA! HA! HA! I'll joyfull laugh at all of you as you drive past me, blissfully unaware of your impending deportation, as I continue to remain on a first name basis at the GM dealership repair shop.

8   Â¥   2010 Feb 20, 6:22am  

Kevin says

The irrational protectionism of the auto industry needs to stop. We need policies that favor what’s best for the whole country, not what’s best for a small group of companies.

This is not that bad a sentiment. There's a lot of broken-window fallacy associated with the auto sector GDP. People buying tires, oil changes, etc. When I was in Tokyo it was humorous to see how marginal the auto-service business was. None of the mass collection of auto dealers, they were just sprinkled around the periphery of the city in no great density -- surprising for a metro with the population of California.

Still, wealth creation is wealth creation, and the value of an automobile is well above the cost of its individual parts.

I'm paying in total $200/mo for my car, $6/day is nice for total freedom. I had a similar freedom in Japan, but it would cost much more than $6 to get out of the city. Plus with families the value-add for a car carrying 4 or 5 people rather than paying $400/day in fares is self-evident.

9   nope   2010 Feb 21, 8:16am  

Troy says

Still, wealth creation is wealth creation, and the value of an automobile is well above the cost of its individual parts.

Not all wealth creation is the same.

I couldn't disagree more about the value of an automobile.

The suburban commute is responsible for every dollar we've spent in Iraq and Afghanistan, the housing crash, and the health care mess (we're fat because we live in the suburbs).

10   4X   2010 Feb 23, 12:27pm  

elliemae says

4X says


This post is directed at Toyota, Honda, BMW, Lexus, Mercedes and Nissan drivers….what makes you think you can live in our country and buy foreign vehicles?

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.
From another forum (2k for a prius) 4x say:

…..and i say all of you are anti-american. Buying Honda, Toyota, and Nissan is not a good look for a bunch of arch-conservatives and neo-progressives. I drive a FORD, my wife has a Nissan she purchased prior to our marriage and rest assured when the times come to replace it we will buy American. You cowards have no principles……..all talk, no action. God bless America and her products……because its her products that drive our economy.

Your wife is unAmerican. What makes her think she has the right to buy & drive what she wants?
Oh, yea - the Declaration of Independence, the Constitution of the United States, the Bill of Rights…

As her husband, as a man...I will never let her buy another foreign vehicle so long as we are together. This vehicle was bought prior to our marriage, it is still running and in good condition so it does not make financial sense for us to get ourselves in debt again so that I can prove a point.

On your next purchase, do us all a favor and buy an American manufactured vehicle from either FORD or GM.

11   4X   2010 Feb 23, 12:29pm  

Kevin says

We don’t “need” a domestic auto industry any more than we “need” a domestic manufacturer of cheap plastic toys.
Obviously we still need cars in most areas, but over time the need is less and less.
We could save a lot of tax dollars by favoring pedestrian communities and co-locating residential and commercial zones. The century old urban / suburban split is bad for taxpayers, bad for the environment, and bad for quality of life.
The irrational protectionism of the auto industry needs to stop. We need policies that favor what’s best for the whole country, not what’s best for a small group of companies.
4X says


This post is directed at Toyota, Honda, BMW, Lexus, Mercedes and Nissan drivers….what makes you think you can live in our country and buy foreign vehicles?

The constitution.

You always leave me lost with your justifications...wouldnt having the #1 manufacturer of toys in the USA equate to more jobs?

Why should we just sit back and let jobs leave our country?

12   4X   2010 Feb 23, 12:33pm  

Kevin says

Troy says


Still, wealth creation is wealth creation, and the value of an automobile is well above the cost of its individual parts.

Not all wealth creation is the same.
I couldn’t disagree more about the value of an automobile.
The suburban commute is responsible for every dollar we’ve spent in Iraq and Afghanistan, the housing crash, and the health care mess (we’re fat because we live in the suburbs).

Again, what about all the manufacturing, service, parts, distribution, sales jobs created by FORD and GM?......yes, Japanes manufacturers do create the same jobs but on a smaller scale her in the US. Toyota employs 7,000 Americans while GM employs 38,000 and Ford employs 70,000 Americans.

Doesnt this count toward you making a principled decision to support your fellow American?....or is this economic downturn ok in your eyes?

13   4X   2010 Feb 23, 12:37pm  

Troy says

Wealth creation like manufacturing line jobs suck. Much better if we were all accountants, doctors, lawyers, teachers, dancers, professional sports players, game programmers, philosophers, firemen, soldiers, gummint employees, etc.
We can continue to have the world ship us their wealth and we can just continue sending them IOUs on our future production of goods and services. Well, mostly services, since we aren’t going to have much in the way of intermediate goods this century.
It was rather embarrassingly late in life that I learned about the Three-Sector modeling of the economy.
Wealth can take many forms, but in the end there’s only production, consumption, and spoilage, and every economy has to net out these quantities, to the extent natural resources are lost from this cycling of physical goods and human services.

thanks for sharing....does this mean that our manufacturing base means nothing to our economy since we are now shifting into the 3rd phase which focuses on services?

What happens when businesses OFFSHORE all services to India, Mexico and other 3rd world countries?

14   elliemae   2010 Feb 23, 12:51pm  

4X says

As her husband, as a man…I will never let her buy another foreign vehicle so long as we are together. This vehicle was bought prior to our marriage, it is still running and in good condition so it does not make financial sense for us to get ourselves in debt again so that I can prove a point.

Anyone?

As her husband - as a man... you won't "let" her... so you can prove a point?

I believe that you've proven your point well. 'nuff said.

15   Vicente   2010 Feb 23, 12:58pm  

Why start with $20K car? Why not start with $50M fighter plane? Much more "bang for buck" there, we can just buy Chinese or Russian planes and close down our F-35 and other programs. As long as we are talking about why produce ANYTHING here, I mean really......

We are heading into being Squanderville precisely because of short-term thinking like that, all about consuming, and trading away our future. Here's a nice video about 3 minutes about it:

Squanderville v. Thriftville

16   4X   2010 Feb 23, 1:03pm  

elliemae says

4X says


As her husband, as a man…I will never let her buy another foreign vehicle so long as we are together. This vehicle was bought prior to our marriage, it is still running and in good condition so it does not make financial sense for us to get ourselves in debt again so that I can prove a point.

Anyone?
As her husband - as a man… you won’t “let” her… so you can prove a point?
I believe that you’ve proven your point well. ’nuff said.

Hmmm...I take it your a feminist and believe that the MANS role in the family has changed simply because you now work. That isnt the case in all families, any family for that matter. Everyone has a role in the household, be proud of yours and try not to look at statements like these as demeaning. ........regardless of what any feminist may want to believe being wife is not always secondary to being a husband. But, in the end women will always blame the guy when there is not food on the table and women will always be blamed when the children behave poorly. Maybe if you had a MAN instead of a PARTNER you could understand these views. I understand, a feminist doesnt want a MAN because she is the MAN and there is not one thing a MAN can tell her about life because SHE can stand on HER own two feet without him. Therefore any MAN that gets with a feminist is a PARTNER.

Here is my point, I am going to LEAD my household and ensure my families success along with my wife. I have let her know that my principles come first and that involves:

1. The protection of our family
2. Professing our love for our family
3. Providing for our family

Buying FORD and GM products ensures that our children have opportunity here in America when they grow up.

YES, I wont LET her ruin our families chances at success simply because she doesnt have principles and SHE wont LET me ruin our families home life simply because I am a MAN.

17   deanrite   2010 Feb 23, 1:44pm  

You can dis all auto manufaturers as far as I care. I fix them ALL. People seem to just love the Asian cars, but frankly they are overrated tinny little pieces of crap after a couple of years. The euro cars are better built but boy are they expensive, and they are really expensive to service- and guess what they do break down too. When they do you better have a good credit line. American cars are vastly improved from the dark days of the of the late seventies and early eighties. Plus you can get some great deals on one a couple of years old. Try to find good deals on a toy or Honda.

The fact is when this country exports products it spurs the economy more than anything else. When you buy imports, you stimulate another countries economy. When we get foreigners money into this country we prosper. Simple as that. Government spending not so much. It is just an exercise in a dimishing return- it's all our money. Nothing additional. That's why spending a trillion a year on defense is moronic- hell, we can't even win a war and we sent our cash so that we look like good guys. Bullcrap! Our foreign policy should be simple- don't mess with us or we'll f#*% you up! Bomb the crap out of them and leave their contry in shambles. And don't make us tell you twice. Now if we could just get 'em pay us not to use bullits and bombs on them. Ha, then we'd be getting their money instead of the other way around.

One other thing. How is it that we let ourselves be bamboozled into selling our natural resources dirt cheap to some other country like japan or china? Neither has didly for natural resources. But they enrich their countries and are impoverishing ours with the raw materials we've practically given them. How lame is that? How unamerican is that? This land is my land, this land is your land.......

18   nope   2010 Feb 23, 2:39pm  

4X says

You always leave me lost with your justifications…wouldnt having the #1 manufacturer of toys in the USA equate to more jobs?

"Jobs" is not what's important. Yes, I'd much rather have 1 Software Engineer than 5 factory workers, because that 1 software engineer contributes more wealth to the society than 20 factory workers do.

And, yeah, I also support taxing that engineer to help pay to support the factory workers who now have to seek employment elsewhere.

You can't be number 1 at everything, period, and it is idiotic to attempt to do so. China is already in the process of being domestically driven, and we simply can not compete with that -- nor should we try!

4X says

Again, what about all the manufacturing, service, parts, distribution, sales jobs created by FORD and GM?……yes, Japanes manufacturers do create the same jobs but on a smaller scale her in the US. Toyota employs 7,000 Americans while GM employs 38,000 and Ford employs 70,000 Americans.

I maintain that the net effect of the automobile at present is a drain on the economy. We would be better off financially with a robust public transportation system. Less employment? Perhaps. But also much lower costs. Your focus on "jobs" is exactly the kind of idiocy that got us into the current mess, and it's why we have bizarre policies that favor the wal marts of the world.

19   Â¥   2010 Feb 23, 3:04pm  

Kevin says

Yes, I’d much rather have 1 Software Engineer than 5 factory workers, because that 1 software engineer contributes more wealth to the society than 20 factory workers do.

Sorta. Software is generally a form of capital wealth, the produced means of production.

The reason we pay so much for software is because it does have this productivity benefit, but one must always keep in mind where the end wealth creation really is.

Wealth is that which provides services that satisfy human needs and wants of utility.
Nobody wants to have a spreadsheet or RDBMS console in their face, these are just part of the means of production of the actual wealth.

But just like light manufacturing, much software development can EASILY be exported to low wage areas like India and China, knocking the generous gross margins enjoyed by US-based software developers.

You can't eat a CD ROM, and an .EXE file isn't going to get you to the doctor's office (though of course software is becoming a replacement capital good for a lot of brick & mortar commerce infrastructure).

Maybe if you had a MAN instead of a PARTNER you could understand these views. I understand, a feminist doesnt want a MAN because she is the MAN and there is not one thing a MAN can tell her about life because SHE can stand on HER own two feet without him. Therefore any MAN that gets with a feminist is a PARTNER.

LOL. Neanderthal, represent!

20   Â¥   2010 Feb 23, 3:09pm  

I maintain that the net effect of the automobile at present is a drain on the economy. We would be better off financially with a robust public transportation system. Less employment? Perhaps. But also much lower costs.

Yes, the car economy is something of a broken-window fallacy. A bus system that ran buses every 5 minutes is MUCH more usable than the 30-minute system we have here in the Bay Area. I'm paying $6/day whether my car runs or not, but in Tokyo for the same outlay I had total run of the city. It was awesome.

21   elliemae   2010 Feb 23, 9:39pm  

Maybe if you had a MAN instead of a PARTNER you could understand these views. I understand, a feminist doesnt want a MAN because she is the MAN and there is not one thing a MAN can tell her about life because SHE can stand on HER own two feet without him. Therefore any MAN that gets with a feminist is a PARTNER.

4X says

1. The protection of our family
2. Professing our love for our family
3. Providing for our family

I'm just thinking out loud here - I'd rather be with a man because I wanted him around than because I couldn't live without his financial dominance, brute force, etc. I actually was married to a man who believed that it was his job to provide financially 100% to the household and make all of the financial decisions. I had refused to buy a house we couldn't afford on my income alone, and at that time he had been angry about that because it challenged his status. But when he wasn't working for over a year and my paycheck kept us afloat. While we didn't maintain our former lifestyle, we still met our essential bills.
And no, 4x, I didn't rub it in and demand respect because I was the breadwinner at the time. That's because we were partners.

22   elliemae   2010 Feb 23, 11:06pm  

http://consumerist.com/2010/02/pontiac-vibe-owners-dont-laugh-at-your-toyota-owning-friends.html

"Just letting you know that today I received a recall letter regarding the Toyota recall. This came as a surprise to me since I don't OWN a Toyota vehicle. It turns out that the GM-made Pontiac Vibe is essentially a Toyota Matrix under the hood - and apparently in the pedals as well! GM Canada is calling in all Pontiac Vibes to help take care of the issue. Just thought I'd let you know!"

BUY AMERICAN!

23   4X   2010 Feb 24, 2:39pm  

deanrite says

You can dis all auto manufaturers as far as I care. I fix them ALL. People seem to just love the Asian cars, but frankly they are overrated tinny little pieces of crap after a couple of years. The euro cars are better built but boy are they expensive, and they are really expensive to service- and guess what they do break down too. When they do you better have a good credit line. American cars are vastly improved from the dark days of the of the late seventies and early eighties. Plus you can get some great deals on one a couple of years old. Try to find good deals on a toy or Honda.
The fact is when this country exports products it spurs the economy more than anything else. When you buy imports, you stimulate another countries economy. When we get foreigners money into this country we prosper. Simple as that. Government spending not so much. It is just an exercise in a dimishing return- it’s all our money. Nothing additional. That’s why spending a trillion a year on defense is moronic- hell, we can’t even win a war and we sent our cash so that we look like good guys. Bullcrap! Our foreign policy should be simple- don’t mess with us or we’ll f#*% you up! Bomb the crap out of them and leave their contry in shambles. And don’t make us tell you twice. Now if we could just get ‘em pay us not to use bullits and bombs on them. Ha, then we’d be getting their money instead of the other way around.
One other thing. How is it that we let ourselves be bamboozled into selling our natural resources dirt cheap to some other country like japan or china? Neither has didly for natural resources. But they enrich their countries and are impoverishing ours with the raw materials we’ve practically given them. How lame is that? How unamerican is that? This land is my land, this land is your land…….

Exactly the point of friggin post.......but everyone continues to buy imports.

24   4X   2010 Feb 24, 2:46pm  

Kevin says

4X says

And, yeah, I also support taxing that engineer to help pay to support the factory workers who now have to seek employment elsewhere.

You can’t be number 1 at everything, period, and it is idiotic to attempt to do so. China is already in the process of being domestically driven, and we simply can not compete with that — nor should we try!

I maintain that the net effect of the automobile at present is a drain on the economy. We would be better off financially with a robust public transportation system. Less employment? Perhaps. But also much lower costs. Your focus on “jobs” is exactly the kind of idiocy that got us into the current mess, and it’s why we have bizarre policies that favor the wal marts of the world.

Your talking astrophysics to a mother***** wino, let me ask pointed questions because I am clearly not undestanding your points.

1. What do you mean by China is in the process of being domestically driven?
2. Why wouldnt we want to compete with and crush them?
3. How did my focus on “jobs” become the kind of idiocy that got us into the current mess? Are you saying we should focus on the quality of the jobs versus the quantity?.....because if so, I think a majority of the plant workers at GM are making 20-25/hour. That is a fairly decent wage that Walmart Managers can make after 10 years of service. Explain your point?

25   4X   2010 Feb 24, 2:52pm  

elliemae says

I’m proud to be able to remain in the US, unlike the rest of you traitors. HA! I say! HA! HA! HA! I’ll joyfull laugh at all of you as you drive past me, blissfully unaware of your impending deportation, as I continue to remain on a first name basis at the GM dealership repair shop.

Not, GM makes vehicles that are just as sound as Toyota....Cadillac, Buick, GMC, Chevy are some of the most top rated vehicles. It your perception that needs to change...

Cadillac Escalade, CTS have been top rated for the past 10 years now...you just cant afford them and choose to buy Honda, Toyota products. ;)

I wink because i know you own a GM, because you told me so in previous posts.

26   4X   2010 Feb 24, 3:02pm  

elliemae says

http://consumerist.com/2010/02/pontiac-vibe-owners-dont-laugh-at-your-toyota-owning-friends.html
“Just letting you know that today I received a recall letter regarding the Toyota recall. This came as a surprise to me since I don’t OWN a Toyota vehicle. It turns out that the GM-made Pontiac Vibe is essentially a Toyota Matrix under the hood - and apparently in the pedals as well! GM Canada is calling in all Pontiac Vibes to help take care of the issue. Just thought I’d let you know!”
BUY AMERICAN!

Your missing my point on how buying Toyota worsens our economy since the profits, wage paying jobs are held overseas.

27   thomas.wong1986   2010 Feb 24, 3:07pm  

Troy says

Many foreign vehicles provide design and/or manufacturing jobs, like the Subaru line in Indiana.

Interesting enough! The Japanese simply copy the designs from the Germans/Italians and made em cheaper. Somewhere down the line we should do the same.

deanrite says

You can dis all auto manufaturers as far as I care. I fix them ALL. People seem to just love the Asian cars, but frankly they are overrated tinny little pieces of crap after a couple of years. The euro cars are better built but boy are they expensive,

Rather remarkable how many "Vintage 80s" BMW 318-325s I still see on the road. They still get pretty good gas milage 30-35 and the enginees still purr even after 300K miles. Not a bad looking car either. I think we could make a no frills car like that and sell them like hotcakes. Not a 2010 BMW clone .. just simple plain-vanilla kind of car that runs.

28   4X   2010 Feb 24, 3:12pm  

elliemae says



Maybe if you had a MAN instead of a PARTNER you could understand these views. I understand, a feminist doesnt want a MAN because she is the MAN and there is not one thing a MAN can tell her about life because SHE can stand on HER own two feet without him. Therefore any MAN that gets with a feminist is a PARTNER.

4X says

1. The protection of our family
2. Professing our love for our family
3. Providing for our family

I’m just thinking out loud here - I’d rather be with a man because I wanted him around than because I couldn’t live without his financial dominance, brute force, etc. I actually was married to a man who believed that it was his job to provide financially 100% to the household and make all of the financial decisions. I had refused to buy a house we couldn’t afford on my income alone, and at that time he had been angry about that because it challenged his status. But when he wasn’t working for over a year and my paycheck kept us afloat. While we didn’t maintain our former lifestyle, we still met our essential bills.
And no, 4x, I didn’t rub it in and demand respect because I was the breadwinner at the time. That’s because we were partners.

Your not LETTING your husband buy an overpriced house is very similar to me no LETTING my wife buy a Toyota. It is all based on making sound financial decisions. In my case, I dont want to suppor the Japanese economy, I want to support the economy here in the USA. I am a partner to my wife, except when something steps on my principles as a man.will.....I just accept the fact that men and women have different roles in the household, and sometimes these roles are reversed.

I just finished cleaning the house, doing the dishes and rocking my son to sleep....all after a 12 hour day in which my wife simply came home, made dinner, bath the kids and went to sleep. Each role is as equally difficult, but when decisions have to be made our families success will be judged by my decisions. If we go homeless today, everyone on this thread will say to me "get a job". If the house goes unkept, everyone will say "She keeps a dirty household". Why? Because at the lowest of levels we are still man and wife, each with our very own role.

29   thomas.wong1986   2010 Feb 24, 3:15pm  

Nomograph says

You can make the same ridiculous statement about any imported item that competes with a similar domestically produced product: Wine, hammers, coffee mugs, shoes, pencils, and any other widget you can think of. Where do you think the gasoline that runs your American vehicle comes from?
You purchase foreign goods on a daily basis, so please pack your bags sir.

Too much polution as the tree huggers say, we dont want to kill off the spotted owl or some worm...
Back inthe 50s we were exporting 50% of our oil to the world. 20 years later importing was much cheaper, we certainly didnt run out of domestic oil.

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