Auto Bailout Talks Collapse

[minnie61650]

7 myths about Detroit automakers

BY MARK PHELAN • FREE PRESS COLUMNIST • December 5, 2008



This column by Free Press auto critic Mark Phelan originally was published on Nov. 17 and has been updated.



The debate over aid to the Detroit-based automakers is awash with half-truths and misrepresentations that are endlessly repeated by everyone from members of Congress to journalists. Here are seven myths about the companies and their vehicles, and the reality in each case.

Myth No. 1: Nobody buys their vehicles
Reality: General Motors Corp., Ford Motor Co. and Chrysler LLC sold 8.5 million vehicles in the United States last year and millions more around the world. GM outsold Toyota by about 1.2 million vehicles in the United States last year and holds a U.S. lead over Toyota of nearly 700,000 so far this year. Globally, GM in 2007 remained the world's largest automaker, selling 9,369,524 vehicles worldwide -- about 3,000 more than Toyota.

Ford outsold Honda by about 850,000 and Nissan by more than 1.3 million vehicles in the United States last year.

Chrysler sold more vehicles here than Nissan and Hyundai combined in 2007 and so far this year.

Myth No. 2: They build unreliable junk
Reality: The creaky, leaky vehicles of the 1980s and '90s are long gone. Consumer Reports recently found that "Ford's reliability is now on par with good Japanese automakers."

The independent J.D. Power Initial Quality Study scored Buick, Cadillac, Chevrolet, Ford, GMC, Mercury, Pontiac and Lincoln brands' overall quality as high as or higher than that of Acura, Audi, BMW, Honda, Nissan, Scion, Volkswagen and Volvo.

J.D. Power rated the Chevrolet Malibu the highest-quality midsize sedan. Both the Malibu and Ford Fusion scored better than the Honda Accord and Toyota Camry.

Myth No. 3: They build gas-guzzlers
Reality: All of the Detroit Three build midsize sedans that the Environmental Protection Agency rates at 29-33 miles per gallon on the highway.

The most fuel-efficient Chevrolet Malibu gets 33 m.p.g. on the highway, 2 m.p.g. better than the best Honda Accord. The most fuel-efficient Ford Focus has the same highway fuel economy ratings as the most efficient Toyota Corolla. The most fuel-efficient Chevrolet Cobalt has the same city fuel economy and better highway fuel economy than the most efficient non-hybrid Honda Civic.

A recent study by Edmunds.com found that the Chevrolet Aveo subcompact is the least expensive car to buy and operate.

Myth No. 4: They already got a $25-billion bailout
Reality: None of that money has been lent out and may not be for more than a year. In addition, it can, by law, be used only to invest in future vehicles and technology, so it has no effect on the shortage of operating cash the companies face because of the economic slowdown that's killing them now.

Myth No. 5: GM, Ford and Chrysler are idiots for investing in pickups and SUVs
Reality: The domestics' lineup has been truck-heavy, but Toyota, Nissan, Mercedes-Benz and BMW have spent billions of dollars on pickups and SUVs because trucks are a large and historically profitable part of the auto industry.

The most fuel-efficient full-size pickups from GM, Ford and Chrysler all have higher EPA fuel-economy ratings than Toyota and Nissan's full-size pickups.

Myth No. 6: They don't build hybrids
Reality: The Detroit Three got into the hybrid business late, but Ford and GM each now offers more hybrid models than Honda or Nissan, with several more due to hit the road in early 2009.

Myth No. 7: Their union workers are lazy and overpaid
Reality: Chrysler tied Toyota as the most productive automaker in North America this year, according to the Harbour Report on manufacturing, which measures the amount of work done per employee. Eight of the 10 most productive vehicle assembly plants in North America belong to Chrysler, Ford or GM.

The oft-cited $70-an-hour wage and benefit figure for UAW workers inaccurately adds benefits that millions of retirees get to the pay of current workers, but divides the total only by current employees. That's like assuming you get your parents' retirement and Social Security benefits in addition to your own income.

Hourly pay for assembly line workers tops out around $28; benefits add about $14. New hires at the Detroit Three get $14 an hour. There's no pension or health care when they retire, but benefits raise their total hourly compensation to $29 while they're working. UAW wages are now comparable with Toyota workers, according to a Free Press analysis.

Contact MARK PHELAN at 313-222-6731 or phelan@freepress.com.

 

[ntsammy5]

7 myths about Detroit automakers

OK, if this is all true what is the problem with the Big 3? Legacy labor costs and retiree benefits?

 

[MarkBarbieri]

Interesting article, minnie61650. Before I respond to the content of the article, let me address the credibility of the source. I think that everyone should be aware that The Detroit Free Press is not likely to be an objective source of information about the auto industry. The reporters for the paper live, work, and socialize in a community that desperately wants the federal funds to stave off a painful readjustment to their lives. I imagine that you'll find few opponents of the bailout in Detroit. Even aside from that, the paper (if you want to still call it that) has a profit motive in telling its readers what they want to here. Given their current financial crisis, I imagine that they'll be bending over backwards to appeal to their local constituents.

Myth No. 1: Nobody buys their vehicles

It is true that the big three sell a lot of cars. It's also true that they have a much smaller market share than they once did. You can see the truth hidden in the circumlocutions they needed to make their point.

GM outsold Toyota by about 1.2 million vehicles in the United States last year and holds a U.S. lead over Toyota of nearly 700,000 so far this year.

This could easily be written as GM's dominance of the US market is still in decline. Despite having sold 1.2 million more vehicles than Toyota last year, they have sold only 700,000 more this year (with a month or two to go). At this rate, it won't be long before GM is no longer the biggest car seller in their home market.

Globally, GM in 2007 remained the world's largest automaker, selling 9,369,524 vehicles worldwide -- about 3,000 more than Toyota.

After having been the largest automaker in the world for decades, GM was in a virtual dead heat with Toyota last year and will sell significantly fewer cars worldwide this year.

The simple truth is that GM's US and worldwide market share have been in pretty steady decline for decades. I have yet to see any indication that will change.

Myth No. 2: They build unreliable junk

Again, rather than directly compare things like frequency of repairs, long term cost of maintenance, or something that would let you objectively compare cars over time, they resort to a misdirection. They quote the JD Powers Initial Quality survey. They cherry pick the brands to include and to leave out. Even if they didn't selectively choose brands, it would only tell you how many "defects" were reported on initial use of the cars. Even then, I've never found much value in JD Power's IQS. Years ago, they listed poor gas mileage as a defect on Hummers because many buyers reported it as such. How does that really mesh with your conception of quality?

I think a better measure of reliability is how well a car holds up over time. Let's take the cars that they mention later Malibu, Camry, and Accord and compare them over time. I'm excluding the Fusion because it hasn't been around for very long. I don't have access to repair statistics (other than anecdotes), so I'll use resale value. Based on Edmund's here are the resale values of a base version of each car during this decade:

Malibu Accord Camry
2008 17,071 18,407 16,067
2007 11,633 14,607 14,703
2006 10,474 12,966 13,175
2005 8,563 11,880 12,049
2004 7,248 10,378 11,410
2003 6,126 9,018 9,673
2002 5,309 7,080 8,111
2001 4,113 6,212 6,289
2000 3,447 5,315 5,512

It's pretty obvious looking at the real data over time which cars hold their value better and which don't. Maybe that's a reflection of styling rather than quality. I don't know. I do know that if I buy a GM car, I should expect to have it depreciate faster than a Honda or Toyota.

Myth No. 3: They build gas-guzzlers

It is true that GM is finally starting to build some fuel effecient cars. It's not true that the cars they sell are as fuel efficient overall as their competitors. Honda consistently beats every GM division for overall fleet fuel economy.

I'm not sure what the relevance of this is for the bailout, however. Gas prices are back down to very low levels. GM makes much better profits off of its gas guzzlers than it does its fuel efficient cars. If it weren't for the gas guzzlers, GM would have gone under years ago.

Myth No. 4: They already got a $25-billion bailout

It is true that the money taxpayers promised for developing high efficiency cars has not been distributed. OK. It's still coming under existing laws. If someone opposes the bailout because they think that this money has already been spent, they stand corrected. I have to say, though, that I haven't seen this used by bailout opponents. It looks more like a strawman.

Myth No. 5: GM, Ford and Chrysler are idiots for investing in pickups and SUVs

They clearly weren't. This is where they made their biggest profits (or should that be smallest losses?) during the last decade. Their mistake was not having the flexibility to make money on anything else. When gas prices went up, they had no profitable fallback.

Myth No. 6: They don't build hybrids

This is yet another non-sequiter, at least as far as the bailout is concerned. Even Toyota, the might king of hybrids, doesn't make money on them. Telling me that GM needs my money because it is growing in a money losing part of the industry doesn't give me warm fuzzies.

Myth No. 7: Their union workers are lazy and overpaid

This is another section with carefully chosen comparisons to obscure the broader point. The UAW workers are paid more than their peers in the US. If they'd have been willing to accept the same pay, they'd have their bailout now. This also excludes the fact that the big three are saddled with job banks workers (people paid to do nothing) that their leaner competitors don't have to deal with.

The simple truth is that GM is not a viable business. They are effectively bankrupt already. Ignore what the politicians, pundits, fanboys, and haters are saying for a moment and look at their financial statements.

Their liabilities (how much they owe) exceed their assets (what everything they own is worth) by $38 billion dollars at the end of 2007. That's before the current economic crisis started. At the end of '04, their assets exceeded their liabilities by $28 Billion. It dropped to $15 billion, then -$6 billion, and then -$38 billion over the years. At the end of September of this year, their owners equity (asset minu liabilities) stood at a whopping -$60 billion dollars. That's right, they owe $60 billion dollars more than they have in assets. And you think a $14 bridge loan followed by $20 billion more loans is going to make them solvent?

Their net income has been negative for years. In 2007, their net income was a staggering -$38 billion dollars. Again, that was before the economic crisis.

Their five year average operating margin (operating income divided by net sales) is a negative -2.45%. They've been consistently losing money on operations for years.

Here is an annual comparison of GM, Honda, and Toyota share values over the decade:

GM Honda Toyota
2000 81 16 87
2001 51 19 70
2002 51 17 52
2003 36 17 48
2004 50 21 56
2005 37 26 78
2006 24 28 104
2007 33 39 132
2008 25 32 108
Today 5 22 63

So Toyota's value has dropped almost 30% since 2000, with all of that decline happening because of the current crisis. Honda's value has actually increased 38% from the start of 2000 until today, although they have seen a decline of 31% this year. GM had already dropped 69% in value by the start of this year. They are now worth a pitiful 6% of what they were at the start of the decade.

It's not that I don't want to help the autoworkers. My interpretation of the above data is that GM is not a viable business. Pouring money into it will just delay the day of reckoning. I would rather start the reallocation of resources now rather than waiting for tens of billions of more dollars to be spent supporting the status quo.

I'm not saying that I wouldn't support some federal assistance. I can definitely see a role for the fed backing a debtor in possession as part of a bankruptcy. I might also agree to a deal in which GM is forced to convert debt to equity (giving creditors shares, thereby diluting the ownership of the current shareholders) along with cancelling the existing contracts and leases of the company and providing transition assistance to displaced workers. Heck, I'd even prefer a one-time buyout of workers if that is what it took to get GM to a profitable size and labor situation. I just think that pouring more money into the status quo is only going to perpetuate that status quo. And you can easily see from the numbers above that the status quo is a very bad one.

 

[jodifla]

It's correct. Here is the link to the Senate role call. I admit that it is confusing as the bill is described as "Alternative Minimum Tax Relief Act of 2008", but that is an artifact of the way the Senate works. They often re-purpose bills for procedural reasons. If you'd like a little more evidence, here is the list of Senate roll call votes, with only one having been taken in December of this year. Finally, if you aren't willing to believe someone that you believe to be evil, here is a link to a Democratic Underground discussion on the subject. *** Warning *** The Democratic Underground link has language that many will find offensive.

So if you read that thread, you'd see that Reid's vote was a procedural issue so he can reintroduce it (that arcane Senate stuff is beyond where MY civics class went, though.)

Alot of individual votes are posturing once its clear something is or isn't going to pass. It's clear the Republicans were going to kill his bill. You can't put it on the Democrats (although, Reid and Pelosi sure look like LOUSY leaders in the House and Senate.)

 

[Charade]

So if you read that thread, you'd see that Reid's vote was a procedural issue so he can reintroduce it (that arcane Senate stuff is beyond where MY civics class went, though.)

Alot of individual votes are posturing once its clear something is or isn't going to pass. It's clear the Republicans were going to kill his bill. You can't put it on the Democrats (although, Reid and Pelosi sure look like LOUSY leaders in the House and Senate.)

Whew! I need to sit down. I'm dizzy from the spin.

 

[MarkBarbieri]

So if you read that thread, you'd see that Reid's vote was a procedural issue so he can reintroduce it (that arcane Senate stuff is beyond where MY civics class went, though.)

Alot of individual votes are posturing once its clear something is or isn't going to pass. It's clear the Republicans were going to kill his bill. You can't put it on the Democrats (although, Reid and Pelosi sure look like LOUSY leaders in the House and Senate.)

It is true that the Majority Leader voted against it for procedural reasons. It is not true that "Republicans were going to kill this bill." If Democrats had unified behind it, they would have achieved cloture. Four voted against, four abstained, and one Democratic seat remains vacate awaiting the end of Blagojevich's apparently interrupted auction. If those Democrats had voted for it (even minus the open seat for sale), it would have passed. A bipartisan group of Senators stopped the bill.

Personally, I'm glad that at least four Democrats voted on principal rather than just following their party leadership. It was up to those wanting the legislation to put for a bill that was acceptable. They failed to find a compromise that was acceptable. From the press reports, it appears to have faltered when some holdouts insisted that the UAW accept compensation cuts to put them on par with their US competitors. The proponents resisted and insisted that the UAW be able to keep their contracts guaranteeing them higher pay than their peers at other US plants until at least 2011.

Why did Baucus, Lincoln, and Tester oppose the bill? And why did Biden, Kennedy, Kerry, and Wyden decline to vote? Perhaps they didn't want to answer questions from their constituents about why their tax money was going to help pay people more money than they were making for doing the same jobs. I imagine that a lot of voters would be troubled by the UAW's demand for taxpayer money to help them continue to make more money than the average for their jobs. Is it really fair to take money from an autoworker at a foreign owned plant in Alabama and give it to a higher paid worker in Michigan?

 

[jodifla]

It is true that the Majority Leader voted against it for procedural reasons. It is not true that "Republicans were going to kill this bill." If Democrats had unified behind it, they would have achieved cloture. Four voted against, four abstained, and one Democratic seat remains vacate awaiting the end of Blagojevich's apparently interrupted auction. If those Democrats had voted for it (even minus the open seat for sale), it would have passed. A bipartisan group of Senators stopped the bill.

Personally, I'm glad that at least four Democrats voted on principal rather than just following their party leadership. It was up to those wanting the legislation to put for a bill that was acceptable. They failed to find a compromise that was acceptable. From the press reports, it appears to have faltered when some holdouts insisted that the UAW accept compensation cuts to put them on par with their US competitors. The proponents resisted and insisted that the UAW be able to keep their contracts guaranteeing them higher pay than their peers at other US plants until at least 2011.

Why did Baucus, Lincoln, and Tester oppose the bill? And why did Biden, Kennedy, Kerry, and Wyden decline to vote? Perhaps they didn't want to answer questions from their constituents about why their tax money was going to help pay people more money than they were making for doing the same jobs. I imagine that a lot of voters would be troubled by the UAW's demand for taxpayer money to help them continue to make more money than the average for their jobs. Is it really fair to take money from an autoworker at a foreign owned plant in Alabama and give it to a higher paid worker in Michigan?

Kennedy is still sick, Biden said he would be there if his vote would make a difference, Kerry was out of the country but again said he'd he cancel trip if his vote would make a difference. Haven't heard about Wyden, or the 3 dems.

Having a couple Senators jump ship is not a bipartisanship.

And Reid DIDN'T vote against the substance of the bill.

 

[rascalmom]

Interesting article, minnie61650. Before I respond to the content of the article, let me address the credibility of the source. I think that everyone should be aware that The Detroit Free Press is not likely to be an objective source of information about the auto industry. The reporters for the paper live, work, and socialize in a community that desperately wants the federal funds to stave off a painful readjustment to their lives. I imagine that you'll find few opponents of the bailout in Detroit. Even aside from that, the paper (if you want to still call it that) has a profit motive in telling its readers what they want to here. Given their current financial crisis, I imagine that they'll be bending over backwards to appeal to their local constituents.


It is true that the big three sell a lot of cars. It's also true that they have a much smaller market share than they once did. You can see the truth hidden in the circumlocutions they needed to make their point.


This could easily be written as GM's dominance of the US market is still in decline. Despite having sold 1.2 million more vehicles than Toyota last year, they have sold only 700,000 more this year (with a month or two to go). At this rate, it won't be long before GM is no longer the biggest car seller in their home market.


After having been the largest automaker in the world for decades, GM was in a virtual dead heat with Toyota last year and will sell significantly fewer cars worldwide this year.

The simple truth is that GM's US and worldwide market share have been in pretty steady decline for decades. I have yet to see any indication that will change.


Again, rather than directly compare things like frequency of repairs, long term cost of maintenance, or something that would let you objectively compare cars over time, they resort to a misdirection. They quote the JD Powers Initial Quality survey. They cherry pick the brands to include and to leave out. Even if they didn't selectively choose brands, it would only tell you how many "defects" were reported on initial use of the cars. Even then, I've never found much value in JD Power's IQS. Years ago, they listed poor gas mileage as a defect on Hummers because many buyers reported it as such. How does that really mesh with your conception of quality?

I think a better measure of reliability is how well a car holds up over time. Let's take the cars that they mention later Malibu, Camry, and Accord and compare them over time. I'm excluding the Fusion because it hasn't been around for very long. I don't have access to repair statistics (other than anecdotes), so I'll use resale value. Based on Edmund's here are the resale values of a base version of each car during this decade:

Malibu Accord Camry
2008 17,071 18,407 16,067
2007 11,633 14,607 14,703
2006 10,474 12,966 13,175
2005 8,563 11,880 12,049
2004 7,248 10,378 11,410
2003 6,126 9,018 9,673
2002 5,309 7,080 8,111
2001 4,113 6,212 6,289
2000 3,447 5,315 5,512

It's pretty obvious looking at the real data over time which cars hold their value better and which don't. Maybe that's a reflection of styling rather than quality. I don't know. I do know that if I buy a GM car, I should expect to have it depreciate faster than a Honda or Toyota.


It is true that GM is finally starting to build some fuel effecient cars. It's not true that the cars they sell are as fuel efficient overall as their competitors. Honda consistently beats every GM division for overall fleet fuel economy.

I'm not sure what the relevance of this is for the bailout, however. Gas prices are back down to very low levels. GM makes much better profits off of its gas guzzlers than it does its fuel efficient cars. If it weren't for the gas guzzlers, GM would have gone under years ago.


It is true that the money taxpayers promised for developing high efficiency cars has not been distributed. OK. It's still coming under existing laws. If someone opposes the bailout because they think that this money has already been spent, they stand corrected. I have to say, though, that I haven't seen this used by bailout opponents. It looks more like a strawman.


They clearly weren't. This is where they made their biggest profits (or should that be smallest losses?) during the last decade. Their mistake was not having the flexibility to make money on anything else. When gas prices went up, they had no profitable fallback.


This is yet another non-sequiter, at least as far as the bailout is concerned. Even Toyota, the might king of hybrids, doesn't make money on them. Telling me that GM needs my money because it is growing in a money losing part of the industry doesn't give me warm fuzzies.


This is another section with carefully chosen comparisons to obscure the broader point. The UAW workers are paid more than their peers in the US. If they'd have been willing to accept the same pay, they'd have their bailout now. This also excludes the fact that the big three are saddled with job banks workers (people paid to do nothing) that their leaner competitors don't have to deal with.

The simple truth is that GM is not a viable business. They are effectively bankrupt already. Ignore what the politicians, pundits, fanboys, and haters are saying for a moment and look at their financial statements.

Their liabilities (how much they owe) exceed their assets (what everything they own is worth) by $38 billion dollars at the end of 2007. That's before the current economic crisis started. At the end of '04, their assets exceeded their liabilities by $28 Billion. It dropped to $15 billion, then -$6 billion, and then -$38 billion over the years. At the end of September of this year, their owners equity (asset minu liabilities) stood at a whopping -$60 billion dollars. That's right, they owe $60 billion dollars more than they have in assets. And you think a $14 bridge loan followed by $20 billion more loans is going to make them solvent?

Their net income has been negative for years. In 2007, their net income was a staggering -$38 billion dollars. Again, that was before the economic crisis.

Their five year average operating margin (operating income divided by net sales) is a negative -2.45%. They've been consistently losing money on operations for years.

Here is an annual comparison of GM, Honda, and Toyota share values over the decade:

GM Honda Toyota
2000 81 16 87
2001 51 19 70
2002 51 17 52
2003 36 17 48
2004 50 21 56
2005 37 26 78
2006 24 28 104
2007 33 39 132
2008 25 32 108
Today 5 22 63

So Toyota's value has dropped almost 30% since 2000, with all of that decline happening because of the current crisis. Honda's value has actually increased 38% from the start of 2000 until today, although they have seen a decline of 31% this year. GM had already dropped 69% in value by the start of this year. They are now worth a pitiful 6% of what they were at the start of the decade.

It's not that I don't want to help the autoworkers. My interpretation of the above data is that GM is not a viable business. Pouring money into it will just delay the day of reckoning. I would rather start the reallocation of resources now rather than waiting for tens of billions of more dollars to be spent supporting the status quo.

I'm not saying that I wouldn't support some federal assistance. I can definitely see a role for the fed backing a debtor in possession as part of a bankruptcy. I might also agree to a deal in which GM is forced to convert debt to equity (giving creditors shares, thereby diluting the ownership of the current shareholders) along with cancelling the existing contracts and leases of the company and providing transition assistance to displaced workers. Heck, I'd even prefer a one-time buyout of workers if that is what it took to get GM to a profitable size and labor situation. I just think that pouring more money into the status quo is only going to perpetuate that status quo. And you can easily see from the numbers above that the status quo is a very bad one.

 

[MarkBarbieri]

Kennedy is still sick, Biden said he would be there if his vote would make a difference, Kerry was out of the country but again said he'd he cancel trip if his vote would make a difference. Haven't heard about Wyden, or the 3 dems.

Having a couple Senators jump ship is not a bipartisanship.

And Reid DIDN'T vote against the substance of the bill.

Kennedy should resign. He served his party effectively for several decades. Now his health is too poor for him to adequately represent his constituents and his party. He needs to put his ego aside and let someone else do the job.

Reid voted for procedural reasons. The entire vote was procedural. No one was voting for or against the bill. They were voting on whether or not to close debate on the subject. When I last checked, there was a workable compromise on the table (pay the UAW the nationwide prevailing wage for solvent automakers), but the Democrats backers of the bill weren't willing to listen. They wanted to shut off debate and force the current bill to a vote. Reid voted against cloture because his vote meant the difference between the bill being killed or debate continuing. He wisely chose to continue the debate.

Why were the backers of the bill, if they are so concerned about the potential for economic tragedy, unwilling to compromise? Why did they insist on forcing the nation to chose between what they claim is something like economic Armageddon and a reasonable compensation adjustment? Are they so beholden to the labor unions that they are willing to put the economic fate of millions of people (so I've been told) at jeopardy just to make sure that their constituents can make more money than the workers in my state? The Republican request sure seemed reasonable. Why are the Democractic leaders in the congress blackmailing me giving me only two extreme choices - pay the unions that bankrolled our election more than other workers make or kiss the automakers goodbye.

I honestly don't think that they have any intention of letting the automakers fail. They are just playing a high stakes game of chicken. They know that they can get their remaining members and a few more Republicans onboard if they make a few more compromises. They are just holding out the threat of collapse to get as much as they can out of the situation for their constituents. This isn't good against evil. It's hard ball politics with each side trying to extract the largest possible consessions from the other.

 

[S. C.]

Since the American government is in so much debt, we should have a vote to take congresses health care away and send their pensions to the pension guarantee board!

They are funded by TAXPAYERS!

 

[CarlaKay]

As I pointed out in another thread, this memo is obviously bogus.

Do you have any proof for this claim?? I have yet to see any republican senator deny the accuracy of this memo or claim that this memo is a fraud. The names of the republican senators was redacted by the Democratic source as a warning to the GOP senators involved that the real memo will be released if they complain with their names.

The GOP has learned not to deny accurate memos in that this will come back to haunt them. Mel Martinez is not running for re-election in 2010 because he was involved in a similar memo mess. During the Schiavo mess, therew as a talkings point memo circulated among republican senators that was not on Senate letterhead. Some senators including Martinez made a big deal about this memo being fake but it turned out that Mel gave a copy this memo to a Democrat and it was one of Mel's aides who had to take the fall and admit that he wrote and circulated this memo.

If you find anyone serious who is claiming that this memo is not real, please let us know. Otherwise, this is just your opinion.

 

[CarlaKay]

I request again that people refrain from ad hominem attacks like this.

I am sorry but the shoe fits here. The actions of the these GOP senators are both hateful and partisian. These GOP Senators want to destroy these unions for their own political gain and do not care about the rest of the country.

I am not the only person who had this reaction. Here is a clip from the Gov. of Michigan who has issues with the unpatriotic actions of these GOP senators http://www.youtube.com/watch?v=jueUe553AX8 Here is another clip from the Young Turks which also explains why these unAmerican GOP senators put their own self interests ahead of what is best for the country http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=385x249515

 

[Galahad]

These GOP Senators want to destroy these unions for their own political gain

If they do destroy the unions they will have done the country and its workers a huge favor. Not sure I really care why they want to do it in the long run.

 

[minnie61650]

Auto suppliers hedge their bets, keep bankruptcy lawyers scrambling

BY BRENT SNAVELY and KATIE MERX • FREE PRESS BUSINESS WRITERS • December 15, 2008
..........................


Credit is critical
Several lawyers said that one of the critical issues facing the bankruptcy system now is the lack of credit.

Most firms that file for bankruptcy use what is called debtor-in-possession financing to restructure under Chapter 11 bankruptcy, Hammer said. But local lawyers are doubtful that such financing would be available, especially if a large number of companies file for protection, as some lawyers are beginning to suspect might happen.

Without that financing, many companies that don't generate enough cash could be forced to close and sell their assets.

"You would be looking at more liquidations," Hammer said.

What's more, if one of the automakers, or a host of suppliers, file for bankruptcy, many banks and lenders that have already been shaken by the housing crisis could be hurt even more when the auto companies don't pay their bills.

Michael Baum, a bankruptcy attorney with Schafer and Weiner PLLC in Bloomfield Hills, said he has been stunned that the banking and financial community has remained largely silent in the automotive debate.

Baum said that the number of banks that will find loans "in serious jeopardy as a result of a bankruptcy filing of one or more of the automakers is mind-boggling."

As production volumes and payments to suppliers diminish, suppliers' ability to remain in good standing with their lenders and make loan payments also will diminish, Baum said.

"All suppliers are going to have difficulties with their banks and the banking industry will suffer enormously," he said.

Loyalty or self-protection?
With so much uncertainty in the air, many parts suppliers also are seeking advice on how they can protect themselves.

Federal laws allows suppliers who are worried about the ability of a customer to pay for parts to formally request proof that a company has the ability to make the payments.

However, many companies in the auto industry are reluctant to do so in this stressed-out environment.

Sharkey said Butzel Long's supplier clients are torn between demanding accelerated payment terms from customers they've worked with for decades and protecting their own company's financial well-being.

"You can see it in their eyes when I tell them that I think they should be seeking accelerated payment terms," Sharkey said. "Chrysler sees that as an unjustified modification of a contract."

Demanding accelerated payment terms is dangerous both for suppliers and for the automakers because it can wind up causing the customer to file for Chapter 11 bankruptcy.

"It just accelerates their cash drain," Sharkey said.

 

[DisMN]

Since the American government is in so much debt, we should have a vote to take congresses health care away and send their pensions to the pension guarantee board!

They are funded by TAXPAYERS!

I really like this idea.

 

[Tigger Woods]

Do you have any proof for this claim?? I have yet to see any republican senator deny the accuracy of this memo or claim that this memo is a fraud. The names of the republican senators was redacted by the Democratic source as a warning to the GOP senators involved that the real memo will be released if they complain with their names.

The GOP has learned not to deny accurate memos in that this will come back to haunt them. Mel Martinez is not running for re-election in 2010 because he was involved in a similar memo mess. During the Schiavo mess, therew as a talkings point memo circulated among republican senators that was not on Senate letterhead. Some senators including Martinez made a big deal about this memo being fake but it turned out that Mel gave a copy this memo to a Democrat and it was one of Mel's aides who had to take the fall and admit that he wrote and circulated this memo.

If you find anyone serious who is claiming that this memo is not real, please let us know. Otherwise, this is just your opinion.

Mel Martinez had nothing to do with the Schiavo memo. Here are the facts:

By Mike Allen
Washington Post Staff Writer
Thursday, April 7, 2005; Page A01

The legal counsel to Sen. Mel Martinez (R-Fla.) admitted yesterday that he was the author of a memo citing the political advantage to Republicans of intervening in the case of Terri Schiavo, the senator said in an interview last night.

Brian H. Darling, 39, a former lobbyist for the Alexander Strategy Group on gun rights and other issues, offered his resignation and it was immediately accepted, Martinez said.

Martinez, the GOP's Senate point man on the issue, said he earlier had been assured by aides that his office had nothing to do with producing the memo. "I never did an investigation, as such," he said. "I just took it for granted that we wouldn't be that stupid. It was never my intention to in any way politicize this issue."

Martinez, a freshman who was secretary of housing and urban development for most of President Bush's first term, said he had not read the one-page memo. He said he inadvertently passed it to Sen. Tom Harkin (D-Iowa), who had worked with him on the issue. After that, officials gave the memo to reporters for ABC News and The Washington Post

 

[MarkBarbieri]

I am sorry but the shoe fits here. The actions of the these GOP senators are both hateful and partisian. These GOP Senators want to destroy these unions for their own political gain and do not care about the rest of the country.

I am not the only person who had this reaction. Here is a clip from the Gov. of Michigan who has issues with the unpatriotic actions of these GOP senators http://www.youtube.com/watch?v=jueUe553AX8 Here is another clip from the Young Turks which also explains why these unAmerican GOP senators put their own self interests ahead of what is best for the country http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=385x249515

Are you lying about this because you are a greedy, pro-union thug that wants to rip off the hard working non-union people of this country to enrich yourself and your own cronies? I doubt it, but that is what some of the "foaming at the mouth" people on the right think. It's called demonizing your opponent.

If you took the time to know some people with different views on the subject, listened to what they had to say, and tried to understand their position, you might realize how slanderous your comments are. I'm not saying that you would agree with them, but you would hopefully quit calling people that want the best for the world "hateful."

The facts don't support your comment. Show me where the Senators said that they were motivated by hatred and I'll back down. Show me the Senators saying hateful things and I'll back down. You can't, because they are motivated by a desire to represent their constituents, most of whom did not support the bill as written.

The Senators that wanted to continue debating the bill offered a compromise. All the UAW had to do was agree to be compensated at the same rate as their peers in the rest of the industry. That didn't seem too unreasonable to me. For their own reasons (surely a mixture of principal and politics), the Senators that wanted to shut off debate on the bill rejected the compromise.

Please stop demonizing people that you disagree with. Almost half the country is Democrat and almost half the country is Republican. The overwhelming majority of the people in this country (and the world, for that matter) are good, honest people that want the best for American and the world. They differ on how to achieve that.

Some people honestly believe that more powerful and more widespread unions are the path to greater fairness and prosperity. Some people think tha the opposite is true. Neither side is motivated by hatred. Some Senators oppose these unions because they think the unions are harming this nation. Whether they are right or wrong, they are motivated by a desire for a better world.

I don't think that there is any cancer worse in our political world today than the incessant demonization of the opposition by people of all political strips. We will be much better off as a nation when the trolls that continue to peddle this internecine idiocy learn the error of their ways or leave the debate. There was no more attractive attribute of our President Elect than his repeated insistance on rising above this sort of ignorant and poisonous rhetoric.

 

[CarlaKay]

Mel Martinez had nothing to do with the Schiavo memo. Here are the facts:...

Mel Martinez made the wise decision not to run for re-election in part because the Terri Schiavo memo mess would be used against him. Mel was in over his head on this mess as shown by this article. Mel passed out copies of the memo on the floor of the Senate including giving a copy to Sen. Harken (a Democrat). The memo was written by a lawyer on Martinez's staff. There had to be more than one copy because several news sources had copies of this memo that they got from republican senators. These facts do not clear Martinez and Martinez is wise to not to run.

Now back to the question that I raised which do you have any proof that the GOP talking point memo obtained and published by MSNBC is false? Again, during the Mel Memo Mess, the GOP was jumping up and down claiming that the memo was a plant and so far I have not heard one GOP senator complain that the memo published by MSNBC was false. If you have any reports, I would love to see them.

 

[CarlaKay]

If they do destroy the unions they will have done the country and its workers a huge favor. Not sure I really care why they want to do it in the long run.

In other words, you have adopted the a variation of the position that what is good for GM is good for the country but in your case, it is what is good for the GOP is good for America.

Luckily, unions are legal and are not in danger of going away any time soon. Chris Dodd is working with the bush administration on the use of the TARP money for a bridge loan and the only reason that the markets have not collasped has been that the markets expect that these bridge loans will be put into place soon.

Unions have played an important role in protection workers and the rights of workers. The fact that unions have supported Democratic candidates should not be grounds for some GOP southern senators to do their best to punish these unions.

 

[CarlaKay]

Are you lying about this because you are a greedy, pro-union thug that wants to rip off the hard working non-union people of this country to enrich yourself and your own cronies?

I would love for you to show me where I have lied about anything? Claiming that I am a liar is a serious charge and I hope that you can back your claim up. So far you have not done anything but pouted and made claims that you have not supported.

Here is a good news story that may explain the facts of this situation. http://www.youtube.com/watch?v=ucYEPLKGtPk