Will Michigan hand Mitt Romney a defeat for his stance on the auto bailout?
Personally, I’m one of those on the left who can actually find common ground with those on the right like Mitt Romney, when it comes to the bailout of the U.S. auto industry. It’s government welfare for corporations and if we (unfortunately) give such a hard time to American citizens who seek help in their time of need; then we should not be giving corporations a free pass.
When a corporation comes upon hard times, I’m more of the mind that they should go through a restructuring phase; where they right themselves and emerge from bankruptcy. I would like to add that I’d like to see as many jobs preserved in the process as possible. Mitt Romney says he was advocating for a restructuring vs. bailout strategy in regards to the auto industry.
There’s one problem with Mitt Romney’s thinking as it is applied to the U.S. auto industry however:
To go through the bankruptcy process, both companies needed billions of dollars in financing, money that auto executives and government officials who were involved with Mr. Obama’s auto task force say was not available at a time when the credit markets had dried up. The only entity that could provide the $80 billion needed, they say, was the federal government. No private companies would come to the industry’s aid, and the only path through bankruptcy would have been Chapter 7 liquidation, not the more orderly Chapter 11 reorganization, these people said.
In closing, there are established figures in the auto industry like Bob Lutz, the man behind the Chevy Volt, who are so furious with Mitt Romney that he’s mailed in an absentee ballot in the Michigan Republican primary for Rick Santorum. A lot of industry executives believe that there came a time where you had to put aside ideology and face reality.
Seriously, do they want us wedded to fossil fuels forever? How is that a good thing? They will run out one day you know whether you like it or not. Even the oil companies you so love are looking towards the future and developing new energy sources. I thought they’d be all about the free-market and support businesses like car manufacturers leaping into a new frontier? How does lying about the cost of a Chevy Volt, made by an American car maker help the United States?
This is exactly what James Hohman, the assistant director of fiscal policy at the Mackinac Center for Public Policy, did recently. You may have seen the headlines: “Each Chevy Volt Costs Taxpayers $250,000.” “Are Volts for dolts? It’s starting to look that way.” “Report: Every Chevy Volt has over $250,000 in government subsidies.” When we first saw this story, we looked it over and figured the math was so skewed that no one would dare repeat it. But then everyone did, so we now think it makes sense to throw some cold water on the whole issue.
It’s truly a shame. Maybe they hate making the President look good because he bailed out GM and they are now doing well?
General Motors said Tuesday that it would invest $2 billion in its factories in the United States to meet gradually growing demand for its products in the aftermath of its government-sponsored bankruptcy.
There’s a lot that GM screwed up over the past two decades or so. They totally missed the boat on hybrids for one. and they were bailed out by the government and have recovered. Now they want to “create or save more than 4,000 jobs.”
“We are doing this because we are confident about demand for our vehicles and the economy,” Mr. Akerson said.
Those are amazing words to hear from a chief executive in these tough economic times where unemployment hovers around nine percent. I’ll bet that the jobs they creat will be far better than the 50,000 jobs McDonald’s created in April. Not to put McDonald’s down for doing this but can any of those 50k people actually live of those wages? Does it put them above the poverty level?
This is really one of the saddest things I’ve seen today.
Most Republicans did not support the “bailout” legislation and aggressively attacked the Democrats over it.
The Washington Post reports that 23 firms that received over $1bn (£634m) in government funds have made political contributions, mostly to Republicans.
The companies include car-maker General Motors and Citigroup.
As far as the financial bailout goes that was done under the Bush administration and many Republicans voted for it. So attacking Democrats is really foolish. As for the financial corporations they took the money but hated the attempts to regulate that came with it. These attempts to regulate involved Democrats and some Republicans.
The auto bailouts were done under the Obama administration. The automobile corporations took the money but will support Republicans because they are their enablers. They want the bailout money but don’t like regulation which is good for America but bad for them. It is socialism for General Motors and gang. I’m not saying that Democrats should seek contributions from corporations but the irony is there. Personally, I have to say if you’re going to bail these corporations out you should have done a better job of bailing the people out too.
So I’m still reading Douglas Rushkoff’s book Life Inc. when I come across this segment on big auto, highways and Robert Moses.
Urban-planning masters such as Robert Moses developed highway schemes intended to keep undesirable people from traveling into desirable neighborhoods. In just one of many examples, Moses built highway overpasses with only nine feet of clearance in order to prevent busses from getting through. This was intended to keep poor black people from traveling from the city to the new suburbs, while also making the purchase of a car a prerequisite for residence.
What Moses did is deplorable. This also reminds me of stories of how Georgetown in the District of Columbia was planned. I’ve heard from people that it was made deliberately inaccessible to “undesirable” people.
I’d also like to add how disgusting US automakers have been throughout the decades they’ve been in operation. They totally conspired and successfully wiped out mass-transit systems all over the nation.
Mirroring the techniques of railroad barons of the century before, GM’s lobbying group crafted legislation that made highways federally funded and controlled. Their justification was that highways were a national defense issue-required to move troops around the country in case of an attack. Conveniently, this made the secretary of defense, Charles Wilson, responsible for highway acts. Wilson was a major GM shareholder, and former president of the company.
He was the one who said “I thought that what was good for our country was good for General Motors, and vice versa.” The highway system that was brought into existence destroyed the homes of thousands.
According to Senator Gaylord Nelson, 75 percent of federal transportation spending has gone toward highways, while 1 percent has been spent on mass transit.
We wonder why the nation’s major mass-transit lines are suffering. The underfunding of these systems has been going on since the days Senator Nelson was in office. Personally, I hate automobiles they crowd the streets of NY and DC making it harder for people to get around. I’m glad that Times Square, NYC has blocked traffic from entering. I think we should look at doing that in DC as well.
I look forward to the day when cars, trucks, vans and SUV’s as we know them are eradicated. Whenever gas prices go up we get a little closer to this reality. Mass-transit has to be our future. As far as workers who manufacture cars now, I think we have to begin moving those jobs into the green economy and into mass-transit. Make windmills, solar panels, busses and trains!
He really doesn’t have to do this at all.
General Motors has hired Michael Whouley, among the Democratic Party’s “most respected organizers of grass-roots politics,” in “a sign the company’s fight for survival has become as much about politics and public image as business acumen,” reports the Detroit News. The move comes as “even some of the company’s staunchest defenders” were surprised at the size of GM’s new request, for “up to $16.6 billion in new federal aid.” GM’s “potential foes” are also hiring. “A committee of bondholders in tough negotiations about restructuring GM’s massive debt has retained the Glover Park Group, one of Washington’s most prominent lobbying and political consulting firms.” Whouley, who leads the Dewey Square Group firm, is expected to help GM build public support. A recent poll found that “two-thirds of Americans oppose any new aid to the car companies.”
General Motors deserves what is happening to them. So now is Mr. Whouley going to whip up some astroturfing for GM? Or is he just going to lobby Democrats?
I don’t really think the President of General Motors Troy Clarke should be resorting to e-Activism to get Americans to put pressure on Congress. This is not some grassroots lobbying effort. Basically the US auto industry has failed and it failed way before this year’s financial collapse. So basically they should prostrate themselves before the US Congress and hope that they will get what they need. As much as I’d like to see them go up in flames for their failures, the only thing that matters are all those jobs. If there’s a way to transition people out of those jobs and into new ones then I’d say don’t bail US automakers out. If that means extending unemployment benefits a little longer and providing training for new jobs then do it. The only thing that would worry me is that there might not be enough jobs for everyone effected by a US automaker failure to fill. Regardless of what happens the leadership of all US automakers should be let go.
They’re asking for loans from the government so that they may be saved. They’re not framing it as a bailout mind you. They offshore tons of manufacturing jobs and yet they sill can’t become competitive? I thought that is what offshoring was supposed to allow you to do? With the current strain of economic ideology that governs America (I don’t agree with all of it)—you’re supposed to become innovative, create new jobs and grow the economy right? Manufacturing is now for the developing world isn’t it? Yet these two have still managed to fail.
If they were able to put back to work most of the people who lost their jobs from the offshoring of manufacturing, and if they were able to create new jobs focusing on the green technologies and alternative energy—then I’d say the loans would be justified. They just haven’t shown much good thinking or any initiative at all.