Not much info here, but the story’s major thread is clear enough. After discovering that Massachusetts Congressional Representative Barney Frank won a reprieve for a local GM operation, Michigan Reps are looking for some of the same non-action for their constituents. The Detroit Free Press is uncharacteristically tight-lipped (uninformed?) about the who, when and where—although we know the what and why (staying elected). “Michigan members of Congress summoned the chief executive of General Motors Corp. to a meeting next week after the company bowed to pressure from U.S. Rep. Barney Frank and delayed the closing of a parts warehouse in his district.” The Detroit News is more forthcoming, indicating that it’s the entire Michigan congressional delegation asking for various stays. This after Dingell’s open letter to Fritz on the first . . .
Dingell throws everything against the wall.
As a Congressman who has fought hard to preserve and promote American manufacturing, with particular regard for the domestic automakers General Motors (GM), Ford, and Chrysler, I am troubled to learn that GM plans to close its Willow Run Transmission Plant in Ypsilanti Township, Michigan.
As you well know, this plant was once known as the “Arsenal of Democracy” for having built the famous B-24 bomber that helped the U.S. and its allies win the Second World War. More recently, the support of the Michigan Economic Development Corporation, tax abatements by Ypsilanti Township, and an investment of $557 million by GM itself have allowed the Willow Run facility to remain an international leader in the efficient assembly of quality six-speed transmissions. When measured against GM’s internal quality scorecard, the Willow Run team assembles GM’s highest-rated transmission.
The bottom line: the people in charge of federal funds are ignoring federally-funded GM’s bottom line, dooming the zombie automaker to extinction. Well duh.
And so begins America’s bold new experiment with socialist capitalism. Good luck with that.
And so begins America’s bold new experiment with socialist capitalism. Good luck with that.
Actual “socialist capitalism” (if there is such a thing) seems to be rather successful. You may wish to pay attention to the GDP growth rate of China over the past two decades for evidence of this.
Government involved in private enterprise is nothing new in this country. What exactly do you think the “military industrial complex” is? Do you think firms like Boeing would be as successful as they are without an intimate, long-term relationship with the government? Would you or I be communicating via the Internet without the government?
Laissez faire capitalism has a rather poor track record compared to more advanced development strategies, pioneered mostly by Japan (neo-mercantilist with a high degree of industrial policy).
With regard to the article itself, this seems again like an instance of members of Congress looking out for the interests of their constituents – which is what they are paid to do. It’s not partisan.
Michigan in particular – wow. Dingell is the same guy who has fought higher fuel economy standards and many other things counter to his party’s platform. It’s a state with obviously the heaviest reliance on the auto industry of any state. So they act accordingly.
Not much different from Loiusiana Democrats or New England Republicans. They stay in office by working in the interest of their constituency, not the nation as a whole.
This is why we have a president who can counter the more parochial interests.
So, basically it’s come down to buying a GM is a vote for Bawney Fwank.
No thanks. I’ll buy ANYTHING BUT GM. This article is exactly why.
How nice of the rest of the country to pay for jobs in Michigan. Since they are getting my tax dollars I don’t need to give them any more by buying a car from them.
It’s true they act in the interests of who votes for them and they represent. This is why you don’t let government get involved in the first place in what should have been a C11 in the courts with winner take all. Now that we have large amounts of government involved in making cars all sorts of mischief will occur.
This is only the beginning.
How nice of the rest of the country to pay for jobs in Michigan.
Nice change of pace after subsidizing Texas for 8 years.
Oh, please. The whole point of this government supported process that none dared call bankruptcy for the longest time is for GM to get right- sized as quickly as possible. “Right- sizing” means closing plants, laying off/ terminating workers, and closing dealerships so that portion of GM which remains (New GM) would evetually return to profitability.
Yet within a week of the bankruptcy filing the process has devolved into pure political hackery. No elected representative, particularly in the House, is going to want to be accused next November of letting the GM factory that made trim screws for Buick Enclave dashboards in his district get closed. The political strongarm tactics to save 50 jobs here and 200 jobs there are only going to get worse.
But if GM can’t use this process to shed all the dead weight, then what exactly is the fucking point? If New GM can’t close the factories and dealers it needs to return to profitability, then it’s still Old GM with a few more billions in taxpayer dollars keeping it on life support.
The money has to keep coming from somewhere. If GM isn’t allowed to make the cuts it needs to make to become profitable, then that means an infusion of $10 or $12 billion dollars every quarter from now until the sun explodes or the GOP retakes all branches of government, whichever comes first. You don’t have to be a business major to see why this plan isn’t going to work. Obama isn’t going to step in and stop his Dem colleagues in Congress from bullying GM into keeping unneeded plants open in their districts. Perhaps if we had a divided government the country’s and GM’s best interests would win out, but we don’t.
# long126mike :
June 6th, 2009 at 12:32 pm
How nice of the rest of the country to pay for jobs in Michigan.
Nice change of pace after subsidizing Texas for 8 years.
http://www.scribd.com/doc/8229012/Tax-Donor-or-Contrib-States
The federal government does spend significant dollars on some large military bases in Texas, but in general Texas doesn’t receive a big percentage of federal spending more or less than taxes coming from Texas. At a local level we still have volunteer fire departments and a well armed population.
The federal government does spend significant dollars on some large military bases in Texas, but in general Texas doesn’t receive a big percentage of federal spending more or less than taxes coming from Texas. At a local level we still have volunteer fire departments and a well armed population.
I was referring to the latest oil boom which was fostered by Federal policy.
Maybe Mr. Dingell hopes we’ll restart the B-24 program, and really relive the glory days?!
Say, at GM maybe we should just call off this whole negative “closing the plants” idea, recall the 450,000 workers lost over the last 20 years, push 4 million cars out the door annually, and declare victory over the recession? I mean, if the bailouts are about saving jobs, let’s not just save them, let’s create them!
@Smegley: I agree; buying a GM is a vote for these clowns.
I think Michigan can make the case to GM to keep plants operating there. They can weight the economics of operating in Michigan vs elsewhere, and make concessions to GM. In the end, Michigan has to persuade GM it is more economical to be in Michigan than elsewhere. It may take some state subsidy, but this is doable.
Let the discussions between Michigan and GM begin.