Auto Bailout? Follow the money

UPDATE:  This is why I do not trust most Liberals – they talk out of both sides of their mouths at the same time.  If one it going to do something, it should be consistent the vast majority of time.  Somebody needs to clue in this Democrat Senator:

Sen. Kent Conrad (D-N.D.) told CNSNews.com he does not believe it is the government’s role to tell companies what they must pay their employees.

“We can’t have Congress setting wage rates by statute,” said Conrad. “Think about the implications. When you get down to the question of Congress deciding what the wage rate or compensation should be, you have a problem. I don’t think that’s a direction in which Congress wants to go. I don’t think that’s going to work.”

So far, so good.  Once government does, that is called fascism.

Conrad said he does not have a problem with a requirement currently in the bill that bars the top 25 paid employees in each company from receiving incentives or bonuses, because that only affects the “upper echelons.”

And then shows how willing he is to fall into the tank for the UAW.  Sorry, but last I looked, "executives" and "line workers" are ALL workers for the company – none of them own the company.  Yes, some have vastly more responsibility for guiding the company and receive commiserate pay for that risk (and have proven themselves incompetent) , but philosophically  they all work for the owners of the company.  The UAW leadership cannot cry poor mouth for their levels of compensation either.

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We are just SOOO anti-bailout!  WHY should ordinary taxpayers take on the foolish results by the auto maker executives and the UAW leaders that have put upon the American auto industry.  Why is it moral for any of the citizens of this country to provide a good outcome for these folks?

First, consider this – Just for Ford, here is 22 lbs of union work rules and regulations (LaborPains via Hot Air):

 Ever wondered what a UAW contract looks like? Here is all 22 pounds of it (in this case, Ford’s 2,215 page 2007 master contract; Coke can is for scale and because I was thirsty).

I’ll tell you this much, those 2,215 pages don’t include much regarding efficiency and competitiveness. What you’ll find are hundreds of rules, regulations, and letters of understanding that have hamstrung the auto companies for years.

Now think – is this for the benefit of the company in adapting to new business conditions and innovative ways to manufacture their product?  Does all that promote flexibility and competitiveness or is it simply to keep union jobs?   And remember, that is just for Ford!  Go to the post at LaborPains to see the source materials.

Now, follow the money (H/T: NRO):

The Audacity of Hope: Chrysler Won’t Invest Its Money But Expects Congress To Pony Up Your Money   [Andy McCarthy]

From the WSJ story this morning on the collapse of the auto bailout:

The collapse of the deal raises the stakes for Chrysler and its majority owner, Cerberus Capital Management LP. Lawmakers had called for Cerberus to put more money into the company, but Cerberus maintains it can’t because the bylaw of its investment funds prevents it from putting more than a small percentage of its investors’ funds into any single investment…. Chrysler Chief Executive Robert Nardelli told Congress the company would be unable to pay suppliers and employees if it doesn’t get loans by the end of the month.

So Chrysler’s owners say, "You’re nuts if you think we’re going to throw our money at our loser business model" — they sit on their own wallets, play chicken with their workers and creditors, and expect the idiot taxpayers to say, "No prob — we’ll pony up for you."

All praise to Mitch McConnell for leading the charge that beat back this lunacy.  Can someone explain why the White House thought this was a good idea?

Let me amplify this again.  The OWNER of Chrysler is a Venture Capital / Private Equity fund.  Their job is to take other people’s money and invest it WHERE IT WILL RETURN A PROFIT.  What they are saying is that they are not willing to bet any more of their own money on this deal.  

But it’s OK for them to have politicians, hardly financial gurus, bet yet other peoples’s money?

As Senate Republican leader Mitch McConnell (R-Ky.) said

"Americans are worried about the government intervening on behalf of some industries and not helping others – “especially when there is no guarantee that the interventions will work.”

“We simply cannot ask the American taxpayer to subsidize failure,”

So, if you are so willing to give your money to the car companies without buying a car, be my guest.  Want to give them mine?  Not so much!   Frankly, it would probably be more efficient to just subsidize individual car buyers instead of this wholesale take over of an entire industry.

It’s socialism (government owning the elements of production), I tell you, or fascism (private ownership but under the control of government). Oh wait, that’s what Obama wants anyways – control!

And since it seems that extreme environmentalim has turned into yesterday’s communism, we get this in "trying to save the auto industry".  If the import of this bailout is to save the auto manufacturers, the top priority should be in making cars that sell, right?  Well, think again…. which is the first priority, and which is the second one?

Section 2 of the draft legislation states what Congress perceives to be the “purposes” of the bill.  The first “purpose” listed is “to immediately provide authority and facilities to restore liquidity and stability to the domestic automobile industry in the United States.”
 
The second “purpose” specifically cited is “to ensure that such authority and such facilities are used in a manner that—(A) results in a viable and competitive automobile industry that minimizes adverse effects on the environment; (B) enhances the ability and the capacity of the domestic automobile industry to pursue the timely and aggressive production of energy-efficient advanced technology vehicles.”

Fooled you – both priorties have an emphasis on politically correct environmentally sound cars.

Versus an emphasis on cars that will sell and make a profit!

And yes, my Congressmen Hodes and Shea-Porter decided that feeding the UAW l
eadership was more important than putting this country more into debt (get that – our debt-laden leadership has decided to go into more debt to give to other debt-laden companies that ordinary banks will not lend to.  Why?  Because those banks don’t feel that the companies can pay it back.  What did our Congressional leaders (and President Bush) know when they voted that would be considered extra special?).