Forget Gutting Tax Breaks; Obama Should Reverse Bailout of Government Motors
by Kyle Olson
Every time I hear a politician say he’s going to end tax breaks for companies that export jobs overseas, I just laugh. It’s transparent pandering to the UAW and other labor unions and a great talking point, but the Democrats have just never gotten around to enacting it. President Obama trotted out that old horse again in Wednesday’s State of the Union speech:
We should put more Americans to work building clean energy facilities and give rebates to Americans who make their homes more energy efficient, which supports clean energy jobs. And to encourage these and other businesses to stay within our borders, it’s time to finally slash the tax breaks for companies that ship our jobs overseas and give those tax breaks to companies that create jobs in the United States of America.
But as a Michigander, it’s even more humorous knowing that the federal government has bailed out a Michigan-based company, General Motors, that has increasingly been “shipping jobs overseas.” According to a May 2009 Washington Post article, GM has been doing that with a vengeance.
The U.S. government is pouring billions into General Motors in hopes of reviving the domestic economy, but when the automaker completes its restructuring plan, many of the company’s new jobs will be filled by workers overseas.
According to an outline the company has been sharing privately with Washington legislators, the number of cars that GM sells in the United States and builds in Mexico, China and South Korea will roughly double.
The proportion of GM cars sold domestically and manufactured in those low-wage countries will rise from 15 percent to 23 percent over the next five years, according to the figures contained in a 12-page presentation offered to lawmakers in response to their questions about overseas production.
Believe it or not, former labor secretary Robert Reich, who has never been accused of being conservative, may be on to something:
“GM is a global company — so for that matter is AIG and the biggest Wall Street banks. That means that bailing them out doesn’t necessarily redound to the benefit of the U.S. or American workers.
“More significantly, it raises fundamental questions about the purpose of bailing out these big companies. If GM is going to do more of its production overseas, then why exactly are we saving GM?”
But silly me. Why am I complaining? After all, a bail out is totally different than a tax break. Isn’t it?
So like parsing President Obama’s other pledges of not hiring lobbyists for his administration, or opposing spending freezes before proposing sham ones, maybe I’m just making too much out of the fact that the government is heavily invested in an auto company that by all appearances is increasing its production in foreign counties.
But President Obama, just gut their tax breaks and everything will be cool.
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85 Comments
I work in the electrical engineering field, specializing in embedded systems. Like in most fields, jobs are scarce. But there are many opportunities in support of "Smart Grid," which amounts to centralized monitoring of energy consumption. How many times has government monitoring of an activity failed to lead to control of that activity?
I would find this hilarious were my tax dollars not going to set up a Mexican or Chinese factory to build cars that our purchasing dollars go back to Mexico and China again. This is just a classic example of government incompetence.
It's simple the bailout had nothing to do with saving GM, it was to save the UAW! It's funny how Ford made a profit last year BECAUSE it didn't take a bailout. Our next President needs to immediately dump all these deals. Let's take the loss now instead of years of constant subsidizing!
At least GM cars turn the direction you steer them. With Obama, you never know which way he will realy go. He points in one direction then veers a different way.
Good point.
My entire family and I are big Chevy people. Of course they were bought waaaayyyy before the bailouts begun. My Chevy Venture is paid off and has been for almost a year now. Everyone else has Chevy Silverado 2005 and 2006. The next time I have to look for a vehicle if anything happened to mine(thankfully it's running like new), I'm going to look at companies that hasn't excepted the bailouts. Not GM.
I think that a man that couldn't hack it in the business world, has no background in economics, should be the last person to chastise the business world. Duh one needs to STFU and do some hard on the job training himself. If he was in the private sector, he'd have been canned by now. What a loser.
I think the whole GM bailout raised several issues:
1) Now that the UAW has become an owner in the business, how do the union bargain against itself as owner? Is this a conflict of interests?
2) Why do we continue down the road of cap and trade, which will hurt GM?
3) Why would you pour millions of dollars into Fisker (aquiring the GM plant in Wilmington, DE), since they would be a competitor? Do you think Apple would pour millions into HP to save jobs?
I may be wrong in my thinking, but I think they should be answered.
THAT won't happen…
As long as Barry and his SEIU thug buddies are there. GM is a prize they had their eyes on, and will not let it escape. But what they will do is start punishing foreign automakers (the Toyota recall really smells of political revenge) and even go back to tariffs to make their brand more successful.
Not because the cars are any better…
I make a point to buy vehicles not made with UAW labor. My "foreign" SUV was made in Indiana. Our next car will likely be a "foreign" car made in Ohio.
Yeah, look for a Toyota that was subsidized by the Japanese government in order to destroy our domestic market just like they did with electronics. This is why the nation will fail, because of disloyal people like you! No other country in the world abandons its own country and NEIGHBORS to save a few pennies like Americans have started doing over the last few generations. All part of the globalism our CFR candidates have been pushing. Just don't look for a recovery to the economy any time so – no jobs=no recovery. You won't know how important the Middle Class was until it is gone.
I purchased an 09 Nissan Titan SE a few months ago. The reason I purchased it was first it’s a fantastic truck and second it was built in the US in Texas. I figured I was helping American citizens who still build autos in
American even though it’s a foreign auto manufacturer.
I wouldn't buy a GM because
1) they began the idiotic trend of throwing out cars that honk when people lock their doors thus causing noise pollution
2) they began the trend of daytime running lights
3) Onstar
Good points! How would the unions bargain against itself…?? This should be a good show to watch!
The government at work, driving jobs out of the US.
With the unions help the sucking sound is even louder.
I think what cities like Detroit need is a Model Cities Program……….Oh wait………….never mind.
Maybe what they need is a new Housing and Urban Development agency (HUD)…………….Ahh yeah……….scrap that.
I know, we can start a new program designed by the dear leader obama called the Community Reorganization and Urban Development (CRUD)………………yeah…………………that's it!
It is ironic that the UAW now owns a big chunk of GM and the US and Canadian governments own a lot more .
Why are these jobs being moved offshore?
Could it be because it was NEVER about saving an "American" company, it was all about consolidating power within a centralized government.
Now the workers who were "represented" by the UAW are just a drag on the system and are to be purged from the roles of useful idiot.
I can almost guarantee when GE gets government contracts for "Green Energy Windmills" most of the components will be made "overseas". (Thanks to Labor Unions).
You're right, Detroit is a wasteland. It's a firsthand example of the effects of decades of liberal/progressive/democrat/socialist policies. Left unchecked, the rest of America is headed this way. The election of solid conservative leaders is the only thing that will turn it around.
Many, many parts on a "foreign" vehicle built in the US are actually made in the US. And assembled by US auto workers. Why should I be dubbed "disloyal" for not pouring money into a car or truck that may be a lemon, just because it is an "American" product? One of the largest and most modern vehicle assembly plant in the US is in Mississippi…. but, it is owned by Nissan so that doesn't count?
"Every time I hear a politician say he’s going to end tax breaks for companies that export jobs overseas, I just laugh."
How else can we progressives unionize the entire world?
I am somewhat dismayed at the tune of our remarks here.
It seems that we are forming a circular firing squad.
"The enemy is there" (Lefty Washington)
Let's get rid of the decease, not the afflicted (i.e, the poor BS'ed union worker)
Cowboy, when you were in Detroit, did you buy a houset? (avg. home sales price in Detroit $6,000) with the tax credit you could have walked away with $2,000… do they still have lines of people waiting for their Obama checks?
Yet they keep voting for the same liberal/progressive/democrat/socialist policies again and again.
Well done Democrats! Detroit is a shining example of your handy work, observe America. The UAW has just about killed it’s host (GM), with the exception of Ford…hmmm…what’s the difference?
The Obama motivation is to gut Capitalism. When one looks at it that way everything he's doing makes sense.
I own a chevy silverado 1975, but if you look inside the door panel you will see that it was built in Canada!!!
And they said Sarah Palin had NO experience.
If GM's sending jobs overseas cap and tax can't hurt them that much
Fonz, I drive a Toyota 4-runner. Second one – the first one I gave to my son as he was starting a family and I wanted them to have a reliable safe vehicle. It still ran great with 220,000 miless on it. I replaced it with another newer but used one which now has 125,000 miles on it. No repairs on either other than suggested maintenance and a replaced water pump. Previously I had a Jeep Cherokee that started falling apart at 75.000 miles. There is a difference between being disloyal and being a smart consumer.
I go out of my way to support US manufactured goods when practical, even if the cost may be more. I don't like this globalism any more than you do, but sometimes finding something not made in China is harder than finding a 4-leaf clover.
I wish there were more stores like Ace Hardware that stock "made in USA" items throughout their store at competitive prices. I find it curious that many manufacturers seem to do fine in the US, even making dollar store goods, while others claim they're forced to go elsewhere. The biggest detriment as I see it is not labor costs, but taxes and regulations – Government in the way.
Fisker is filling a niche market that GM isn't anywhere near. An $80K hybrid sportscar isn't anywhere on GM's radar, so no competition there.
I however agree with all of your other points.
Sarah Palin can dress a moose – Barack Obama can dress.
No.
Out of curiosity, I drove through some of those areas, and I visited with some folks who have lived there since the late 40's. They have seen alot. They saw the place bloom and grow, and have watched it die. It is a sad story. Just watching the evening news, listening to the politicians on TV, it is obvious what the problem is. A failed welfare state, with beggar mentality. The only thing that will change that, is new people to change the complexion of politics. That will not happen, for those folks have left. It is over for Detroit.
" Anytime government gets involved, a project fails. Look at Amtrack, and CONrail. "
Education system
And Ford Motor Company posts a $2.7 billion dollar profit ! Gotta love the PRIVATE SECTOR. Every time the GUMMENT steps in…epic failure.. And why ?? UNIONS ! UNIONS ! UNIONS ! FMC renegotiated their contracts as the rank and file knew that protection of their jobs was a higher priority than the union bosses limo's….
Last night, I watched a bit of Robocop II. Robocop's creators sought to render him ineffectual, so they programmed him with an enormous list of trivial and contradictory directives, having little to do with his original purpose.
Sound familiar?
Well Fonz, we really part company here. The Japanese cars are not cheaper than the American cars, they're BETTER!!! I owned a Ford – piece of junk. Then I bought a Dodge to try to save Chrysler (I am a loyal Michigander, born & raised) – even WORSE piece of junk. Ever since it's been nothing but Honda, Toyota or Mazda for me. When the UAW gets out of the picture and allows the American car companies to build a quality product, I will consider American cars again. In the meantime, I have no intention of supporting the unions.
You couldn't be more correct. Ford is a shining example of the best of capitalism. Consequently, that makes them a TARGET for the Obama Administration.
CRUD? Ha-ha! Don't give them any ideas.
Spot on. We need a bumper sticker that reads "It's The UAW Pensions Stupid!"
Detroit? GM? Everyone should look at this:
http://www.youtube.com/watch?v=02×8EHXPfB0&fe...
That is what Detroit is today.
That is what GM will be tomorrow.
Indeed. But if the obscenity of card check becomes law, and factory workers are denied their right to secret ballot when voting on union representation, we may lose that patriotic option.
I will not buy a UAW-made car.
I found myself deep downtown once, low on gas. I was driving up Gratiot Avenue, trying to find a gas station that looked safe. I quickly realized it was a fool's errand. The stations were either surrounded by idling sedans, presumably filled with drug dealers, whores, or in one case the scene of a gang skirmish, with about a dozen men beating the crap out of each other. By the time I made it to Reford, the car was running on fumes.
Truly a sight to behold, eh?
Such a quivering, jiggling, shuckin', jiveing mass of humanity, the likes of which I've never seen. It sure isn't home on the range.
Truly funny, my experience a few weeks ago was comparable to your. I'm getting fuel, and this guy in a van pulls up and starts hollerin": "Hey, hey you, you in the cowboy hat"( now I know the feeling of sticking out like a honkey in a woodpile). I think to myself, "Oh shit, now what?" Long story short, he has 5, two thousand dollar speaker systems in the van. He tried to sell me one, for 150 bucks. I told him thanks, but no thanks. Told him I didnt have any cash, only a credit card.
Welcome to third world America.
Wasn't that ironic?
Now THAT, was transparent.
It's sad, but guess which party they'll vote for again (give them yet another try)
Right, because on the day before election day, the precinct captains (city workers) will be out in full force throwing around five dollar bills like it's confetti.
It's called what have you done for lately.
The longer the wait, the heavier the weight. You are correct, of course.
I'm gratified to see that you are a wise user of your resources. I wish more people who invested in the stock market had your attitude. We'd be living in a better country right now.
My 2001 Silverado was, as well. Built by CAW labor, which when it comes to screaming, yelling and p*****g their pants over how oppressed and exploited they are, make the UAW look like capitalists.
Excellent article.
I had occasion to be in Detroit three weeks ago (about the time of the auto show). I was astounded! Detroit is a wasteland. The city is decimated, the jobs are gone, shipped overseas as the article states. All for the sake of Union representation and concessions. It is nothing but failed policy.
Anytime government gets involved, a project fails. Look at Amtrack, and CONrail.
If you want to see another example of what Democrats can do to a region, take a look at Chicago. This is the most incredibly corrupt major city in the USA. It's also one of the most segregated – despite the notion that "Democrats bring people together."
Rather, Democrats in office here have kept minorities down and segregated.
Notice how "green" is being replaced by "clean energy"?Seems like every two years or so(once the word is related with something fishy)the propaganda machine creates a new buzzword…
Consolidation of power via big business=Fascism….
On this we can agree. All part of NWO. Look up "Agenda 21" some time.
GM and Chrysler are being run by the union and the government and they are still losing money. Explain; these are the best minds in the country, who know everything about running a business, right?
Ford did not take any money from the government, so they ran the company as they saw fit, and surprise, they had a profit last year. Now enter the greedy labor unions, they stated that they want the money that Ford made and that they would get it. Obama will see to it that they do, also. Ford will go under because of the unions and GM and Chrysler will stay and be supported by the public coffers forever, with the corrupt unions siphoning off everything they can get their hands on.
DOWN WITH THE CORRUPT UNIONS!
The long cold fingers of the EPA (as well as the unions) are (were?) a major source of the problem. Their regulation and restriction has put a stranglehold on profitability, which then affects productivity. GM died when the government took over. It is time to bury it and let some other enterprise take over, without the EPA dragging it down.
WE know wich way he's going…. Left. Left. left..
Was it just me that found it pecular that at Obie's town hall meeting (Jan. 22- Ohio) a 'random' lady picked from the audience stated:
" The second thing that I wanted to address to you is the unfair labor laws that they seem to have in some of these industries as far as discrimination and different issues of that nature. . . I have actually worked for Ford . . . and even when I was working there. . . and there's a lot of very unjust situations. . . and it's always pushed under the rug. . . . it's not fair that even at this point my mother still can't retire, she has to continue to suffer."
WOW, isn't it just amazing that Ford happened to come up? And who would have known what that evil company has been doing?
. . . and poor mama !
LOL
as long as we can keep him going in circles
hey olson…. look under your dash, your ford's wiring says assembled in mexico,your radiator cap in china,and so on…. ALL auto manf. out source,hell the government out sources on weapons parts…..shit the country vote in an out source. if china stop in porting for one month walmart would be GONE(a good thing).
I will absolutely purchase no vehicle made by GM or Chrysler as long as they owe the American people money that they received in a bail out.
I seriously doubt they will ever have the ability to repay our money.
I will purchase my next vehicle where no Union Labor was used.
Unions can go pound sand along with GM and Chrysler.
UNIONS killed the US auto industry in Detroit……
Just like…..
UNIONS WILL KILL ANY OTHER US INDUSTRY THAT THE GET THEIR HOOKS INTO……
The days when UNIONS were needed are long gone………
With today's technology and laws "sweat shops" and other unfair labor practices are a
thing of the past.
This Won't Work!
Government Is Always Smarter Than Its' Subjects.
You Unionize Wall Mart, I'll Unionize microsoft.
Ford is in bed with the obama administration.Do the research.
Obama is now building high speed rails in Florida with our "RINO" Governor Crist's blessing. The study perfromed under Jeb Bush stated it would be cheaper to buy each person that would actually ride this train a first class airline ticket between the cities.
Do these idiots not know that Rail is for goods not people? That is where Rail excels.
The real bailout is when the federal government assigns a no bid contract for $100000 caviliers to keep Government motors (uaw) solvent
I do believe we can stop all this. The win in Massachusetts was just the beginning the key is for the Republicans to realize that win was about BIG government and/or to much government. the same thing they've been doing for years. We want less spending, reduced taxes, get rid of all the take overs and bailouts. We need to remove as many of the Progressive policies we've seen enacted over the last 100 years and they come from both sides. "Yes we Can!
[...] Forget Gutting Tax Breaks; Obama Should Reverse Bailout Of Government Motors [...]
Don't buy anything that isn't 100% Made in the US! Avoid assembled in the US!
There will be no bargining they will just take what they want. The Union by its nature has no intrest in the issues of its employer only its members. I know this is short sighted but consider the inverse. Unions that split their allegience between the worker and the management would be even more corupt then what you see today. The problem that created this mess was the corporate board room, short sighted and unwilling to take the lumps of strikes. The corporate culture of today unlike yesterday is not married to an individual corporation or industry. The boards maximize short term profits show a great track record and move on. shareholder control has been stiffled by flooding the market with unvotable stock. Does corporate governence need change? YES, Does it need the current reforms in washington to do it HELL NO. Their idea of improving corporate governance is to give unions and retirement funds and local citizens groups seats at the table. Detroit has suffered for years, with its new handlers Acorn, Uaw, Sierra club and the rest of the progressive cabal Detroit will be returned to its former glory a frozen swamp salt mine.
They are already being made in China and bought by GE.
Now maybe he should put a 'high speed rail ' station in the inner cities so the poor can at least ride it once to get out of Dodge as fast as possible (if they really want to change their life).
I can still remember Ron "Middlefinger" up on capital hill along with the CEO's of Ford, Chrysler, and GM trying to negotiate a deal with the government. What concessions in the end did the unions take to keep GM & Chrysler afloat? How's that "buy it here, build it here" slogan of the 80's working out for the unions? You can't stay in business very long when your labor costs are halved by the competition and you continue to do the same thing. Heck back in the late 70's GM was paying its mindless workers $22-$27 hr. They want to say these are high-tech jobs. Let me tell you, I worked the final assembly line and there was nothing "high tech" about it which deserved paying that kind of money. I was installing 2 bolts in the fender to grill assembly – 61 cars an hour. Mind numbing. And I couldn't believe the mindset of the UAW workers there either. Constant battle between them and management.
Just got back from Detoilet. It is the Progressive agenda on full display. A living object lesson. And they are all in denial as they swirl down the drain! Unions will not budge an inch, they keep electing liberal weenies, looking for handouts, self=pity – etc. This is America in 5 years if we do not reverse the trends immediately.
Didn't some of the BORROWED money spent on "Cash for Clunkers" wind up benefiting foreign auto-makers?
I hope Republicans will not only prevent future reckless BHO decisions, but undo existing ones wherever possible. Like the GM bailout. And by sending the Christmas Day bomber to Gitmo for interrogation.
In reality, the GM bailout was mainly another sop to unions wasn't it? Sending enormous amounts of taxpayer money to groups that helped elect BHO. Similar to the tax exemption on cadillac health benefits. Not only wasteful, and ineffective, but utterly corrupt. More Orwellian "Hope and Change".
Isn't it true that the states that are in the worst fiscal shape are mostly blue states? And vice-versa?
Government doesn't generate revenue. It only knows how to take revenue from the productive private sector, waste it on stuff, and dole it out to cronies.
A caller on Limbaugh (Friday 1/29/10) who sold Toyotas for six years believes the current accelerator pedal problem Toyota is experiencing is actually a "prevent defense" against the government's goal to damage Toyota. Toyota's actual goal is to deliver a car that is above suspicion so they are taking a giant hit now, lest Eric Holder's lawyers come at them with trumped up charges of building unsafe cars.
It does look fishy that the nationalized GM immediately began running ads offering buyers $1000 to bring their Toyotas in to buy a GM car.
Too bad that headstone dosen't read HERE LIES THE BIGGEST FOOL THAT EVER HELD THE PRESIDENCY barack insane obama.
Too funny.
— On Sat, 1/30/10, IntenseDebate Notifications <notifications@intensedebatemail.com> wrote:
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