Bailout Watch 239: $21m And Still No Bailout?

bailout watch 239 21m and still no bailout

Let’s just agree now that if Ford, GM and Chrysler get their $25b in December, the $21m they invested in lobbying efforts this year was a brilliant investment. Of course, as the Detroit News reports, that’s actually $21.6m and that only covers the first three quarters of this year; fourth-quarter lobbying disclosures don’t come out until January, and with their companies on the line you can bet the D3 will be throwing what’s left in their wallets at DC until the last bailout option is depleted. The problem for Detroit though is that their political contributions are actually shrinking in relative terms. The auto industry is only 34th on the list of contributers to congressional election campaigns, down from the 16th spot eight years ago, and even generous campaign contributions don’t guarantee your safety. For example, Chrysler owners Cerberus Capital Management donated $37,500 to Senator Richard Shelby’s (R-AL) 2008 campaign, only to have Shelby badmouth the industry from his position as a ranking member of the Senate Banking Committee. And though it spends more on lobbying than the other Detroit firms, General Motors says its reducing its efforts. “In fact, it’s decreased considerably,” spokesman Greg Martin said. “We’re looking at every operational expense and cutting where we can. That includes our efforts here in D.C. Lobbying is a legal, very transparent means to have your voice heard in Washington, especially as it relates to political issues that have a substantial effect on your business.” And if it pays off, it will make Porsche’s play on the hedge funds look like a mediocre investement. Where else can you invest $25m and have it turn into $25b in less than a year? Only in American government.

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  • OldandSlow OldandSlow on Nov 24, 2008

    After getting CitiGroup to make the the big play with risky financial instruments, it was Charlie Prince who had to walk the plank, not Robert Rubin. Rubin was a major pusher of creative debt packaging, to include credit default swaps - a.k.a legalized gambling. It looks like Rubin got a lot richer and now has the privilege of advising Barack Obama. Our financial industry, to include major banks and Wall Street have spent hundreds of millions of dollars lobbying Congress. They'll get at least a trillion dollars in taxpayer funded bail outs.

  • Bearentino Bearentino on Nov 24, 2008

    The bailouts are a real comment as to the 'sad state of affairs' in the United States. Some of us remember the 1970's and the 'Arab Oil Embargo'. As a result, the Carter administration called for, and we had 'CAFE standards' for auto fuel economy and credits for alternative energy. We provided a 'loan' to Iacoccoa and the Chrysler Corp. They used the loan to retool, and came out with a line of vehicles that were fuel efficient. So now we must ask, What did we learn from those experiences? The answer appears to be, Very little! In 1990, California enacted a 'Zero-emissions mandate' which would require 10 percent of vehicles sold there to have 'Zero-emissions'. So in 1996, GM began to 'lease only' the first version of their EV-1 which had lead-acid batteries. Discontinued in 1999, the second generation of EV-1 come to the market with nickel-hydrid batteries. During this period, GM also manufactured a 'stretch version' of the same platform using Compressed Natural Gas (CNG) which had a fuel economy of 60 mpg when compared to gasoline; and a EV-1 parallel hybrid (similar to the Opel Astra Diesel Hybrid) with a 1.3 liter DTI diesel which achieved a fuel economy of 80 mpg. In 2002 the Bush administration sided with automakers to fight 'Zero-emissions' and in 2003 GM discontinued the EV-1 program. Where would we be if we had continued this and programs at Ford and Chrysler? Taking the liberty of sumarizing, the March 13, 2007 issue of Newsweek attributes GM Chairman and CEO, Rick Wagoner with a statement that "AXING EV-1 and not putting the right resources into hybrids" was one of the worst decisions of his tenure. GM's R&D Chief, Larry Burns is also attributed with an evaluation that they could have had the 'Chevy Volt' 10 years earlier. A total of 1160 EV-1 vehicles were manufactured. They could only be leased with restrictions. Though opinions often were that it exceeded the testing program, GM said "NO" and evoked the terms and conditions of the lease. The vehicles were returned and destroyed by GM. Despite those few vehicles generating 1948 people signing an 'interest to purchase' in an environment with a total lack of marketing, GM discontinued the program. 50 of those vehicles were stripped of parts and the shells donated to museums and colleges. Finally, one might question if the fact that GM is one of the biggest contributors to the Smithsonian, but on June 16, 2006 the Smithsonian removed the EV-1 electric sedan from display to make room for a 'SUV' display. One can only ask, "If we learn little or nothing from history, why do we continue to print history books?

  • Islander800 That is the best 20-year-on update of the Honda Element that I've ever seen. Strip out the extraneous modern electronic crap that adds tens of thousands to the price and the completely unnecessary 400 pd/ft torque and horse power, and you have a 2022 Honda Element - right down to the neoprene interior "elements" of the Element - minus the very useful rear-hinged rear doors. The proportions and dimensions are identical.Call me biased, but I still drive my west coast 2004 Element, at 65K miles. Properly maintained, it will last another 20 years....Great job, Range Rover!
  • Dennis Howerton Nice article, Corey. Makes me wish I had bought Festivas when they were being produced. Kia made them until the line was discontinued, but Kia evidently used some of the technology to make the Rio. Pictures of the interior look a lot like my Rio's interior, and the 1.5 liter engine is from Mazda while Ford made the automatic transmission in the used 2002 Rio I've been driving since 2006. I might add the Rio is also an excellent subcompact people mover.
  • Sgeffe Bronco looks with JLR “reliability!”What’s not to like?!
  • FreedMike Back in the '70s, the one thing keeping consumers from buying more Datsuns was styling - these guys were bringing over some of the ugliest product imaginable. Remember the F10? As hard as I try to blot that rolling aberration from my memory, it comes back. So the name change to Nissan made sense, and happened right as they started bringing over good-looking product (like the Maxima that will be featured in this series). They made a pretty clean break.
  • Flowerplough Liability - Autonomous vehicles must be programmed to make life-ending decisions, and who wants to risk that? Hit the moose or dive into the steep grassy ditch? Ram the sudden pile up that is occurring mere feet in front of the bumper or scan the oncoming lane and swing left? Ram the rogue machine that suddenly swung into my lane, head on, or hop up onto the sidewalk and maybe bump a pedestrian? With no driver involved, Ford/Volkswagen or GM or whomever will bear full responsibility and, in America, be ambulance-chaser sued into bankruptcy and extinction in well under a decade. Or maybe the yuge corporations will get special, good-faith, immunity laws, nation-wide? Yeah, that's the ticket.