TriShield

BY EDITORIAL WRITER | OCTOBER 17, 2013 AT 7:30 AM

Saving General Motors from bankruptcy was among President Obama’s most frequently cited achievements when he ran for re-election last year.

Democrats everywhere touted the company’s revival as proof of the 2009 bailout’s wisdom. That was then. Now, Obama has quietly released the auto manufacturer from a bailout requirement that it increase its production in the U.S. Instead, GM is spending billions of dollars building up its production capacity in ... China.

This is happening despite the fact that the Treasury Department has to date recovered just $36 billion of its original $51 billion loan to GM. By most analysts’ predictions, American taxpayers will be out approximately $10 billion when the remaining stock is sold off. Which is a long way of saying that it now appears that taxpayers paid $10 billion to make it easier for GM to accelerate its foreign outsourcing and send more manufacturing jobs to China.

Here’s what happened: In exchange for the bailout in 2009, GM promised to meet certain domestic car production targets over the next four years. The obvious point of this stipulation was to ensure that GM jobs remained here at home and weren't shipped overseas. The production targets started at 1.8 million in 2010 and were supposed to rise to 2.26 million by 2014. GM repeatedly missed the targets, beginning with an 81,000-unit shortfall the first year. Production increased thereafter, but never quite enough to meet the targets. Last year, GM fell about 13,000 cars short of its 2 million target.

How did it do this year? GM refuses to say. But in February, GM announced in its annual report to shareholders that Treasury had agreed to “irrevocably waive certain of its rights” regarding the federal loan. These included “certain manufacturing volume requirements.” Guess what happened next? GM announced in June that it would stop releasing its North American production figures altogether. Its spokesman tried to justify this move with Orwellian doublespeak about how providing more information would result in “an incomplete data set to look at.”

The same month, GM announced it would boost its output from its China plants by 70 percent. It is not just selling Chinese-made cars to the Chinese, either. GM is nearly doubling its export production capacity there from 77,000 units to 130,000. It doesn’t take a Ph.D. in economics to see what is really going on. GM cannot make the domestic production targets and still turn a profit. It wants to be spared the embarrassment of having everyone know that. Obama, who is in this as deep as anyone can be, doesn’t want the embarrassment, either. So both buried the news.

It is yet more proof that Mitt Romney was right in the 2012 presidential campaign: GM should have gone through a traditional bankruptcy instead of the politicized farce of a taxpayer-funded bailout and government managed “bankruptcy.” The TARP funds involved could have instead been used to provide liquidity for a managed sale to a private buyer that minimized the opportunities for political interference in the new GM’s operations.

http://washingtonexaminer.com/examiner-editorial-gm-got-bailout-now-ships-jobs-to-china/article/2537323

cmac06

iTrader: (16)

China's economy is doing significantly better than ours, so it only makes good business sense to build cars there. It's essentially the same reasoning as Honda, Toyota, Nissan, Hyundai, BMW, Mercedes, etc. build the cars destined for the U.S. here. No one ever mentions how unions are running jobs out of the U.S. by chocking corporations in the guise of protecting employees. I would have liked to see bankruptcy because it would mean the end of UAW, and although it would have been a huge blow in the short term; all of the American auto companies would have come out better.

SSCamaro99_3

iTrader: (1)

Not really shocking. A four year agreement expired, and production capacity is being shifted in a manner that everyone knew would happen. Yes, a goverment directed bankruptcy screams of a bad idea.

Federal Tax receipts are something like $200,000,000,000+ per month. $10,000,000,000 is like someone making $3,000 per month losing a $150 at the Casino, which is basically what happened.

ULTIMATEORANGESS

iTrader: (4)

how bout your employer moves your job to china because you make too much?

Spoolin

iTrader: (8)

I think the point he's making is to get rid of the Union, not GM's US labor force. If GM was allowed to go bankrupt they could of hired people on as company employee's many of them former UAW workers and they would still have a job, just no Union Affiliation.

Producing cars in China makes as much sense as someone else mentioning the Japanese and German brands producing cars here. What's fair in that regard is fair for everyone.

02ls1gun

Anything obummer is involved in is ridden with despair, deceit, jealousy, stupidity, political corruption, evilness. Just to name a few

ULTIMATEORANGESS

iTrader: (4)

what wouldve happened is GM would continue moving jobs overseas and laying off with no worker protection. jobs were added here as needed because it was agreed upon with the UAW not because GM wanted to. im sure if they had their way thered be little to no jobs here in NA because they could pAY china and mexico wages and still charge the same here.

but i agree as far as im aware vehicles that are made in china are sold there so it does make sense.


GM agreed to take our money so they should be grateful and do their best to create jobs here. but that would be if they cared which they dont.

speedtigger

iTrader: (16)

This should come as a surprise to no one. The government did not bail out GM to save jobs. Why would they? Elected officials only care about big donors. The end. They bailed out GM to take care of their fat cat friends who stood to lose money if GM failed.

2002ss335

And I guess Bush's Wall Street bailout was done for the good of the country and nothing else.

cmac06

iTrader: (16)

Thank you Spoolin, the pay parity is there now as far as labor rates, but bankruptcy would allow GM to rid some of the extra bulk that it has incurred due to its life in the U.S. It's a very old company and before manufacturing efficiencies the footprint was huge. I bet every state had some manufacturing arm to supply this juggernaut. Now because of agreements that are outstanding with UAW that GM finances, it is hurting them. I'm looking at profit margins on a single vehicle which is a lot smaller for all U.S. autos because of this. I mean most people will buy a Toyota because of perceived product quality differences instead of a Chevy or Ford. My wife owned a Honda, and I can tell you her car was no cheaper to own than any car I've owned. So in order to compete, GM can't charge the prices to even the profitability margin. I stand behind China because their economy is on the up turn, and GM is already producing models that will sell well in their market. I suppose that GM could have created another brand to sell there, but it would still be GM. The greater concern I see is jobs going to Mexico, France and the like, which are non union jobs. GM would still have to offer a benefits package, but it would be dictated by the industry not by some outside entity, and a lot more sustainable long term.

ULTIMATEORANGESS

iTrader: (4)

what was hurting them is that they built garbage and lost customers forever. while it has improved its not enough to get buyers back.

thats why they couldnt pay their bills.

justin455

So a mod posts a thread that is basically a thinly veiled jab at Obama, even managing to plug the failed candidate from the losing team. Excuse me while I don't take anything in here seriously and pity the year old whining of sore losers.

99FRC

iTrader: (5)

Wasn't it the union workers that built the garbage? I don't know for certain, but I doubt any of the GM executives were on the assembly line.

ULTIMATEORANGESS

iTrader: (4)

they built the garbage that was DESIGNED by GM which they had nothing to do with.

all they did was put together the cheaply half assed cost cutting crap that drove customers away.

nice try but that excuse doesnt work. surely youre not saying GM execs share no blame here? you cant be that blind?

when toyota was and is leading the industry in recalls im sure youre right there blaming its non union workers for this? correct?

oh,and what is it you drive again?

cmac06

iTrader: (16)

That's hilarious, but I don't mind playing the game for a while. I honestly thought all those signs were protesting Alabama's football program.

But it's been more than a year of whining.

Back to the car argument though. GM didn't make the best looking cars on the planet for a while, but their total cost to own is much better than a lot of the cars that are considered good cars (i.e. Lexus/Toyota).

So, I suppose I should go buy a Toyota now because it'll run forever, it just may have trouble stopping. Or maybe a Honda that is guaranteed to develop an oil leak between 85 and 100k miles. They sure are stylish though.

ULTIMATEORANGESS

iTrader: (4)

but on a positive note GM is improving.

http://media.gm.com/content/media/us...m-jdpower.html


lets give a hand to those UAW workers! lol

cmac06

iTrader: (16)

Wow, so I I suppose the employees are at fault for working in an industry that's run by the equivalent of a mob boss. I don't think anyone has slammed employees here. How many would work for GM as non union employees if that were an option? And how much of a better company would they be if that were the case. Imagine pay based on performance like non union employees. Even the U.S. military stopped automatic promotions based on tenure.

ZEEYAL8R

the toyota not stopping rant is so so so OLD.....there is a reason why this american car lovers wife daily drives a toyota, its a better car for the money. the only recall on our camry was a stupid power window switch! im not complaining about that, the last camry we had was a 1995, went 162k with us, still on the road now, only changed out the rear struts and the cv axles, thats it! and the struts were shot cause i towed 2500 lbs with the car when i was down a truck, safe to say i broke them.

i guess i should start a rant about how my wives 2008 chevy cobalt power steering pump failed at 50k miles during a turn causing loss of steering in her car, i suppose i should run with the damn chevys cant turn when you need them too gripe. ha. chevy made the recall but didnt have the parts in stock to replace the pump for almost 5 months!


and yeah i know obummer is a total jackass. he is an embarassment to this country

justin455

I don't like toyota at all, but because they're boring as **** not because they aren't good cars. However, Toyota just recalled about 800,000 2012 and 2013 Camrys and related vehicles. The AC condenser can drip onto the airbag module and either cause them to fail when needed or deploy when not needed.

cmac06

iTrader: (16)

Your lack of ability to show even a little respect for the office is the embarrassing thing. Glad you like your car, and I hope it gives you years of trouble free operation. I bet you don't even know why you don't like the President do you? If you voted then I apologize for you being in the minority, but the good thing is you only have three more years. I didn't bitch about the former President and his less than stellar tenure, what was his name busch?