Pat Buchanan: The Toyota Republicans

So may have read the headline Friday, had not President Bush stepped in to save GM, Ford and Chrysler, which Senate Republicans had just voted to send to the knacker's yard.

What are Republicans thinking of, pulling the plug, at Christmas, on GM, risking swift death for the greatest manufacturing company in American history, a strategic asset and pillar of the U.S. economy.

The $14 billion loan to the Big Three that Republican senators filibustered to death is just 2 percent of the $700 billion the Senate voted to bail out Wall Street. Having gone along with bailouts of Bear Stearns, AIG, Fannie, Freddie and CitiGroup, why refuse a reprieve to an industry upon which millions of the best blue-collar jobs in America depend?

In a good year, Americans buy 17 million cars. A more populous EU probably buys as many. Three billion people in India, Southeast Asia and China, four times as many people as there are in the EU and United States, are moving toward the middle class. They, too, will be wanting cars. And millions of them love American cars.

Is the Republican Party so fanatic in its ideology that, rather than sin against a commandment of Milton Friedman, it is willing to see America written forever out of this fantastic market, let millions of jobs vanish and write off the industrial Midwest?

So it would seem. "Companies fail every day, and others take their place," said Sen. Richard Shelby on "Face the Nation."

Presumably, the companies that will "take their place," when GM, Ford and Chrysler die, are German, Japanese or Korean, like the ones lured into Shelby's state of Alabama, with the bait of subsidies free-market Republicans are supposed to abhor.

In 1993, Alabama put together a $258 million package to bring a Mercedes plant in. In 1999, Honda was offered $158 million to build a plant there. In 2002, Alabama won a Hyundai plant by offering a $252 million subsidy.

"We have a number of profitable automakers in America, and they should not be disadvantaged for making wise business decisions while failure is rewarded," says Sen. Jim DeMint of South Carolina.

DeMint is referring to "profitable automakers" like BMW, which sited a plant in Spartanburg, after South Carolina offered the Germans a $150 million subsidy and $80 million to expand.

Be it BMW, Honda, Toyota, Nissan, Mazda, Mitsubishi or Hyundai, the South has become a sanctuary for foreign assembly plants, for which Southern states have been paying subsidies.

Fine. But why this "Let-them-eat-cake!" coldness toward U.S. auto companies? General Motors employs more workers than all these foreign plants combined. And, unlike Mitsubishi, General Motors didn't bomb Pearl Harbor.

Do these Southern senators understand why the foreign automakers suddenly up and decided to build plants in the United States?

When an icon of American industry, Harley-Davidson, was being run out of business by cutthroat Japanese dumping of big bikes to kill the "Harley Hog," Reagan slapped 50 percent tariffs on their motorcycles and imposed quotas on imported Japanese cars. Message to Tokyo. If you folks want to keep selling cars here, start building them here.

Fear of Reaganism brought those foreign automakers, lickety-split, to America's shores, not any love of Southern cooking.

Do the Republicans not yet understand how they lost the New Majority coalition that gave them three landslides and five victories in six presidential races from 1968 to 1988? Do they not know why the Reagan Democrats in Pennsylvania, Ohio and Michigan are going home?

How? By telling U.S. manufacturers they could shut plants here, get rid of their U.S. workers, build factories in Mexico, Asia or China, and ship their products back, free of charge.

Republican globalists gave U.S. manufacturers every incentive to go abroad and take their jobs with them, the jobs of Middle America.

And, for 30 years, that is what U.S. manufacturers have done, have been forced to do, as their competitors closed down and moved their plants abroad in search of low-wage Third World labor.

It's Herbert Hoover time in here, Vice President Cheney is said to have told the Senate Republicans -- as they prepared to march out onto the floor and turn thumbs down on any reprieve for General Motors.

In today's world, America faces nationalistic trade rivals who manipulate currencies, employ nontariff barriers, subsidize their manufacturers, rebate value-added taxes on exports to us and impose value-added taxes on imports from us, all to capture our markets and kill our great companies. And we have a Republican Party blissfully ignorant that we live in a world of us or them. It doesn't even know who "us" is.

We need a new team on the field and a new coach who believes with Vince Lombardi that "winning isn't everything. It's the only thing."

Attached is a “Letter to the Editor” from Elkins Fordland (a Ford dealership owner).

Editor:

As I watch the coverage of the fate of the U.S. auto industry, one alarming and frustrating fact hits me right between the eyes. The fate of our nation’s economic survival is in the hands of some congressmen who are completely out of touch and act without knowledge of an industry that affects almost every person in our nation. The same lack of knowledge is shared with many journalists whom are irresponsible when influencing the opinion of millions of viewers.

Sen. Richard Shelby of Alabama has doomed the industry, calling it a dinosaur. No Mr. Shelby, you are the dinosaur, with ideas stuck in the ‘70s, ‘80s and ‘90s. You and the uninformed journalist and senators that hold onto myths that are not relevant in today’s world.

When you say that the Big Three build vehicles nobody wants to buy, you must have overlooked that GM outsold Toyota by about 1.2 million vehicles in the U.S. and Ford outsold Honda by 850,000 and Nissan by 1.2 million in the U.S. GM was the world’s No. 1 automaker beating Toyota by 3,000 units.

When you claim inferior quality comes from the Big Three, did you realize that Chevy makes the Malibu and Ford makes the Fusion that were both rated over the Camry and Accord by J.D. Power independent survey on initial quality? Did you bother to read the Consumer Report that rated Ford on par with good Japanese auto makers.

Did you realize Big Three’s gas guzzlers include the 33 mpg Malibu that beats the Accord. And for ‘09 Ford introduces the Hybrid Fusion whose 39 mpg is the best midsize, beating the Camry Hybrid. Ford’s Focus beats the Corolla and Chevy’s Cobalt beats the Civic.

When you ask how many times are we going to bail them out you must be referring to 1980. The only Big Three bailout was Chrysler, who paid back $1 billion, plus interest. GM and Ford have never received government aid.

When you criticize the Big Three for building so many pickups, surely you’ve noticed the attempts Toyota and Nissan have made spending billions to try to get a piece of that pie. Perhaps it bothers you that for 31 straight years Ford’s F-Series has been the best selling vehicle. Ford and GM have dominated this market and when you see the new ‘09 F-150 you’ll agree this won’t change soon.

Did you realize that both GM and Ford offer more hybrid models than Nissan or Honda. Between 2005 and 2007, Ford alone has invested more than $22 billion in research and development of technologies such as Eco Boost, flex fuel, clean diesel, hybrids, plug in hybrids and hydrogen cars.

It’s 2008 and the quality of the vehicles coming out of Detroit are once again the best in the world.

Perhaps Sen. Shelby isn’t really that blind. Maybe he realizes the quality shift to American. Maybe it’s the fact that his state of Alabama has given so much to land factories from Honda, Hyundai and Mercedes Benz that he is more concerned about their continued growth than he is about the people of our country. Sen. Shelby’s disdain for “government subsidies” is very hypocritical. In the early ‘90s he was the driving force behind a $253 million incentive package to Mercedes. Plus, Alabama agreed to purchase 2,500 vehicles from Mercedes. While the bridge loan the Big Three is requesting will be paid back, Alabama ‘s $180,000-plus per job was pure incentive. Sen. Shelby, not only are you out of touch, you are a self-serving hypocrite, who is prepared to ruin our nation because of lack of knowledge and lack of due diligence in making your opinions and decisions.

After 9/11, the Detroit Three and Harley Davidson gave $40 million-plus emergency vehicles to the recovery efforts. What was given to the 9/11 relief effort by the Asian and European Auto Manufactures? $0 Nada. Zip!

We live in a world of free trade, world economy and we have not been able to produce products as cost efficiently. While the governments of other auto producing nations subsidize their automakers, our government may be ready to force its demise. While our automakers have paid union wages, benefits and legacy debt, our Asian competitors employ cheap labor. We are at an extreme disadvantage in production cost. Although many UAW concessions begin in 2010, many lawmakers think it’s not enough.

Some point the blame to corporate management. I would like to speak of Ford Motor Co. The company has streamlined by reducing our workforce by 51,000 since 2005, closing 17 plants and cutting expenses. Product and future product is excellent and the company is focused on one Ford. This is a company poised for success. Ford product quality and corporate management have improved light years since the nightmare of Jacques Nasser. Thank you Alan Mulally and the best auto company management team in the business.

The financial collapse caused by the secondary mortgage fiasco and the greed of Wall Street has led to a $700 billion bailout of the industry that created the problem. AIG spent nearly $1 million on three company excursions to lavish resorts and hunting destinations. Paulson is saying no to $250 billion foreclosure relief and the whole thing is a mess. So when the Big Three ask for 4 percent of that of the $700 billion, $25 billion to save the country’s largest industry, there is obviously oppositions. But does it make sense to reward the culprits of the problem with $700 billion unconditionally, and ignore the victims?

As a Ford dealer, I feel our portion of the $25 billion will never be touched and is not necessary. Ford currently has $29 billion of liquidity. However, the effect of a bankruptcy by GM will hurt the suppliers we all do business with. A Chapter 11 bankruptcy by any manufacture would cost retirees their health care and retirements. Chances are GM would recover from Chapter 11 with a better business plan with much less expense. So who foots the bill if GM or all three go Chapter 11? All that extra health care, unemployment, loss of tax base and some forgiven debt goes back to the taxpayer, us. With no chance of repayment, this would be much worse than a loan with the intent of repayment.

So while it is debatable whether a loan or Chapter 11 is better for the Big Three, a $25 billion loan is definitely better for the taxpayers and the economy of our country.

So I’ll end where I began on the quality of the products of Detroit. Before you, Mr. or Ms. Journalist continue to misinform the American public and turn them against one of the great industries that helped build this nation, I must ask you one question. Before you, Mr. or Madam Congressman vote to end health care and retirement benefits for 1 million retirees, eliminate 2.5 million of our nation’s jobs, lose the technology that will lead us in the future and create an economic disaster including hundreds of billions of tax dollars lost, I ask this question not in the rhetorical sense. I ask it in the sincere, literal way. Can you tell me, have you driven a Ford lately?

Jim Jackson
Elkins

That is just it, Toyota, Honda, and others are building cars right here in the US by US workers. They also don't have the overhead that GM, FORD, and Chrysler do. US manufacturers have to pay for the retirement of all their former workers. Honda and others do not, because they have not been here that long.

I don't car who the manufacturer is, as long as a American is working to build the vehicle.

I have owned one foreign car in my life. I bought more GM made vehicles then any other. I love my Chevy Supercharged Monte Carlo, but you know what? I am not in the mood to borrow money to bail out failed businesses.

Ford came out the other day and said they are doing alright and they don't need a bail out. What is the deal with that? GM is the one who needs it. They owe their Union 29 billion. Time to build a new car company in the South.

Yes, at one time businesses took advantage of the people. Now, people are taking advantage of the business. They have been for years. Now, they are in trouble and they want my children's money. NO! Go to Wall Street and find some investors and leave my children's money alone.

We need to rebuild our industrial base anyway. We only have one steel company and most of our manufacturing industry is in China. If you are concerned about our military industry, then bring our steel companies home. Time to rethink some things and bring it back home properly. Sometimes, it takes a disaster to get people motivated to fix a problem.

Now, I really don't think it is fair or right to throw mud on folks who are not happy with the extortion that is going on. We had a gun put to our head that said if we don't bail out banks, we will all die. Now car companies are doing it. Who is next? Walmart? No, it is not the taxpayer responsibility to bail out short sited businesses.

See my prior post, bailing our the UAW with my tax dollars is a bigger F U to America. If GM, Ford and Chrystler vanishes today, it will not affect our weapons manufacture. Can any of you even name a single weapon system contracted to one of the big 3 at the present time?

You prefer subsidizing foreign auto makers with tax dollars? Just about every foreign auto plant is there because of some tax subsidies. I would rather have no tax dollars go to any business...but if money is doled out...preferably American companies over foreign

Also...if you know anything about history...it was our auto plants that were converted during WW II that made the war materiel so needed during the war. You think the foreign auto makers would be willing to do such, in a time of war?

Paying people for years 95% of their salary to sit at home is beyond folly. Why I, who’ve worked my arse off, should be forced to reward this sloth and greed is bs. Furthermore, its nothing more than a bandaid applied to a severed leg, it’s not going to work.

Its wrong for anyone to sit and collect a paycheck without working. However, do you support bonuses for non-producing management in financial institutions that have been bailed out? Your tax dollars at work.

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