By on March 10, 2010

As an American citizen, it is tough on my part to pay tax dollars to an entity that can turn around and use those tax dollars to get my fellow American citizens to not do business with me. The government owns 60% of General Motors, and these American tax dollars are funding business activity for one company, with the express goal of negatively impacting another company

Paul Atkinson, President of Toyota’s National Dealer Council, manages to capture the central problem with government intervention in industry without resorting to the hyperbole that so often accompanies such lines of criticism [via Radio WAOI]. Examples?

There are some mailing lists which have been given to dealers, and there have been some mailers, in fact, I’ve seen several of them. On the outside of the envelope it says “important Toyota recall information enclosed.” But when you open up that envelope, it is nothing more than an advertisement trying to get you to come trade your Toyota in at a GM store.

Your tax dollars at work? What’s worse is that GM and Chrysler’s sales range from mediocre to lousy, considering the opportunity Toyota is presenting them with. And despite ugly tactics like those described by Atkinson, who says angry letters to “Senators and Congressmen, as well as Secretary LaHood” are forthcoming. [Hat Tip: Robert Walter]

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33 Comments on “Quote Of The Day: Screw The Politics Edition...”


  • avatar
    superbadd75

    Once the Toyota scare simmers down a little, it will be back to business as usual. GM and Chrysler will go back to having to sell their cars by way of cash on the hood, and Toyota will offer a better product, albeit with an unknown issue affecting an unknown amount of vehicles. Toyota will figure out what’s going on with the unintended acceleration issues, and they will fix it. Chrysler, however, will never figure out what American consumers want in a car, and GM seems to more or less have it figured out, but refuses to build them.

  • avatar
    crash sled

    Well, it coulda been worse for the Toyota dealers, if they think about it for a minute. If the Chicoms had bought GM and Chrysler (as we should have allowed them to do), they would have probably skinnied down those 2 and been making smart decisions and rationalized their lineups within 5 years, and been eating Toyota’s lunch, rather than eating the taxpayers’ lunch, as Government Motors is doing.

  • avatar
    Steven02

    GM doesn’t own or run the dealers who send out these types of letters. There is an important distinction there.

    I received one letter from a Toyota dealer that on the inside looked like a news paper claiming how Toyota had successfully recovered from its recall woes. It was a fake newspaper and a fake story. It isn’t like car dealers are the most reputable businesses out there.

    • 0 avatar
      Robert.Walter

      Conversely, with Atkinson being the head of Toyota’s National Dealer’s Council, and given TMC’s ‘One Voice’ policy, I have to wonder if this dealer is speaking for himself, the dealers, or the Company.

      I think that this may be the beginning of Toyota exploring various channels by which to go on the Offensive.

    • 0 avatar
      JohnAZ

      My thoughts exactly Robert.

  • avatar
    gslippy

    I wouldn’t be so quick to claim that Chevy pedals will not stick.

  • avatar
    Detroit Todd

    As an American citizen, it is tough on my part to pay tax dollars to….

    Someone call this man a wahhhmbulance! I don’t like my tax dollars going to, among other things, the Iraq War, Goldman Sachs, marijuana busts, etc. At the same time, I realize we have a representative, duly-elected, legitimate government.

    Anyway, the sign at the Chevy dealer is stupid, and so is Mr. Atkinson’s statement.

    • 0 avatar
      forraymond

      WELL SAID!

    • 0 avatar
      TrailerTrash

      Kind of lacking in reason.
      Its one thing to not want money to go for roads, wars (WW1,2 or even Iraq), defense…whatever you selfishly pick.
      But it’s a whole dumber thing to allow for use in government social experimentation or control.
      You know there IS a difference.
      Nobody on this sight speaks in favor of government bailouts, be they big bank, big manufacturers or big mortgage/credit card debtors.
      So to kind of mix them all together to pitch one big bitch is insincere and deceptive

  • avatar
    pgcooldad

    Ohh, Booohh Hooohh….

    But it was ok to take the government’s money on the Cash-For-Crunker deal, huh?

    • 0 avatar
      geeber

      The government did not give Toyota money through the Cash for Clunkers program. The government indirectly gave the customer the money. Toyota did not directly receive any money – nor did GM, Ford, Honda, Nissan, Hyundai or VW.

      The fact that more customers chose Toyotas than GM or Chrysler models is a reflection of Toyota’s ability to make vehicles that are appealing to buyers. Customers were free to buy any vehicle they wanted, as long as it fit the criteria of the program. There were plenty of GM and Chrysler vehicles that were eligible. Not as many customers wanted them, and, in most cases, for very good reasons.

  • avatar

    Such tactics reflect badly on the dealers that use them. So I’m not so sure they’ll benefit Chevy and harm Toyota. They could well have opposite their intended effect.

  • avatar
    Gregg

    These letters about “Important Toyota Recall..” are quickly becoming an urban legend. The first one I heard of was supposedly from a Honda dealer. Does anyone know whether they actually exist?

  • avatar
    geozinger

    Welcome to the wonderful world of selling cars. All kinds of tricks, all the time. Nothing new here.

    I have to admit that I laughed at the sign, though. It IS funny.

  • avatar
    JimothyLite

    Flash! AP headline: “Spike in Prius complaints may not be all it seems”… You don’t say?

    http://news.yahoo.com/s/ap/20100311/ap_on_bi_ge/us_prius_panic

  • avatar
    y2kdcar

    I find it interesting that Mr. Atkinson objects to tax dollars being used to bail out GM and Chrysler, but apparently has no objection to tax dollars being used to provide incentives to locate Toyota facilities in Texas and Kentucky, among other places in the United States. The tax dollars spent on infrastructure and not collected (virtually spent) due to tax abatements improved Toyota’s competitive position relative to the Detroit Three. That sure sounds to me like funding business activity for one company with the express goal of negatively impacting another company or companies.

    • 0 avatar
      Steven02

      Very interesting way to think about this and it is absolutely correct. Everyone auto company has benefited in one way or another from gov’t at some level.

    • 0 avatar
      Robert.Walter

      +1 y2kDcar (by the way, is it a Taurus or a Sable?)

    • 0 avatar
      John Horner

      No kidding. Toyota also took taxpayer money for “retraining” at the Nummi facility not long before choosing to close it down. Toyota has been in very tight with the Japanese government for a long time.

      This is just more grandstanding. Lots of grandstanding going on these days.

    • 0 avatar
      crash sled

      Actually, no, Toyota or any other OEM taking tax abatements from an individual state is not the same thing as the federal government owning and operating Government Motors.

      States have to balance their books, and are accountable for their financial decisions, including tax abatements. The federal government is not accountable, and doesn’t have to balance their books. They can just borrow cash, or worse yet and most insidious, the feds can print money, which is what they’ve been doing for some years now.

      I don’t really favor state tax abatements, but Government Motors certainly likes them, as they are taking them from any state they operate in. Here in Michigan, Big Ed, Rattlesnake Ed, Ed the Knife… well, he has his hand out begging even as you read this post.

      Government Motors, taking over the automotive industry, running it direct from Washington, and shaking down the state and local governments. Disgusting.

      Absolutely disgusting.

    • 0 avatar
      geeber

      y2kdcar: I find it interesting that Mr. Atkinson objects to tax dollars being used to bail out GM and Chrysler, but apparently has no objection to tax dollars being used to provide incentives to locate Toyota facilities in Texas and Kentucky, among other places in the United States.

      That’s because, as crash sled correctly noted, there is a difference between states using tax dollars to encourage manufacturers to locate there, and the federal government using tax dollars to bail out two failed companies. A big one is that state governments have to balance their budgets, while the federal government does not.

      y2kdcar: The tax dollars spent on infrastructure and not collected (virtually spent) due to tax abatements improved Toyota’s competitive position relative to the Detroit Three.

      A red herring argument. ALL companies manufacturing vehicles in the U.S. have benefited from this practice.

      States have been happy to lavish incentives, rebates and infrastructure improvements on GM, Ford and Chrysler when they improve or upgrade plants. States would also have been happy to offer incentives to GM, Ford and Chrysler in exchange for the construction of new facilities, but those companies have been busy closing or consolidating plants for the past 10-15 years.

      GM has received state and local money to upgrade its Warren, Michigan, facilities. Ford received state and local money to upgrade its Chicago plant when it prepared it for Five Hundred/Freestyle production.

      And who can forget the circus when GM announced what finally became Saturn? States were falling all over themselves to offer tax breaks, incentives and infrastructure improvements in exchange for promises to build the plant there. GM didn’t choose Tennessee because its executive team liked southern cooking.

    • 0 avatar
      Steven02

      geeber and crash,
      You are missing the point. I don’t think anyone doubts there is a difference between bankruptcy and tax abatements. But taking his quote which says…

      “The government owns 60% of General Motors, and these American tax dollars are funding business activity for one company, with the express goal of negatively impacting another company”

      Correct me if I am wrong, but American tax payers unwilling are giving money in the form of tax abatements to these companies as well. The express goal is to make them more competitive against another company (which does negatively impact the other company). Till an auto company refuses gov’t money, this don’t matter at all.

      Also, since there is a myth that state govts have to balance budgets. Look at the trouble California and other states are in with unbalanced budgets. It doesn’t happen at that level of gov’t either.

      And if you want to make more distinctions, gov’t money isn’t funding these recall letters. Dealers are not owned by GM. They operate their own businesses and send out their own ads.

    • 0 avatar
      Juniper

      Don’t forget the “Prius” tax credit.

  • avatar
    gslippy

    Such tactics don’t result in more sales; they just make good-humored people chuckle and drive on.

  • avatar
    mtypex

    Chuckle, chortle, or sneer? Some people hate crappy car dealers more than others, I guess.

  • avatar
    john.fritz

    CHEVY PEDALS WILL NOT STICK

    Whatever dealer put that comment up has a nut sack the size of a beach ball.

  • avatar
    Moparagain

    It’s a joke. Jeeeez. Your congressman is probably chuckilng. Gm doesn’t care what the dealer does. The dealer knows his turn is coming. Be nice. Enjoy the moment.

  • avatar
    geeber

    steven02: Correct me if I am wrong, but American tax payers unwilling are giving money in the form of tax abatements to these companies as well.

    State government is closer to the people, and residents have a more direct say in the actions of that level of government (as their votes aren’t diluted by the votes of people in the other 49 states).

    As a Pennsylvanian, I’m not paying for tax abatements in Kentucky and Tennessee for Toyota – or in Michigan and Illinois when GM and Ford receive them.

    steven02: The express goal is to make them more competitive against another company (which does negatively impact the other company). Till an auto company refuses gov’t money, this don’t matter at all.

    Except that GM, Ford and Chrysler have received plenty of tax abatements, training dollars and infrastructure upgrades from states where they have facilities, too.

    The original contention was that only the transplant operations are benefiting from state-funded taxpayer largesse, and this therefore gives them a competitive advantage over GM, Ford and Chrysler. This is not true. ALL companies making vehicles in this country receive this type of aid. GM, Ford and Chrysler have received this type of aid on many occasions.

    steven02: Also, since there is a myth that state govts have to balance budgets. Look at the trouble California and other states are in with unbalanced budgets. It doesn’t happen at that level of gov’t either.

    They are required to balance their budgets, as per their state constitutions…the fact that they use tricks instead of spending reductions or tax hikes (or do as little as possible and wait for a federal bailout, as it looks as though California is now doing) does not change this fact.

    • 0 avatar
      Steven02

      Just like the state and local gov’t that are putting up red light and speed cameras and all of the fights going on there. Citizens do not have more direct say. They elect people who make decisions just like any other level of gov’t. The difference is that it is a smaller pool of people that elect that official. It doesn’t mean that people aren’t still giving away tax dollars when they don’t want to.

      You see, I didn’t say that GM, Ford, and Chrysler didn’t take money. The quote you have of mine is actually me quoting the original article, with a small addition, saying you can’t be upset for someone else taking gov’t money when you do the same thing. No one turns it down. Since they don’t turn down gov’t money, it doesn’t matter.

      So, essentially the states aren’t following their own constitution because of “tricks” that allow them to spend more than their budget. That to me sounds like states aren’t running a balanced budget. And, for the record, tax dollars are tax dollars no matter who they are coming from or what car company they are going to. Federal vs State in this case does not matter.

  • avatar
    geeber

    Steven02: Just like the state and local gov’t that are putting up red light and speed cameras and all of the fights going on there. Citizens do not have more direct say. They elect people who make decisions just like any other level of gov’t. The difference is that it is a smaller pool of people that elect that official. It doesn’t mean that people aren’t still giving away tax dollars when they don’t want to.

    They do have more of a direct say. They can vote directly for or against the people who made those decisions, without their votes being diluted by 49 other states. The fact that they haven’t chosen to vote based on that particular issue – elections are rarely about just one issue – does not make that less true.

    The fight against red light and speed cameras has been ongoing, and there are cases where citizens are forcing governments to remove the cameras. So I wouldn’t use that one as an example.

    Steven02: You see, I didn’t say that GM, Ford, and Chrysler didn’t take money. The quote you have of mine is actually me quoting the original article, with a small addition, saying you can’t be upset for someone else taking gov’t money when you do the same thing. No one turns it down. Since they don’t turn down gov’t money, it doesn’t matter.

    There is a difference between government assistance in the form of incentives or tax abattements to build or upgrade a plant and government assistance in the form of a direct injection of taxpayer money to avoid bankruptcy.

    All of the domestics and the transplants have done the former. The person who wrote the original article wasn’t objecting to that practice. (Whether he should or not is another question entirely.)

    Only two companies – GM and Chrysler – have done the latter in this country. The original writer was clearly referring to this use of government money.

    Attempting to equate the former with the latter does not make them equivalent.

    I would like to see where any of the transplants received a direct injection of taxpayer money from the United States federal government to avoid a date in bankruptcy court.

    Many of us object to state governments giving incentives to ALL companies – transplants and domestics – but we can still make the distinction between giving a company tax breaks or infrastructure upgrades to refurbish a plant, and giving a bankrupt company money to keep the plant running.

    Steven02: So, essentially the states aren’t following their own constitution because of “tricks” that allow them to spend more than their budget. That to me sounds like states aren’t running a balanced budget.

    The day of reckoning is coming for them…

    Steven02: And, for the record, tax dollars are tax dollars no matter who they are coming from or what car company they are going to. Federal vs State in this case does not matter.

    Really? That’s interesting, because I work in the Pennsylvania General Assembly, and you’d better believe that the state of Pennsylvania must account separately for state and federal dollars (not to mention local tax dollars).

    They are not regarded merely as “tax dollars” for accounting and budgeting purposes, and the state would quickly get into trouble if it did so. And states can’t simply hand out the money that they receive from the federal government for any purpose that they choose. They are strict rules covering how any state can use federal money. So, yes, for this question, there is a HUGE difference between state and federal tax dollars used for this purpose.

    And the question isn’t which car company receives government assistance. The question is WHY they are receiving government assistance and in what form. (And please note that companies that receive tax abatements aren’t receiving tax dollars – they are receiving a reduction in taxes. Big difference.)

    There is a difference between government assistance in the form of tax abatements or infrastructure upgrades to serve an upgraded or all-new plant and government assistance to keep a company out of bankruptcy court.

  • avatar
    Steven02

    Geeber,
    The red light cameras are a perfect example. Different jurisdictions have been putting them up without a single tax payer vote. Voters do NOT have a direct say. It has been brought up later in courts and in some cases by votes to take the cameras down, meaning that the tax payers were unwilling and in some cases, have taken action to reverse the actions of the elected officials. The point being that action has taken place that the tax payer didn’t like and didn’t have a direct say in. The voters DO NOT have a direct say at a local level. There vote merely counts at a higher percentage in the population. My point remains that the tax payers are unwilling. No one votes on tax abatements for different companies.

    I have never said there isn’t a difference between tax abatements and funds to avoid bankruptcy (which didn’t avoid bankruptcy in either case). But taking gov’t money and then complaining about someone else taking gov’t money is a joke. That is essentially crying home to mama about how the other team isn’t playing fair. Life isn’t fair. Business isn’t fair. Instead of crying about, Toyota could be using this to their advantage. The problem is, Toyota has its own problems that are making most news right now and DEALERS, not GM, you know the company that actually took the gov’t money, is sending out letters trying to lure the other customers. A dealer talking about unfair tactics is terrible. That is absolutely crying home to mama.

    I understand that gov’t have to account for how money is spent. Corporations do as well when the money is supposed to be earmarked for a particular purpose, like the DoE money some auto manufactures have taken. But what is the difference to the organization that is receiving the money really? If a corporation or gov’t is supposed to spend this specific money on a particular project, it means they spend less of their own money to do this. While it might be accounted that the money when there, it is essentially just going into a general fund. Since the corporation can spend less on something because of gov’t assistance, it can take the extra funds to do other things. But, again, to the corporation, it makes little difference especially if there are not strings attached. It just becomes profit in the end.

    Besides, you haven’t addressed the real issue here. You have made many statements about the differences in the money you take from local, state and federal gov’t. You have also made statements about the different powers at each of these levels. You have made no statements in regards to the fact that all of the communication that is being done here is actually from dealers and not GM. This difference is quite huge.

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