In an earlier post today I said GM must think Americans are incredibly stupid because they ran an ad blaming themselves for the auto mess when fault should also be placed at the feet of Congress who mandated the stupidity in the first place.
Of course, that’s only part of the story. The other part deals with the fact that GM was bailed out once before and posted a very similar ad 5 years ago. Michelle Malkin quotes from a piece at Slate:
What’s a little more unusual is a company coming out and apologizing for just being generally lousy over the past couple of decades. But that is essentially what GM is doing now, with a curious campaign touting its journey on “the road to redemption.” GM has run big two-page ads in major newspapers and also spins its tale on the Web.
Like all ad campaigns, the bottom line is that GM, right now, is a fine, high-quality company, whose products you should buy immediately. It’s the journey to this obvious destination that’s interesting. “Thirty years ago, GM quality was the best in the world,” the print ad starts. “Twenty years ago, it wasn’t.”
And apparently the company muddled along in a sub-par manner for 10 years before deciding to change. “The hard part [was] breaking out of our own bureaucratic gridlock,” the ad copy continues, and “learning some humbling lessons from our competitors.” After a “painful” decade of effort, they’re now back up to snuff, putting out great cars, etc., etc. The ad cites positive consumer-satisfaction research and recent automotive awards, presumably the hook for the campaign. “The road to redemption has no finish line,” the copy concludes. “But it does have a corner. And it’s fair to say we’ve turned it.”
So here we are again, refusing to learn our lessons and our politicians once more screwing us by throwing billions more good money after bad.
What will we get? Basically a nationalized auto industry with severe restrictions on what can and can not be done. Plus we get a “CAR CZAR” out of this and oversight inspectors. GREAT!! Just what we need, more government workers. Check out some details of “the deal.”
he government would receive warrants for stock equivalent to at least 20% of the loans any company receives. The company also would have to agree to limits on executive compensation and dividend payments, much like those contained in the government’s $700 billion rescue of the financial industry.
In the case of General Motors Corp., such a move could give the government a large stake in the company and may hurt existing shareholders. GM is seeking about $10 billion in short-term loans and has a market capitalization of about $3 billion. The legislation didn’t specify what kind of stock the government would take, leaving open the option it could be preferred, common, voting or nonvoting.
Assuming congressional Democrats and the White House come to agreement on the plan, the car industry would be the latest to submit to strict government scrutiny in return for a bailout, joining most prominently the banking sector.
The auto industry would undergo a restructuring process akin to bankruptcy reorganization, only with fewer rigors and with the government, not a judge, in control, and with many associated political complications.
The program would be overseen by an official, tapped by President George W. Bush, whom congressional aides and lawmakers describe as an “auto czar.” This person would act as a kind of trustee with authority to bring together labor, management, creditors and parts suppliers to negotiate a restructuring plan. He or she also would be able to review any transaction or contract valued at more than $25 million.
It’s all here in this Wall Street Journal story which I highly recommend you read.
Funny how Congress is demanding auto execs take pay cuts and as noted in an earlier post by NewsBusters if our politicians want our auto execs to make salaries commensurate with Japanese companies, why aren’t they insisting American workers at our factories make what Japanese auto workers make in the US?
Oh well, now that we are about to nationalize our auto industry like Argentina did, will we also regulate what to charge for cars….like they are also doing?
Here’s how I see it: In the not-too-distant future, America will be producing “Made in America Trabants”
Copyright: PixelSmooth at www.3DM3.com
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I haven’t listened or read everything concerning the bailout but I did notice one thing. I haven’t heard of the companies saying they can’t pay suppliers throughout their “food” chain. The main reason I can see for the bailout is to pay pensions and benefits of UAW retirees and employees.
The CEO of Ford said they were doing great until the stock market took a dump. He said the pension funds are paid out of earnings in the stock market. They’re no longer getting the capital gains and dividends from their investments to pay pensions. Explain to me something? How is that different than the retiree down the street who is living off his IRA and 401k? His retirement investments went down the toilet and now he’s having a hard time. Why is he any different than the autoworker retiree? Only thing I see is the autoworker retiree has the UAW and the UAW has the automakers by the kahunas.
…..the auto company bail would get THEM thru 02/09?…then WTF?