More Union lies about Chrysler

We’ve all heard that the unions gave up HUGE concessions in the “Fiat buys Chrysler patronage bailout.

Not hardly.

This from the Kaus Files…

**– Here’s a WSJ news story on what the UAW seems to have actually given up: 1) Suspended cost-of-living adjustements; 2) Overtime only after 40 hours a week of work.[That wasn't the rule already?] 3) No Easter Monday holiday in 2010 and 2011.” Some additional concessions in this AP report: 4) “The union also agreed to consolidate nonskilled labor job classifications into a team concept at all factories.” [You mean unskilled workers were separated into different classifications before?] 5). Performance and Christmas bonuses suspended for two years. 6) In what seems like the only major cut, retirees will lose dental and vision benefits, at least temporarily. … The 2015 contract will also go to binding arbitration if no deal is reached. I don’t know if this is a “concession” or a protection. … Most significantly, there is apparently no reduction in current UAW workers’ high basic wage rate of near $30/hour. See also “Hourly Employees Spared Painful Cuts in Chrysler Bankruptcy“.

Every last one of them ought to be put out of work, along with their awful management. There was a 20% overcapacity in auto production BEFORE the downturn. Let the weakest companies die. Let their workers feel the brunt of their Union’s greed.

GM and Chrysler now part of Mayor Obama’s patronage farm

I hope people will join me in boycotting the purchase of soon-to-be-union-owned GM and Chrysler.

Some on the conservative side of the aisle tell us that we have a patriotic duty to “buy American.” I do that where I can, but not at the expense of my own well-being. Now, with the help of Bush in his last few days in office, Barack Obama is close to realizing his dream of turning every American industry he can get his hands on into a patronage farm for his shock troops.

Here is to hoping 2010 provides a reversal to these awful trends, but that doesn’t mean it isn’t time to start looking for a “exit strategy” of some sort.

UAW to Get 55% Stake in Chrysler for Concessions

The United Auto Workers union would eventually own 55% of the stock in a restructured Chrysler LLC under the deal reached by the union and the auto maker, according to a summary of the agreement that was reviewed by the Wall Street Journal.

Fiat SpA “eventually” will own 35%, and the U.S. government and Chrysler’s secured lenders together will end up owning 10% of the company once it is reorganized, that summary said.

The summary was distributed Monday evening at a gathering of union leaders in Sterling Heights, Mich. The deal was first disclosed Sunday night. The UAW aims for Chrysler workers to vote Wednesday on the proposed agreement, which requires changes to the union’s current Chrysler contract.

According to the summary, Chrysler will also issue a $4.59 billion note to the health-care trust fund that the union will manage for retired workers. The agreement said Chrysler will pay $300 million in cash into the trust fund in 2010 and 2011, and increasing amounts up to $823 million in the years 2019 to 2023.

The trust fund will own a “significant” amount of Chrysler stock and will be allowed to appoint a representative to Chrysler’s board, the summary said.

“While we realize the proposed sacrifices for UAW members are painful, we fought to maintain our wages, our health care and our jobs,” UAW President Ron Gettelfinger wrote in a letter with the summary. The UAW summary also said the accord would provide the union with regular updates from the company on its long-term strategy and product plans.

GM Offers U.S. a Majority Stake

General Motors Corp. outlined a new turnaround plan that would leave the U.S. government controlling the auto maker, as it set up a showdown with bondholders that could determine whether the company lands in bankruptcy court.

Under the plan, GM is asking the Treasury Department for an additional $11.6 billion in loans, on top of the $15.4 billion it has already received. It envisions giving the government at least half ownership of the company as payment for half of the loans.

At the same time, GM said it would use stock instead of cash to pay off half the $20.4 billion it owes a United Auto Workers fund to cover retiree health care. That stock would leave the union owning about 39% of GM.

The upshot would be the transformation of a troubled American icon, leaving it in the hands of the government and its main union. The situation, fraught with complications and potential conflicts, comes on top of the U.S. government taking stakes in banks and insurer American International Group Inc.

Also Monday, the UAW and Chrysler LLC disclosed that the union would own 55% of that restructured car maker, while Fiat SpA would get 35% and the U.S. and lenders would own the rest.

GM told bondholders it wants to swap up to $27 billion in unsecured debt for a 10% company stake. If bondholders tender less than 90% of the debt, GM is prepared to file for bankruptcy protection, Chief Executive Frederick “Fritz” Henderson said.

These were two horribly managed companies whose Unions and Executive leadership lead them to disaster. They should have been allowed to go under. Here is a note to all the Union Drones in the EU and the US…

…there isn’t enough money in the world to fund your insane demands!!!

You’ve bankrupted entire states, large companies once thought invincible, and corrupted the entire financial industry. You are the new “robber barons.” Anything that isn’t tied down, you steal, and anything thing you can pry loose isn’t tied down.”

Unions have become the new definition of greed.

King Obama Replaces the Duke of GM

Keeping with the general theme of politics that he learned at knees of King Richard Daley, King Barack Obama is replacing the Duke of General Motors (with whom the King is unhappy) with a new Duke to be announced later.

Government Forces Out Wagoner at GM

The Obama administration used the threat of withholding more bailout money to force out General Motors Corp. Chief Executive Rick Wagoner and administer harsh medicine to Chrysler LLC, marking one of the most dramatic government interventions in private industry since the economic crisis began last year.

The administration’s auto team announced the departure of Mr. Wagoner on Sunday. In a summary of its findings, the task force added that it doesn’t believe Chrysler is viable as a stand-alone company, and suggested that the best chance for success for both GM and Chrysler “may well require utilizing the bankruptcy code in a quick and surgical way.”

I don’t give a damn about Rich Wagoner. He is clearly an incompetent manager who ought to have been booted by any board actually interested in running GM. He also deserves getting tossed for being stupid and venal enough to take government money, when he ought to have declared bankruptcy and resigned like a man.

I also appreciate the President using his power to oust the guy because it gives us a glimpse of the world Barack wants to create – a corporate/government superstate. The “audacity” is instructive.

For more examples of what we are about to witness at the Federal Level now that a “King” is in town, read my older post on Feudalism.

Congressional Motors – UPDATED

I’ve noticed that plenty of people on the web, as well as radio hosts, find a lot of funny stuff, use it, and don’t attribute it to the originator. That’s skanky. Here at Extreme Wisdom, I try to “hat tip” every post that I find on the web, especially when the blogger is provides much of the commentary.

That said, I use links that I find on “Brothers Judd” so often, (but provide my own commentary) that I usually just tell my readers that they are the best blog on the web (they are).

Regardless, I finally did find the originator of the “Congressional Motors” post. It is Chicago and Illinois own IowaHawk, and the post is here. I’m adding Iowahawk to my blog roll, and I hope you go there often.

Click the picture to go to the original post.

Pelosi Motors

The coming anarchy?

A friend sent me this quote from Louis Brandeis…

“In a government of law, the existence of the government will be imperiled if it fails to observe the law scrupulously. Our government is the potent, the omnipresent teacher. For good or for ill, it teaches the whole people by example. Crime is contagious. If the government becomes a lawbreaker, it breeds contempt for the law; it invites every man to become a law unto himself; it invites anarchy.”

Our government(s), from the Federal, down to Banana Republics like Illinois and its rapacious local governments, has been in the business of twisting the laws so as to be bent, if not totally broken. It’s not a surprise that the people have become a bit twisted, bent, and broken as well.

The economic downturn into which we are cascading is a direct result of government failure, not market failure. We can argue all we want about which came first, the briber, or the bribee seeking the bribe, but what we are witnessing now is the classic prediction made by Ayn Randian libertarians regarding the moral hazard of rent seeking.

This is why we need a harder, longer crash, with as few “bailouts” as possible. The government should step in to keep people from dying, freezing, or starving. It should do NOTHING else to “ameliorate” the disaster that our over-reliance upon government has created.

UAW tries to revive the goose that it killed

Of course, the goose had a strong hand in its own destruction


UAW grants concessions, exec warns of depression

DETROIT—- Worried about their jobs and warned that failure could lead to a depression, hundreds of leaders of the United Auto Workers voted overwhelmingly Wednesday to make concessions to the struggling Detroit Three, including all but ending a much-derided program that let laid-off workers collect up to 95 percent of their salaries.

When I read that sentence above, I want heads to roll. I want UAW management (Note to lefties: Unions are corporations too, and just as corrupt as any “for profit” corporation!) to be tarred and feathered by their workers. I want GM engineers and salespeople to ransack the homes of every board member and top management at GM. WHAT WERE THESE IDIOTS THINKING!

I really no longer care about kicking this can down the road so future generations can deal with the “something for nothing” mentality that has metastasized through out EVERY STRATA of American culture. Maybe a REALLY BAD depression is what these people need. With the loss of character and growing moral hazard that comes from every bailout, a huge depression/collapse is going to happen anyway. We may as well trigger it now, because it will only be worse, and bigger, later.

Union leaders also agreed to let the cash-starved automakers delay billions of dollars in payments to a union-administered trust set to take over health care for blue-collar retirees starting in 2010.

Here again, the Unions and the incompetent management are in cahoots. Appear to compromise, get the federal bailout, and both go crying to the Government for “nationalized health care,” selling the silly notion that by getting government to pay GMs health care bill, they can drop the cost of their fleet of cars. They seem to have forgotten that the overtaxed American won’t be able to afford the cars because THEY will paying for everyone’s health care. Again, something for nothing!!!

In addition, they decided to let the Detroit leadership begin renegotiating elements of landmark contracts signed with the automakers last year, a move that could lead to wage concessions.

The UAW, along with bad management that gave into them, has killed the Goose that lays the golden eggs. Now they want to bring it back to life a little bit, in the hopes that they can kill it again, when “times get better.”

Look folks, the US Auto Industry had horrible management, the US Gov. has horrible “auto” policy, (like forcing CAFE standards, but then allowing for a “class” of trucks, so that the industry could manufacture its way into a dead-end – big gas guzzlers), and the UAW had awful, greedy, and stupid leadership.

Americans, once the most dynamic people on earth, have been led by the Big 3 collectives (Big Unions, Big Corporation, and Big Government) to become stupified, fat, intellectually lazy, and expectant of bailouts and rich early retirements, all at the expense of fewer and fewer productive citizens.

You got what you asked for. You followed collectivism to where it leads. Bankruptcy.

Let GM (AND the other 2) Fail

Why the American taxpayer should bailout a manufacturing company is beyond me. Whether GM is or isn’t building better cars isn’t the issue. The fact is the company caved to Unions demands over the last few decades, and the labor cost per car is too high to compete with rivals.

Bailing out GM is to bail out their cowardice in negotiating with the UAW. Let the UAW find companies to hire their workers.

People across the globe want cars. There are factories and companies across the globe that build cars. Taxing American citizens to prop up a car company is AWFUL public policy.