Let’s just agree now that if Ford, GM and Chrysler get their $25b in December, the $21m they invested in lobbying efforts this year was a brilliant investment. Of course, as the Detroit News reports, that’s actually $21.6m and that only covers the first three quarters of this year; fourth-quarter lobbying disclosures don’t come out until January, and with their companies on the line you can bet the D3 will be throwing what’s left in their wallets at DC until the last bailout option is depleted. The problem for Detroit though is that their political contributions are actually shrinking in relative terms. The auto industry is only 34th on the list of contributers to congressional election campaigns, down from the 16th spot eight years ago, and even generous campaign contributions don’t guarantee your safety. For example, Chrysler owners Cerberus Capital Management donated $37,500 to Senator Richard Shelby’s (R-AL) 2008 campaign, only to have Shelby badmouth the industry from his position as a ranking member of the Senate Banking Committee. And though it spends more on lobbying than the other Detroit firms, General Motors says its reducing its efforts. “In fact, it’s decreased considerably,” spokesman Greg Martin said. “We’re looking at every operational expense and cutting where we can. That includes our efforts here in D.C. Lobbying is a legal, very transparent means to have your voice heard in Washington, especially as it relates to political issues that have a substantial effect on your business.” And if it pays off, it will make Porsche’s play on the hedge funds look like a mediocre investement. Where else can you invest $25m and have it turn into $25b in less than a year? Only in American government.
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What 25 billion? This bailout will cost us (taxpayers) well over 100B when all said and done. You start talking billion here and there and then it is real money. In 5-6 years when dust settles everybody will be shocked how ineffective governance by government really is. Those Seibring based Volgas from Moscow will be pinnacle of auto manufacturing.
As fools we thought that we defeated socialism/communism 20 years ago. The thing emigrated right here and lives happily thereafter.
Just one question to the best and brightest out there concerning bailouts. Why is citibank being bailed out again with no questions no dragging the ceo’s over the coals. why? more money being poured down that drain than the one the big 3 are circling. why is there a justification for that bank that made bad investments and bad business decisions but no public flogging or public enquiry yet they still receive more money than the big 3 and affects less jobs than the big 3. where’s their business plans that can be scrutinised, again more double standards, back scratching and short-sightedness by the powers that be.
@BostonTeaParty
Robert Rubin
What a bunch of cheap skates. Our big multinational and Wall Street banks have spent hundreds of millions on lobbying and campaign contributions. So, the financial industry should get theirs before anyone else gets in line. It’s only trillions, not billions being handed out.
After getting CitiGroup to make the the big play with risky financial instruments, it was Charlie Prince who had to walk the plank, not Robert Rubin.
Rubin was a major pusher of creative debt packaging, to include credit default swaps – a.k.a legalized gambling. It looks like Rubin got a lot richer and now has the privilege of advising Barack Obama.
Our financial industry, to include major banks and Wall Street have spent hundreds of millions of dollars lobbying Congress. They’ll get at least a trillion dollars in taxpayer funded bail outs.
The bailouts are a real comment as to the ‘sad state of affairs’ in the United States.
Some of us remember the 1970’s and the ‘Arab Oil Embargo’. As a result, the Carter administration called for, and we had ‘CAFE standards’ for auto fuel economy and credits for alternative energy. We provided a ‘loan’ to Iacoccoa and the Chrysler Corp. They used the loan to retool, and came out with a line of vehicles that were fuel efficient. So now we must ask, What did we learn from those experiences? The answer appears to be, Very little!
In 1990, California enacted a ‘Zero-emissions mandate’ which would require 10 percent of vehicles sold there to have ‘Zero-emissions’. So in 1996, GM began to ‘lease only’ the first version of their EV-1 which had lead-acid batteries. Discontinued in 1999, the second generation of EV-1 come to the market with nickel-hydrid batteries. During this period, GM also manufactured a ‘stretch version’ of the same platform using Compressed Natural Gas (CNG) which had a fuel economy of 60 mpg when compared to gasoline; and a EV-1 parallel hybrid (similar to the Opel Astra Diesel Hybrid) with a 1.3 liter DTI diesel which achieved a fuel economy of 80 mpg.
In 2002 the Bush administration sided with automakers to fight ‘Zero-emissions’ and in 2003 GM discontinued the EV-1 program. Where would we be if we had continued this and programs at Ford and Chrysler? Taking the liberty of sumarizing, the March 13, 2007 issue of Newsweek attributes GM Chairman and CEO, Rick Wagoner with a statement that “AXING EV-1 and not putting the right resources into hybrids” was one of the worst decisions of his tenure. GM’s R&D Chief, Larry Burns is also attributed with an evaluation that they could have had the ‘Chevy Volt’ 10 years earlier.
A total of 1160 EV-1 vehicles were manufactured. They could only be leased with restrictions. Though opinions often were that it exceeded the testing program, GM said “NO” and evoked the terms and conditions of the lease. The vehicles were returned and destroyed by GM.
Despite those few vehicles generating 1948 people signing an ‘interest to purchase’ in an environment with a total lack of marketing, GM discontinued the program. 50 of those vehicles were stripped of parts and the shells donated to museums and colleges.
Finally, one might question if the fact that GM is one of the biggest contributors to the Smithsonian, but on June 16, 2006 the Smithsonian removed the EV-1 electric sedan from display to make room for a ‘SUV’ display.
One can only ask, “If we learn little or nothing from history, why do we continue to print history books?