Thursday, November 13, 2008

"Bailout" for who?...

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Pelosi and gang are working hard to deliver a "bailout" to the Top-3 Auto worker Unions that helped deliver them a victory last Tuesdays on election day. In fact President-elect Obama is now calling for a $50 BILLION bailout to the Top-3 automakers in Detroit as seen here...

"Congressional Democrats, meanwhile, are pushing for legislation to help the automakers. House Speaker Nancy Pelosi called for congressional action, saying failure by one or more of the big U.S. automakers would have a ``devastating impact'' on the U.S. economy. Assistance must be conditioned on ``rigorous independent oversight'' of carmakers and restrictions on executive compensation, she said in a statement."
We see that Pelosi calls for "rigorous independent oversight" but it seems targeted at the evil "executive compensation" side of the problem. The article states that there should be the appointment of a "Auto-czar" but there is no mention of restructuring the Labor side of this equation. As stated in the prior post on this subject, the Top-3 automakers made very poor labor deals in the past and these too must be dealt with if the Top-3 are to survive. Otherwise we will just be dumping Billions of taxpayer money into a industry destined to fail...

Underwater Pumpkin Carving Contest...

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The team over at the Point Pleasant (NJ) Rescue Scuba Dive Squad had their annual Underwater Pumpkin Carving contest... Several local First Aid and Fire department teams attended and additional info will appear at the Point Pleasant Rescue site...















Tuesday, November 11, 2008

What to do with the Auto Industry?...

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The U.S. Auto industry, or should I say the "Top Three" automakers, are in trouble. Both GM and Ford are reporting massives loses and doubt that they will be able to continue operations if they do not receive additional "bail-out" money from the Federal government (Taxpayers)...



Democratic Speaker of the House Nancy Pelosi is doing her best to bring more of this taxpayer aid to save the Big-3 automakers and the jobs they represent. Possibly her actions are to secure additional “bail-out” money so to prevent the Big-3 auto manufacturers from having to go into bankruptcy courts where many of the negotiated Union Auto-workers would be subject to cancellation or change. Unions are a very large voting bloc for the Democratic Party and this may be a significant reason for Pelosi’s actions… Do you Think!!!…



As analyzed by Harbour-Felax, labor costs the Detroit Three substantially more per vehicle than it does the Japanese



Health care is the biggest chunk. GM (Charts), for instance spends $1,635 per vehicle on health care for active and retired workers in the U.S. Toyota (Charts) pays nothing for retired workers - it has very few - and only $215 for active ones



Other labor costs add to the bill. Contract issues like work rules, line relief and holiday pay amount to $630 per vehicle - costs that the Japanese don’t have. And paying UAW members for not working when plants are shut costs another $350 per vehicle.



For those of you keeping score at home, that’s approximately $2,615 in costs per vehicle manufactured which GM has to pay (and thus pass on to its customers) that foreign automakers don’t. But that’s just the beginning. Labor work requirements, which state that workers can’t be laid off even when the auto company has no work for them, cost the auto industry even more:



"If an assembly plant with 3,000 workers has no dealer orders, it has two options. One is to close the plant for a week and not build any cars. Then the company still has to give the idled workers 95 percent of their take-home pay plus all benefits for not working. So a one-week shutdown costs $7.7 million or $1,545 for each vehicle it didn’t make"



"If the company decides to go ahead and run the plant for a week without any dealer orders, it will have distressed merchandise on its hands. Then it has to sell the vehicles to daily rental companies like Hertz or Avis at discounts of $3,000 to $5,000 per vehicle, which creates a flood of used cars in three to six months and damages resale value. Or it can put the vehicles into storage and pay dealers up to $1,250 apiece to take them off its hands"



Management for the auto manufacturers are also very much responsible for the state and condition of the American owned industry for they have negotiated and signed off on the contracts that have led to where they are now… But should the Federal government once again “bail-out” an industry that has gotten itself into trouble by their own “greed” (both Mgmt and Unions) and actions?



In the past I have bought American made vehicles such as Chrysler, Chevrolet, and General Motors products, to support the American worker. I do not wish to see harm to those retired workers who put their time in and are looking to get their promised benefits. But with these bad deals that were made by BOTH sides resulting in an additional $2,615 tacked onto a GM price tag, should the government bail these guys out with our tax money? And with Honda and other auto manufacturers operating plants in Texas, the Carolina’s, and other states, should I not buy a auto that was made by American workers in these plants?…

Sunday, November 09, 2008

Lessons from the campaigns...



Spank that Donk has a great post-election piece about the Gilmore campaign that many in the business need to take a look at...


The Democratic President-elect spent more then $600 million on his campaign, Hillary must have spent at least $200 million, McCain $200-300(?) million, then add in all of the other campaigns out there. Just running a campaign has become big business and one that is only short term for some of those involved so setting up for the next "gig" is always in play. Look at the noise coming from "staffers" who are now attacking Palin. These people need to be identified and if they have facts, dirt, or info they wish to present they need to stand in the sunlight and do so...

Campaigns also need to get back to basic campaigning and get to the voters themselves. Sure you need to do the T.V. thing, the internet thing, the fundraising thing, enough with the robocall thing(!), and get back to talking with the people...



This political season found that the local person at a parade was willing to talk politics with somebody who was willing to listen and debate where needed. It's nice to see the float and the candidate running by waving and shaking your hand, but evidence from the local parades here in the Valley showed that the people wanted to talk about the issues...