$4 billion down the drain…

…as Chrysler files bankruptcy.

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.

GM sending bailout money to Korea

#TCOT #diggcons

You would have thought General Motors CEO Rick Wagoner would have learned a little about the value of PR last November.  Flying to DC to beg for taxpayer money aboard a private jet almost cost him and the other little piggies their bailout cash.  Evidently he didn’t learn a thing.

In an announcement at Detroit’s North American International Auto Show today, Little Piggy Wagoner announced that GM would bypass an American supplier to spend our money in Korea.  The battery cells for GM’s long overdue Chevy Volt, will be purchased from LG Chem in Korea.  LG Chem and Massachussetts based A123 Systems/Continental were competing for the contract.  I wonder what Rep. Barney Frank (D-MA) thinks of the bailout now that GM is bypassing a Massachussets company and sending his constituents’ jobs overseas. 

Now, I’m a free market/free trade fan and if these were normal times I wouldn’t raise a fuss about this.  However, these aren’t normal times and last month’s auto company bailout cast off any semblance of GM operating under free market/free trade principles.

Recall, we were told the bailout of GM and Chrysler was essential to save American jobs and prevent an imminent collapse of our economy if these two went under.  In this video, Wagoner claims the bailout will “preserve many jobs, and support the continued operation of GM and the many suppliers, dealers and small businesses across the country that depend on our company and our industry.”  The following is a Bush quote from an article in the Dallas Morning News after the bailout was announced.  (emphasis added)

“By giving the auto companies a chance to restructure, we will shield the American people from a harsh economic blow at a vulnerable time,” the president said. “And we will give American workers an opportunity to show the world once again that they can meet challenges with ingenuity and determination, and emerge stronger than before.”

This would be understandable if the A123 batteries just couldn’t cut it, but that’s not the case.  GM’s vice-chairman, Bob Lutz says the A123 product was “very good.” 

That’s not the worst part.

Lutz went on to blame the US government for GM’s choice of a foreign supplier, saying Detroit isn’t the problem, Washington is.  His rationale?  The US government hasn’t spent enough money on research to develop battery technology.  He goes on saying this “is part of the penalty we pay in the U.S. for not having a well-funded R&D budget.”

Talk about biting the hand that feeds you!  Can you believe the arrogance of these jerks running GM?

They come begging from us, telling everyone that will listen the US economy is dependent on them and we must fill their coffers to save our jobs, save our economy.  Then, they have the gall to send that money overseas and tell us its our fault!

GM management still doesn’t get it.  They’re dependent on us, the US taxpayers/consumers.  This latest PR boondoggle is going to use up whatever good will the American taxpayer has for this US icon.  I’ve bought nothing but GM vehicles for the past 15 years, and now I’ll probably never buy another.

Congress shouldn’t give the idiots running GM another dime.  The only hope for this American icon’s survival is bankruptcy.  The GM Board of Directors should be ousted for leaving incompetent Little Piggy Wagoner in charge and paying him millions of dollars to lose billions of the company’s money.  Wagoner and the rest of GM’s management should be replaced with a team that understands that without customers, there’s no chance of success.

Witness to inefficiency of 3 Little Piggies slams bailouts

#TCOT #diggcons

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, American Axle 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 like George Bush and 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 deserve free health care benefits.

That job driving that forklift for the big 3 really isn’t worth $85,000 a year. We really shouldn’t allow Wal-Mart to 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!

Bailing out UAW Tax Crooks?

#TCOT #diggcons

Oh the story of Little Piggie Gettelfinger just keeps getting better all the time.

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.

Unbelievable!

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Related Posts

The bottomless UAW money pit–Michelle Malkin

The Fun Part About Financial Disaster…–Michigan Taxes Too Much

$5 billion more for GMAC

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.

Lies, Misrepresentations, and Omissions from UAW

(#TCOT)

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

1. 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.
2. 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.
3. 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.
4. 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.

UAW to taxpayers: $%^@ you!

from Michelle Malkin

Well, it will come as no surprise to you that the union thugs have thrown concessions under the bus and are looking to Barack Obama to fork over all the money they need without strings attached. They promised they would abandon any wage cut proposals as soon as President Bailout, er, President Bush, announced the $17 billion auto “rescue” package.

(Remember?)

Yep, this is no surprise at all:

…(Read full article)

#TCOT: Who would have guessed?

The General Motors chief executive Rick Wagoner said the biggest U.S. automaker got “what we asked for” with $9.4 billion in U.S. loans over the next 24 days. Investors are betting that it will not be enough.

GM tumbled the most in more than a month Monday in New York trading, while credit-default swaps on the company’s bonds jumped 2 percentage points in a sign of increasing concern that the Bush administration’s bailout may end in a default.

The stock-price slide all but erased the 23 percent gain on Dec. 19, when the Detroit-based GM received a federal aid package to help it stay in business until March 31 while crafting a plan to shut plants, shed brands and reduce debt.

“It’s almost impossible for a management that invested in the assets, that hired the people, that put forth the strategy, to change so dramatically in such a short period of time,” said Edward Altman, a New York University finance professor who created the Z-score formula to measure bankruptcy risk.

…(Read full article)

*emphasis added

Spotted: Little Piggy Gettelfinger 12-22-08

Little Piggy Gettelfinger was fulfilling his role on Fox Business News today, still whining about how unfair life is for his poor, mistreated organization. He whined about not being included in last minute talks with the White House and whined some more about how difficult the concessions will make things for the UAW.  He even goes so far today as to deny responsibility of either the UAW or management for the current predicament.  Now, he lays the entire blame on the current economic climate.

He may not realize that well run companies realize that periods of fortune are eventually followed by less fortunate times.  And I guess he doesn’t remember how close he came to not having his union subsidized by us, the U.S. taxpayers.

Had Bush remained true to our conservative principles, I can only imagine how Gettelfinger would be whining today. It just goes to show that you just can’t please a little piggy like this.

Bush (for God knows what reason) gave the Three Little Piggies $4 billion more than they last requested–and Little Piggy Gettelfinger is still whining! Oh woe is me, life is so unfair, I’m so mistreated, nobody loves me, nobody respects me, the sky is falling, etc., etc.,…

But, then at the end of pitching his fit he holds to the hope that Obama will be his Knight in Shining Armor. The valiant hero will ride in on a white horse and save the UAW from the torment visited upon it by the evil Bush Administration!

If anyone out there who calls themselves a conservative ever believed that pandering to the Democrats would further the cause of bipartisanship and bridge the divide that separates the jackasses from the elephants, this should be a wake up call. Bush gave them more than they asked for! $4 billion more, and now that the money is in the bank it’s back to politics as usual for the jackasses.

We will never gain favor with the Democrats. Not by pandering to them, not by opposing them. So why do we time and again abandon our principles in the vain hope that this time will be different? The only thing that will make them happy is our unconditional surrender. And even when they get it, they turn around and stab us in the back with it. Just like they’re doing now.

Conservatives cannot sell their philosophy to the party of jackasses, they’re not buying! We must sell it to the people. The rank and file Americans who share our conservative values. They’re out there, even in the deep blue states they’re out there. Christians, gun owners, limited government enthusiasts, and fiscal responsibility fans reside in every state of the union.

Gettelfinger’s persistent belly-aching about how he didn’t get enough from the President’s socialistic subsidies reinforces the importance of a return to our conservative roots. This seems obvious to most grassroots activists on Top Conservatives on Twitter and Rebuild the Party, two groups which sprung to life in the wake of last months defeat that are dedicated to reinvigorating the GOP. Somehow though, this idea seems lost on those who’ve led our party for the past several years.

Little Piggy Gettelfinger’s trough was just refilled with feed.  Though he hasn’t yet consumed it all, he’s already complaining that it isn’t enough.

Thanks again Mr. President.  This is precisely what we warned you would happen.

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UAW to taxpayers: $%^@ you!–Michelle Malkin

Little Piggies’ Activity 12-19-08

We now know Little Piggy Wagoner was in Detroit yesterday, where he gave a press conference at GM headquarters.  I’m not sure if he took questions from reporters because the only video I can find only shows him reading a prepared statement.

Wagoner thanked everyone at GM, his competitors, Little Piggy Gettelfinger, the President, Congress, etc. for their work in getting Bush to approve the taxpayer bailout “loan”.  He went on to say he is confident GM can meet the requirements laid out by the administration.  (I don’t know if he’s considering Gettelfinger’s threats to challenge the UAW’s part of the requirements.)  He also wants GM to lead the country’s recovery during the economic crisis.  (I don’t know how he can lead it when he’s part of what’s holding it down.)

I wasn’t impressed, but here’s the video so you can judge for yourself.

I still can’t find anything on the whereabouts of Little Piggy Nardelli, but he did send a lengthy letter to Chrysler employees yesterday.  Like I said, it’s lengthy so I won’t clutter this post with it.  You can read the text of the letter here.  It doesn’t do anything to make me feel like Bush’s investment in Socialism was money well spent.  He uses a lot of words to say Chrysler is the victim of a global recession and everyone’s been doing a great job and they should simply keep doing so.  Everything will be fine.

Right.

I haven’t found anything new on Gettelfinger today.  Last word I have on him is still that he plans on pressuring Obama to remove the “unfair conditions” Bush’s Socialist agreement makes on the proletariat.

Remember, at TCOT we’re looking for any info readers may find on the Three Little Piggies.  So if you see them out and about, snap a few pictures or video them (if you can do so without being intrusive) and let us know.