EVERYONE loves an underdog. The news of Detroit’s bankruptcy on July 18th, the largest ever filed by an American city, made headlines everywhere. The story is one that people have been following intently for over half a century. Motown, America’…
Posts tagged ‘general motors’
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?
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.
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.