So there’s a lot of conversation out there about car dealerships being told they won’t be selling cars for Chrysler and GM any more.
The idea, we are told, is to save the auto manufacturers money by reducing the number of dealerships with whom they do business.
I don’t really know that much about the car business; and I really didn’t understand where these cost savings would come from, but I was able to have a conversation with the one person I do know who actually could offer some useful insight.
Follow along, Gentle Reader, and you’ll get a bit of an education at a time when we all need to know a bit more about these companies we suddenly seem to own...and about the closure of thousands of local businesses that will make the news about our bad job market worse.
Is the Obama Administration saving General Motors or is it saving auto industry jobs in the US? Is it saving GM as an American brand or GM as an American manufacturer?
Globalization isn't going away, but we definitely need to rethink the U.S. role.
Nancy will be debating Nolan Finley of The Detroit News at 8:00 p.m. tonight on Campbell Brown's show on CNN. They'll be debating about the auto industry.
I understand that Rick Wagoner was closely associated with many of GM's bad decisions over the past few years. I also think it's reasonable for the federal government to have a say in how things are done when they loan $$ to a project.
But why is it OK to axe Wagoner when leaders at AIG, Citigroup, Bank of America, Fannie, Freddie et al are taking hundreds of millions in federal bailout funds (not loans) and refusing to fully disclose how it has been spent?
Doesn't look as though there won't be any Washington housecleaning for Wall Streeters...
Could be that Wagoner is just an easy target, sacrificed to quiet an increasingly angry public who can't differentiate between Bernie Madoff and Bob Nardelli. Maybe it's a bit of "pour encourager les autres."
Either way, it's hard to understand the logic behind this decision, given that the banking boys are murmuring that $700 billion, while lovely, was really just an appetizer.
OK, I have no idea what this actually means, and it's obviously WAY too early to be too encouraged, but this is certainly a long-overdue positive bit of news:
General Motors has just announced that they will no longer need the $2 billion in government funding that they had previously requested for March. The good news comes in tangent with the announcement that GM Canada has ratified a competitive agreement with the CAW.
GM states they no longer need the US funding due to an acceleration of company wide cost reductions and “pro-active deferrals of spending previously anticipated in January and February.”
Readers of the Michigan progressive blogosphere are probably familiar with FarLeftField, a small blog that focuses on the issue of labor and the economy here in Michigan. It's written by a good friend of mine, and one of the strongest advocates of organized labor and the auto industry that I've had the pleasure of knowing over the last couple of years, Mike Huerta.
If you watched CNN on the tv or checked out CNN.com, chances are you've read about Mike and local Saturn dealership owner, Sherrill Freeborough and how their lives, and the lives of so many of us in the Lansing area and across Michigan have been affected by the economic collapse of the Auto Industry.
CNN's John King was in town last week, and had the opportunity to speak with both Mike and Freeborough about what life is like for them, and how it's been for most of the rest of us. Check out the story and video here, and be sure to catch the choice words that Mike has for those Southern Republicans who'd like nothing more than to see us all fail.
So Politico is reporting this from last night's vote on the stimulus package:
But an $11 billion tax break for customers buying new car and light trucks in 2009 sailed through 71-26, overwhelming bipartisan opposition from top tax writers.
“It’s a market incentive and it gets them in the showroom,” said Sen. Barbara Mikulski (D-Md.), the chief proponent. “Not a nickel will be spent unless you go buy a car. We’re not throwing money out of a helicopter.
Not that we don't appreciate it, but why was a Maryland Senator championing this provision? In the same vein, why was Alabama Rep. Mike Rogers the sponsor of a similar bill in the House, instead of Michigan Rep. Mike Rogers?
AG Cox has come out swinging at California's attempts to place their own limits on auto emissions,
filing an amicus brief with a federal appeals court.
See, Mr. Cox is worried that bad things will happen -- cats and dogs living together! -- and general craziness will ensue when individual states try to set up their own standards for stuff, and don't accept standing federal law.
Fair enough, if you're a consistent supporter of federal authority...
but this hissy fit over California (and the 13 states in agreement) comes from the same guy who appealed a 2005 U.S. District Court decision to overturn Michigan's partial-birth abortion law.
Apparently legislation supported by a large majority of Californians should be overturned, while legislation supported by a slim majority of Michiganders should be untouchable.
With the entire state seemingly up in arms after last week's flipping of the bird by the Republican U.S. Senate, the fallout got me thinking about what lies ahead for the coming electoral cycle.
Never before have I seen such a complete and total unified reaction from Democrats, independents, media, and even Republicans on one singular state issue. Sure there were a couple exceptions, like those being fed the GOP talking points like mother's milk, but as we so quickly learn in politics, rational logic doesn't necessarily have to apply to all of us.
With the news this morning that Pete 'Turtlegate' Hoekstra won't seek re-election in two years in the 2nd Congressional District and is still mulling a run for governor (how many years has he been mulling that?) and Markos' thoughts on the subject, it got me thinking.
How might the ramifications of the Senate Republican vote play out electorally for our state over the next two years?
There aren't any major elections for another two years, but a vote this large that affects essentially an entire state is not likely to be forgotten anytime soon. And the case was cut and dried, so there's no mistaking precisely who the perpetrators are.
Will we see local Republican candidates run against the actions of their congressional party members, or will we see them delicately two-stepping their way through a messy minefield? How are Republican gubernatorial candidates going to handle it without jumping party ship?
A friend just sent me this great pdf presentation about the auto industry. It took a lot of work and research, it's very professionally done and it contains a lot of facts.
Take a look at it, download it and spread it around.
I've spent the last 18 hours trying to figure out how to verbalize the rage, the frustration, and the deep sadness I feel after the asinine vote by the Senate Republicans in Congress that killed the auto industry bailout. And then I saw this quote by Lt. Gov. Cherry that seemed pretty spot on -
"We are witnessing Congressional unraveling of the American Dream and the demolition of the very foundation of our national security. A few beltway insiders who are completely out of touch with the struggles of American families decided to settle old political scores at the expense of millions of jobs and our national economic security. While bankers get the keys to the Treasury our manufacturers get a one-way ticket to bankruptcy and American families are left unprotected."
Last time I checked, the United States included Michigan, although with the way we've been slapped and kicked around in DC, you wouldn't know it.
If only Congress were as sharp and cared as much about working families as we do, they'd realize what letting the Big Three fail really means: not being able to retire, not being able to have health care, not being able to put food on the table - not being able to enjoy even a hope of achieving the American Dream.
These aren't just "workers". Every time I hear this topic discussed on the airwaves, I wonder how many people truly understand that these "workers" are actually people like my dad, my aunt, my neighbor, your friend, even you. Do they get that there are actual people behind this very in-personal collective group term, also used to describe honeybees and ants??
We owe American workers, who had nothing to do with the onset of the economic crisis or the strategy of auto management, the benefits and pay they agreed to, and we owe it to them to fight for their jobs and well-being.
Do Senate Republicans know what it's like to lose a job for no reason other than credit markets seizing up? We bailed out the financial institutions that got us into this crisis with much less rancor than providing much less money in a LOAN, not a bailout, to one of our most important manufacturing industries.
And has Congress been to Michigan lately? Have they seen the job losses we've already suffered, and the pain workers have already faced as the Big Three restructure?
Growing up in the Metro Detroit area, there were good times, and then there were tough times, but my family still managed to always have Christmas that included plenty to eat and gifts under the tree.
Some years, that required my dad to work three jobs and my mom to work two, not to mention raising three kids, one of which was chronically ill (me) often times paying up to 25 different medical bills a month. Somehow we always got by, and now as adult, I can only imagine the financial juggling act that occurred with a mortgage, car lease, bills, groceries and the like.
After he was laid off from the Buick plant in the late 80's, my dad took on a side job as a pizza delivery man to help supplement the family's income. As a pre-teen, I remember being a little embarrassed seeing my dad don the company hat and come home smelling like a pizza oven. I'll never forget my mother admonishing me, "Be proud that your father is able to work and support his family, that's more than some people can do." I had really never thought about it like that before, too young to understand how dire the circumstances actually were.
This year is on track to be one of the toughest years for most Michigan families, including my own in the last 50 years. My mom starts her new job today, after being unemployed for the better part of the year, while my dad tries to not let the frustration of his own unemployment get the best of him. In addition, I have an uncle and an aunt who are also both without jobs, and my own sister walks into her job each day uncertain if she will be included in the latest round of lay-offs.
Even with all this, my family is among the lucky few this holiday. When Christmas Day arrives, there will be gifts under the tree, and there will be food on the table, but certainly not to the extent there was in years past. Instead of everyone getting gifts for everyone else, we're drawing names. We're cutting back on the type of food and the quantity we're serving, and clipping coupons and checking sale ads before making any purchases.
A recent report from the Michigan Non-Profit Association shows a dramatic increase in the demand for support, while financial and in-kind support for these same organizations has dropped significantly. The reasons will come as no surprise to any of us: the economy, fuel costs, foreclosure rates, and cuts to the state budget.
Worth asking, when you think about the results of last month's election and the fact that W has an approval rating somewhere in the 20s...
I just don't understand why the Democrats in Congress are caving so easily. And not just because their electoral success and Bush's all-time-low approval ratings put the party in a position of strength. What I really don't get is what the hammer is that is causing them to crumble. What is the "or else"? The answer you will hear is, "If we don't get money to General Motors and Chrysler, they will go into bankruptcy, and millions of Americans will lose their jobs." But if the party is truly looking out for the workers, why are they allowing Bush to demonize the union contracts? And, more importantly, the future of American auto workers depends on a viable industry emerging from this mess. That will not happen if money is handed to the companies so they can just continue their "business as usual" approach, one that has failed miserably and brought them to near extinction.
The Democrats in Congress should stand up and say the party supports a bailout, but only if it leads to a restructured, environmentally friendly, energy-intelligent, viable American auto industry. The deal the Democrats are striking with Bush doesn't do any of that, and congressional leaders should be strong enough to say that they won't support legislation that won't work. After all, in less than six weeks, the party will control the White House and enjoy large majorities in Congress.
By taking such an incomprehensibly weak position, the Democrats are ceding the high ground to their Republican rivals.
Would you please explain why it was so crucial to shell out $700 billion plus in taxpayer dollars to "stabilize the markets," given that the TARP program is now being
* disbursed tocompanies that are spending it for "seminars" at luxury resorts, and
* swarmed bylobbyists who want to grab some of the remaining $60 billion (!) in uncommitted funds?
After doling out ~$640 billion, the markets are still in turmoil and banks still haven't loosened up on lending. At the same time, Detroit automakers are begging for help; thanks to the hideously mismanaged TARP program it's not clear they'll get it.
Now, there's no question that the Big Three have made some less than stellar decisions. There are also many factors, such as the retiree health care burden, that are contributing to their hefty cash burn rate.
But somehow, I have a hard time seeing why Washington thinks it's OK to say no when a "yes" would have the very real result of keeping people in their jobs.
Released pre-market open, Ford announced that it experienced a larger-than-expected loss of $1.31 per share for the quarter, and that it will be cutting 10% of its North American workforce.
Analysts had expected a loss of $0.94 a share, as well as a lower cash burn rate than Ford is reporting.
Democratic presidential candidates have had the advantage in our state since 1992, when Bill Clinton won our state and made the climate favorable to Al Gore and John Kerry. Surprisingly however, while all three previous presidential candidates had leads 5-6 points higher than the national margins, Obama leads our state with only a 1-2 point margin. Why isn’t Obama doing as hot as the other previous candidates?
After all, McCain is the one who scorned our embattled struggle to revitalize the auto industry, and it’s Obama who shows a more genuine concern for the common people of Michigan–those stuck in their foreclosures, suffering from escalating heath care costs and hopeless from job loss.
From the viewpoint of a young Michiganian, I think this standstill will quickly change in the upcoming weeks.
Yesterday my family joined the ever-growing group of Michigan families who now face an uncertain economic future due to lay-offs in the auto industry.
My dad's employer, once part of The Big Three, offered their employees age 50 and over a puny buyout package, with the hopes that 300-400 people take them up on it. Whispers around the office led most to believe that if the buyouts weren't taken, they'd still most likely be without a job, and the measly benefits. So as of August 1st, my dad will stay in Michigan, unemployed, with a mortgage, bills, and a very uncertain future. His job, like so many others, is heading to Mexico.
The news broke my heart and my spirit, just as it has for thousands others.
Here's what worries me most - like many other laid off auto workers, my dad's in his late fifties, with a bad back, arthritis starting to set in, and a minimal college education in auto repair, no thanks to the GI Bill. He can send me email, watch the funny YouTube videos I send him, but that's about as far as his computer skills go. With a crummy economy, how does my dad compete with all the hungry, tech-savvy college graduates that don't have families to support?
This is not the American Dream, this is the Auto Industry Nightmare.
Some time today, Nissan's Carlos Ghosn will announce plans to sell an electric car in both the US & Japanese markets by 2010. Nissan wants to market the zero-emission car globally by 2012.
So where is the American auto industry? We're not taking the lead in getting these cars to market. We're not even leading in component development, as noted in a recent Green Car Advisor article titled "Will Imported Oil Give Way to Imported Batteries?".
I'm not from Michigan, and I understand that I don't have the same protective feelings about the auto industry as someone who grew up here. I am from New England, though, where the Industrial Revolution began... then left. Textile mills began in my neck of the woods, then quickly headed to the south where labor was cheaper. After that, they moved overseas for the same reason. This happened to shoes, paper and costume jewelry, too.
Most towns never really recovered. The ones that did make it succeeded because they found something new, and kept on looking for the next new thing. The high-tech haven that is the 128 corridor suffered as Silicon Valley overtook it, but because the region kept innovating industries like biotech, fiber optics and software have taken root.
Just noting that "Michigan's Favorite Power Couple" is losing power, fast. (Thank goodness) My diary of earlier today about JD being handed his weathered head by Nancy Pelosi and Arnold Schwarzenegger re CAFE standards etc., Nancy + Arnie terminate Dingell's preemption perversity, covers J. Ding; and wife Debbie's defeat in persuading DNC Dean to be her deferent doormat (thus leading to the result of Mich being stripped of its delegates), is in various diaries today, but see especially greee's comment linking to photos of the defeated dinosaur-Detroit-automaker doyenne Debbie D in her abjection at Dean's DNC today. Sad. Very sad. And utterly her own fault, despite months of warnings.
After these Dingell dual disasters, Michigan can hopefully be persuaded to get new leadership faster (in the 15th District Congressperson position and the Michigan DNC Committeeperson position), shed the corruption, and get out of its mess faster. Sail on!!
...The package nearly fell apart this week when Mr. Dingell insisted on leaving sole authority to regulate automobile mileage standards with the National Highway Traffic Safety Administration, an arm of the Transportation Department. That would have weakened the power of the Environmental Protection Agency and the states, led by California, to regulate auto emissions of carbon dioxide, which are in large measure a function of the amount of fuel burned.
Federal court rulings this year have decided this so-called pre-emption issue in favor of the E.P.A. and the states, decisions that Mr. Dingell hoped to undo by Congressional action. ...
The authority of the E.P.A. to regulate tailpipe emissions and the right of California and other states to set their own, higher standards were considered deal-breakers by Ms. Pelosi and her fellow California Democrat, Senator Dianne Feinstein. Arnold Schwarzenegger, the Republican governor of California, weighed in late in the week to tell negotiators that he would oppose the bill if the [sic] Mr. Dingell's preemption language stayed in.
Mrs. Pelosi and Democratic leaders in the Senate rejected Mr. Dingell's preemption effort, but softened the blow by agreeing to allow the car companies to retain a credit for vehicles capable of running on a blend of gasoline and ethanol. That credit was set to expire in 2008 but now will begin to decline in 2014 and be eliminated entirely by 2020. ...
