…at the White House.
The folks at the National Right to Work have put together this video emphasizing the Obama White House’s unnaturally close relationship with big labor’s bosses. This is a clear violation of the President’s campaign promise to keep lobbyists out of positions of influence in his administration. Of course, he’s already broken that promise many times over.
by Fred Barnes at The Weekly Standard
First President Bush, then President Obama poured billions into General Motors and Chrysler to keep the companies alive but barely breathing. That was just for starters. Next came Obama’s creation of an Auto Task Force to oversee the auto companies. To head the task force, the president picked Steve Rattner, a Wall Street investor with no experience in automaking but lots in raising campaign money for Obama and Democrats.
GM and Chrysler were quickly restructured, mostly to the benefit of the United Auto Workers, the union which spent millions in 2008 to elect Obama and Democrats. The UAW now owns 17.5 percent of GM and 55 percent of Chrysler–quite a return on an investment of zero dollars. Obama said all parties should “sacrifice,” but only bondholders did. They got a fraction of what they were legally entitled to receive. UAW retirees, in contrast, got a gift of $9.5 billion at GM and $14.2 billion at Chrysler.
There’s an epilogue. Delphi, the auto parts manufacturer once owned by GM and still its biggest supplier, has been in bankruptcy for four years. To acquire its assets and run the company, Delphi and Obama’s Auto Task Force picked an affiliate of the private equity firm Platinum Equity. There was no auction or competitive bidding, though Platinum stands to make millions in the deal. Why Platinum? The UAW favored it, sources said.
There’s a name for all this: crony capitalism. Obama insists he believes in capitalism, but it’s not the free market variety that he’s been promoting since he became president. Obamanomics is a different strain entirely.
GM and Chrysler, in a concerted effort with the Obama administration, are destroying Americans’ lives by colluding with the government to seize and redistribute private property–not to protect consumers, not to ensure fair competition, but to reduce competition as a means to protect the UAW and artificially prop up their already overpriced products.
GM’s own North American sales chief recently stated “Too many dealers, in actuality, is not the problem. We’ve got too little industry and too little sales we have to contend with.” Yet, GM informed more than 1,100 dealers their rights to sell the company’s products will be stripped from them next year and Chrysler axed almost 800 dealers effective next month.
George C. Joseph, President and owner of Sunshine Dodge-Isuzu in Melbourne, FL, gave a 1st person account of suffering being imposed on Main Street America by the failed, soon-to-be-government-owned Detroit automakers. He explains how he and his family have devoted their lives to his profitable dealership since they first purchased it in 1974. When Chrysler recently demanded he renovate the dealership, Mr. Joseph financed the multi-million upgrade with the understanding that he would continue to represent the now nationalized company. He owes $3 million on his new car inventory and holds $300,000 worth of Dodge parts in inventory. Joseph’s family and the families of his 50+ employees have staked their futures on a relationship with Chrysler.
To the new management at Chrysler–the Obama administration–none of this matters. The new government/UAW-owned Chrysler makes no offer to purchase Joseph’s inventory, his business, or even make good on the renovation loan. In short, he’s being thrown to the wolves. His business is effectively being seized by a US government-UAW cooperative and handed to a dealer down the street who will now be able to charge his customers more. Joseph and his employees will lose their livelihoods, many forced into bankruptcy so the new nationalized Chrysler can charge more for it’s unpopular products.
Pure and simple, this is payback to the UAW for its support of Obama in the presidential election last year.
Since GM and Chrysler first came begging the government for help last year, Americans have overwhelmingly insisted the UAW make serious concessions. Instead, the President has given the union a disproportionate stake in the companies for the money it was owed versus bondholders whose debt was guaranteed. Last month, the administration-brokered deal reached by the UAW and Chrysler grants the union a 55% stake in the company. Using the bailout money received by the banks as leverage, the executive branch forced bondholders to take about 30 cents on the dollar for their debt with no equity stake in the company.
The UAW can’t even run a golf course, but Obama handed it the keys to the boardroom of Chrysler–to the detriment of Wall Street and Main Street.
Is this the change America voted for? A government that subsidizes failed companies and institutions by seizing or destroying their successful competition.
It’s the change we got.
Hat tip–American Thinker
You might recall that in December, we were told bankruptcy of any one of the Big 3 auto companies would take down the entire economy. So then-President Bush shoved the bailouts of GM down the throats of Americans in spite of the fact Congress refused to do so legislatively. The US Treasury made a $4 billion loan to Chrysler along with $13 billion to GM.
Many of us predicted the loans couldn’t cure the auto companies’ ills, and we were slandered and maligned by left-leaning pundits and politicians of both parties. We recognized these loans would simply subsidize failed business models and encourage a continuation of the same failed strategies that put them in this position to begin with.
We said at the time, bankruptcy was the way to go. A court-ordered restructuring would have allowed Chrysler to negotiate concessions with its creditors and unions under the court’s protection and direction. Now, we’re $4 billion poorer and Chrysler’s right where we knew it was headed from the start.
It wasn’t ESP that allowed us to see these months into the future. No crystal ball, no special powers.
The administration, the unions, and management at Chrysler and GM like to blame the current economic crisis for the auto industry’s woes, but it goes so much deeper than that. If the credit crunch was truly the spark that started the fire that burned down the American auto industry, why are foreign companies with manufacturing facilities in the US not closing down too?
The problem with the American giants was smoldering long before the current economic crisis flared up. GM posted record sales in 2007, but also record losses that same year. Figures are harder to come by for Chrysler because it’s not a publicly traded company, but its former owner Daimler has released some figures that show its problems began long before the current downturn. The company lost $3 billion in 2007 and $1.6 billion in 2006. In May of last year, GM was burning cash at a rate of $1 billion a month. All of this before the economy crashed!
Now that our $4 billion have been squandered, the Obama administration is promising another $8 billion in aid in exchange for an 8% stake in the company. The UAW will take a 55% stake in exchange for money owed to its pension plan. So 63% of Chrysler shares will be owned by a partnership of the inefficient UAW and the inefficient US government. Is that likely to result in a streamlined, efficient, and profitable business model. I doubt it.
With the Obama administration preparing to take control of GM, we may need a new bureaucracy (the Department of US Auto Manufacturing?) in DC. Hell, UAW employees may well be integrated into the federal employees’ pension system before it’s all said and done.
This whole ordeal reminds me of a gambler whose lost everything and borrows to “double down” thinking surely he’s due to win. All too often though, the house takes what he’s borrowed as well.
No, not United States Marine Corps. United States Motors Corporation.
That’s right. GM, the former icon of American capitalism, could well be the first icon of American Socialism!
GM is offering over 50% of its stock–a controlling interest–to Uncle Sam to cover the ill-advised multi-billion dollar bailout initiated by Bush and exacerbated by Obama. After all the promises that government loans would save the company, the US government just bought itself a car company!
Let’s see, the same government that’s bankrupting Social Security, hemorrages cash through the USPS, forced FRE and FNM to back bad loans, and forecasts trillion dollar deficits as far as the eye can see is somehow going to bring this manufacturing giant back to profitability? Right!
Oh, but Uncle Sam will have plenty of help running this behemoth even deeper into the ground
The automaker also proposed that the United Auto Workers take GM stock for at least half the $20 billion the company owes to a union-run trust…Combined, the union and government would own 89 percent of the century-old automaker
Though we saw it coming, this is truly a sad, sad day in the
USA USSA–United Socialist States of America.
Thanks to my father for alerting me to the existence of this letter from Gregory Knox, President of Knox Machinery, Inc. to Troy Clarke, President of General Motors. Mr. Knox claims to have observed first-hand what those of us who’ve been against the bailout of the auto industry from the start. He also makes great points (that many of us have been making) against ALL the bailouts.
Snopes has already verified the legitimacy of the letter.
From Gregory Knox, President Knox Machinery, Inc., Franklin, Ohio 45005
In response to your request to call legislators and ask for a bailout for the United States automakers please consider the following, and please also pass this onto Troy Clark, the president of General Motors North America for me. You are both infected with the same entitlement mentality that has bred like cancerous germs in UAW halls for the last countless decades, and whose plague is now sweeping the nation, awaiting our new “messiah” to wave his magical wand and make all our problems go away, while at the same time allowing our once great nation to keep “living the dream”.
The dream is over!
The dream that we can ignore the consumer for years while management myopically focuses on its personal rewards packages at the same time that our factories have been filled with the world¢s most overpaid, arrogant, ignorant and laziest entitlement minded “laborers” without paying the price for these atrocities. and that still the masses will line up to buy our products.
Don’t tell me I’m wrong. Don’t accuse me of not knowing of what I speak.. I have called on Ford, GM, Chrysler, TRW, Delphi, Kelsey Hayes,and countless other automotive OEM’s and Tier ones for 3 decades now throughout the Midwest and what I’ve seen over the years in these union shops can only be described as disgusting.
Mr. Clark, the president of General Motors, states: There is widespread sentiment in this country, our government and especially in the media that the current crisis is completely the result of bad management, it is not.
You’re right – it’s not JUST management. How about the electricians who walk around the plants like lords in feudal times, making people wait on them for countless hours while they drag ass so they can come in on the weekend and make double and triple time for a job they easily could have done within their normal 40 hour week.
How about the line workers who threaten newbies with all kinds of scare tactics for putting out too many parts on a shift. and for being too productive (mustn’t expose the lazy bums who have been getting overpaid for decades for their horrific underproduction, must we?) Do you really not know about this stuff?!?
How about this great sentiment abridged from Mr. Clarke’s sad plea: over the last few years .we have closed the quality and efficiency gaps with our competitors.
What the hell has Detroit been doing for the last 40 years? Did we really JUST wake up to the gaps in quality and efficiency between us and them?
The K car vs. the Accord? The Pinto vs. the Civic? Do I need to go on?
We are living through the inevitable outcome of the actions of the United States auto industry for decades. Time to pay for your sins, Detroit.
I attended an economic summit last week where a brilliant economist, Alan Beaulieu surprised the crowd when he said he would not have given the banks a penny of “bailout money”. Yes, he said, this would cause short term problems, but despite what people likeand Troy Clark would have us believe, the sun would in fact rise the next day, and something else would happen. where there had been greedy and sloppy banks new efficient ones would pop up. that is how a free market system works. It does work, if we would let it work.
But for some reason we are now deciding that the rest of the world is right and that capitalism doesn’t work – that we need the government to step in and “save us”. Save us, hell – we’re nationalizing. and unfortunately too many of this once fine nation’s citizens don’t even have a clue that this is what’s really happening. But they sure can tell you the stats on their favorite sports teams. Yeah – THAT’S important.
Does it occur to ANYONE that the “competition” has been producing vehicles, EXTREMELY PROFITABLY, for decades now in this country?…
How can that be? Let’s see.
Fuel efficient. Listening to customers. Investing in the proper tooling and automation for the long haul. Not being too complacent or arrogant to listen to Dr W Edwards Deming four decades ago. Ever increased productivity through quality, lean and six sigma plans. Treating vendors like strategic partners, rather than like “the enemy”. Efficient front and back offices. Non union environment.
Again, I could go on and on, but I really wouldn’t be telling anyone anything they really don’t already know in their hearts.
I have six children, so I am not unfamiliar with the concept of wanting someone to bail you out of a mess that you have gotten yourself into – my children do this on a weekly, if not daily basis, as I did at their age. I do for them what my parents did for me (one of their greatest gifts, by the way) – I make them stand on their own two feet and accept the co nsequences of their actions and work them through. Radical concept, huh?
Am I there for them in the wings? Of course – but only until such time as they need to be fully on their own as adults. I don’t want to over simplify a complex situation, but there certainly are unmistakable parallels here between the proper role of parenting and government. Detroit and the United States need to pay for their sins.
Bad news people – it’s coming whether we like it or not. The newly elected Messiah really DOESN’T have a magic wand big enough to “make it all go away”. I laughed as I heard Obama “reeling it back in” almost immediately after the vote count was tallied.” We might not do it in a year or in four.” where was that kind of talk when he was RUNNING for the office? Stop trying to put off the inevitable.
That house in Florida really isn’t worth $750,000.
People who jump across a border really don’t deservebenefits.
That job driving that forklift for the big 3 really isn’t worth $85,000 a year. We really shouldn’t allowto stock their shelves with products acquired from a country that unfairly manipulates their currency and has the most atrocious human rights infractions on the face of the globe.
That couple whose combined income is less than $50,000 really shouldn’t be living in that $485,000 home.
Let the market correct itself people – it will. Yes it will be painful, but it’s gonna be painful either way. The bright side of my proposal is that on the other side of it is a nation that appreciates what it has, and doesn’t live beyond its means. and gets back to basics. and redevelops=2 0the work ethic that made it the greatest nation in the history of the world.. and probably turns back to God.
Sorry – don’t cut my head off, I’m just the messenger sharing with you the “bad news.”
Gregory J Knox
President Knox Machinery, Inc.
Franklin, Ohio 45005
Bravo, Mr. Knox!
January 4, 2009 Posted by John Allison, III | Bailout | 3 Little Piggies, Bailout, Bush's Mistakes, Chrysler, Clarke, General Motors, Gettelfinger, Knox, Nardelli, Socialism, UAW, USSA, Wagoner | 1 Comment
This investigative report caught union bosses skipping out of work early, hours early, on a regular basis, leaving work to take care of personal business while remaining on the clock, and sleeping in while on the company dime.
Rescue 4 also reports posts on discussion boards at Ford admonishing those who tipped the reporters, saying the informants should be ashamed to call themselves UAW members and Ford employees. Absolutely amazing what this mob mentality produces in defense of its indefensible actions.
The report also shows comments from UAW members who find the conduct of the union bosses unacceptable. One even invited the investigators to do a report on his plant, saying it “would make this story look like nothing.”
Great job to Rescue 4 for taking on Little Piggie Gettelfinger’s organization.
Just remember ladies and gentleman, before you chose whether or not to fund this wasteful organization by deciding whether or not to purchase one of the Big 3′s vehicles. Now, thanks to Bush and the Democrats in Congress, all of us who pay taxes are required to pitch in to pay these union bosses to sleep in and get haircuts.
The bottomless UAW money pit–Michelle Malkin
By now, you’ve likely read all about the the UAW’s $33 million Black Lake Golf Club. Well, maybe not all.
It seems the UAW isn’t as concerned about all the citizens of Michigan as it is its dues paying members. Cheboygan County Drain Commissioner-elect Dennis Lennox has issued a press release detailing the UAW’s repeated efforts to avoid paying property taxes on the luxury resort for union bosses. You can view the press release in its entirety on Michelle Malkin’s blog here.
Apparently, the UAW carries the resort and golf course on it’s books at $33 million when reporting to the federal government but has spent the last 4 years fighting the county’s efforts to collect property tax on that amount. According to Lennox’s statement, the courts have actually reduced the valuation several times allowing the UAW to receive more favorable tax treatment than other property owners in the county.
Now, this is bad enough considering the UAW fought tooth and nail for the Socialist bailout of GM and Chrysler these past two months, a bailout that picks the pockets of the rest of us taxpayers who pay our fair share. It gets even worse when you take into account this organization and it’s boss, Little Piggy Gettelfinger campaigned for and donated to the presidential campaign that told us it’s “patriotic” to pay more taxes. But it gets even worse when you consider exactly what Michigan property taxes support.
Property taxes support schools and local governments in Michigan. So the UAW, spends union dues (that will soon be coming from our pockets) to support a $33 million luxury resort that has lost $27 million over the past 5 years (WOW!!!) and then has the gall to cheat Michigan schoolchildren out of decent textbooks and educational facilities! And don’t forget, those local governments are charged with furnishing little amenities like water and sanitation services to those children and their families as well. Less tax money translates to higher rates for these vital services.
So, let’s tie all of this together.
The UAW seizes money from autoworkers in the form of dues, then wastes that money on a money losing luxury golf resort so union bosses can “relax” from the pressures of their extortion racket, then proceeds to demand that the US government use taxpayer’s money to supply more cash for them to waste, and all the while takes every opportunity to ripoff the good citizens of Michigan and deny them and their children quality education, clean water, and sanitation services.
And the UAW acts shocked that we didn’t support their bailout.
The bottomless UAW money pit–Michelle Malkin
The Fun Part About Financial Disaster…–Michigan Taxes Too Much
Not only did President Bush give the Three Little Piggies (GM, Chrysler, and by extension the UAW) more money than they asked for, but now the Treasury Department is throwing $5 billion more GM’s way. That’s on top of the $1 billion included in Bush’s Socialist bailout for GM last week that was dedicated to propping up this appendage of GM.
You might have read the other day that GMAC, the financing arm of GM, was given bank holding company status by the feds, allowing them to qualify for assistance from the seemingly bottomless pit known as the TARP fund. Today, GMAC hit the $5 billion jackpot from this fund that was originally intended to keep the banking industry from collapsing.
This just goes to show there’s no telling how deep into our (taxpayers’) wallets these at best incompetent, at worst corrupt and dishonest companies will be before this bailout/stimulus/Socialist conversion of our economy is over. So far, between the banks and the Three Little Piggies and whoever else has transformed themselves into something that qualifies for the right to spend our money to save them from their inability to properly run their companies, we the taxpayers are on the hook for more than $8 trillion–and we’re nowhere near the end of it yet.
Merry Christmas Little Piggies! Go to sleep knowing that we’re paying and our children will be paying to keep you fat and happy, warm and comfy, and full of Christmas cheer.
The UAW has published talking points on it’s website (and in pdf format) in an effort to get its members to sell the public on Bush’s Socialist bailout. As we would expect, only those with some substitute for brains between their ears would believe this package of greatly exaggerated lies. Let’s see what the union expects Americans to believe.
UAW Talking Points on Socialist Bailout of GM and Chrysler
- It’s good news that loans have been released to keep America’s auto factories open.
- Good news for workers and their families at automakers, dealers, suppliers and others who are part of the auto industry that emergency bridge loans have been released to help America’s auto companies weather the current financial crisis.
- This will help save millions of jobs, thousands of companies and hundreds of billions of dollars for taxpayers.
- All this could have been lost if one or more automakers were forced into liquidation.
- A victory for UAW members and auto industry stakeholders.
- Against tall odds, UAW members and others who are part of the auto industry carried out a successful grassroots campaign to save jobs.
- We convinced a majority in the House and Senate and the White House to back legislation for emergency bridge loans.
- When a minority of senators blocked passage of this critical bill, President Bush reversed his position and agreed to release Troubled Assets Relief Program (TARP) funds to help the auto industry.
- The UAW appreciates President Bush’s action to release these emergency funds, but we’re disappointed he attached strings which unfairly single out workers.
- These targets were not in the bipartisan legislation which passed the House of Representatives and which won support from a majority of senators.
- It’s unfair and unworkable to single out one group to bear the burden of restructuring the auto industry. We will work with the Obama Administration and the new Congress to have these unfair targets removed.
- To succeed in rebuilding our industry, all groups must participate — management, directors, dealers, suppliers, bondholders and workers.
- Hard work still ahead.
- In the coming months, we’ll work with all stakeholders to create a viable long-term future for the auto industry.
- This will include top quality cars for consumers and building the fuel-efficient cars of the future and key components here in the United States.
- Sacrifices will be required from all stakeholders.
- Working together, we can succeed — the same way we won support for the emergency bridge loans which will help save American jobs and American companies.
I guess this is good news for UAW workers who cost the auto companies ~$70 per hour and for the overpaid executives who’ve run these once great countries into the ground. It’s not good for those of us who will be taxed to subsidize the bloated, inefficient, and incompetent businesses which continue to lose market share. And it’s not good for our children who will inherit Uncle Sam’s ever-increasing debt which will act as a ball and chain as they step out into the world and attempt to secure their place in it.
The #2 talking point fails to mention they successfully secured this Socialist bailout to the detriment of free market principles and the system of checks and balances our forefathers considered essential to our republic. And exactly how does spending billions (which also practically guaranteeing spending many more billions in the future) to prop up an unsustainable, unprofitable business model save the taxpayer “hundreds of billions of dollars?”
I guess the UAW has forgotten that Gettelfinger seemed inclined to make concessions when the Socialist bailout was in doubt, but quickly changed his mind as soon as the check was in the mail. It seems he was willing to say whatever it took to get the loans that would enable him to retain power, but his words were like so many empty promises.
And finally, sacrifices will be required by all stakeholders and all other Americans (who have no stake in the American auto industry) and future generations of Americans to subsidize a poorly run industry that’s most likely to continue making the same mistakes that have led to its current predicament.
Sorry Little Piggy Gettelfinger, we’re still not buying it. Learn to live by the same rules the rest of us have to live by.
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