Bailout Watch 506: None of the Responsibility, None of the Blame
For some reason, The Detroit News columnist Daniel Howes reckons the average Joe will blame the bankers when—sorry “if”—Chrysler goes Tango Uniform. Yes, the money men will take the hit “whether they deserve it or not. I say this not because it would be entirely fair, either, unless ‘fiduciary responsibility’ and the duty of lenders to determine whether a Chrysler allied with Italy’s Fiat SpA would have a shot at survival now are quaint notions that no longer apply. In normal times, lenders are supposed to decide where credit-worthiness ends and recklessness begins. But these are not normal times and bankers, as one of them quipped privately to The Detroit News, ‘are the most hated people in America.'” I know TTAC is guilty of first degree inside baseball, but I’m not feeling that at all. The average American will place the blame squarely on Chrysler for not building competitive products. But it’s interesting that Danny “I can’t get off the fence but I know who’s on either side” Howes would see it that way; it shows that Detroit still can’t take responsibility for its failures. Or admit defeat . . .
A flurry of discussions during coming days could still produce an out-of-court solution.
This from another DetN article on Chrysler’s forthcoming Thelma and Louise moment. What I don’t get: who gives a flying you-know-what if the next chapter in Chrysler’s saga is settled in or out of court? The only real question is whether or not more of our money will disappear down the ChryCo-shaped rathole. To which the only possible answer is yes—no matter what.
In Washington, the Obama administration’s auto task force continued intensive negotiations with the United Auto Workers on an agreement to protect the bulk of workers’ health care and pension benefits in the event of bankruptcy.
One thing’s [even more] for sure: the money flowing towards what’s left of Chrysler won’t be Fiat’s.
In Italy, Fiat SpA Chief Executive Sergio Marchionne said he was still committed to concluding an alliance with Chrysler, but reiterated that the Italian automaker would not inject cash to close the deal.
Ever.
Marchionne said demands that Fiat put cash into Chrysler are “unjustifiable.” He said Fiat might put some cash into Chrysler later on, noting that the company would have an option to increase its holding in the Auburn Hills automaker. “We are going to commit cash at the relevant time, if the situation arises.”
Hang on; if putting money into Chrysler is “unjustifiable,” what’s the Presidential Task Force on Automobiles reasoning for propping-up the Auburn Hills zombie? Answer on a postcard. Void where prohibited by law.
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It's quite amusing to the see the plebs now blaming the cleanup crew. The damage to the individual companies were already done by their poor management and planning, the damage to the economy is already done by the financial thieves, and now that the shit's been dumped (ie. externalized) to society at large (front line defense being the representative government with our money), the plebs are trying to distance themselves as if it's a burden that's unrelated to them. I guess it makes sense in a way, but sad nonetheless.
Disclosure: I am not now, nor have I ever been, a union member. In fact, I am a partner in a small business, which puts me smack dab on the management side. With that said, why is the MSM obfuscating the real story on who's to blame for the present state of Chrysler and General Motors? It sure isn't the fault of the UAW or the banks. The UAW wasn't the only signatory to the bloated contracts, was it? It certainly wasn't the UAW that designed and engineered thirty years of substandard automobiles, was it? It wasn't the UAW that offered poor warranty and service work, was it? It wasn't the UAW that continued to support a bloated and sleazy dealership network, was it? The finger of blame can be pointed directly at GM's BoD's, and it's upper and middle management. With Chrysler it's obvious Daimler was the worst offender (to support this claim, I direct you to Allpar.com, wherein several stories relate tales of Daimler's mistreatment of the staff and products, and callous disregard of the "partnership of equals"). At any point during the past forty years GM's BoD's had multiple opportunities to stand up to the UAW in contract negotiations, but didn't. To blame the UAW for what's ailing GM is just flat out wrong. In no way am I excusing the UAW for the recalcitrant position they've taken in regards to sacrificing wages and benefits to help salvage GM, but that's a different story. Rick (Red Ink Rick) Wagoner and his predecessors always took the "short term gain" position in every bargaining session with the UAW, and in fact, took the short term position with regards to every decision, or non-decision, that they ever made. There are very few examples of GM looking forward much past the next quarter's profits. Why should this be the fault of the UAW? The MSM and the blogosphere are chock full of stories and editorials about the gross amount of pay and benefits earned by members of the UAW, but it's a red herring, really, because the UAW wasn't ever responsible for what transpired in the boardrooms in Detroit. GM's BoD's was (criminally) negligent in my opinion, and are almost wholly responsible for what is ailing GM. It is not the fault of the banking sector that GM was ill-prepared for an economic crisis, it's not the fault of the car-buying public that GM has manufactured sub-standard product, it's certainly not the fault of the UAW that GM has sold product at a loss for the last several years, it's not the fault of white-collar employees that GM has sold off seemingly profitable divisions to raise cash to support the unprofitable core business. This situation can be entirely ascribed to GM's BoD and senior management. Just my opinion of course.