The White House fairy tale about the Happily Ever After Auto Bailout is missing a crucial, bloody page. While President Obama bragged about “standing by American workers” at a rowdy United Auto Workers meeting Tuesday, he failed to acknowledge how the Chicago-style deal threw tens of thousands of non-union autoworkers under the bus.
In a campaign pep rally/sermon billed as a “policy speech,” Obama nearly broke his arm patting himself on the back for placing his “bets” (read: our money) on the $85 billion federal auto-industry rescue. “Three years later,” he crowed, “that bet is paying off for America.” Big Labor brass cheered Obama’s citation of GM’s “highest profits in its 100-year history” as the room filled with militant UAW chants of “union-made.”
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“Union-made” — but who paid? Scoffing at the criticism that his bailout was a massive union payoff, Obama countered that all workers sacrificed to save the auto industry. “Retirees saw a reduction in the health-care benefits they had earned,” Obama told the congregation, er, crowd. “Many of you saw hours reduced,” he sympathized, “or pay and wages scaled back.”
Let’s clear the fumes (again), shall we? The bailout pain was not distributed equally. It was redistributed politically.
Bondholders standing up for their property and contractual rights got shortchanged and demonized personally by the president. Dealers and suppliers faced closures based on political connections and lobbying clout, rather than neutral efficiency evaluations. And as I first reported in September 2010, in the rush to nationalize the auto industry and avoid contested court termination proceedings, the White House auto team schemed with Big Labor bosses to preserve UAW members’ costly pension funds by shafting their non-union counterparts.
These forgotten non-union pensioners (who worked for Delphi, a GM auto-parts company) lost all of their health- and life-insurance benefits. Hailing from the economically devastated Rust Belt — northeast Ohio, Michigan, and neighboring states — the Delphi workers had devoted decades of their lives as secretaries, technicians, engineers, and sales employees. Some have watched up to 70 percent of their pensions vanish. They’ve banded together to seek justice in court and on Capitol Hill under the banner of the Delphi Salaried Retiree Association.
Through two costly years of litigation and investigation, the Delphi workers have exposed how the stacked White House Auto Task Force schemed with union bosses to “cherry pick” (one Obama official’s very words) which financial obligations the new Government Motors company would assume and which they would abandon based on their political expedience. Obama’s own former auto czar Steve Rattner admitted in his recent memoir that “attacking the union’s sacred cow” could “jeopardize” the auto-bailout deal.
Ohio Republican representative Michael Turner last month called attention to the glaring conflicts of interest that entangled Obama moneyman Tim Geithner’s multiple meddling roles in screwing over the Delphi workers. Geithner served simultaneously as co-chair of the Auto Task Force, board member of the Pension Benefit Guaranty Corporation (the federal agency overseeing pension payments to bankrupt companies) and treasury secretary. The General Accounting Office raised eyebrows at Geithner’s “multiple roles” in the deal-making.
Thanks to a separate Freedom of Information Act request filed by the Competitive Enterprise Institute, we already know that Geithner’s department and General Motors closely coordinated their PR strategy and collaborated on making fraudulent claims about GM repaying all of its government loans. The cash-strapped Delphi retirees are suing the transparency-ducking PBGC in federal court to unearth documents that may yield key details of the improper Obama-administration influence over Delphi’s bankruptcy organization.
As ebullient UAW officials hooted and hollered on Tuesday, Obama smugly attacked Republicans for “anti-worker policies” and their “same old you’re-on-your-own philosophy.” The Delphi workers know better: One union’s government-subsidized, government-manipulated “success story” is the rest of the workforce’s nightmare.
America made a bad bet three years ago, time to do not gamlble with the russian roullette with this commie in chief, next bumper sticker: BLAME, WE CAN BELIEVE.
As usual Michelle is right on point. We have been hearing Obama's voice almost every day since his election and most of what he is saying is exaggerated or untrue.
Michelle: In Ohio it is not just northeast part of the state. The Dayton area (Southwest) has been hit hard. Why? In the GM heyday (1980's) we had 11 plants. 1 assembly (Moraine) and 10 parts plants. Now roughly 2 plants remain, 1 Delphi and 1 sold to Tenneco. The rest are gone.
People don't realize that Delco (immediate predecessor to Delphi in the GM structure) stood for Dayton Electric Laboratories COmpany. Charles Kettering (known as "Boss Kettering") founded it and was the brains behind Alfred Sloan's move to making GM a vertical supplier.
I live in Dayton, moved here to go to college 30 years ago. Worked at one of the parts plants in the mid 80s for two summers as an engineering intern. I figured out then the insanity of the situation and went in a different direction, thank god. However I have friends, parents of friends and co-workers, who were engineers, finance and production managers who have been financially devastated by the situation. Work for GM/Delphi for 40 years, expect a reasonable pension and you left with nothing because you were white collar.
Mike Turner is our congressman here in Dayton. He trying, but it is an uphill slog against Obama.
As one of the 70 percdent club, I am a 30 year employee of GM and Delphi. I am also from Chicago. The patronage handling of the UAW bailout was no different than Chicago patronage to the O'hare airport union workers or the McCormick Place union workers - just bigger. Trample over the law, strong arm anyone in your way, and reward your cash cow benefactors. The whole GM bailout and Delphi bankruptcy emergence was right out of Mayr Daley's playbook.
And now, GM is starting to tank again - they pulled ahead sales with discounts and fleet sales to 2011 to be #1, and now are dropping sales and market share by the bushel. Look for GM to be down from 21% to 18% in market share in February sales. He had to get his speech in today, befor the sales numbers come out tomorrow.
I've lost my pension, my job is hanging by a thread, and if he wins again, I fear for my 401k, Keep going DSRA!
While I have no doubt Delphi employees would have had their benefits trimmed as a part of a legal bankruptcy, as would ALL of the stakeholders in GM, it would be interesting to see an analysis of what the result of that legal bankruptcy may have looked like for each of the players, absent the corrupt hand of the bullies in the federal government.
While I recognize that such an analysis would be war-gaming a "what if" scenario, isn't there anybody with experience in bankruptcy law that could map that out for all to see?
I spoke to a car dealer in my area, a family business that used to employ 70-80 people and had been in business for 40 years or so, who told me that the common distinctive characteristic of the dealers that remained open and those who had the auto companies' logos removed was their history of donations to the two political parties. Those with principals who had supported Democrats remained open and those that had supported Republicans were closed. In his particular case, his business had been thriving, and his customers (of which I was one) now had to travel 20-30 minutes for service, to what had been a smaller, less successful, dealership.
I'll be buying at least one or two vehicles for myself in the next 5-10 years, and another couple for my daughters, but none of them will be GM or Fiat Chrysler vehicles. None. While I recognize that will punish the likes of Delphi along with the rest, I can't see another way I can vote with my wallet when it comes to auto sales and service.
Nice artical,but I was in a union that represented the moraine gm plant,and we got shut down and lost all transfer rights in the gm bankruptcy,so not only suppliers got the shaft,even gm workers that didnt have UAW on the sleeve to one for the team also.