By on October 29, 2009

(courtesy steve-calvert.co.uk)

The Wall Street Journal rips the veil off of General Motor’s true identity, revealing Government Motors in all its ignominious glory [sic]. The piece lists numerous examples of political interference with the automaker’s business, each worse than the one before. “Democratic Sen. Amy Klobuchar of Minnesota persuaded GM to rescind a closure order for a large dealership in Bloomington, Minn. In Tucson, Arizona Democratic Rep. Gabrielle Giffords did the same for Don Mackey, owner of a longstanding Cadillac dealership with 80 employees. Rep. Giffords argues it made sense, even for GM, to keep the Mackey dealership, which sold 750 cars last year. ‘All I did was to help get GM to focus on his case,’ she says.” So that’s alright then? In America, politicians own you! “Lawmakers say it’s their obligation to guard the government’s investments, ensure that bailed-out firms are working in the country’s interests and protect their constituents.” Swallow blood pressure meds, continue . . .

That same month, GM dealer Pete Lopez in Spencer, W.Va., received notice that GM was giving him just over a year to shut down his Chevy, Pontiac and Buick dealership, which he’d acquired two years earlier . . . With an assist from his mayor, Mr. Lopez took his complaint straight to one of his state’s senators, Jay Rockefeller, the Democratic chairman of the powerful Commerce Committee.

Sen. Rockefeller sent a letter to GM headquarters on Mr. Lopez’s behalf, according to a staff aide. He arranged for Mr. Lopez to come testify before a Senate panel in early June, alongside GM Chief Executive Frederick “Fritz” Henderson. The senator introduced the two men, giving Mr. Lopez a chance to make a personal pitch.

“He couldn’t have been nicer,” Mr. Lopez said of the GM CEO. “He said to me, ‘We’ve made some quick decisions and now we’re going to look it all over again.’ ”

The GM chief executive put Mr. Lopez in touch with Mark LaNeve, then the company’s top official for North American sales. The dealer received a response on the last Saturday in June while fishing on a lake near his house.

“Mr. LaNeve called and said, ‘I’ve got some good news for you. We’re going to save your dealership,’ ” Mr. Lopez recalls. He says he owes it all to Sen. Rockefeller.

Rockefeller? The Senator who insisted that GM CEO Henderson surrender the list of closed GM dealers for the public good, and then kept it private (failing to return TTAC’s calls)? Would it be too cynical to suggest that the secret dealer list would have presented an excellent opportunity for Rockefeller’s staff to shake-down threatened dealers in exchange for political support and cash money?

Is there more? Of course there’s more.

Similar rescues have played out across the country. Sen. Charles Schumer and Rep. Dan Maffei, both New York Democrats, helped save Crest Cadillac of Syracuse. “There would not have been a Cadillac dealership in all of central New York,” says Mr. Maffei. “That would have been a problem.” Mr. Maffei insists there was no “strong-arming here. We just asked GM to take a look at it.”

So far, GM has given reprieves to 70 dealerships nationwide. GM’s Washington spokesman says congressional pressure helped “put a focus on an individual dealer’s plight.” Beyond that, he said, “decisions to save individual dealerships were made on the merits.”

Is there more? Of course there’s more.

In addition to the dealership issue, lawmakers have jumped into a union fight that pits GM and Chrysler against two trucking companies that haul new cars around the country. The auto makers want to give some of the work to cheaper nonunion contractors. But that raised the ire of lawmakers who support the International Brotherhood of Teamsters.

Rep. Dale Kildee, a Democrat from Michigan, sent letters on Sept. 30 to the chief executives of both GM and Chrysler, demanding they explain their positions and advising them to stick with their unionized carriers. At least four other lawmakers sent similar letters.

Is there more? Yes, but not all of its in this article. And I think you get the picture: your taxes hard at work.

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21 Comments on “Government Motors Revealed...”


  • avatar
    mfgreen40

    There is a grass roots effort to vote out ALL incumbents and have term limits. Maybe a good idea.

  • avatar
    KingShango

    I’m shocked that congressional interference has been so mild. They saved a few dealerships, so what? Is anyone really surprised by this? I’m sure the meddling will get worse but so far this is pretty tame by congressional standards.

  • avatar
    rnc

    so far this is pretty tame by congressional standards.

    It’s kind of the wrong word to use, but that is the beauty of the way that TARP was set up, congress authorized alot of money with no control over it, that is the only thing that is keeping congress (politics) out of it (which as bad as the bailouts have been, letting 400 something people interfer with the process would have only made it that much worse.)

    Yes term limits and eliminating government by duolopoly would help a great deal.

  • avatar
    TZ

    mfgreen40 :
    October 29th, 2009 at 11:58 am

    There is a grass roots effort to vote out ALL incumbents and have term limits. Maybe a good idea.

    The problem with that is that people are generally happy with their local representatives and hate the rest. Look at individual Congressional member approval rates in their local districts. They are light-years ahead of the overall approval rates.

    Of course, that boils down to, “My local guy/gal looks out for my interests and the rest are looking for pork.”

  • avatar
    Madeleines Petite French Cakes

    I’m with the Dem congressmen on this one. They obviously want GM to fail and so do I.

  • avatar
    Geotpf

    mfgreen40 :
    October 29th, 2009 at 11:58 am

    There is a grass roots effort to vote out ALL incumbents and have term limits. Maybe a good idea.

    Good luck with that. Incumbents get re-elected 99% of the time because there are very strong technical advantages to incumbency, especially in the House. As for term limits, they are unconstitutional for Federal offices (have fun trying to amend the constitution to change that). Term limits are actually bad ideas, as then you have no senior members who actually know how the system works, so the elected representatives get pushed around by lobbyists easily. The California legislature is a good example of this.

  • avatar
    jkross22

    Term limits are actually bad ideas, as then you have no senior members who actually know how the system works, so the elected representatives get pushed around by lobbyists easily. The California legislature is a good example of this.

    Term limits would be a bad idea if we had an intelligent electorate that pays attention to these matters. We don’t, so term limits make sense in the bizarro world of CA and nationally.

    The problem with that is that people are generally happy with their local representatives and hate the rest.

    You’re right, and another example of an incredibly ignorant electorate.

  • avatar
    Madeleines Petite French Cakes

    KingShango :

    I’m shocked that congressional interference has been so mild. They saved a few dealerships, so what?

    I don’t know if the article is behind the WSJ subscriber wall, but it goes further than that. There are examples of MI rep. interfering in GM business decision when GM wanted to hire nonunion contractors. RI Sen. wants GM to join an environmental program, and another in MT wants GM to keep using an MT company.

  • avatar
    Daanii2

    Of course, that boils down to, “My local guy/gal looks out for my interests and the rest are looking for pork.”

    That is indeed the dark side of democracy. One the carmaker bailout has shown has not, and will not, stay dormant.

  • avatar
    TZ

    jkross22 :
    October 29th, 2009 at 1:39 pm

    You’re right, and another example of an incredibly ignorant electorate.

    More like narrowly-focused. To many, many people, the job of their representatives in DC is to look out for their (local) interests. Many of them couldn’t care less about the rest of the country. As long as their reps are looking out for their local interests (read, getting them local $$$), they will continue to support them.

  • avatar
    new caledonia

    Hmm… I see that my local Chevy dealer, Avenue Chevrolet, Batavia, IL, is back in GM’s dealer locator. I wonder if our congressman had a “talk” with somebody?

  • avatar
    TonUpBoi

    TZ:

    It’s best explained by one name: John P. Murtha.

    Without him, the town of Johnstown, PA would have become a ghost town shortly after the 1977 flood. Having lived there for 48 years (before moving south), I can understand the need and support. As an American, it still pisses me off.

    And yes, Jack will continue to be reelected as long as the pork keeps coming home. If anything, the town is starting to panic with the realization that the guy can’t have all that much longer to live.

  • avatar
    folkdancer

    I usually vote Democrat and this makes me sad. Of course if the Republicans were in the majority they would be doing the same.

    Having 500 some congress and senate bosses meddling will only kill GM quicker or even worse make more bailouts likely in order to keep the meddling going.

    I absolutely positively will not buy anything from GM.

  • avatar
    ClutchCarGo

    So, as I’ve read on this site, GM decision making on dealer closing was abysmal, and govt intervention to correct matters is an abomination. Apparently nothing done about the dealer surplus can satisfy this group.

  • avatar
    KingShango

    Madeleines Petite French Cakes,

    I did read the whole article. GM was already in the environmental program before bankruptcy and I don’t see how that is any different from mandating gas mileage and emissions. Also as far as the mining company is concerned it looks as if GM has made a pretty strong case for not renewing that contract. My whole point was that I’m not surprised that Congress is trying to interfere. GM made this mess by running the company into the ground and then asking the government for help. I don’t blame Congress for doing what Congress has always done, I blame GM for putting themselves into this position.

  • avatar
    ZoomZoom

    The Founding Fathers’ intentions were for all legislative and executive branch government servants to serve their time for a limited period, then go home and live under the laws that they enacted.

    The Founding Fathers recognized that a long-term/no limit government methodology creates an elite political class (not unlike kings, queens, dictators), and this ultimately becomes at odds with a free society.

    I think the electorate has been dumbed down by our politically correct education system, and that’s why the electorate has shown itself incapable of providing that healthy turnover of politicians.

    Look, we just promoted a “present” but decision-averse Senator to the office of the Presidency. Our other choice was another Senator, one who’s been in government far too long. This is not healthy turnover.

    I think today, we are in a situation where term limits would in some small way help mitigate the inadequacies of our education system.

    It should also be noted that in the mid/late 1700’s, terms were often limited by shorter life-expectancies. Maybe that’s why term limits weren’t written into the Constitution; it just didn’t occur to the authors that this might someday be needed.

    So today, we have politicians from all parties who are serving well beyond the expiration date stamped on the carton.

    Another point made in earlier posts requires a response: To say that government is “too complicated” for new politicians to be successful is in a way ADMITTING that we’ve gone too far. Government SHOULDN’T be that complicated! It’s only become complicated because government is doing too much. I blame politicians who have been there for too long…in other words, politicians with “too much” experience in politics. Which goes back to the electorate and the government-controlled education system.

    folkdancer wrote:

    I usually vote Democrat and this makes me sad. Of course if the Republicans were in the majority they would be doing the same.

    Unfortunately, this is probably true.

    Having 500 some congress and senate bosses meddling will only kill GM quicker or even worse make more bailouts likely in order to keep the meddling going.

    I disagree with one part of this…I think it will kill GM slower, not quicker. But in the end, dead is dead and yeah, you’re right, it will make more bailouts more likely because the same congress and senate bosses will not let GM go under. They’ll keep it going with bailout after bailout, and this goes to my point about it being a slower death.

    But really, for Congress to take a different direction (ending the endless bailouts for example), they would be admitting that they were wrong. And when was the last time we heard a member of Congress admit that they were wrong?

    This brings us back to my earlier points about term limits being necessary. The only way to change course here is to start with a new Congress. The old one is tainted and soiled beyond recognition.

    I absolutely positively will not buy anything from GM.

    Me neither. Never, ever in a bagillionkagillion years. Plus one for good measure. By then, our sun will have supernova’d or blackholed and it won’t matter!

  • avatar
    FloorIt

    Lee Iacocca stated years earlier that he hated having the Government looking over his shoulder and questioning the company’ decisions. And back in 1980 it was private bank loans backed by the government not direct government bailout like today.
    We’ll see more involvement by congress constituents and possibly more like the incident with Rick Wagoner and Steve Rattner.

  • avatar
    tparkit

    I don’t consider this litany of congressional intervention to be interference per se.

    The interference was the decision to nationalize GM and Chrysler. After that, interference becomes impossible; how can one say that the ruling party is interfering with the ruling party? Perhaps it is better to say that the subsequent interventions underscore the fundamental character of the initial intervention:– was 100% political.
    – was ill-considered and haphazardly executed.
    – diverted public money to private interests.
    – had no bottom, no boundries (the CfC program is just one example of extensions to come), and no planned termination.
    – will throw sums large and small in any and every direction the ruling party and its coalition of friends thinks advisable.
    – will include illegal and unethical acts (like robbing the Chrysler bondholders).That’s why the only solution is to force the government to close the doors at GM and Chrysler. This can only be achieved if we stop buying their products. Further, it may well be that such a taxpayer boycott is time-critical. We must force shutdown before Washington can morph the auto companies into makers of light rail transit, windmills, prefab housing (think the Katrinaization of Democrat-leaning districts nationwide), or other environmentalist and social engineering frauds.

  • avatar
    50merc

    Second the motion for term limits. Long-term incumbency usually has effects like those of England’s “rotten boroughs” a long time ago.

    tparkit described well the potential for mischief.

  • avatar
    ronin

    The whore borrowed money from a pimp, and is surprised the pimp is now calling the shots?

  • avatar
    PeteMoran

    Time for the greatest American philosopher of the last 30 years; George Carlin.

    If you’ve never seen it, make sure you watch the whole thing. (I think the audio is out of sync).

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