Showing posts with label auto industry. Show all posts
Showing posts with label auto industry. Show all posts

Tuesday, June 2, 2009

Now that I own GM, here are my demands.

GOVERNMENT MOTORSAs a forced and reluctant shareholder in GM (I’ll never buy their product, why would I want their stock?) here are my demands:

1. Stephen Harper and Dalton McGuinty must explain in detail (use pictures and one-syllable words if necessary) why the ongoing demand for cars wouldn’t/couldn’t be met by other more successful manufacturers. People are still going to buy new vehicles, whether supplied by GM or others.

2. I want a letter of appreciation from GM pensioners thanking me and all other pension-less Canadians for the taxes paid on our depleted savings to top up their incomes so they don’t have to suffer the effects of the global recession like their fellow citizens. That’s the least they owe us.

3. A formal letter of apology to all taxpayers by the various levels of government which failed in their fiduciary duty to ensure that GM (and other corporations like it) adequately funded their pension plans, resulting in item 2 above. The letter is to be read out in the House of Commons by Prime Minister Stephen Harper and in the Ontario Legislature by Premier Dalton McGuinty. Name names.

That’s all. Three demands. Satisfy those and I’ll quit bitching about this egregious waste of taxpayer dollars to selectively support one industry sector that just happens to be centered in a vote-rich area of the country.

Sadly, I expect I’ll be complaining for a while yet.

Thursday, May 28, 2009

The water is getting a bit warm….

Like the proverbial frog in the pot of water that supposedly doesn’t realize how hot the water is getting until it is too late and it boils to death, our respective federal and provincial governments (Conservative and Liberal – this is a non-partisan rant) are sitting in a hot tub of epic proportions with the auto bailouts.

Frog in pot (3)A mere 4 or 5 months ago, the total bailout amounts being discussed for Chrysler and GM were in the range of $3 to $4 billion dollars. And those amounts were greeted with howls of outrage from taxpayers and others.

Flaherty’s latest trip to the deficit cupboard was necessitated in part by a ballooning estimate of $10 billion required by GM and Chrysler from the Federal  and Provincial treasuries (i.e. taxpayers). And while McGuinty predicts that the current Ontario deficit should be able to handle the increased bailout funds needed, he also couches his confidence with this: “We're going to keep an eye on it.” In other words, expect to see us back for more later.

And none of this comes with any guarantees whatsoever. There’s nothing to say that $10 billion will be the end of it. GM will still likely go into bankruptcy, and will probably be broken up. Chrysler may yet end up consolidating operations in the US, leaving Canada with nothing but future loft condo properties where factories used to employ thousands.

Actually I misspoke. There is one guarantee, and that is that the taxpayer will never be repaid those billions in ‘loans’ to the auto industry. That you can bet on.

So one has to wonder what the current situation would be if the discussions back in the fall were about a $10 billion dollar (or more) bailout. Would our political ‘frogs’ have jumped right back out of the pot? Or would they have settled in for a nice, long soak?

Sunday, May 10, 2009

Politicians as business leaders?

As Randall Denley says in today’s Ottawa Citizen, “Events of the past several months have certainly made private-sector executives look incompetent, but the corollary is not that politicians are better at business.”

He then goes on to describe how the public and private sectors have different motivators and drivers as well as different reward systems.  In short, a properly functioning marketplace operates on a financial risk-reward basis, while governments operate in a no-risk environment where they control the resources, the laws, the money-collecting mechanisms, and the money-printing equipment to be used once the taxpayers have been wrung dry.

And the irony of it all is that we now have politicians taking control of large businesses like GM and Chrysler, not because the politicians have better business smarts (you only need to look at Jim Flaherty to prove that point) but because the businesses had themselves become too big and unwieldy. “GM is failing because it is bureaucratic, unable to make tough decisions, can't control costs and doesn't have a compelling plan for the future. In other words, it was run too much like a government and not enough like a business.”

With few exceptions (across all parties) I wouldn’t trust the fiscal ability of any politician to balance my check book, let alone direct the day-to-day operation of a multi-billion dollar corporation dedicated to profits and wealth creation. Yet that is precisely what they are doing.

If GM and/or Chrysler are going to fail, they will fail for reasons beyond the scope of this (or any) government to fix, so by dabbling in an area they know nothing about, the politicians are simply delaying the inevitable and incurring huge taxpayer obligations in the process.

"I don’t have the brains for business. I want to go into politics." - Mao Xinyou

Wednesday, April 8, 2009

GM’s Horseless Chariot

It may be too little too late for GM, but this latest announcement of a partnership  with Segway to produce the Puma is the kind of creative thinking the Big Three should have been doing for years.

GM SegwayObviously this is not everyone’s idea of the ultimate two-wheeler, but for the right marketplace it has the potential to be a low-cost, energy efficient, flexible means of transportation.

Unfortunately for North Americans, our governments will ensure that this innovative idea will never see the light of day in any of our over-crowded and motor vehicle congested cities. By the time they have legislated front and side airbags, impact bumpers, seat belts, crash guards, safety glass, crush-proof fenders, a dashboard full of idiot lights, strengthened door pillars, and a spare tire the Puma will be indistinguishable from this other GM product.

hummer

Except that the Puma driver (rider?) will probably be required to wear a helmet.

(cross-posted from www.ontwowheels-eh.blogspot.com)