Pelosi and Reid Back an Auto Bailout
As the NYT reported yesterday, Nancy Pelosi and Harry Reid have written Hank Paulson requesting he provide relief to the auto industry using TARP funds. First, in her statement on the meeting with the auto industry, Pelosi emphasized what I did in my first post on this–the need to preserve manufacturing in this country.
It is essential that we preserve our manufacturing and technology base in this country.
In addition, in their letter, Pelosi and Reid stress accountability and energy efficiency–pushing precisely the kind of goals that many commenters described in this post.
Were you to determine that the automobile industry is eligible for assistance under EESA, we would urge you to impose strong conditions on such assistance in order to protect taxpayers and maximize the potential for the industry’s recovery. An automobile industry that is forward-looking and focused on ingenuity, competitiveness, and the creation of green jobs for the future is essential to its long-term viability. Other taxpayer protections should mirror those required of financial institutions currently participating in the Troubled Assets Relief Program (TARP), such as limits on executive compensation and equity stakes to provide taxpayers a return on their investment upon the industry’s recovery. Any assistance to the automobile industry should reflect the principles contained in EESA that guard against the need to recoup costs to the taxpayers.
We must safeguard the interests of American taxpayers, protect the hundreds of thousands of automobile workers and retirees, stop the erosion of our manufacturing base, and bolster our economy. It is our hope that the actions that Congress has taken, and that the Administration may take, will restore the preeminence of our domestic manufacturing industry so that it can emerge as a global, competitive leader in fuel efficiency and in new and path-breaking energy-efficient technologies that protect our environment. [my emphasis]
While Pelosi and Reid seem convinced the auto industry needs this bailout, they seem intent on placing conditions on it–with the goal of energy efficiency paramount.
I am pessimistic that Paulson will respond to Pelosi and Reid’s request–he has thus far resisted GM’s requests to be considered for funds under TARP–and that Treasury has the capability to offer the kind of oversight that this would require. After all, presumably TARP funds would only come with requirements on lending practices, and though the finance arms of the Big Two and a Half have some irregularities, the financing of consumer loans and loans to dealers have fewer of the novelties that the mortgage market had (though if Treasury were to give money, it ought to limit the number of auto loans extended beyond five years, as anything longer tends to result in consumers upside down on their loans). What Treasury probably doesn’t have is a means to prevent auto companies from making bone-headed decisions that ignore the marketplace.
That said, even while Pelosi and Reid submitted a request that–at some critical levels–relates to constrained credit, Treasury is still throwing money out in bundles to both banks and AIG. I can see valid arguments both supporting and opposing sharing bailout money with the car companies. But any argument against it invites serious questions about the direction of our economy going forward.
Are we bailing out the economy–all of which suffers from the credit crunch–or just the finance side? I guess we’ll soon find out.
It’s past time to separate the need for an auto industry with preservation of two failed corporations.
I’m feeling cynical this morning. What would be the worst thing Paulson could do in terms of hurting the incoming administration?
1) spread the money around aimlessly. Don’t give any one area enough to make a difference, while claiming to help everyone.
2) Don’t control how the money is actually spent, trust the receiver to do what’s right.
3) Back the companies that donate heavily to GOP causes regardless of their need.
In this case, I bet Paulson gives money to the Auto industry for the purposes of repaying money owed to Wall St.
I read your post on the auto industry, but for the first time on of your posts left me more indecisive then before I read it. I really don’t know what to do.
GM’s lastest commercials with the massive rebates seems to distill down to this: We’re going to get your money, either from you or from the Treasury. If YOU give it to us, you’ll get a car for it.
Boxturtle (Extortion marketing…the new wave!)
Though I gotta say the F150 ads–talking about gas mileage for those who need a truck–is remarkably good for the crappy-ass JWT advertising agency, which is the single biggest problem with Ford.
The ads for trucks have confused me recently. I suppose there’s a group of folks out there who buy trucks and don’t use ‘em like trucks. Gas mileage is very important to such.
But for most folks, a truck is a tool.Tell me about the mileage with a full load. Tell me what a full load is. How much can it tow. Show me how easy it is to load. Show me the inside of the darn thing where I’ll be sitting, rather than the 3/4 outside view. A view of the instrument panel that doesn’t concentrate on the GPS screen.
Boxturtle (Most current auto ads are a waste of airtime)
You obviously don’t live in my neighborhood (suburban Houston). Maybe 1 out of 20 people who own trucks use them as trucks. The rest seem to believe that only truck radios get country music or something. Except the high school kids. I’m still not used to pulling up beside a couple of buzzcut ‘goat roper’ dressed whitebread suburban football players and getting blasted out by rap instead of country. I guess the old rule of kids listening to the music that pisses off their parents the most still holds, but it still seems weird.
I’m in Xenia, Oh. Most of the F150’s around here work for a living. And come with the radio preset to the local country station.
Boxturtle (Rap seems to come from the Dodge vehicles)
My truck’s a Ram 2500 and it makes a lot of trips to the feed store. With the diesel, I’m getting just over 20 mpg in town when not hauling a trailer. Yes, it’s on country when the kids are with me; otherwise it’s on Sirius Left.
About 25 years ago, I spent a summer (while in Grad School) working for the Kettering Foundation in Dayton. I still remember getting some awesome fresh ice cream from a dairy near Xenia. It’s weird how things like that stick in your mind. Back then, Xenia was a beautiful place.
Youngs Dairy outside of Yellow Springs. One of the commenters(she had attended Antioch and I believe is in Minnesotat) here at EW’s had some great stories about Youngs Dairy. Great spot where the local areas (farm folks around Urbana, Dayton) mix it up with students at Antioch, WPAFB folks etc. over an ice cream cone.
The area has developed a great bike path that runs quite the distance through this region. Xenia has promoted itself as a hub for this bikeway
That would be the wonderful Sara.
She has great stories and great insights.
It’s still nice. And Youngs Ice cream is still there, serving ice cream made from whole unpasturized milk. And you can meet the cows the milk came from if you want to go outside and eat.
Boxturtle (Technically, Youngs is in Yellow Springs about 7mi from xenia)
the Glen
http://www.antioch.edu/glenhelen/
Riding bikes around Xenia/Yellow Springs
http://www.buckeyepower.com/cl/upload/pg_187.pdf
Hell now you can ride your bike from Xenia to Young’s Dairy and earn that ice cream cone
I live about a half mile from the path to Yellow Springs. I have biked to Youngs, but that’s way too much like work.
I know Glen Helen like the back of my hand, it’s MUCH better than John Bryan. I think I learned to walk on the path back to the Springs itself. I certainly learned the evils of stairs on the climb to the glen floor from the parking lot.
Boxturtle (There are spotted turtles in Birch creek. Those are really rare around here)
Spent many of my young years hiking in the Glen. Worth a trip for all to experience
I have an 89 chevy four wheel truck with over 200,000 miles on it. Use it when I need it for hauling etc (own some land). Otherwise drive a Nissan Sentra. Have read that it is better for the environment to buy a small economical car than one of the newly produced hybrids
In case it wasn’t clear, I wasn’t casting aspersions on owners of what we always called ‘pickem up trucks’. This link will give you a good idea of the problem we have in Texas. It’s from two years ago, but the situation is still the same. Trucks are a vanity buy. It’s insane.
I got it. Just sharing how one can have a truck and not drive it except when necessary. I know so many folks who drive these hogs around when it is completely unnecessary. Country high school parking lots are filled with big trucks.
How about an add where a couple of young cowboys (or pretenders) are shown giving up their “pickum up” trucks for an economical environmentally sound hybrid. Show the folks that they are after walking over to the more aware cow folks vehicle.
SNAG’s (sensitive new age guys) or SGAC (sensitive Green Age Cowboys)
Boy, ya got that right.
“strong conditions” that makes sense.
Robert Kuttner was on C-Span’s Washington Journal and on Amy Goodman’s last week discussing his book “Obama’s Challenge”
On the Journal he said that some of the money that Wall Street has been given has been used as “bonuses for executives and dividends to share holders”
Robert Kuttner said this on this program. What a brilliant and reasonable person Kuttner seems to be
http://www.c-span.org/Series/W…..urnal.aspx
here is economist/journalist Robert Kuttner last Jan and more recently discussing the economy
http://www.democracynow.org/2008/1/23/recession
Can Grassroots Movement that Propelled Obama to Victory Chart a Better Economy?
President-elect Barack Obama is expected to name his Treasury Secretary soon and is moving quickly to form his response to the economic crisis. We speak to Robert Kuttner, author of Obama’s Challenge, and Arun Gupta of The Indypendent. [includes rush transcript]
http://www.democracynow.org/20…..lled_obama
As long as the Republicans are in charge, I’d bet on the side of the ‘just the finance’ side. They have no incentive to bailout the real economy.
Agree. The question is, how much can Obama influence things between now and January.
A wise president will at least consult with the president-elect about major moves.
But I think we’ve got a bitter, vindictive president. And vice president. And their staffs are worse. I think they’re going to try to make sure that Obama hits the ground 1/20 under heavy pressure and with few actual options. They then will blame him.
Boxturtle (Rush is already calling this an “Obama recession”.)
The way I’m interpreting Bush’s unprecedented cooperation in the transition: an attempt to turn smother him in his embrace and mark the next two months of worsening conditions as his successor’s responsibility. Which is why it’s nice to see Obama remind us that “there’s only one president”; I’d like to see him do it more pointedly.
My wife and I were scratching our heads over the reports this weekend that Obama would attack the hundreds of executive orders Bush has used to change policy and gut regulatory protections. Why would they let that out just before meeting Bush on Monday?
Ah, maybe to put some distance from Bush’s embrace.
Smart.
Thanks ew.
digg
Are the Wall Street Welfare Kings ( a few Queens) receiving bonuses via this corporate welfare? According to Kuttner they are
Where is the congressional oversight?
Convienently, the bailout bill gives congress very little actual power and leaves all the decisions in Paulson’s hands. Should congress decide to challenge that, I doubt it will even get a court hearing before bushco is gone. And the courts will simply tell congress “YOU have to power to act, should you choose”.
Boxturtle (I think it’s that congress would simply rather not have to watch sausage being made)
I like Xenia have spent some time in your town (the bike path is wonderful)
Paulson and Bernanke sure waited along time to come to congress. At that point they basically told U.S. citizens that the U.S. family jewels were nailed to the Treasury floor. Paulson handed the nation a knife and a pack of matches and said “choose”
An inside Heist job
Here’s another interview of Kuttner with Ian Masters:
http://www.ianmasters.org/
Thanks. Kuttner seems so brilliant and reasonable
the financial side has become the real economy…
bailing out companies traded on the stock market is an interesting twist… not sure what that is called in relation to the idea of capitalism, but it strikes me as corporate welfare not capitalism..
This could get an adverse reactions, but I can’t see how anyone could argue that the Pelosi-Reid demand comes from any motivation other than pure partisan politics and empire building.
The more honest message would be to remind Paulsen AND his boss that he’s currently serving at the pleasure of a lame duck president with an agenda that’s been rejected by the electorate & has less than 3 months before he leaves, and suggest that both conduct themselves in a manner that does as little harm as possible to restrict the options of the incoming chief executive and incoming Congress.
Instead, Pelosi-Reid seem to be saying: It’s imperative that you act now, but whatever you do must in the short term save the industry, but at the same time in the long term you must act against a standard of completely securing the environmental vision and inter-related plans of the incoming Democratic party president and Democratic party led-Congress, despite that neither you nor your boss have shown the slightest evidence of the slightest belief in any of that, that indeed your boss has acted in a manner that bears no other conclusion than that he believes quite the opposite, and that no part of that Democratic party quasi-hegemony has definitively identified that vision or laid out those plans in any practical detail.
And just so you know, whatever you choose to do, we’re going to reserve the right to take you to task for it against this standard.
Got it?
I’d being content to settle for Paulson doing absolutely nothing.
I disagree, if only bc the auto industry is one thing that can’t wait until 2009. I certainly understand those who don’t want to bail out the car companies. But if they don’t get bailed out, you’re going to see another tremendous blow to the economy that is fairly widespread. If Paulson says no, I expect that Pelosi will try Congress, though I’m utterly pessimistic they’ll get anything passed.
A figure on ABC nightly news the other night: if GM fails, it means 2.5 million lost jobs.
People are a bit cavalier about seeing our industrial base evaporate.
Sorry to be away when your response arrived.
First – I see a distinction between WHATEVER Paulsen would want to or feel comfortable doing as an officer of the current administration, and WHATEVER holds the promise of doing the least harm. By way of example as to the latter, I point to the current fiasco with the nationally-backed advances to the Big…uh…is the number at 3 now? banks, as well as to AIG, which I see as throwing cash down a money pit for all the good that could possibly ever do beyond making a few thousand executives and investors feel more “confidant” about maybe continuing to hang around Wall Street because they’ve been able to put some more money into their off-shore bank accounts and might get more on top of that.
Second: If Obama and his people see anything like the same short term urgency and need as you do [and I don’t argue with that], what’s wrong with going with some variation on Paul Krugman’s idea today as to the near term infrastructure spending and budget planning needs of municipalities and other local and regional authorities? That is: identify with at least the minimum level of assurance required at least some aspects of what help is soon on its way, along with a clear date of arrival, and call on Bush/Paulsen to act accordingly?
I mean, it’s not as if Bush has any reason to go into today’s meeting with any justifiable room for surprise about the regard in which Obama does not hold Bush – just read the relevant passages from Obama’s second book.
And I don’t see that as anything like playing Double Dare You with Bush. Given the last few months, it appears that the entire Bush administration, Paulsen included, has so little in the way of ideas, as long as nobody on Obama’s team actually uses the word “dare” to kibosh the move, the Bush administration would be pleased to do it just because they won’tbe blamed for thinking of it on their own.
Second – I trust the point of view and focus of Team Obama a hell of a lot more than Team Pelosi-Read [as opposed to Congress, which may not end up being any better].
Yes. But personally, I’m not at all convinced detroit’s even viable any more. What are the odds dropping $50b into GM is going to turn things around? They’ve been headed towards ground 0 for quite a while now.
Anyone have stats on big 3’s cost per car compared to Jap/Korean majors? As of a couple years ago or so, GM had somewhat closed the gap but still well short of catching up.
Personally, I’m not convinced the $2(?)t spent so far on this mess has been worthwhile at all… far from it actually. Give state of US balance sheet, if someone asked me I’d want to see good evidence supporting the notion throwing $$ @ Detroit will actually work.
I just don’t think “nothing” has ever been an option. “Credit crisis” is a euphemism for “the banks are insolvent.” Wall Street executives with the assistance of too-low-for-too-long interest rates engineered our financial melt down. It was already bad before Paulson persuaded Congress to increase leverage limits to 40 to one. Wall Street then put up one dollar for every forty they borrowed to buy up most US mortgages. Then Wall Street repackaged those mortgages into a pyramid scheme, tranched securities, and sold them at immense paper profits. Then Wall Street created phony insurance, credit default swaps, that did not hedge the risk. I don’t know of any plans to get that cash back for the U.S. taxpayers. When banks, mutual funds, hedge funds, endowments,pensions, local and state governments around the world bought collateralized debt and credit default swaps, Wall Street essentially made the world economy dependent on the US housing bubble. As Stiglitz, Krugman and others predicted, none of those financial profits produced anything remotely resembling the value they have destroyed.
OT, part of the benefit of the bailout is that it keeps the stock prices up. That’s ok, because it keeps investor money in. That’s better than taxpayer money. The downside is that all the top management people have stock options. In addition to their too large salaries, they are cashing their bonus checks, because our tax dollars subsidize their stock options. That has to stop. They have to take massive voluntary pay cuts and return all bonuses. If they don’t do it voluntarily, IRS should step in Brainstorming about TARP and Wall Street Pay Cuts
I accept everything you write here, and frankly none of it comes as any surprise. Nonetheless, I continue to draw a distinction between “something” being throwing a hell of a lot of money into pit to keep a few people interested in hanging around a while in case you throw in some more, and “something” that is flexible enough to be adapted within a larger framework that has some promise of building a new paradigm. My complaint about the Pelosi-Reid letter is that ON ITS TERMS it can’t be followed by Paulsen and Bush, and further at this point those two alone constitute inadequate [to say nothing of suspect] authority in implying the use of controls over the purse string, oversight and future legislation set terms.
We all accept that the money being “discussed” at this point for use with the US auto industry is included in what Paulsen and Bush have effective control over, no some additional monies like the impending Obama-driven stimulus package [although certainly it may have to come to that]. Again: based on what Paulsen’s done so far, what he can do within the mandate provided him by the terms on that money AND the other mandate from Bush, the best that can be said of the Pelosi-Reid letter is that is sort of implies Paulsen should act with reference to what the next president and Congress will do, as expressed by the president elect and the current leadership of the current Congress, or there will be heck to pay, gosh darn it. I think there’s clearer, cleaner ways to address the concern.
Thanks for the response.
EW,
This post makes a point I made after the election. Let’s make sure we move to the next step and shape policy through our netroots collective work and dialogue. The detailed and informed dialogue here at times approaches thinktank policy making…
The fact that the letter contains some of the ideas discussed here over the weekend, I think, is no mistake…
Let’s keep the solution-based dialogue going on the top issues of concern. I’ll even push for regional group meetings for policy dialogue.
How is building gas guzzling SUVs worse than building beach front condos? Next time a hurricane comes along, do we tell them they made bad choices? Should have seen the storm coming? Last time Michigan got anything like a federal bailout was Chrysler in 1980. The government got all that money back.
OT-Scott Horton is on Scott Horton now talking about Gitmo.
http://thestressblog.com/
Also OT: Sorry I missed that; I’d be interested to hear what they said.
In spite of the BushCo warnings over the last few weeks that Bush’s successor was going to discover it is too difficult to close GTMO, it appears that Obama’s transition team is planning to do just that.
Like some critics quoted there, I also don’t like the idea of creating yet another new alternative court system, but I guess we shall see. I took this as a moderately good signal.
The interview with Scott Horton will be posted on Anti-War.com in a couple of days. The highlights for me were
1) Remember that Obama is a lawyer and knows a lot about Gitmo. He will probably fold the Gitmo cases to military & civilian courts. The new law leaves those decisions to the president.
2) There will be pardons, probably blanket pardons; but, since that admits guilt, a lot of people don’t want to be included.
3) The congress (and complicity of key members) has be unable to get to the bottom of war crimes. Probably need to wait for awhile so doesn’t appear as political act and have a commission with powers investigate thoroughly.
4) With pardons, other nations can begin investigations and develop cases against all players immediately.
5) There is a standing ruling from Truman (1945?) that pardons cannot be issued for war crimes. If bush goes against that ruling, he must do so ‘officially’, meaning something visible and in writing.
There was a lot more, but I had a phone call in the middle of the discussion.
Thank you. This sounds more positive than we’d been warned to expect. Maybe.
Scott Horton’s interviews are some of the best going
So. What if we partially funded car purchases, maybe by rebate, on a sliding schedule against mileage?
Truck purchases for folks with businesses or in the trades could be the same thing except maybe in a scale of mileage against load carrying capacity?
Small business would get rebates for vans or trucks. I know I could use two new delivery vans.
Of course it’d have to be for American-built vehicles, which does shorten the list, but maybe the mileage-rebate scale would promote high-mileage models.
I’d sure like to see this at least talked about, rather than just toss another dumpster of cash at the same old guys who are running these companies into the ground.
That’d help short term. But long term, we need to address retiree benefits. If the Government were to use that cash to pay for retiree health care, auto prices would drop between $1-4K per car depending on who’s numbers you believe.
GM disassembled it’s parts network because it wasn’t competive. They’re buying parts made by people making half (at best) what the GM workers made. Didn’t help, but GM managed to maintain it’s dividend for awhile longer. I don’t want to compete on wages with the third world, even if we win we lose.
Boxturtle (Do we want to be a nation of executives, with all real work done in the Third World?)
I was thinking of a sliding scale buy-in for citizens. Not quite a leasing program but an investing program. Have the highest buy-in rate for new car use for two years or “X” number of miles. Have a second tier for cars two years old or “X” milage plus a factory certified inspection. And a final tier for cars four years old. When the car hits 6 years or “X” miles it can then go to the used car market.
I know, crazy.
One aspect missing from the discussion is the advancement in terms of engineering for ELV’s (End of Life Vehicles). The EU has a big push to hit a 100% mark. Most in US are at about an 85% recycle rate. Toyota seems to be the only one moving towards the 90% mark. I posted some links in the previous auto bailout post on ELV issues.
http://emptywheel.firedoglake……e-save-it/
Sorry, my link did not link to the specific comment. It’s @257.
Fascinating idea. So how would it work? And we’re talking high mileage tradition drive train cars, or just rebates for hybrid trucks, etc?
Well I don’t know how it works, but that’s never stopped me from talking…
I’d like it to be split into several categories,
1) Get thing moving now, maybe with a rebate for purchase of all cars and trucks, with incentives by a sliding scale according to MPG and utility. Maybe pay the car company directly, sort of backing a purchase rebate plan by the dealer: I walk in, select my car or truck, fill out some paperwork, and get the instant rebate at the time of purchase. The dealer submits it to Corporate, who gets the money transferred each week from Treasury. This works for one or two years to keep things afloat, not wildly successful, but not failing.
2) Pay Detroit to buy parts domestically. Bring it on gradually, over maybe three years, but cut out any non-US made parts where possible. I want to see it made in Flint or anywhere in the US instead of somewhere in Asia. Sorry, I’m as global as the next guy, but we’re in a jam and we’ve got people who can run a lathe flipping burgers and running a checkout register.
3) Give Detroit cash performance incentives to meet CAFE-on-steroids standards. What are the numbers? Shoot for the moon, and the better they hit them, the more cash they get. If times aren’t tough anymore (and we can hope, right?) then switch over to tax incentives.
4) Keep the pressure on the car companies by keeping purchase incentives to the consumer for higher mileage cars and hybrids.
5) Issue some grant money and a Big Assed Prize for developing working cheap-to-manufacture high-capacity batteries. Lithium, whatever, we need some killer batteries for hybrid and electric cars and trucks. Including big trucks. Government should be spending big money to make the US the global leader in serious battery technology. And by the way photovoltaics and wind turbines, but that’s another story.
I like your ideas. I think it will need to be a group of purchase incentive programs in order to transfer the US industry over to total alternative designs/hybrids.
1. A staggered rebate for current non-hybrids.
2. A staggered rebate and consumer by-in. Higher rebate incentives for the better performing hybrids.
3. I like the “Big Assed Prize” idea.
4. Grants to companies doing the most for alternative designs. (And means even the none biggies).
There are a number of small design firms ready to be the next Ford.
I also want to see consumer and manufacturer rebates for retooling standard traditional drive train, non-hybrids with technology that meets EPA emission standards and provides more fuel efficiency out of drive train engines.
Terrific comment, thank you.
I really like the part about the auto parts. That’s where the Big 2.5 can make money in this climate. People will be postponing future purchaes. I don’t know how enforcible it is.
WRT CAFE standards, I agree about shooting for the moon, but I think we also have to be prepared to tax oil, especially foreign oil. We have to keep the price high to allow development of other more sustainable alternatives.
I’d also like to see Congress do something on passenger vehicle weight. IMHO, we can’t continue to force consumers to make the Hobbesian choice between the safety of a big heavy vehicle on one hand and fuel efficiency on the other.
Material engineers are coming up with light weight yet extremely strong materials which will allow the industry to maintain safety standards.
Thanks.
Good idea to discuss, but don’t forget what happened when a similar plan was tried in Arizona for alternative fuels vehicles. Almost bankrupted the state; lots of fraud.
>>The new package “will allow AIG to continue to restructure themselves in a way that will not hurt the overall economy. AIG is a large, interconnected firm,” she said.
If the company were to fail, it would wreak havoc on the country’s already ailing economic health, Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke determined back in September when the government first moved to help AIG, Perino said.
they can use the same logic with GM for sure… GM is down 25% at the moment so it appears the market doesn’t think GM is going to be bailed out…
disclosure – i own an 85 nissan pickup which i use for moving musical gear around in.. i periodically do firewood and an assortment of other moving things and find a pu truck is invaluable for my needs… my wife owns a honda fit which i get to use from time to time..
emptywheel, I think there are broad fronts that liberals/progressives can move on. I’m just throwing these too broad ideas out to support brainstorming and better solutions.
1. Huge voluntary cuts in white collar pay from anyone making over $100,000. Biggest cuts should come from those making the most.
2. UAW then makes wage concessions.
3. Medical/Dental providers slash their prices down to the level of Medicare/Medicaid. I see this as an emergency bridge until a single payer system emerges.
4. Per the $25 billion, that’s been allocated, but not yet received. I’d like that to go to federal rebates on fuel efficient car purchases/leases. I think people worry more about cheating on their tax filing, so I like the idea of getting the IRS involved. I don’t know if they agree or could handle the paper work. IRS would be smart to require proof of insurance on vehicles that are really fuel efficient/subsidized by the US taxpayers. Again, involving the insurance company makes it harder for people to cheat. Ideally, IRS could “refund” the rebate to a Big 2.5 dealer at the point of sale. Per your excellent post over the weekend, I think the rebate dollar delivers more bang throughout the entire industry, dealers, advertising, suppliers, ….
5. I liked Reid/Pelosi’s letter, because it focused on saving what parts of the Big 2.5 are most likely to survive.
Big projects that only the Federal government can really initiate.
6. I think carbon offsets are a huge tool towards providing tax incentives for vertical farms in Detroit, Gary, Youngstown, and other urban areas that are hit hardest by this. Long term, vertical farms with their twelve month growing season will compete directly the big agro businesses. Tax payers want their dollars to go to stuff that builds value. Making sure we have enough to eat and that the food supply is safe meets that criteria. Absent other better proposals, I think this is a strong candidate for federal tax credits and loans.
The construction of high tech farms might provide some short boost. The high tech vertical farms might provide some good paying jobs and many that are not so high paying. You still have to plant and harvest. Some might be relatively low tech and provide low skill, low paying jobs. If deflation continues, the relative price of food will rise.
7. Closely following in terms of long term value to the taxpayer imho is a HVDC (High-Voltage Direct Current) backbone at about a million dollars a mile. As you know, that allows power companies to more easily buy energy from a much wider variety of generators. That decentralizes the power grid makes it more redundant, more sustainable, and a lot less expensive in the long run.
8. Radial Wind Farm in Lake Michigan
I have no idea if this is feasible, but I thought I’d throw it in.
9. Separate breakout of ideas for US Steel industries, metallurgy, tool and die technologies, but the approach is the same. Where is the customer base heading? Identify start-ups that have already recognized the trend and provide them with tax credits in exchange for job creation.
I think it’s interesting that 3 times now the dems have tried to regulate the fees in the mortgage and credit card industry and that each time the gop was willing to walk out on the bill. To me, it says that they are protecting the fees for some reason beyond simply the bottom line. (we all know they won’t see realize that money). I think it’s to hide the truth about the bottom line.
Yes, health care reform is at the foundation of why it costs as much as it does for employers. It will change the cost of living when our health care costs go down.
I think right now, we need to be focusing on getting the whole truth before we make any big decisions. I think we need to slow down and search for the real bottom line. I am concerned that we still do not know all we need to know about these companies and what has been going on.
One fear I have is that foreign entities might own some of these corporations and that we are now beholden to them because of our debt. Who really owns these companies?
Do we know for sure?
As to truck ownership. I live in Nebraska, but my ford expedition has been sitting in my garage for 3 years. (it’s a 99 and would be a much more comfortable reliable ride than the car I am driving) My husband has a 1976 Ford F 150 sitting in the driveway…it’s just for collecting. I am driving a 91 Bravada because it has better gas mileage than the expedition.
Financially we are trying to sell the expedition so we can get a more fuel efficient car. But the truth is that alot of poor folks (ones who have spent huge amounts of money paying predatory lenders to keep their homes, and who have filed chapter 13 bankruptcy) may want to scale down but may not be able to do it.
That’s why retrofits to retool current cars on the road to make them more energy efficient is important in terms of short term environmental justice. Retrofits could be a stop-gap as we move the industry to total alternative energy engineering.
I still think the biggest challenge for the industry will be to manufacture something better than the compressed air car coming here in 2010.
My son gets a kick out of the compressed air car. He did a science project two years ago where class teams had to design the best performing balloon car (win on speed and distance). His car won because of a design of a valve that controlled the expulsion of air from the balloon. It gave good propulsion for the greatest distance and speed.
This kid has read every article on the compressed air car. I wonder how many in Detroit have studied the car?
Personally I think it’s exciting. I smell freedom from oil addiction and I think most folks see that oil and our need for it has compromised our values as a country.
It was the best of times, it was the worst of times.
My 49 was for you. Did not intend to dialogue with myself!
I don’t know alot about the compressed air cars, but how exciting that your son is so interested. I know enough to know that the solutions are available to us and that part of the republican ploy is to convince us that we need them. (just like that batterer who says: “No one else will ever love you like I do.”) In that sense, these are exciting times. I really do believe that the changes to come will create a shift in paradigm.
Looking back, as horrible as the bushco years have been, they have made it clear to lots of folks that the republican themes don’t work and most average citizens have a pretty good idea of where we need to go from here.
Good for your son. My husband is a total gearhead and can work on just about any engine. He is also certain that we can build good vehicles that are not dependent on oil. I really think we have had the knowledge and capability for a long time since the steam engine? at least. I think that the oil barons have had been controlling us for WAY too long.
Now the criminals and traitors that run GM and Ford have their hands out, begging for free money. This is obscene. These folks outsourced thousands of American jobs in the auto industry to Mexico and China and other foreign locations. Now Americans can’t earn the money to buy the G-D cars made by GM and Ford. What an idiotic plan. Outsource our manufacturing jobs and then act surprised when Americans no longer have the bucks to buy cars. Short-term corporate greed is destroying America.
Republican-run corporations have been outsourcing and exporting our good manufacturing jobs and high-tech jobs for many years now, dating back to NAFTA and WTO in the corporate Clinton days. We need to get out of NAFTA and WTO and rebuild our tariff walls to traditional levels to protect American industry and American jobs.
The Republican way of keeping our economy out of recession was based on short-term tactics,such as cutting the interest rates, and puffing up the real estate bubbles, which have created several long-term problems. By repeatedly cutting the interest rates, Greenspan has virtually destroyed personal savings in America. Instead we borrow billions from the Chinese, the Japanese and the monied folks in Europe and the Middle East to ”pay” for our wars and our spend-thrift ways. This won’t work in the long run as we are know learning to our sorrow.
We are going to have to tighten our belts, get the hell out of Afghanistan and Iraq and start living within our means.
We cannot borrow our way out of debt.
Oval
With all due respect, this bailout, if it happens, is the only thing keeping the UAW from being rolled up.
Ford and GM (Chrysler much less so) still employ hundreds of thousands of union line workers. Not so their competitors. So you can either try to save Ford and GM, or you can just write off the union car worker in this country.
Here is a HuffPo article from last week basically stating what I am stating. Detroit has to beat the Tata Compressed Air car.
Compressed air. The exhaust is so cold (and clean) it can be recycled to cool the engine and the car interior, reducing the environmental impact of coolants.
http://www.huffingtonpost.com/…..40674.html
Understand, in India Tata’s aircar is competing against a motorized rickshaw–basically a tin can running on a motorcycle engine. Vehicles in India don’t have to get over 35 MPH–because they can’t; there’s just not the infrastructure (in terms of things like traffic lights) to support higher speeds. By comparison, though, the Chinese do like their speed bc they have dedicated car lanes with huge intersections and tons of traffic lights.
There’s a reason that’s being developed for India–because it’s the perfect car for India.
EW,
They have a model which will be introduced in the US which will meet our safety standards and will compete speed-wise. For now, yes, the car as introduced in India is competing against a rickshaw.
Here is a small car tech firm trying to beat the Tata car.
http://cleantechnica.com/2008/…..#more-1204
Tata info… Still the talk at the Detroit auto show…A car that would be an affordable alternative energy car…
http://www.product-reviews.net…..gulations/
Tatas, unless something has changed 180 degrees recently are a joke that ain’t happening according to the car guys I have talked to in the past and what I have seen and known. There is a difference between the talk and idea, and the resultant execution, on a lot of these “new” things. Most of this crap makes the worst GM car look like a Lexus or Mercedes in quality and engineering. Making cars and marketing them on a mass scale is tough, expensive, problematic, and not for the uninitiated and feint of heart. those who are quick to write off Detroit really don’t understand the logistics etc. at play in this market.
http://www.popularmechanics.co…..?series=19
A senior engine designer at one of the big 2.5, who happens to be a dear family friend, has stated this is quite real and Detroit should take note.
bmaz,
Here’s more:
http://zeropollutionmotors.us/?page_id=23
It will have to be CAFE on steriods because EU and other global standards are passing our CAFE standards. I would be willing to base it on the highest global standards if we want to be competitive globally.
Good point. THough of course, Ford and GM are MEETING those higher standards in other markets–along with the different safety requirements,etc.
I am really impressed with the way Obama is handling the transition. He is speaking truth to power and basically by “taking charge” nonverbally he is establishing the boss while the boss is still in technically in charge. I think this squashes the potential of a november or december surprise because he has made it clear that he is in charge despite how they might protest. His strong start says “don’t cross me, the people are behind me.”
At least that’s my read. I think it’s a good start.
Agreed, and I really like that Podesta is in charge of transition. A progressive-thinking President-elect, and a progressive running the transition team.
As long as we’re talking, as a refugee from the Tech industry, it just grinds my wheels to think that other countries are leading in the science and manufacturing of alternative energy products.
We have always been the world leader in the development of silicon electronics. Photovoltaics have not been cost-effective to manufacture in small quantities, which means we are stuck between the chicken and egg as far as manufacturing and customer acceptance: if you build it, a lot of it, they will buy, ’cause the price will be lower.
We need a government program to purchase and install massive amounts of solar panels, but only if it says “Made in USA” on the label.
And wind machines–we’ve got killer designs (see Clipper Wind Power), cutting-edge material scientists (as pointed out by klynn), and thousands of square miles of wind resources throughout the country.
A dear friend is one of the country’s leading material engineers. He is amazing. I’ll find a PBS link that covered some of his work.
(and BooRadley)
Here’s the link I was talking about:
http://www.pbs.org/wgbh/nova/c…..la-02.html
And my link @62 is worth a read (EW you might like to take a look).
Here is an update on what Tata is planning on doing in the US and there is more news I’ll post later.
Detroit better watch out.
http://www.financialexpress.co…..ia/381778/
I’m not discounting that it will work. But a $18,000 car that meets top speeds of 96 MPH is not the same as a $2500 car that meets top speeds of 35 MPH.
They bought the rights to ZPM. The ZPM car is a different car from the Nano being produced in India but both cars have the compressed air technology. Any compressed air technology engine design is being bought up by Tata. The ZPM will have a 6 seater by 2011-12 that can also reach 96 mph.
Who the hell is going to drive one of those things? My weedeater has almost as much power as that thing. I dunno. Maybe it would work in an eastern city or in Malibu or Frisco or something; but it isn’t going to fly out here. I want my jet pack I was promised in the 60s now.
Try looking at this:
http://zeropollutionmotors.us/?page_id=54
90 was for bmaz.
I admire and dearly love your passion and effort, but you ain’t getting me in one of those pillboxes. If it is not from Bavaria, Stuttgart or Maranello it just isn’t going to excite me. But I grew up around cars, classic cars and racing cars; they are not transportation to me, they are an art form and a way of life.
Then you should appreciate the fact…
(My bold)
Most of the time art is a reflection of history and social change. Since you mention art…Generally, art is a material based human response made with the intention of stimulating thoughts and emotions. An art movement is a tendency or style in art with a specific common philosophy or goal, followed by a group of artists during a restricted period of time. Many times the artists are influenced by the need to communicate ideas, such as in politically-, spiritually-, or philosophically-motivated concepts to reflect the changes happening in society.
Pneumatic cars are the avant-garde of next generation car engine design. You strike me as one who just might be progressive enough to catch the pneumatic car wave and become an alternative clean based driver…but then you could be a status quo kind of guy. Push your boundaries bmaz…You can do it, especially if the car can do 98 mph and go 100 miles on a tank of alternative fuel and pretty much drive on air. And there are some sporty designs which will hit the market.
Anyway, my point all along, is that Tata is serious about this. They have plant designs ready to go and are breaking ground in a number of states soon. This is not going away and Detroit has not even taken a look at this technology in a serious way. Their BIG mistake. Many of the X-prize cars selected for the X-car race have some element of pneumatic engine design and are quite sporty. Look at the list of designers with intent to make the 2009 cross-country race. These small design teams are going to be the next Detroit. Detroit is blowing it…excuse the pun.
http://www.progressiveautoxprize.org/
Heh heh; talk to me when it can do 150 mph and get from 0-60 in under 6 seconds. But I do love the progress and passion!
You keep tempting me bmaz…
Well, you know what they say about a man who has the need for speed…
Maybe this is more to your liking…a plug-in car!
http://www.autoblog.com/2008/0…..-speakers/
http://www.forbesautos.com/new…..brids.html
Now that’s “responsible” sexy…
Heh, I actually have friends involved in the Fisker project; know it well. It is a nice step, we’ll see.
Acuras are for grandmas; BMWs, that is a real driver’s sedan.