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Observations from the Cheap Seats

Hillary, UAW, Shelby and Bankruptcy

  • Hillary for Secretary of State – Chris Matthews calls it Machiavellian and questions why Obama would make such a mistake. But, the question is really why would Hillary accept such an offer. If she wants to be president some day, expect there to be a problem with Bill’s vetting and Hillary to return to the Senate. And, whether accepted or not, having made the gesture to Hillary, Obama goes a long way to make-up with Hillary’s supporters, who are angry at the VP snub. Hardly a mistake, Mr. Matthews, but then it isn’t the first time that Matthews has missed the point.

  • If the UAW is so interested in preserving its hold on the Big 3, why doesn’t it make it official? Take that $7 billion pension and welfare fund and buy majority, or near majority, stakes in at least one, if not all three car companies. The UAW wants the American taxpayer to put our money up to support its jobs — let’s see if it will put up its own money to support its jobs. Only then will we understand how well UAW actually understands the industry problems and the obligations of management. I am not holding my breath.

  • Senator Richard Shelby is right and wrong. He’s right to note that the domestic auto industry has been run with an antiquated business model and that there are gross inefficiencies in their operation. He’s right to note that an unconditional government handout is the wrong prescription to save this industry. He’s wrong, however, to conclude that the American economy doesn’t need a domestic car industry and we should just let it die. Apart from the millions of jobs which are affected by its success or failure, our economy needs a domestic car industry in the same way we need energy independence from foreign sources. We don’t get ahead of the economic curve by achieving energy independence, just in time to fuel our foreign produced cars — simply trading one dependency problem for another and one which will needlessly sacrifice American jobs, severely damage our economy and sacrifice tremendous choice for the American consumer.

  • Really don’t understand the opposition to chapter 11 bankruptcy options for the Big 3. The principal argument goes that it will be extremely complex and then difficult to generate sales to consumers, who will be unsure of the likely success of such reorganization. The theory goes – who will buy a car from a company that they don’t know will be around to back up the warranty? Sorry, don’t buy it.

  • Why not adopt a carrot and stick approach with the Big 3 and the UAW? Successsfully file and complete a chapter 11 reorganization, with all the necessary reconfiguration of contracts, business models, etc., and, in turn, the U.S. government will conditionally agree to loan guarantees (in some amount less than $25 billion), now, to be available when the companies emerge from bankruptcy protection. Don’t tell me it can’t be done, because it can. Don’t tell me that bankruptcy laws won’t permit it, because Congress writes the bankruptcy laws. This way we save the domestic car industry, we achieve the economic efficiencies from a re-organized company and business model, we save millions of jobs, the American consumer is happy and the American taxpayer isn’t throwing good money after bad.

  • UPDATE: The Godfather has spoken — like Santino Corleone giving his streetside lesson in family etiquette to his wayward brother-in-law, Carlo Ruzzi — Senator Reid and the family have let Senator Lieberman tentatively carry-on, with a strong warning. The question is will Senator Lieberman’s chairmanship survive any further insubordination you might naturally expect from a declared independent? Or will Senator Reid ultimately take his chairmanship, akin to Ruzzi’s fateful one way ticket to Vegas?

  • Two observations of the Lieberman matter — first, perhaps it’s the cynic in me, but is it mere coincidence that Senator Lieberman’s stay of execution comes a day after Senator McCain meets with Senator Obama? Any implied quid pro quo? On one hand, I can clearly see Senator McCain going to bat for Joe Lieberman with Senator Obama — that’s what a man of honor does for those who have served him well. But, knowing the political opportunism that has characterized the Obama campaign, I wouldn’t be surprised if, even if only between the lines, something were asked of Senator McCain in return. I would expect John McCain to tell Harry Reid et al. to shove it, although he would be more tactful with the president-elect. Nevertheless, I do find the timing curious and worthy of note. Second, like John McCain, Joe Lieberman is a good, good man. This resolution admonishing him for exercising his rights to support the candidate of his choice is another sterling example of the pure hypocrisy in the Democratic party. So much for freedom of speech and association!! The sheer arrogance of these “protectors of freedom” is astounding.

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