In the House Financial Services Committee hearings on loans to the auto industry, Rep. Maxine Waters hectored the CEOs of Chrysler, Ford and GM. The California democrat attacked the execs on behalf of “small” independent auto dealers on “Main Street.” “Is there a commitment by any of you to give support to these small independent dealerships that include a lot of minority dealerships that are going to close down?” Never mind how they replied. Implied but not stated: The Big Three are guilty of, at best, racial insensitivity. At worst, racism. It’s untrue, unfair and outrageous.
Rep. Waters is upset that GMAC, Ford Credit and Chrysler Financial Services are calling in notes– as opposed to perpetually extending credit– to minority car dealers. In the interests of fairness, let’s keep in mind that this is the same Congresswoman who, in 2003, informed us, “We do not have a crisis at Freddie Mac, and in particular at Fannie Mae.” So no surprise that Waters’ tirade about the domestics’ dealer reduction and consolidation plans misses the entire purpose of exercise: reducing surplus dealers to survive.
Once upon a time, Chrysler, Ford and GM owned the U.S. market. There were domestic dealerships and then there was… nothing. Minority dealer programs were first initiated by Henry Ford II because he thought it was good business and the right thing to do, not because of pressure from activists. Be that as it may, special considerations were extended to minorities. Through financial incentives and active recruitment, they were encouraged to own stores and train members of their community.
That was then. This is now. As the domestics’ market share has steadily decreased, the domestics’ dealer count became a gigantic anchor tied around their collective necks.
It costs a lot of money to supply and support all those dealers. Inter-dealer competition drives down average transaction prices, yielding lower average vehicle sales per dealer. And pandering to the plethora of stores has lead to the brand-diluting practice known as “badge engineering” resulting in yet further intra-store competition.
For example, at the moment, GM’s eight domestic brands account for 24 percent of the U.S. market. The General has well over 6k dealers. That’s down from the nearly 8k dealers back when GM’s brand portfolio accounted for over 35 percent of the U.S. market. But it’s still well over 4k more dealers than Toyota.
There is an upside to the domestics’ ubiquity: they are far better represented in rural areas and small towns than Toyota, Nissan, Honda, Hyundai and the rest of their transplanted competition.
Reading between the lines of Ford CEO Alan Mulally and GM CEO Rick Wagoner’s testimony in the hearings, both domestics [rightly] view their small town dealers as a strategic advantage. During his testimony, Mulally referred to Ford’s small town dealers: “We are woven into the fabric of every community that relies on our cars and trucks and the jobs our company supports.”
All of which means that Chrysler, Ford and GM are closing/losing proportionally more dealers in big cities than smaller cities and towns. Ford CEO Alan Mulally’s prepared remarks to Congress admitted as much, revealing that Ford has reduced dealers by a greater percentage in “large markets.”
There is no getting around the fact that the vast majority of minority-owned car dealers operate within large, urban markets. While there’s no reason to believe that minority-owned dealers are any less well-managed than other dealers, and many are indeed profitable, there’s also no reason to suggest that the domestics are targeting minority-owned dealers for closure. They’re simply in the wrong place at the wrong time.
To satisfy Rep. Waters’ desire to protect African-American dealers, to exempt them from the inevitable cull, Chrysler, Ford and GM would have to discriminate against both rural dealers and well-managed non-minority-owned urban dealers.
Of course, that’s exactly what Rep. Waters wants. She wants to make any loans to the domestic automakers contingent on their continued support of dealers that are part of their problems in the first place. “Do you believe that if we are to rescue these big automobile manufacturers we should insist or include in our language support for the small independent dealers?”
If there was a time when the automakers could afford to cater to the concept of political correctness, that time is past. In their fight for survival, to meet their obligation to return taxpayers’ money, the domestics’ must ruthlessly “right size” their operations. The bottom line is all.
The Detroit automakers are among the biggest private employers of minorities in the country. A larger number of minorities in the auto industry work within the domestics’ organizations than without. Rep. Waters needs to understand that if the Detroit automakers don’t consolidate their dealer networks, the automakers will not survive and a lot more African-Americans, Hispanics and other minorities will lose their jobs.
Detroit’s automakers have collectively done more for blacks in this country than any other industry. It used to irk the shiat out of southerners to see blacks flee the south and earn 10 times what they were making in Alabama. Of course, someone on here will pull out some obscure event that happened years ago to disprove this.
This is typical Democratic party foolishness, in the form of racial preferences, but we also saw last week a huge dose of green foolishness. I think we are going to get some kind of bailout that has green (and maybe black) strings attached, which will do nothing to address the core problems facing the domestic auto companies. If so, every penny spent will be wasted, and quickly.
Victimology is her main method of staying in office.
Unfortunately that message seems to be spreading across the country.
She’s refuse from the Jesse Jackson / Cynthia McKinney era.
To give this lady a mike is like giving John Holmes a condom. Too little (or big), too late.
derm81,
Henry Ford, unlike other early automakers, bigot though he was, made a point of hiring blacks. He also liked to hire ex-cons and handicapped workers. The Health Department at Ford placed handicapped workers in appropriate jobs (when they weren’t busy tending to the hundreds who lost fingers and limbs in press machines).
To give this lady a mike is like giving John Holmes a condom. Too little (or big), too late.
While I was writing the editorial, C-SPAN hadn’t yet posted transcripts of the hearing so I transcribed Waters’ remarks myself. Shear torture. The lady doesn’t have enough neurons to form a single synapse.
Obviously, she has some guile and street smarts or she never would have gotten as far as she has in politics, but you gotta figure that other House members cringe when they hear the phrase “The gentlewoman from California”.
This is the same person that threatened to nationalize the oil industry. Ugh.
Maxine “Short Bus” Waters isn’t insane, she’s just “very special”.
It’s like that old saying — when the only tool in your toolbox is a hammer, every problem looks like a nail.
To Maxine Waters, the nail is racism, and having observed her antics with incredulity for years, I can say that she’s definitely a tool.
Ugh, I’m sick of people who think everybody except them is all about patronage and that they and only they got to where they were on thrift, self-denial, personal responsibility, and all that meaningless garbage. Personal responsibility is for suckers.
World Ends: Women And Minorities Hardest Hit
Isn’t the biggest job in America about to be filled by a minority? I think we can close that page, and relics like Waters need to be put to pasture.
all that was missing were the two ultimate media whores, the “reverend” Sharpton and Jackson.
She’s just one of many. There are plenty from the ‘right’ who spout their drivel regardless of circumstance or recent experience of how their platform has worked. We badly need public funding of campaigns to eliminate the incumbent advantage.
it’s shocking to think the future of the detroit based automakers rests in the hands of people like this.
This is just how Waters and the rest of the government gang of incompetents(including Dodd and Frank) brought the economy to this point.
Waters and the rest defend Fannie and Freddie
An example of yet more politicking and lobbying on Captial Hill. Nauseating.
If you polled the general public on who they would trust more – a politician or a car dealer – my bet is it would be a dead heat.
“No independent minority dealer bailout, no peace.” Idiot.
The CA.Gang of Four: Pelosi, Boxer, Feinstein and Waters . An embarassment,every one
What you see in Maxine is a glimmer of the future for the Big 2(.8)
I think that it was discussed a few days ago, that with gov’t control of the domestic auto industry come their agenda – and apparently it’s not focused on making money.
“Minority” as a catch-all label for under-privileged or discriminated individuals is bunk. Drive down El Camino Real in the Bay Area and note the minorities, most all of them Asian, that are cleaning it up in Silicon Valley whizzing by you in their German iron.
When Maxine says “minority,” she means “black.”
Black people as a group and a culture in the United States are very Detroit-loyal in their car choices it should be mentioned, however. The ‘Sclade wouldn’t be around if it wasn’t for black America’s odd appreciation for that vehicle at the highest income and cultural level. Ditto for any luxo-barge from the ’70’s.
With that in mind, it probably makes sense for Detroit to be “sensitive to minority concerns” as Maxine might put it, because they have an out sized representation in Detroit’s market share relative to their numbers. Once Maxine and the gang are in control of Detroit however, I imagine they will also run this into the ground. I can’t wait to buy a Honda knowing the sales-tax I pay on it will subsidize someone’s Pontiac G1.3 someday.
Well, it’s comforting to know that in the US the race card and associated drivel from politicians gets whipped out at every opportunity. At least in this case it’s a black politician…in Canada, it’s usually some publicly funded, white guilt drenched socialist. Anyway, politics aside if propping up dealers bring’s any of the Detroit automakers down I can’t imagine that the black employees, or any others, will have much time for Maxine’s nonsense.
Racism is the use of someone’s ethnicity, religion or skin color in a place where it clearly is not the issue.
Maxine Waters is a racist.
She uses racism as a baton to beat others with, when in reality, she has no evidence to support any of her claims.
She represents the worst of the worst politicians of our time.
www12,
…Tomorrow, Congressional Democrats intend to have a hearing so they can blame old white men.
Maxine Waters is still a member of of the House of Representatives in the US Congress? Oh, dear Founding Fathers, why didn’t you see fit to make term limits the law of the land?
She may well be insane, but that’s really not the point.
What really worries me is that her constituents keep re-electing her! Let’s face it, they have been voting her back into office every other year since Christ was a corporal!
So what is the greater severity of insanity, her own messed up way of thinking, her penchant for screaming racism evrytime somebody disagrees with her, or that she is continually chosen and re-chosen by the majority of voters in her district?
I tell you, she may be insane, but the voters are getting EXACTLY what they want.
On the TTAC political spectrum, I am probably six sigmas to the left of mean.
That being said, Maxine Waters is either horrifically dense or, more likely, gratuitously opportunistic, and her grandstanding makes me cringe.
That’s not exclusive to her, or even left-wing politicians. I can recall that then-Speaker of the House Newt Gingrich once blamed the actions of a woman who drowned her own children on “the values of liberalism”.
Similarly, much of the disaster in Iraq is because the current administration treated it as pork barrel, rather than a serious commitment.
Still, I wish dingbats like Waters and Senator Richard Shelby would look at the issue of the Detroit bailout outside the lens of their narrow provincial interests.
“Victim” pays quite well, otherwise there wouldn’t be so many folks working that racket.
And look, she has Beavis and Butthead’s teacher playing guitar!
It’s untrue, unfair and outrageous.
You left out one descriptive, typical. Maxine Waters is just continuing to play on a sense of entitlement and victimization that, as others have already pointed out, gets her elected every two years. If she truly is crazy, its crazy like a fox. She knows what her constituents want and gives it to them. I would say a better characterization of her behavior is evil. She does no favors for the people she supposedly represents by trotting out excuses that put any perceived or actual failures completely outside of their control. And, she is doing no favors for the nation as a whole by stirring up racism on both sides of her imaginary line and continually trying to divide this country along racial lines. So, I am sickened everytime I hear a report about her latest ecapade but not surprised.
Lumbergh,
Very well put.