Republicans Never-Ending Hypocrisy

Remember when Republicans criticized the auto industry "bailout"?

“Unless Chrysler, Ford and General Motors become lean and innovative and competitive in the market place, this is only delaying their funeral,” said Sen. Richard Shelby, an Alabama Republican and bailout opponent.

It was a colossal waste of money and pointless.

Actually, it was a success.  The auto companies are performing well again and have paid back the "bailout".

Auto workers are union members and usually vote for Democrats, which is the real reason Republicans were against helping them out.

Farmers usually vote Republican ...

And, what most Americans probably don't know, Trump's Farm Bailout Has Cost The Taxpayers More Than Double The Auto Bailout.  (Lets also not forget that Trump's own trade policies exacerbated farmers' problems.)

As Bloomberg reported, "Doling out billions in aid to American farmers, who have become more dependent on government money than they’ve been in years. At $28 billion so far, the farm rescue is more than twice as expensive as the 2009 bailout of Detroit’s Big Three automakers."

This is what the Republican party has become - a spiteful cabal of sycophants and grifters, only concerned with power and cronyism.  Their policies have nothing to do with what is right for America, what would be good for America, but are more concerned with what will buy them votes, keep them in power, and allow them access to the trough of public dollars to reward themselves.

Obama's Accomplishments

The Auto Industry And Labor Productivity

General Motors had $150.28 billion in revenues in 2011. General Motors has 202,000 employees. That's $743,960 revenue per employee. As David Leonhardt wrote, "The average GM, Ford and Chrysler worker receives compensation – wages, bonuses, overtime and paid time off – of about $40 an hour. Add in benefits such as health insurance and pensions and you get to about $55." If we use this $55 per hour number (for total compensation), which would gross roughly $114K per year, the typical GM worker only receives 16 percent of his revenue productivity.

People complain about taxes. But this is a direct example of how labor is taxed. In this case, at 84 percent! (And Republicans complain about 30, 20, and even 10 percent taxation?)

2011 Ford Revenues: $136.26 billion.
2011 Ford Employees: 164,000.
2011 Ford Revenue Per Employee: $830,854.
Labor Tax: 84%

2011 Chrysler Revenues: $55 billion.
2011 Chrysler Employees: 51,623.
2011 Chrysler Revenue Per Employee: $1,065,416.
Labor Tax: 89%.

Seeing as how the Republicans are so concerned with the average Joe and fair taxation, I know we'll be hearing from them any minute now about how we must obtain more just compensation for our auto workers.

Race To The Bottom

The former head of Obama's auto task force, Steven Rattner, while speaking at a luncheon in Detroit, expressed that he wished he would have made the UAW sacrifice more.

Rattner also mentioned, "Friends on Wall Street were concerned by GM's earnings and communications with the market."

The three-tiered pay structure has the highest 900 workers making $29 an hour, $16 for those 200 workers in the middle, and $9 for those subcontracted at the bottom. Which means that the top worker has gross earnings somewhere near $60,000 per year; the middle worker somewhere near $33,000; and the bottom somewhere near $19,000.  

The article goes on to note that GM's North American division posted profits of $5.7 billion in the past nine months of this year. So, even though the workers are not making lavish amounts and the company is profiting handsomely, the Wall Street and Republican mindset is on full display - the rich deserve more, while the workers should sacrifice more.

This is class warfare people. Wake up! 

Weekend Reading

American Troops Under the Formal Control of Another Nation

Distressed Real Estate: Yet To Hit Bottom

Falling Dollar Phobia

Inside the GOP's Fact-Free Nation

Job Creation by the Wealthy is Mostly a Myth

9 Things the Rich Don't Want You To Know About Taxes

Only Little People Pay Taxes

Small Biz No Job Machine

Super Rich See Federal Taxes Drop Dramatically

10 Epic Failures of the Bush Tax Cuts

The True Price of Auto Labor Costs

Three Most Important Health Care Graphs

What Determines the Price of Gas?

Wisconsin's Wolf in Sheep's Clothing

Depressing Republicans

GM Report Profit, First Since 2004.

Another teachable moment here...

If we'd followed the 'screw the UAW and American auto manufacturers' Republican game plan, we'd have millions more unemployed and an even more depressed economy.

Rewarding Corruption

Dean Baker wonders Why Are Contracts for AIG Execs Different Than Contracts for Autoworkers?

"Back in the spring, the Obama administration had no problem insisting that union autoworkers give up some of the health care benefits that they were entitled to in their contract. In some cases, workers had already put in more than 30 years earning these benefits. Note that this was before any of the manufacturers went into bankruptcy.

While these workers were forced to make large concessions on contractually promised benefits, we are told yet again that AIG, an effectively bankrupt company, has a contractual obligation to pay big bonuses to its top executives and traders. It would be interesting to hear why this would be the case and if it is legally committed, why shouldn't the company just go into bankruptcy now that the immediate post-Lehman panic is over."

Retooling

Why can't the majority of our auto workers be retrained for producing green vehicles or other green technologies (solar, wind turbines, etc.), along with retooling the factories? The government could use stimulus money to establish a management team to retool the factories and workers for these new production possiblities (rather than just throwing money at Fiat and making the workers continue to experience paycuts and layoffs). Then after getting the new endeavors up and running, sell them off to the highest private bidders. This would be similar to what many have suggested we do with the banks (nationalization) to get them healthy again. We already have a defacto policy that does this, the problem is we (the taxpayers) have no control and only get to experience the losses rather than the upside.

Auto Asphyxia

Allowing the auto companies to slowly crumble (while bailing out financiers and banks) and their workers to be laid-off, or take substantial wage cuts, is having a devastating effect on communities countrywide, as predicted.

Financial Double-Standards

Another example of the double-standard our country and economic system has between labor and capital. The auto industry better beg, grovel, and whimper for the $28 billion they received. Wall Street can have their $5.7 trillion without stipulations, no questions asked. WTF?!

Let's not forget about our, what seems to be, never-ending $5 trillion war(s).

For Further Reading:
Class Warfare
Correction To The $70-Per-Hour Myth
Failure Bonuses
Foreign-owned: Yes. American-owned: No.
Republican War Against U.S. Workers

Class Warfare

So...A.I.G. (and their ilk) needs "retention" bonuses to keep such skilled workers at the company, even though these are the same employees that ran everything into the ground?

One can only assume that it would be perfectly fine for the auto industry to lavish lucrative bonuses on their workers, too. They also need to keep their skilled employees happy and productive in these hard times. Right?

Or does this simple question of logic and fairness cross over into the gist (and idiocy) of our modern-day bizarro world?

One where the wealthiest are subsidized, given tax breaks, and have all their risk insured by taxpayers. While the majority of Americans, everyday workers, are told to go without - where their wages stagnate, where their health care premiums continue to skyrocket, where pensions are a thing of the past, and where retirement is now having a job working the counter at Walgreens for many in their golden years.

The auto workers (along with all unions workers) have seen their wages and rights steadily dismantled over the last thirty years. They have taken pay, health care, and pension cuts. They have continually renegotiated their contracts cycle after cycle.

I haven't heard someone demanding setting limits on executive compensation (other than a few mumblings and labor advocates), yet they are the ones responsible.

Auto workers don't design vehicles. They don't make the company's investment decisions. Plus, executive labor costs, proportionally speaking, cost these companies a lot more than the assembly line workers (if it's just labor cost we're supposedly irked about). It's these higher-ups whose reckless greed and poor management destroyed the economy and their companies.

This is class warfare. The Haves are continuing to pick our pockets. We need some Change to believe in more so than ever.

Double Standard

The mayor of Lansing reads the riot act to yet another dimwitted Fox host. [Hat tip to Michael Rosen]

For more on this, see here and here.

Foreign-owned: Yes. American-owned: No.

Greg LeRoy, Good Jobs First’s executive director, proclaims, “And while proposed federal aid to the Big 3 would take the form of a loan, the vast majority of subsidies to foreign auto plants were taxpayer gifts such as property and sales tax exemptions, income tax credits, infrastructure aid, land discounts, and training grants.”

These state and local subsidies for foreign-owned auto assembly plants total approximately $3.6 billion.

Just more of the beggar-thy-neighbor, zero-sum development policy we're pursuing in the U.S.

This whole - make the automakers sweat - episode is really just cutting off our own nose to spite our face.