Friday, November 28, 2008

I Wish Congress Would Read This

Born, raised, and living in the 'burbs of Detroit all my life, I breath and eat because of the auto industry. I'm reprinting this column written by Mitch Albom. Is is SO worth the read, please do so.

If I had the floor at the auto rescue talks
By Mitch Albom, Detroit Free Press columnist
November 23, 2008

OK. It's a fantasy. But if I had five minutes in front of Congress last week, here's what I would've said:

Good morning. First of all, before you ask, I flew commercial. Northwest Airlines. Had a bag of peanuts for breakfast. Of course, that's Northwest, which just merged with Delta, a merger you, our government, approved -- and one which, inevitably, will lead to big bonuses for their executives and higher costs for us. You seem to be OK with that kind of business.

Which makes me wonder why you're so against our kind of business? The kind we do in Detroit. The kind that gets your fingernails dirty. The kind where people use hammers and drills, not keystrokes. The kind where you get paid for making something, not moving money around a board and skimming a percentage.

You've already given hundreds of billions to banking and finance companies -- and hardly demanded anything. Yet you balk at the very idea of giving $25 billion to the Detroit Three. Heck, you shoveled that exact amount to Citigroup -- $25 billion -- just weeks ago, and that place is about to crumble anyhow.

Does the word "hypocrisy" ring a bell? Protecting the home turf?

Sen. Shelby. Yes. You. From Alabama. You've been awfully vocal. You called the Detroit Three's leaders "failures." You said loans to them would be "wasted money." You said they should go bankrupt and "let the market work."

Why weren't you equally vocal when your state handed out hundreds of millions in tax breaks to Mercedes-Benz, Hyundai, Honda and others to open plants there? Why not "let the market work"? Or is it better for Alabama if the Detroit Three fold so that the foreign companies -- in your state -- can produce more?

Way to think of the nation first, senator.

And you, Sen. Kyl of Arizona. You told reporters: "There's no reason to throw money at a problem that's not going to get solved."

That's funny, coming from such an avid supporter of the Iraq war. You've been gung ho on that for years. So how could you just sit there when, according to the New York Times, an Iraqi former chief investigator told Congress that $13 billion in U.S. reconstruction funds "had been lost to fraud, embezzlement, theft and waste" by the Iraqi government?

That's 13 billion, senator. More than half of what the auto industry is asking for. Thirteen billion? Gone? Wasted?

Where was your "throwing money at a problem that's not going to get solved" speech then? Watching over the bankers?

And the rest of you lawmakers. The ones who insist the auto companies show you a plan before you help them. You've already handed over $150 billion of our tax money to AIG. How come you never demanded a plan from it? How come when AIG blew through its first $85 billion, you quickly gave it more? The car companies may be losing money, but they can explain it: They're paying workers too much and selling cars for too little.

AIG lost hundred of billions in credit default swaps -- which no one can explain and which make nothing, produce nothing, employ no one and are essentially bets on failure.

And you don't demand a paragraph from it?

Look. Nobody is saying the auto business is healthy. Its unions need to adjust more. Its models and dealerships need to shrink. Its top executives have to downsize their own importance.

But this is a business that has been around for more than a century. And some of its problems are because of that, because people get used to certain wages, manufacturers get used to certain business models. It's easy to point to foreign car makers with tax breaks, no union costs and a cleaner slate -- not to mention help from their home countries -- and say "be more like them."

But if you let us die, you let our national spine collapse. America can't be a country of lawyers and financial analysts. We have to manufacture. We need that infrastructure. We need those jobs. We need that security. Have you forgotten who built equipment during the world wars?

Besides, let's be honest. When it comes to blowing budgets, being grossly inefficient and wallowing in debt, who's better than Congress?

So who are you to lecture anyone on how to run a business?

Ask fair questions. Demand accountability. But knock it off with the holier than thou crap, OK? You got us into this mess with greed, a bad Fed policy and too little regulation. Don't kick our tires to make yourselves look better.

I just want to add, the auto industry isn't looking for a free ride, just a loan to help get through this restructuring time. Loan is the operative word.


Mr. Mack said...

I'm almost in complete agreement...but it has to be acknowledged that our auto industry has been more than a little myopic about their entire business model. The EV1 is an example. The decision to buy Hummer. The tax breaks afforded to imports has also been available to domestic manufacturers, provided they opened new plants in other states, right?

That said, the idea that we should reward parasitic financial companies that produce little to nothing and ignore whats left of our manufacturing base is dangerously short-sighted.

sgk213 said...

That article says it all. Thanks for finding it.

Mary Alice said...


Audubon Ron said...

I'm not sure what to make of it. Ford and GM and Chrysler had this problem before the stock market melt down. Chrysler as I remember merged with a German car company, Ford and GM had poor profits and had to shut plants down. If anyone is to blame it is the American consumer who demanded SUVs. Did you here that California with your fierce impossible emission standards and the biggest market for SUV’s? Then there is blame on the unions. GM is actually a big hospital and big fat retirement. And you know what, at least somebody is getting good health care and retirement in America because nobody, but nobody has said JACK about the Medicare system needing a bailout. How am I going to live on $800 a month Social Security? Say what you will, American autoworkers are some hardass workers. The auto makers have only done good for the world, like we taught Japan how to whip our butts making cars. And guess what else, we’re going to need the plants open just like the government did in World War II when they asked GM to convert a plant to build the Grumman Avenger torpedo airplane that greatly assisted in destroying the Japanesse navy. Ever think about that? Are we going to outsource that? And finally, Congress can agree to award a contract to EADS a French company to build our refueler airplanes in and pay for 1,000s of new French jobs? Horse petunias, don’t get me started young lady. Now I’m steamed all over again. I need a drink. Automakers need a hand, not a handout.

Michael said...

I'm stealing yet another of your posts because I think everybody needs to read this. Thanks for sharing.

Joan said...

I am not informed enough on the issue to probably make a intelligent comment other than to say the whole thing is a big mess.

Whit said...

I bet there aren't any congressmen among the 5 people you'll meet in heaven.

Betty said...

Well said. I shudder to think of how things will turn out if Congress doesn't offer a loan to the auto industry. Detroit will be ruined, and the rest of the country won't be in good shape either.


delmer said...

Thanks for finding that for us.