Obama suggests some auto execs should lose jobs

[HARDCORE]

[media]http://news.yahoo.com/s/ap/20081207/ap_on_go_co/congress_autos[/media]

By PHILIP ELLIOTT

CHICAGO – President-elect Barack Obama announced support Sunday for a short-term government bailout of the nation's carmakers that is tied to industry restructuring. He also accused auto executives of a persistent "head-in-the sand approach" to long-festering problems.

Obama said Congress was doing "the exact right thing" in drafting legislation that "holds the auto industry's feet to the fire" at the same time it tries to prevent its demise.

In an appearance on NBC's "Meet the Press" and later at a news conference, Obama suggested some executives should lose their jobs.

One leading Democrat in Congress, Sen. Christopher Dodd of Connecticut, was far blunter. Rick Wagoner, the chief executive of General Motors Corp., "has to move on," said Dodd, chairman of the Senate Banking, Housing and Urban Affairs Committee.

In response, GM spokesman Steve Harris said the company appreciates Dodd's support for the loans, but added, "GM employees, dealers, suppliers and the GM board of directors feel strongly that Rick is the right guy to lead GM through this incredibly difficult and challenging time."

Last week, The Associated Press asked Wagoner if he would resign at the request of Congress, to which he replied, "It's not clear to me that experience in this industry should be viewed as a negative, but I'm going to do what's right for the company and I'm going to do it in consultation with the board."

GM's board recently has been meeting three times a week by telephone.

The criticism of industry leaders deepened as negotiators for the White House and Congress narrowed their differences over a plan to extend roughly $15 billion in short-term loans to any Detroit automaker that needs it. Analysts say General Motors Corp. and Chrysler LLC, in particular, are at risk for running out of money in the next few weeks, and that Ford Motor Co. may need help if the economy deteriorates further.

Democratic Sen. Carl Levin of Michigan, whose state is ground zero for the battered industry, said he was confident an agreement would emerge within the next day.

Democratic leaders have said they hope to pass the measure this week. While Levin declined to predict its approval, support among rank-and-file lawmakers presumably would improve dramatically if both White House and Obama were to signal their backing once the legislation is complete.

"The last thing I want to see happen is for the auto industry to disappear, but I'm also concerned that we don't put $10 billion or $20 billion or $30 billion or whatever billion dollars into an industry, and then, six months to a year later, they come back hat in hand and say, `Give me more,'" Obama said.

Obama, who takes office Jan. 20, has drawn some criticism from Democrats who want him to become more involved in efforts to save the industry. The president-elect said his aides are monitoring developments and considering longer-term plans.

He expressed no support for calls to allow the big carmakers to enter bankruptcy and said, "We don't want government to run companies." Instead, he said, "if taxpayer money is at stake — which it appears may be the case — we want to make sure that it is conditioned on an auto industry emerging at the end of the process that actually works, that actually functions.

"Taxpayers, I think are fed up. They're going through extraordinarily difficult times right now."

Obama did not single out any individual executive by name for criticism, and said there had been incremental progress in the past 15 years toward a more competitive line of products.

"What we haven't seen is a sense of urgency and the willingness to make tough decisions. And what we still see are executive compensation packages for the auto industry that are out of line compared to their competitors, their Japanese competitors, who are doing a lot better," he said.

Asked whether the top executives should remain in the jobs, he said: "Here's what I'll say, that it may not be the same for all the companies. But what I think we have to put an end to is the head-in-the-sand approach to the auto industry that has been prevalent for decades now."

Later, at the news conference, he appeared to temper his comments, saying that current management should be ousted if it doesn't understand the urgent need to make changes in the industry.

A breakthrough on the long-stalled rescue came Friday when House Speaker Nancy Pelosi, D-Calif., yielded to President George W. Bush on a key point: allowing the aid to come from an existing fund set aside for the production of environmentally friendlier cars.

The Big Three executives spent two consecutive days on Capitol Hill this past week pleading for as much as $34 billion in loans to help their industry survive. But they made clear that $15 billion would be enough to keep them running until the end of March 2009.

Dodd appeared on CBS' "Face the Nation" and Levin was on "Fox News Sunday."

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AP Auto Writer Tom Krisher in Detroit contributed to this story.

[Seascamp]

Fine, but that whole Detroit bunch dances the death dance, have so for decades, and now end up tits up on the gurney and gasping. Now exactly why is that a big surprise? Said so right here at PF, there is no way the UAW and the big three can realize the human and creative potential of Detroit, no way. The UAW shop floor practices are totally stone axe and something of yesteryear and absolutely counter productive. Big hint Obama, enable the UAW to further excesses and they will produce un-sellable junk; an absolute. Not new ground, and that is exactly why the Brit’s auto industry crashed, for keeps. And that is why we have the ever-growing rust belt.

Scamp

[SuperScout]

What is truly amazing is the decision-making process that surrounds the CEO selection process. For example, Robert Nardelli is a former CEO of Home Depot, and managed to drive the stock price to an all-time low, made some really stupid decisions about expansion when the economies didn't support the decision, and put the entire corporate structure at risk. After an $11 million buy-out from Home Depot, he lands on his feet as a CEO of one of the Big 3?

As an aside, maybe some members of Congress should also lose their jobs for the stupid decisions they have made, that will lead us down the bankrupt trail.

[darrels joy]

The bill...

http://senateconservatives.files.wor...08e32_xml4.pdf


UPDATE: Here is a list of several key provisions in the bill after an initial review:

• No confirmation process for “President’s designee” or Car Czar (page 3)
• Only benefits three companies in a much larger marketplace (page 4)
• Federal Advisory Committee Act does not apply (page 8 )
• Car Czar has sole authority to provide long-term financial assistance (page 10)
• Creates bailout in addition to the previous $25 billion bailout (page 12)
• Veto authority of Car Czar over any business transaction greater than $25 million (page 15)
• Prohibits legal challenges to state laws that increase emissions mandates on automakers (page 16)
• Warrants for stock equal to at least 20% of financial assistance value (page 17)
• Aircraft divestiture (page 20)
• Public transit repurposing (page 25)

SEC. 13. AUTOMOBILE MANUFACTURERS’ STUDY ON PO

TENTIAL MANUFACTURING OF TRANSIT VEHICLES.

10

(a) IN GENERAL.—Each eligible automobile manufacturer which receives financial assistance under this Act shall conduct an analysis of potential uses of any excess production capacity (especially those of former sport utility vehicle producers) to make vehicles for sale to publictransit agencies, including—

(1) the current and projected demand for busand rail cars by American public transit agencies;
(2) the potential growth for both sales and supplies to such agencies in the short, medium, andlong term;
(3) a description of existing ‘‘Buy America’’ provisions, and data provided by the Federal TransitAdministration regarding the use or request of waivers from such provisions; and
(4) any recommendations as to whether such actions would result in a business line that makes sense for the automobile manufacturer.

• Sense of Congress on negotiated or legislated restructuring (page 29)
• COLA adjustment for judges (page 31)

http://senateconservatives.com/2008/...-auto-bailout/

[39mto39g]

White, Kenworth and Peterbuilt are next followed close behind is the Rail industry, Then Shipping, Kroger, Food town, The Poultry industry, Wheat farmers and tire manufacturers. Somewhere I need to get in line.

Ron