Obama Touting Auto Bailout Benefits is a Fraud
Top eleven reasons why Obama is wrong
By Marc J. Rauch
Exec. Vice President/Co-Publisher
The Auto Channel
AUTO CENTRAL - October 13, 2012: As we move toward the next presidential debate Barack Obama is attempting to shore up his support by touting the benefits of the auto bailout program. In his weekly radio address, Obama said "We refused to let Detroit go bankrupt," "We bet on American workers and American ingenuity, and three years later, that bet is paying off in a big way."
This is a fraudulent claim - but what else could you expect from someone who is so uniquely unqualified to understand and discuss any aspect of business and the economy.
The "American Auto Industry" would not have collapsed if there was no government bailout:
1. Many of the vehicles produced under the GM, Chrysler and Ford brands are not made in America and don't use American made parts.
2. Ford didn't need to take any bailout money and so they would have been left unscathed.
3. For the past several years the "American Auto Industry" has included several foreign brand manufacturers who are building vehicles here in America, using American workers, and they use about as many American made parts as the Detroit-three. These manufacturers would have continued operating.
4. These foreign-brand domestic manufacturers and Ford would have absorbed the demand for vehicles if GM and Chrysler were unable to continue. To do so they would have had to hire (or re-hire) American workers to build these vehicles.
5. It's likely that Chrysler would have still been acquired by Fiat and would have been able to continue in much the way it is now.
6. GM appears to be more interested in the China market than the U.S. market. They use their presence here as a way to give the vehicles they build and sell in China an authentic American identity - Buick is the prime example, but it's true for the other sub-brands, too. There is no value to America in this effort. (see video below)
7. Hundreds of thousands, if not millions, of GM investors lost everything they had invested in GM. By handling the bankruptcy situation the way the Obama Administration did, GM shares became worthless. And remember, there are plenty of retired and active blue collar and low level executives who are investors. So this was not simply a matter of very wealthy share holders losing their very hard earned savings. Many of GM's vendors were similarly negatively affected.
8. The petroleum oil-gasoline companies should have ponied up the bailout money to protect their industry. 2008 happened to be one of the most profitable years for them. Exxon alone could have provided the bailout money. Automobiles are the petroleum oil industry's biggest user of their products. They had a vested interest and they should have been made to pay. American consumers already pay too much at the pump and we already pay for the defense and protection of the world's oil industry.
9. GM's dance with Opel/Vauxhall was more sleight-of-hand. They made it look like they were selling off the European divisions, thereby denuding GM of more assets (assets that would have been considered in a normal bankruptcy). But when everything was said and done, GM retained Opel/Vauxhall, and the investors still received nothing.
10. GM remains burdened with a number of tired, worn out brands and model names that will not be successful. Volt is completely upside-down, losing as much as $40,000 per vehicle (according to some reports).
11. The bailout diversion allowed the three Detroit car makers to steer back away from alternative fuel options, thereby keeping us in the clutches of the OPEC and the OIL WORLD ORDER. Everyone seems to have forgotten that just a month or two before GM, Ford and Chrysler went to Washington to beg for money that congress had authorized $25 billion dollars to be used by the car makers to speed up “future fuel” vehicle design and manufacturing. This money might have been sufficient to stave off the impending bankruptcies of Chrysler and General Motors and help put us on a better track towards becoming gasoline-free and energy independent. However, not one of the three applied for any of these funds.
The Obama Administration has done nothing to help America, the American auto industry, or the American investor.
• SEE ALSO: The Rise and Fall of General Motors...