Michael Moore thinks he can run G.M.

Oh please, somebody stop him from making movies and also from writing. Please.

Moore, like many liberals, is worried about the precious environment and what cars are doing to the planet. He even calls it a "war":

1. Just as President Roosevelt did after the attack on Pearl Harbor, the President must tell the nation that we are at war and we must immediately convert our auto factories to factories that build mass transit vehicles and alternative energy devices. Within months in Flint in 1942, GM halted all car production and immediately used the assembly lines to build planes, tanks and machine guns. The conversion took no time at all. Everyone pitched in. The fascists were defeated.

We are now in a different kind of war -- a war that we have conducted against the ecosystem and has been conducted by our very own corporate leaders. This current war has two fronts. One is headquartered in Detroit. The products built in the factories of GM, Ford and Chrysler are some of the greatest weapons of mass destruction responsible for global warming and the melting of our polar icecaps. The things we call "cars" may have been fun to drive, but they are like a million daggers into the heart of Mother Nature. To continue to build them would only lead to the ruin of our species and much of the planet.

The other front in this war is being waged by the oil companies against you and me. They are committed to fleecing us whenever they can, and they have been reckless stewards of the finite amount of oil that is located under the surface of the earth. They know they are sucking it bone dry. And like the lumber tycoons of the early 20th century who didn't give a damn about future generations as they tore down every forest they could get their hands on, these oil barons are not telling the public what they know to be true -- that there are only a few more decades of useable oil on this planet. And as the end days of oil approach us, get ready for some very desperate people willing to kill and be killed just to get their hands on a gallon can of gasoline.

President Obama, now that he has taken control of GM, needs to convert the factories to new and needed uses immediately.

Sure, blame the oil companies. How convenient. Moore reveals is true anti-capitalist self.

Wait a minute, did President Obama take control of G.M.? Just a few paragraphs earlier Moore writes his joy of "you and I and the rest of America now own a car company!" Ooops, looks like we don't really own it if it's the president who's taken control of the company? Silly.

And about that $30 billion poured into the bankrupt company?

2. Don't put another $30 billion into the coffers of GM to build cars. Instead, use that money to keep the current workforce -- and most of those who have been laid off -- employed so that they can build the new modes of 21st century transportation. Let them start the conversion work now.

I'm starting to think Moore is a fan of the vicious circle. How can more money to keep employees at this juncture save G.M. when keeping them on the payroll means higher expenses when nobody is buying their cars? Then he babbles about building out a mass transit system and having G.M. reconfigure its factories to build trains and hybrid cars instead.

That's simply flawed business thinking. Let's forgive him, he's a (struggling) filmmaker after all. If we are to follow his logic, then the fastest way for G.M. to bring in revenues is to outsource its facilities to build cars for other companies, like Ford and Toyota. It's not to build rail cars and trains! Heck, we don't have enough tracks for trains, but plenty of nicely paved roads...

Then he brings up...taxes!

8. Provide tax incentives for those who travel by hybrid car or bus or train. Also, credits for those who convert their home to alternative energy.

9. To help pay for this, impose a two-dollar tax on every gallon of gasoline. This will get people to switch to more energy saving cars or to use the new rail lines and rail cars the former autoworkers have built for them.

What about those who walk? Don't walkers deserve tax credits too? Are Americans supposed to keep track of how many miles they walk each year in order to qualify for the tax credit?

And imposing higher taxes on gasoline? If he truly thinks the oil companies are evil, he ought to advocate banning gasoline altogether! In fact, let's ban gasoline and cars. But I guess even a liberal like Michael Moore understands how unrealistic his ideas are...

A young amateur handles General Motor's disassembly

According to the NYT, it's 31-year-old Brian Deese that's handling the break up of General Motors, turning it into "Government Motors." And how is he qualified? Let's just say he can compete with President Obama for who has the thinner resume. From the NYT piece:

...Brian Deese, a not-quite graduate of Yale Law School who had never set foot in an automotive assembly plant until he took on his nearly unseen role in remaking the American automotive industry.

I feel a little bad for ousted CEO Rick Wagoner, who's received a B.A. in Economics from Duke University and an MBA from Havard, and has worked at G.M. for many years. Here comes Mr. Deese, not having his Yale diploma even and zero experience in the auto industry, but thanks to his work at the Hillary Clinton presidential campaign, he now gets to decide what happens to this iconic American company.

Merely a "special assistant to the president for economic policy," he makes rounds to the Treasury to discuss and influence decision makers about the American auto industry, and even the NYT raises a point about his lack of training and experience:

Mr. Deese’s role is unusual for someone who is neither a formally trained economist nor a business school graduate, and who never spent much time flipping through the endless studies about the future of the American and Japanese auto industries.

So what does this say about the Obama administration and its handling of the trouble auto industry? Does it really have the people's interest in mind when it allows an industry amateur to influence policy?

The PUMA Weeniemobile: Detroit nails its own coffin

Say hello to PUMA, the Personal Urban Mobility and Accessibility project from General Motors with the help of Segway. Obama doesn't think the G.M. Volt could save the company, so he "kindly" asks for a replacement project, and it's going to be PUMA. Oh yes, that's what happens when the government runs an auto company. The Volt was generating a lot of buzz, and G.M. poured so much time and money into the project, but now we have to look forward to PUMA.

Fierce sounding name, but it's just a glorified Segway. Top speed: 35 mph for 35 miles. That means commuters will have to wake up another hour early just to make it in time to the office. That is, if PUMA drivers don't get killed by SUVs and trucks first. And hoping the weather is balmy.

Seriously, nobody in Detroit would even want to drive this. Do you know how cold it gets in Detroit?

I want to see a picture of the President sitting in one of these ugly things. He ought to take the lead in endorsing this product.

General Motors is now Government Motors

There is a troubling trend in the relationship between American companies and the American government since Obama took office. Companies are failing, but also failing to enter bankruptcy, a norm in a healthy capitalist society. Rather, the federal government prefers to provide loans and inject capital into them, in turn prolonging the suffering of the firms and of the taxpayers as well. And because of these government funds, now it owns shares of companies, and is even dictating how to run them, on Wall Street and in Detroit.

The latest casualty is General Motors, once an American -- no, global -- icon. Rick Wagoner is now an ex-CEO, to be replaced by COO Fritz Henderson at the demand of the White House. Yes, you read it correctly: it's the President that's telling G.M. how to operate now. Welcome to the new Detroit, folks.

The auto industry has roots so deep in Detroit, Michigan that I wouldn't be surprised one bit if the White House starting handpicking the mayor and governor for the city and state! Heck, just annex Michigan into another federal jurisdiction! Washington, D.C. is still the capitol, but Detroit, D.C. can be where the federal government runs businesses.

Blaming Republicans, defending unions

Rose Ann DeMoro of the Huffington Post comes out swinging at the Senate Republicans, specifically their leader Mitch McConnell, in the matter of helping the auto industry. Funny title for an article: The Mitch Who Stole Christmas -- just in time for the holidays. Too bad she lacks the holiday spirit, calling Sen. McConnell "mean-spirited," "vilifying unions," and "cynical"...

Ms. DeMoro is upset over the Republicans' demand for "parity pay structure," or cutting wages and benefits for UAW laborers. She doesn't think it has anything to do with what's wrong with Detroit. Well, she's partially right -- unions share the blame with the clueless auto executives. Japanese automakers don't have to deal with excessive union contracts like G.M. has to, so naturally they can sell their cars cheaper than their American competitors. It's not about "punishing workers" as DeMoro argued, but rather staying competitive in the marketplace. And in the long run, allowing the employer to survive so the workers can still work. After all, nobody benefits from G.M. closing shop.

Being the liberal that she is, of course this has to tie into universal health care:

Or helping employers, as well as the people who work for them, by shifting healthcare coverage costs from employers to a national system like Medicare. It's one major reason why car producers have lower costs in other industrial countries which have national healthcare systems. It would also guarantee healthcare coverage for the millions of Americans who have lost, or are losing their jobs or employer-coverage in this recession, or were already uninsured.

Instead of cutting health care benefits, why not offload the obligation to a nationalized system like Medicare or some other universal health care plan. (I'm guessing she voted for Obama.) That actually sounds like a reasonable argument, but deep down it only means burdening taxpayers (including the workers) with UAW's health care bill.

No, thank you! Everybody is suffering in this recession, not just the auto workers.

But she concludes with a decent point:

During the last major Depression, we experienced a wave of union growth. A direct result was the full flowering of economic prosperity for American families and an unprecedented economic boom in the 1950s and '60s. The erosion of that dream and the shocking wealth chasm in our nation has coincided directly with the decline in union membership and the relentless attack on unions during the Bush-McConnell reign.

But let's just say that the unions of today is very different than those of the last Depression. There's nothing wrong with labor unions. In fact, it is indeed a good way for workers to organize and protect each other against injustices in the work place. However, mega-unions like the UAW, National Education Association, and American Federation of Teachers, have morphed into something sinister, something resembling political parties. And that stems from union leaders cozying up to Washington, particularly the Democrats, to stay in power and further their own agendas.

It is a shame that the UAW is getting so much negative attention in light of Detroit's troubles. Unfortunately, UAW leaders brought this unto themselves and their union colleagues for taking advantage of their employers and being a hard-headed cry-baby all these years...

Latest auto bailout proves TARP is slush fund

President Bush, soon to leave office amid lowest approval ratings, seems to be unconcerned about leaving a bad taste in taxpayers' mouths and is ignoring signals sent from his party members in Congress. Why else would he approve a $17 billion rescue package for G.M. and Chrysler when the Senate killed its version of bailout? Has he lost faith in free market capitalism? And notice that Ford isn't among the list of beggars. Maybe G.M. and Chrysler ought to learn a few things from this competitor. The fact that Ford is doing just fine without government money proves that there is a glimmer of hope for the auto industry, even if it means America is left with just one car company.

The auto bailout will come out of the TARP fund originally set up to relieve "financial institutions." Hans Bader of OpenMarket.org gives us a good idea of the statute:

...The bailout statute defines “financial institutions” eligible for the bailout as ”any institution, including, but not limited to, any bank, savings association, credit union, security broker or dealer, or insurance company.” Never mind that Congress listed as examples of ”financial institutions” only entities that were banks, insurance companies, or financial institutions, not automakers.

Using this money to save a car company is clearly not the intent of this statute. What is Bush thinking? If he is interpreting the bailout bill to include any institution, then TARP is essentially a slush fund for the White House. That would make it unconstitutional. But if the bill is honored as-is, then the auto bailout is illegal.

Would there be lawsuits coming forth about this? Maybe that is what kept Ford away from this package.

And what will Obama's incoming administration do? Billions of dollars in spending money for the White House. I'm sure the lobbyists are already buzzing around for a piece of that diminishing pie.

Bush blinks first in auto bailout

In the high stakes game of "Who blinks first?" it looks like President Bush lost to the UAW. The biggest losers are taxpayers, naturally.

The White House will authorize a $17.4 billion bailout for G.M. and Chrysler LLC which should last them through February 2009. If the automakers cannot show they're worth saving by March 31, 2009, the loans will be called and all funds to be returned.

Senate kills auto bailout bill

A few moderate Democrats joined forces with Republican senators to kill the $14 billion bailout bill after the UAW refused to cede wage and benefits to match those of foreign carmakers like Toyota and Honda. But now it seems the White House may step in to help Big Auto with TARP funds.

However, fingers are pointing everywhere already...

Democrats are blaming Republicans and the White House for not lining up their ducks, causing wasted energy and time, especially after the House passed the initial plan. Republicans are standing firm on greater concessions by Big Auto and its unions or else Detroit won't see a penny. They also bring up the point that Democrats have been too intimate with UAW and its largess, ultimately causing the downfall of G.M., Ford, and Chrysler.

It's a disturbing fact indeed that UAW and its political action committees have donated millions and millions to Congressional Democrats to lobby for labor benefits. Now look at what's happening. Daniel Howes of the Detroit News says it's Republican payback. That's certainly an oversimplified view of the situation. The bottom line is that the recession is hurting everyone, but not everyone is coming out asking for government handout. Why should taxpayers, many of whom are losing homes and jobs, further thin their wallets for these mismanaged corporations?

It bothers John B. Judis of The New Republic even more:

Here’s what bothers me. Japanese companies, which for years have benefited from one-way deal by which they could sell cars in the U.S. while U.S. companies were stymied in selling cars and trucks in Japan, set up non-union plants in low-wage, low-education, right-to-work states where they can pay less wages and benefits to their workers. Of course, in Japan, these same companies recognize and work with unions, but not here, where they have a chance to undercut American firms that work with unions. Corker and these other great patriots want to allow these Japanese companies to dictate the wages and benefits that American companies pay their workers. It’s despicable. Imagine, for a moment, American companies being allow to operate in this manner in Japan or South Korea. It would not happen.

Yes, that is part of the problem -- unfair trade practices between Japan and the U.S. But keep in mind that the Democrats control the House and the Senate and soon the White House! Why hasn't even one Democrat draft legislation to reverse this unfair trade? All they are thinking about is where and how to give more government handout, filling the media and our heads with images of an unemployment apocalypse triggering Great Depression II. Putting it bluntly, Democrats control the federal government, but they are not leading the nation.

And Judis ends with this:

Put it this way. What we have learned from the economics of the Great Depression is that in order to end the spiral of unemployment, government has to throw money at companies and consumers. It should be trying to raise wages, not lower them. The Wall Street bailout was a fiasco, but it was probably better than nothing. And the auto bailout was considerably better thought-out. Now there is a good prospect that two of the Big Three will fail, jeopardizing, perhaps, as many as a million jobs. That’s exactly the kind of thing that Americans should not be doing. But don’t tell that to those great patriots Corker, DeMint, or Shelby. They know better.

Anyone with basic understanding of capitalism and the fundamental economic principle of supply and demand would know Judis's thinking is flawed. Instead of the government throwing money, how about just not taking as much in taxes to let the companies and consumers decide what to do with it? Instead of trying to legislate acceptable wages, why not just let the market decide? The Great Depression was prolonged because of government intervention. The government should just get out of the way -- Americans have always found a way to recover and thrive without handouts!

Big Auto is desperate, but still arrogant

General Motors CEO Rick Wagoner is now begging the public for support of the bailout package for Big Auto. On cost-cutting he presents these facts:

...we have been streamlining our U.S. operations while simultaneously improving quality and productivity. Since 2000, we have reduced our U.S. hourly workforce by 52%, from 133,000 to 64,000, through buyouts and other programs. During the same period, we have cut our U.S. salaried employment from 44,000 to fewer than 30,000, and reduced our U.S. executive ranks by 45%.

But wait, what about that luxurious corporate jet you took to fly to Washington begging for taxpayer money from Congress? First class airfare on a commercial airline would be much cheaper, considering your company is on the brink of going bust, wouldn't it?

Sorry, Big Auto. Americans do not have deep pockets and have seen through your incompetency. The best solution to your problems isn't more cash, but a "managed bankruptcy" as Mitt Romney puts it. Your executives deserve to join the millions of other unemployed Americans.

Latest bailout saves UAW, not Big Auto

Another bailout package is in the works in Congress, one that's even less popular but that's not stopping the Democrats from pushing for it. House Speaker Nancy Pelosi said a government lifeline would be provided only if the auto industry meet new fuel-efficiency standards and restructure to limit executive compensation. Of course, there is no mention of concessions from the United Auto Workers (UAW) union.

We all know that the Democrats are good buddies with the UAW. This bailout will infuse fresh blood into the dying General Motors, Ford, and Chrysler so that the UAW can drain them some more. Big Auto already knows to make better, fuel-efficient cars. They came late to the green game and are paying the price. But the root of the problem is unionized labor in the auto industry. It's interesting how Jeffrey D. Sachs never mentions this in his Washington Post article. Michael E. Levine, writing for WSJ, is on the right track: Why bankruptcy is the best option for GM.

GM, Ford look for handouts

There's already talk in Washington, especially among Democrats, to bailout the troubled U.S. automakers. GM and Ford may be no more if they cannot get a good-sized loan or some sort of capital infusion. GM is betting its future on the Chevy Volt all-electric car to come out in 2010, but the automaker may not make it through next year. That's how bad they are...

Let's face it. These U.S. automakers are in the shape they are in now mainly because of bearing the burden of labor unions like UAW. Hundreds of thousands of employees could lose their jobs if the companies go under, but maybe that's what's needed to get Detroit back on track. The unions have to realize that the automakers do not provide social programs and welfare. The automakers are in the market to make cars that'll sell and create profits. If GM and Ford want loans, then let them go bankrupt first so the court can restructure their obligations and fire the executives, too.