CHRYSLER and GENERL
MOTORS/GOVERNMENT MOTORS
GOVERNMENT IN THE CAR BUSINESS..
SCAMS ON THE TAXPAYER
UNIONS WINNER IN BAILOUTS..
Obama’s General Motors About to Again Handsomely Reward Unions At Our Expense?
In this, the third Age of Bailout, the Troubled Asset Relief Program
(TARP)’s $50 billion General Motors (GM) bailout (upped from $20 billion by
President Barack Obama) is yet another unmitigated disaster.
But a few of the many failures:
·
GM had to file for bankruptcy anyway.
·
President Obama originally claimed we’d make money on our $50 billion. Seven months later, the
Administration admitted we’d lose more than $16 billion – and dishonestly claimed the
loss they had said would be a profit was “less than the(y) originally
expected.”
·
GM last year claimed in a television ad campaign to have “repaid (their)
government loan in full, with interest, five years ahead of the original
schedule.” Which was another total lie. They had in fact paid back only a tiny
fraction thereof – and had done so so with other government TARP money.
·
So fraudulent was GM’s media-buy
proclamation that there has been a Federal Trade Commission (FTC) complaint filed against
them.
·
As of November 16, 2010 – more than
half a year after the “paid in full with interest” ad – GM had only paid back $361 million.
·
With
the exception of the 2011 Mercedes-Benz S-Class, the 2011 Smart For Two and the
2011 Nissan Titan, the cars on the list are all American-made. Worse than that,
they all come from two manufacturers: General Motors and Chrysler. Ford managed
to avoid the list completely…. (GM) offerings from Chevrolet and Cadillac
crowded the picture…
·
GM
has some work to do before it can regain a good reputation fleet-wide. Four
GM-made vehicles–the Cadillac Escalade, Chevy Tahoe Hybrid, Chevrolet Colorado,
and Chevrolet Aveo/Aveo 5–are ranked as among the worst on the market today.
All but the Tahoe Hybrid qualified for the Worst Cars list last year as well.
·
Probably also due at least in part
to these distractions, GM has had to recall their cars – again, and again, and again, and again, and again, and again, and again, and again, and….
As horrendous as all of this is, it
can at least perhaps be written-off as the utterly predictable, yet
unintentional, ruinous outcome of government involvement in the private sector.
Not so this:
·
President Obama and GM eviscerated
bankruptcy law – throwing secured bond holders over the side to the benefit and illegal betterment of his union allies.
To quote Jaws – this was no boating accident.
This was President Obama willfully
breaking the law – to advantage the unions who every election so thoroughly
help him and his fellow Democrats.
Specifically the United Auto Workers
(UAW).
Between 2000 and 2008, the UAW gave $23,675,562 to the
Democrat Party and its candidates.
(During that same eight years, the
UAW gave a whopping $193,540 to Republicans.)
In 2008 alone, the UAW gave
$4,161,567 to the Democrat Party – including Obama.
Think they’re owed? Obama apparently
does.
And another payoff opportunity has
arrived. For it’s labor contract renewal time for GM and the UAW.
We have here the ridiculously
pro-Obama union on one side of the negotiation table – and Obama on the other.
I wonder how these talks will end up.
The UAW will undoubtedly get an
absurdly good deal. Not just because of their uber-favorable partner, but
because of the artificially good situation in which GM currently – but
temporarily – finds itself.
GM’s present profitability is a
harmonic convergence of events that has very little to do with any possibility
of their long-term success – for which the prospects actually look pretty grim.
Obama wiped out entirely GM’s debts.
He has issued them a multi-year tax waiver – they do not for years owe the
Internal Revenue Service (IRS) a dime.
GM, meanwhile, is fire-selling billions of dollars worth of assets –
further artificially bolstering their bottom line.
And Japan’s tragic
earthquake-tsunami combination devastation dramatically damaged Toyota, which
had until then held the global automotive top spot. GM didn’t ascend – Toyota
collapsed.
So GM is currently enjoying
synthetic profits – they most likely would not last even if they weren’t building expensive, unprofitable cars that no one wants.
All of which will not at all stop
the UAW from pointing to these profits as grounds for demanding even more out
of GM.
And they’ll get it. Because Obama
owes them. And desperately needs them again for 2012.
And, of course, the UAW will get
this absurdly good deal in large part at our expense – as We the People still
own 33% of GM.
And even if We the People manage to
extricate ourselves from this TARP-inflicted morass, it still leaves GM (again)
hamstrung by a terrible UAW deal.
But that’s ok, because it helped President
Obama and his fellow Democrats in their reelection efforts.
And that’s really what the terrible
GM bailout was all about.
In Chrysler Bailout, Taxpayers Likely To Lose Up To $1.3 Billion: Treasury...
http://www.5min.com/Video/Chrysler-Pays-Back-Debts-517070609
DETROIT (Deepa Seetharaman) - The U.S. and Canadian governments exited their investments in Chrysler Group LLC on Thursday, allowing Italy's Fiat SpA (FIA.MI) to become the automaker's majority stakeholder. Fiat now owns 53.5 percent of Chrysler on a fully diluted basis, the Auburn Hills, Michigan-based company said in a regulatory filing on Thursday. Fiat is on track to hold 58.5 percent of Chrysler by the end of the year. Fiat also now has the right to appoint a majority of the company's board, Chrysler said in the filing. A health care trust affiliated with the United Auto Workers and known as the VEBA holds the remaining shares of Chrysler. The company and the union plan to begin negotiations on a new four-year contract on Monday. Fiat said in early June that it would buy the U.S. and Canadian governments' stakes in Chrysler. [ID:nN02276819] [ID:nLDE753033] The United States and Canada took equity positions in Chrysler during the U.S. automaker's bankruptcy restructuring in 2009. Fiat received a 20 percent stake and many options to increase it. Read More: Huffington Post
