Political Cronyism at Government Motors (GM)

Something to chew on:

The UAW  openly supported the Obama election campaign.

The United Auto Workers Union was given 17.5% of GM by the Obama administration.

When Haliburton–former employer of Dick Cheney–was awarded contracts in Iraq, liberal critics were quick to demonize him and his administration, criticizing them of political cronyism.

This is a huge political hand out!

First, the Obama administration is rewarding the UAW for its generous support by pumping BILLIONS of tax-payer dollars into GM. Will these billions be spent supporting more Democratic election campaigns?  Second, the Obama administration is rewarding the very group that helped bring GM down through its inflexibility.  When Obama says that he does not want the American auto industry to disappear, it becomes obvious that he means he doesnt want his cozy relationship and revolving-door funding scheme to disappear.

It’s time for America to wake up. By meddling in the private sector, the Democratic party is attempting to solidfy its power with tax-payer money. Get the government out of GM and put the UAW out of business!

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3 Responses to Political Cronyism at Government Motors (GM)

  1. Stuart says:

    This is absolutely rediculous! Rewarding the UAW for basically bankrupting the company is wrong. Don’t get me wrong, unions do serve some important functions, like protecting workers against company explotation, but unfortunately the UAW has strayed far from that model. Their constant inflexibility and short-sightedness has put GM in this position (CEO’s also must share the lion’s share of the blame for building poor quality machines). The UAW has repeatedly acted contrary to the interest of their parent company. Sometimes their “negotiating” appeared like they forgot who was employing their workers. This highlights my fundamental disagreement with the Obailout model: Not allowing poor business models and poor business decisions to fail. Capitalism has a built in check and balance system. Its called failure. Bad businesses don’t survive, the good businesses compete on the basis of price, quality and functionality.
    The workers union strongarmed and weakened GM to such an extent that the company has failed. But not to worry, uncle Nobama, can save us. By bailing out GM (again and again, when are these payoff going to end?!), the union execs do not “see” the consequences of their actions. By forcing the company to agree to horrific salary and retirement deals, the UAW brought bankruptcy on the company. Before Obailout, the company goes under, the union workers are now out of jobs, and they think, “hey, maybe we shouldn’t have pushed for that extra week of paid leave (at $55/hr), because that cost the company XXX millions of dollars”. I would keep an eye on this situation, because Obama and his “car czars” are in a perfect position for huge kickbacks both politically and personally after they leave public service with their fingers in many large companies and knowledge of their internal workings.

  2. jason says:

    i understand that you are arguing against the means rather than the ends here… but if i do remember correctly, about 6 months ago we were agreeing with mittens romney, in his brilliant op-ed in the NYT, that a government managed bankrupcy was the american auto industries best hope. and if union participation is the best way to insure the rights of the workers are protected, then so be it. i am quite pleased. although this should have happened in october.

    • travis87r says:

      No we were agreeing that a bankruptcy was the industry’s best bet. Not a government managed one! There is a difference. Declaring bankruptcy allows the firm to cancel its debt and sell its assets, it does not necessarily entail government ownership of the firm. Take for example declaring bankruptcy on your home. You cancel your debt but the government does not own your house. Government ownership of GM was a condition of GM receiving bailout funds, and continuing to do so through their restructuring process. It could have been avoided, I agree, if bankruptcy had been declared in October. As we have seen there are many buyers willing to gobble up GM assets–China is taking Hummer (yikes) and Penske is taking Saturn. Free-market actions could have had the same effect that government ownership is having now. The free market approach is preferable to me because it keeps my tax dollars out of GM, and prevents a private enterprise from becoming a government liability.

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