I honestly can’t figure out why GM was saved and for whom. Let’s look at the record:
| 2007 | 2011 | |
| Total revenue (millions) | 207,349.0 | 135,592.0 |
| Number of employees | 280,000 | 202,000 |
| Number of dealers | 6,693 | About 3,000 |
The data are taken from the Fortune Global 500 info for the respective years except for 2007 dealers and 2011 dealers.
It wasn’t for shareholders or bondholders who took a bath. It wasn’t for the 80,000 GM employees that lost their jobs and the tens of thousand more employees of GM dealerships who lost theirs. By comparison Ford laid off about the same number of its employees over the same period as GM did without the drastic cutback in dealers. In 2010 there were more Ford dealers than GM dealers.
How about the suppliers?
That’s a good question. My guess it that their numbers have been trimmed as well. Orders certainly must be down since GM isn’t moving as much product as it used to.
Suppliers might well be the hardest hit since 2007. I think there’s a GM that’s selling cars with Chinese-built engines being installed in Chinese-built chassis by American workers and sold as “Made in the U. S. of A.” stamped on them on the horizon.
For the remaining employees? For the prospective new employees? For the employees of subsidiaries and suppliers? The towns supported by same?
Not quite sure what the question is here. GM is doing very well at the moment. And as a related note the Volt has evidently tripled its sales year to year.
Michael, none of the “Big 3” U. S. automakers have brought on net new employees in a generation. Basically, there are no new employees. They’re shrinking by attrition.
Yes, but when the current employees retire they will be replaced in whole or in part — jobs that would almost certainly gone to Japanese car makers. GM has repaid most of the money, it won’t have cost us anything in the end, and GM appears to be healthy. What’s the practical downside to keeping some US-based jobs alive for a while?
Of course that brings up another question – wouldn’t those Toyotas and Nissans been assembled in Tennessee? What makes a company “American” or “Japanese” in this environment? The jobs go all over, the profits likewise, and God knows corporations have no loyalty to their home country. Is the whole connection between company and country broken? Hasn’t it been like that for a while?
They exist so I could buy my Chevy Equinox, designed in Japan and built in Canada.
Politics…best way to run a business.
Reynolds:
“Of course that brings up another question – wouldn’t those Toyotas and Nissans been assembled in Tennessee? What makes a company “American†or “Japanese†in this environment? The jobs go all over, the profits likewise, and God knows corporations have no loyalty to their home country. Is the whole connection between company and country broken? Hasn’t it been like that for a while?”
To what extent do you believe GM is still a US company?
These are global numbers:
Number of employees 280,000 202,000
What percentage are US jobs?
Using these numbers actually understates the relative job loss in the US.
Ironically, the path that Romney suggested and is now being ostracized over, that of having GM undergo a managed bankruptcy, would have been the best long term choice. However, Obama, chose the short term band aid, throwing the stockholders, many dealerships as well as employees, under his government bus, calling himself the savior of the auto industry. I just look at Ford, and disagree with his vision of a “good thing,” let alone a wise business decision.
So true. That’s why Germany, Japan and China frequently kick our asses: because they’re all free from the pernicious influence of politics on business.
Jan:
The Romney historical rewrite has been debunked by pretty much everyone, but here’s the first one that came up on the Google: http://articles.latimes.com/2012/may/08/news/la-ol-mitt-romney-auto-bailout-20120508
You’ll be on much safer ground assuming that everything Mitt Romney says is a lie. Because everything Mitt Romney says is a lie.
GM is doing “well” in part because the government is subsidizing them by buying their cars.
Shareholder value continues to drop.
And if the Volt triples its sales a few more times it may actually end up selling near the projected totals. Interesting that the Volt is being touted as a success when it is as bad an example of Obama-machine planning as the 2009 Stimulus package. (How’s the 5.6% UE-3 rate prediction for mid-2012 looking right now? Oh, that’s right, it is a complete and epic failure. Thank God the Administration put two whole weeks of effort into fixing ther economy.)
…
To answer Schuler’s question, GM was saved for union management. Those jackals get to keep their jobs as union bosses, skimming off the pay of a shrinking workforce, and will in return keep shilling for the Dems. It was all about payoffs from one elite (Democratic elected officials) to another (union officials in dying unions). Bankruptcy would have likely ended up someplace similar, but the wrong people would have lost in that situation, so instead Obama had to step in and destroy hundreds of years of contract law.
Let’s see, Germany is about to go down the toilet with the rest of Europe. And the last time they took us on they ended up a big stinking pile of rubble. (I will also note that one of the big reasons they did well in the meantime was that they were the recipient of massives amounts of US welfare. The Japanese too, for that matter. Social justice is easier to pay for when you don’t actually have to pay for your own defense.)
Japan has been in the toilet for 20 years now, and is now just starting to circle the drain at the bottom. (Soon they will have to go international in their quest to fund their debt, at which point they will get killed by rate increases.)
And China? Well, Michael, I would love to see you move to some ghost city in China and renounce you citizenship to join their winning team. I’m sure that will work out wonderfully well for you and your family.
You’ll be on much safer ground assuming that everything Mitt Romney says is a lie. Because everything Mitt Romney says is a lie.
That makes Mitt and improvement over Barry. When Obama opens his mouth you always got to ask, “Is he lying, delusional or incompetent? He can’t REALLY mean that, can he?”
Germany’s going down the toilet? I don’t think so.
And what does moving to China have to do with noting that numerous Chinese government/party/industries are doing very, very well?
And the Japanese will be killed by interest rates? I’m curious: how long would you have laughed if I’d told you a week ago that France would be selling bonds at negative interest rates? Weren’t you also predicting we’d be killed by our national credit downgrade?
And by the way, wasn’t the prediction by all the libertarian types that A) GM would never pay us back and B) They’d go out of business? Certainly Chrysler was being written off, and yet, there they are, and apparently selling cars.
Ah, it seems like only yesterday he was also weak and indecisive and sucking up to our enemies. As for lies Obama has told: show me a lie. Not a failed prediction, a lie.
By the way, the “renaming” politicians has got to be the weakest form of political commentary. That’s true whether it’s calling Mr. Obama “Barry” or calling Mr. Romney “Willard.” It’s a big flashing neon sign that says, “I got nothin’.”
Yes, Chinese state companies are doing very well. Is that sustainable? Is that something that can be replicated here?
Michael
I read that LA Times piece, and it didn’t seem to show that Romney lied, more than then fact that he has asserted his solution of a managed bankruptcy would have accomplished much of the same ends — perhaps with a fairer shake to the shareholders and dealerships too, I might add.
Icepick is spot on about GM shares not doing well, as is the sluggish sales (I’m being kind) of their wonder car, the Volt.
Also, where are most of the GM car sales — in this country or abroad?
@Icepick
Government spending by Japan (or the U.S. or U.K.) drives interest rates DOWN. This is simply an inevitable consequence of a fully fiat currency combined with a reserve system. Japan spends, which creates new reserves in the banking system. It then issues debt to drain the excess reserves and maintain the target interest rate. Japan will never need to go anywhere else to fund its spending because it operates only in the Yen and no one else has the capability to produce them.
Michaels comments notwithstanding…..
The GM bailout was about unions, and Obama himself. Period.
GM is not doing well, look at the channel stuffing. And if the Volt sells 3, it three times one. The Volt is a bust. Period.
Solar companies, GM, it goes on. They are not economically viable as constructed. So they need politically motivated government subsidy. It’s not complicated. It’s about ideology and Obamas re-election. That’s it.
With GM, the government circumvented the traditional reorganization process in favor of a Section 363 sale of the good assets to a the union and taxpayors. The argument for doing this was that time was of the essence. The problem with doing it was there was no opportunity to restructure the contracts with the dealerships, the unions and the suppliers pursuant to a reorganization plan approved by an independent judge, relying on the business judgment of incoming management, and the opportunity to object by interested parties.
I expect we’ll find out whether the administration sacrificed business judgment for speed.
The problem with doing it was there was no opportunity to restructure the contracts with the dealerships, the unions and the suppliers pursuant to a reorganization plan approved by an independent judge, relying on the business judgment of incoming management, and the opportunity to object by interested parties.
This was the crux of the problem, IMO, PD. Had GM been allowed a restructuring that didn’t have government interference, the entire organization would have undergone scrutiny and reorganization, rather than a cherry-picking by government entities, many of whom had no knowledge, whatsoever, about the automobile industry.
Obama’s campagin commercial about Bain outsourcing jobs was given four pinochios by the fucking Washington Post, of all places. It is a lie, and a lie that you love repeating.
That’s one.
Hillary called him a liar (and backed it up) several times during the 2008 campaign. You can look that one up.
That’s two.
It has been shown that Obama lied numerous times in one of his autobiographies, usually making up stories about how oppressed he was by the white man. (My favorite is how he didn’t get playing time on his high school basketball team because he played black basketball. He didn’t get playing time, later revealed, because he was only the ninth or so best player on the team – those guys don’t get much playing time on most basketball teams.)
I’ll just count this as three, although I believe his latest biographer foundsomething like 38 instances of Obama just making shit up to make himself look good.
Obama lies every time he claims PPACA’s individual mandate isn’t a tax. He’s suppposedly the most brilliant individual who ever lived AND a constitutional law lecturer – he knows the SCOTUS ruling sticks. Not only that, but his own lawyers CALLED it a tax in arguments before the Court.
I’ll just count this as four, but it is a favorite lie of his. His own lawyers’ arguments make him out a liar on this one. Lawyers are usually better about covering their client’s ass on this sort of thing.
He lied when he had his literary agent claim he was born in Kenya for almost 20 years. This also makes all his claims that there is no reason to question where he was born a lie, as he himself clouded the issue. (Disclosure: I believe he was born in Hawaii, and I also don’t care if he was born in Kenya. His mother was American – you don’t get any more natural born than that.)
That’s five.
Claiming that oil production is up because of policies he implemented is a lie. When the EPA implements more rules later this year to curtail fracking it will become an even bigger lie than it already is.
Six.
Obama’s claims that GOP obstructionism is preventing him from implementing his policies when he frequently can’t even get enough democratic support for his projects: notably his budgets (can’t even get any Democratic votes the last two years).
Seven.
Obama’s claims that he would run the most transparent Administration have become so big a lie that no one even bothers to joke about it anymore. Holder is even committing contempt of Congress and lying to Congress in order to avoid turning over documents that Congress is entitled to.
Eight.
Oh, and PPACA itself means that Obama lied when he said he wouldn’t raise taxes on any family making less than $250,000.
Nine, and this one the exact kind of lie that cost Bush I his Presidency.
Obama’s claim that he would reduce the deficit were a lie, as he never made the effort to do anything about it, and he ran on policies that would have perforce increased the deficit even if we hadn’t been in this big economic downturn.
Ten, and a huge one, especially in scope. Altohugh the fun part about this one is that it means that Obama is unpatriotic, by his own definition. (Alternately, he was lying then, and just trying to score cheap political points mtop further his own slimy career. Which is it, hates America or is a liar?)
Obama’s claim that the private sector is doing fine is the most infuriating of all. Really, how is record levels of long-term unemployment, the longest stretch of 8.0% unemployment since the Great Depression, record levels of people claiming SSDI, record growth in Food Stamp usage (even during his three year long “recovery”), depressed wages, and on and on and on POSSIBLY reconcilable with the claim that the “private sector is doing fine”? His advisors scrambled for days trying to explain that one away, but the truth is that he is such a monumental liar that he thought he could make that claim and have no one question it.
That’s eleven, and the most sickening of all for the millions of people that have been out of work for years.
I could go on and on. The sickening part is that I wouldn’t run out of big lies for some time.
How are the airlines able to go in and out of bankruptcy without a loss of service? You do not even lose air miles.
icepick
That was a comprehensive post of Obama’s lies. I would say there is a compulsive streak in the man. But, the social progressives forgive/overlook all the lies, and instead will focus on Romney’s ‘earned’ wealth, his overseas accounts, his ‘whiteness’, the hubris of his success, and on and on.
It’s sick!
Ice:
Wow, that was much more pathetic than I expected.
Campaign ad exaggerations, unsupported statements by former opponents, failed campaign promises and autobiography conflations are your examples? Really?
Damn, Obama’s more honest than I thought.
No, no, here’s a lie: “I did not have sex with that woman, Ms. Lewinsky.” That’s a lie. Or, Nixon lying about Watergate. Or Mr. Bush the Younger claiming we had proof of Saddams WMD’s.
That had the unintended effect of reassuring me. I was sure you’d have something better.
Or, here’s an example of a lie:
“This is a president who has failed to communicate that military options are on the table and in fact in our hand. And that it’s unacceptable to America for Iran to have a nuclear weapon.”
That would be Mitt Romney. See, a lie is something you know to be untrue and you say it anyway.
I’m not sure what you two are arguing about. Politicians lie – it’s part of the job description. Anything else is about keeping score.
@Andy- Amen. I was totally blown away at work one day when one of the guts I was working with claimed that Bush had never lied. They all lie or spin. I get pissed when the lies are really stupid, but that probably has an element of observational bias.
Steve
I didn’t weigh in on this at OTB when Doug raised the point but I am baffled by our present crop of politicians’ lying, at least its scale. It’s too easy to be found out.
I’m not sure what you two are arguing about. Politicians lie – it’s part of the job description. Anything else is about keeping score.
Reynolds is arguing that Barry Half-White is saintly and pure, and that Mittens is corrupt and evil. As usual, nothing will get him to back down from his point. Mittens makes a campaign pledge and violates it, and it is evidence of complete lack of character. Barry H-W does same, and it is no big deal. Mittens is on all sides of an issue (abortion, say) and it is evidence of evil subterfuge. BH-W does the same thing (gay marriage) and it is evidence of his subtlety of character, and at no point was any of it ever disingenuous. So on and so on.
Romney is a liar, and not very good at it. He shamelessly switches positions time and time again, depending on what he needs to do to get elected. A complete weather-vane, as Reynolds points out. (That is, when he isn’t complaining about people calling Barack Barry, and claiming that as an insult. Clue for the Clueless, Barry is not insulting, Barry Half-White is – mostly to Obama voters who found a sorta-black man to vote for and feel cool for doing so, instead of an Urkel trying to put on gangsta airs. Walking around wearing a sari and reciting TS Elliot from a book? That ain’t Shaft….) Romney is already backing down from his primary position on immigration, for example. He has no core, which is why it will be so easy to NOT vote for him.
Obama is different in that he doesn’t get called out on it very much. But he has been all over the place on issues like gay rights, healthcare reform (guess what he was against before he was for it: mandates – it was a bone of contention between him and Hillary Clinton in 2008; there are others bits of that but those go farther back in time and are even less worthy of note), budgetary policy, treatment of terrorists, transparency in government, etc. He pretty consistently runs in favor of bigger government, however, and a more imperious government.
Yes, they’re all scoundrels, which is why you won’t find me defending the likes of Boehner, McConnell, Romney,
Yosemite SamJohn McCain, Bush II, etc. in terms of their honesty. You might find me defending one of them in terms of specific issues, but not because I think any of them are worth a bucket of warm piss as people or leaders.Icepick
So, are you going to vote for anyone in the presidential election? Or, will it be someone like a Gary Johnson, which could be considered a ‘principled’ vote, but one that doesn’t really weigh a preference in either the D or R direction?
Jan, I’m not voting for anyone. Why bother voting for Gary Johnson? Even assuming he won (which is only slightly more probable than me, as Icepick, winning via write-in), what’s he going to do? He will be working with Boehner, Pelosi, Reid and McConnell. You think they’re going to let him do anything? You think he is going to be able to find enough senior staffers to adequately staff the White House and the departments in order to fight blow-back from BPR&M? No chance.
The whole leadership class needs to be replaced. However, there is almost no desire amongst the electorate to do so. At least half the voters seem to really think the only real problems out there are the other guys, the ones they don’t vote for. “If only those Republicans in Maine would elect REAL Republicans we could get things done and usher in Heaven on Earth!” “If only those goddamned Blue Dogs were real JFK liberals that believe in HIGH TAXES and unilateral disarmament we could achieve Utopia!”
Until that changes it will be more of the same.