The Advantages and Pitfalls of Auto Bailouts

picture-103.thumbnail.pngI’m (finally) working on my post on the Chevy Volt.

But before I do that, I want to lay out three data points–and point to some of the policy issues that still need resolved if we’re going to have a viable American auto industry.

The first is the excellent news that Obama has will announce really aggressive CAFE efficiency standards tomorrow [they’re not CAFE standards]–35.5 miles per gallon.

The Obama administration is set to announce tough standards for tailpipe emissions of carbon dioxide from new automobiles, establishing the first ever nationwide regulation for greenhouse gases.

It will also establish high fuel efficiency targets for new vehicles that would set a 35.5 mile per gallon average for new passenger vehicles and light trucks by 2016, four years earlier than required under the 2007 energy bill, sources close to the administration said.

The administration is embracing standards stringent enough to satisfy the state of California which has been fighting for a waiver from federal law so that it could set its own guidelines, sources said. Gov. Arnold Schwarzenegger (R-Calif.) will be among a variety of state and industry officials attending an announcement tomorrow, said sources close to the administration.

The compromise deal, which has been under negotiation since the first days of the administration, includes the White House, the state of California, and the automobile industry, which has long sought a single national emissions standard and has waged an expensive legal battle against the California waiver. The industry will get its single national standard, but at the price of one that approximates California’s targets.

Make no mistake–this is a huge bump in gas efficiency and will have a big impact on our gasoline use.

But I suspect Obama’s announcement came with a trade off–and perhaps not the right trade off. As David Sirota and others have reported, GM’s current recovery plans have quietly included plans to import their Chevy Spark (that green thing above) from China.

GM expects to sell about 17,300 China-made vehicles in the United States in 2011 and to triple that to about 51,500 in 2014, according to a planning document that GM circulated among U.S. lawmakers. The document did not name models or say what their brands would be.

The plans are subject to change pending the outcome of negotiations with the UAW and already have drawn fire from lawmakers and others. If GM goes forward with the plan, it likely would become the first major automaker to ship Chinese cars to the United States.

The Chevy Spark is an increasingly popular in China, India, and is being exported from China to Peru (and is, I believe, what GM plans to assemble in the Russian factory it built last year). It’s an A car–a mini that will compete with the Toyota Yaris and the Fiat 500 once it comes to the US.

But it’s also assembled in the interior of China, with dirt cheap labor.

Now, these two events are fundamentally tied together. No one–not even Toyota or Honda–can make a car this small profitably in the United States. Want 35.5 MPG in the auto fleet in this country? You’ve got a couple of options: cede the market to companies like Toyota and Honda, which can import small cars from cheap labor countries, and resign yourself to US manufacturers becoming increasingly uncompetitive as gas prices inevitably rise. Find a way to make GM’s importation of such cars palatable. Or, put a steep tax on gasoline, to make it easier for manufacturers to charge more money for these cars (though even in Europe, where you’ve got similar conditions, manufacturers opt to make these cars in cheap labor places like Poland). I don’t know which option is best (I guess alternately, you could forbid any company from importing such small cars, even while increasingly requiring such cars to be made to meet CAFE standards). But those are the options.

It would help, of course, if we had single payer health care and a national pension plan, to make US assembled cars more competitive with foreign assembled cars. I don’t see that happening any time soon (and yes, the auto companies should be leading the push for this to happen, I agree).

Then there’s the other news, the huge numbers of auto dealers being closed by GM and Chrysler–a total of roughly 2000 dealers in all, each employing about 50 people. Observers and members of Congress claim to be surprised by this news, but they shouldn’t be. The Big 2.5 have been talking about shedding dealers since November. I predicted a Chrysler-Fiat deal would bring about the closure of 990 dealers (which I guess means I still expect another 100 or so to close, beyond those that have already been listed for closure).  And frankly, I don’t see much option to this, if the Big 2.5 are going to become more competitive (in fact, I expect that the GM and Chrysler closures will, for the first time in a while, give them big advantages over Ford).

I’ve worked with dealers around the country, and every one of them complains about the same-brand dealer a short distance away (often just a mile or a few miles). Those dealers are always caught in bidding wars with each other, which has the effect of driving prices down and diminishing the perceived value of the vehicles themselves.  Honda and Toyota don’t have this problem because the overwhelming majority of their dealers were opened after the time when it made sense to have a car dealer in every town. And they have far fewer dealers anyway, even though Toyota matches GM’s volume.  And because Honda and Toyota can sell more cars per dealer, they can invest money in things like good service and new service bays. 

Now, like I said, I can’t imagine any alternative to closing dealers (though I pointed out in November that Congress could have chosen to deal with dealers, which might have led to a politically more palatable solution, yet Congress completely refused to consider doing anything with dealers in its attempted bailout). The only thing that might have prevented this is a restriction on dealer size, making all dealers uncompetitive–and I can’t see anyone advocating that. 

Still, that doesn’t diminish the pain. The people whose dealers are closing–many of them–have been in this business for generations. They’re leading businessmen in local communities. And somewhere (I have lost the link), I read that car dealers generate about 16% of all ad dollars, in any given ad market (so this is going to hurt newspapers and so on). 

Obama’s auto bailout has not entirely ignored dealers. By freeing up credit to auto finance companies (like GMAC), the Administration was basically freeing up the credit that makes the dealers tick. And he made small business loans available to them too. But the price for this, I suspect the auto task force would say, is in requiring that dealers be viable before getting additional loans from the taxpayers. 

Tomorrow I’ll have my Volt post (some good news about an American car company!). But for now, here’s the state of play.

76 replies
  1. Funnydiva2002 says:

    Thanks, Marcy
    It’s astonishing that you’re keeping on top of this in addition to your torture-related work.
    We were talking about heros last night on LateLate, and we all agreed that you top our list. So in the same spirit as adding the middle name “hussein” in support of candidate Obama (remember that?), some of us will sign off:

    Funny Wheelie Diva

  2. MadDog says:

    A couple of additional thoughts occur to me:

    1. While mini-mobiles, like the GM Spark, the Toyota Yaris, and the Fiat 500 may help meet the new CAFE standards, they will also likely increase car insurance costs and medical insurance costs given the mini-mobiles inherent low ratings in the “crashability” tests. Growth in the funeral home and cemetery plot businesses are likely outcome too.

    2. EW wrote:

    …And somewhere (I have lost the link), I read that car dealers generate about 16% of all ad dollars, in any given ad market (so this is going to hurt newspapers and so on).

    And it’s not just newspapers either. From TelevisionBroadcast:

    Car and truck dealerships comprised the fourth largest spot-spending category among the top 100 TV markets last year, contributing $801 million of a $16.5 billion total. Now their ranks are in dire jeopardy…

    …Automakers and dealers represented 12 of the top 25 spenders on local and national spot in the top 100 last year. Together, they spent more than $2.5 billion, or 15 percent of the total. Full-year spending was off by about 20 percent from 2007. For 4Q08, it was down 30 percent, but the impact was buffered by political spending…

    • Petrocelli says:

      All excellent points !

      I think Obama’s central idea for raising CAFE standards is to push for hybrids, Plug- ins & EVs.

      We’ll get safer vehicles and help the environment.

      BTW Marcy, I’m one of the many Car Buffs who eagerly await the Volt post(s).

      Did they let you drive the Camaro from Transformers too ? *g*

    • emptywheel says:

      Well, yeah, if everyone else is driving a Suburban. But if you could get lots of people in the Sparks and 500s, then they wouldn’t necessarily be devastated by being hit by a tank.

      And of course, there will be fewer and fewer Hummers on the road.

      • MadDog says:

        Well, yeah, if everyone else is driving a Suburban…

        Like now, you mean? Yup! *g*

        …But if you could get lots of people in the Sparks and 500s, then they wouldn’t necessarily be devastated by being hit by a tank…

        That’s partially true too! But even if everyone was driving a mini, the current “crashability” tests show, if I am remembering correctly, that minis consistently suffer more damage (as do their occupants) at the same speed than do the bigger model autos.

        And please note, I’m one of those yahoos who gives the finger or curses under my breath everytime I encounter Denalis, Yukons, Expeditions, etc.

        I guess what I’m saying is that I’d be a bigger supporter (and I do support them now) of mini-mobiles if the manufacturers weren’t just reinventing the Ford Pinto or Chevy Vega, and instead spent more effort on designing safety into the minis.

        Given the manufacturers’ past history, I guess I shouldn’t be surprised that safety design lags other design aspects like mileage, appearance, etc.

  3. bobschacht says:

    So what’s the deal with Treasury indecision about whether the ex-CEO of Chrysler (or do I mean GM?) will get his $20M golden parachute?

    Bob in HI

  4. MadDog says:

    In keeping with the topic of this post (and near future ones EW has in mind specifically on the Volt), this is an interesting article today from Bloomberg News:

    Toyota Questions Cost, Batteries of Plug-In Hybrids

    Toyota Motor Corp. said U.S. consumer demand for plug-in hybrids, a technology backed by President Barack Obama, may be limited by the vehicles’ price, recharge time and battery durability.

    Toyota estimates sales of hybrids that can be recharged at household outlets may be 50,000 units a year at most and could be as few as 3,500, Bill Reinert, U.S. national manager for advanced technology, told a National Academy of Sciences panel today in Washington. Sales of Toyota’s Prius, the best-selling gasoline-electric vehicle, were almost 159,000 last year…

    …Tests of Priuses fitted with $10,000 lithium-ion packs from battery maker A123 Systems Inc. found fuel economy rose only to mid-to-low 50 miles per gallon from the standard Prius’s 46 mpg rating, Toyota said…

    …Toyota’s wariness on demand in the U.S. for plug-in vehicles stems from its experience selling battery-powered RAV4 sport-utility vehicles in California in the early 2000s, Reinert said.

    While the company spent 15 times as much per vehicle to advertise and promote the all-electric SUVs as it did for its first-generation Prius, it managed to sell only about 300 a year, he said.

    Sales Remained Low

    “These marketing efforts were successful in generating high awareness, as shown in our Web site traffic data, but sales remained low and did not increase over time,” Reinert said…

    • Petrocelli says:

      I would look at this news item as an attempt by Toyota to push competition away from developing Plug- ins, in very much the same way that I believe GM has tried to do.

      We have become the Plug- in generation, from Laptops to Phones to Shavers to Mowers … Plug- in vehicles will be a natural extension of this culture.

      What will decide the success of PHEVs are ease of recharging, range and safety … earlier Li- ion Batteries burst into flames. If that happens to even one Plug- in, the entire idea will get mothballed for 10 years, perhaps forever.

    • emptywheel says:

      My post on it? I went into the archives (still have to post a bunch from that) and then to visit family, and then had to catch up. I’m caught up. The pix are loaded. And I felt like I had to do this post before I did that one.

      Here are two short articles from people who also got the test drive.
      I drove the silver one.

  5. kimmy says:

    Approx. 20 years ago we went to Europe to take my family to my homeland. Three adults and two teenagers plus two weeks luggage. We rented a Renault Nevada wagon with a 2.2 litre motor. We drove all over the Netherlands, Germany and Denmark in those two weeks. We filled up twice, the second time when we returned the car. Excellent mileage and quality of vehicle. 30+ mpg.
    Why can’t we do it here? BTW. We actually did 200 kph on the Autobahn.
    The makers over here need a lesson from Europe.

    • MadDog says:

      And if we had the gas prices here that the Europeans do there, we’d all be driving much smaller and more efficient cars.

      We be dinosaurs and don’t even know it.

  6. flyarm616 says:

    I love the mini Cooper and since being a 33 yr flight crew that flew France alot is my favorite car..for many many years..I just love that adorable car..
    A dear friend who plays golf with my hubby owns a BMW?MINI COOPER last spring my husband was going to buy me a mini cooper..our friend who owns the dealership ..would not sell us one..he gave me the speech he gave his own is not safe to drive on our roads as they exist today.

    He said ..get hit head on and kiss your rear end goodbye!

    This is the man who owned the dealership!

    He told my husband he refused to sell us one, and that he will not allow anyone in his own family to drive one.
    He said get rid of the big SUV’s and big semi trucks on our roads, like they have in Europe..maybe , but that is not what exists today here in the USA.

    • MadDog says:

      I too like smaller cars, but I wouldn’t want to be leading the pack in getting one (I drive a Camry) until a whole lot of those existing monster vehicles are safely in the junkyard.

        • Raven says:

          Nothing at all wrong with my 66 chevy longbed fleetside with a nice 350, bbl, 3 on the floor!

        • MadDog says:

          …As long as they say Porsche and 911 on them.

          Yes indeedy! *g*

          When I was in the military a couple decades ago, a shipmate of mine let me have his 911 for a week while he went on vacation.

          I was stationed in Long Beach, CA. then and man, I did my best to blast from one end of LA to the other at the speed of sound for that entire week.

          Similarly, another shipmate of mine who owned a Camaro Z28, went on vacation for a week, and also lent me his car. Vroooom, vroooom!

          I really enjoyed the “muscle” of that Camaro, but I liked that 911 better because it was as slick as greased lightening.

        • SouthernDragon says:

          Reminds me of a blonde joke.

          Seems this young blonde decided to make some money for herself doing odd jobs around the neighborhood. Went up to a house and asked if there was any work she could do. Guy said, yeah, the porch needs to be painted and asks how much. Blonde says 50 bucks. Guy says paint and brushes are in the garage, goes inside and tells wife. Wife says did you tell her the porch goes all the way around the house? About 3 hours later young blonde knocks on door and says: “I’m done, gave it 2 coats and had paint left over. Oh, and by the way, it’s not a Porsche, it’s a Lexus.”

      • cinnamonape says:

        No vehicle will survive head on with a semi (or even a side-swipe). But you’re right about the SUV’s and Hummers. But wasn’t there a report a few years back about how those tended to flip and hydroplane?

    • bobschacht says:

      He said ..get hit head on and kiss your rear end goodbye!

      Yeah, here’s where I have mixed feelings. My wife has a Toyota SUV that we drive when we’re in So. Calif. One night we were tooling around, all innocent-like, and wife had stopped in the left turn lane on a major street when we were violently creamed from behind by a speeding Honda. We were stunned, but unhurt, as the speeding car backed up and took off without so much as a “Sorry, Ma’am,” leaving behind one headlight, the hood ornament (plastered neatly against the Toyota’s rear bumper, leaving a discernible “H” impression), and several other pieces of the Honda’s front end.

      Evidently the Honda was still driveable, because it sped away. Eyewitnesses said the car was driven by a young lady, attended by a young man in the passenger seat. I have no idea what happened to them, or their mangled car. Our Toyota, however, was barely scratched– no discernible damage at all, except for the impression of the “H” on the back bumper.

      I hate to think what might happen if, with my Ford Focus, I back-ended someone at that speed.

      Bob in HI

  7. Petrocelli says:

    My buddies who bought those exp. European Toys are fuming, or then hopping over to Buffalo to buy v. exp. radar detectors, which are also illegal up here.

  8. AitchD says:

    12 of those Sparkies could fit inside a 1968 Bonneville Brougham. My 1968 copy of Cream’s Wheels of Fire got better than 35.5 and it’s still going strong. I learned in a ‘56 Bel-Air (2 4bbls!). Electric won’t be the kind of transformer like automatic transmission and power steering – or financing and leasing. Volt may not be a winning name: Appalachian English says ‘Voltswagon’ for Volkswagen. Impala was a great name. The 1996 Impala SS is a great work of art.

    • emptywheel says:

      Yup. I’m with those who believe anyone who thought no plants would be closed are idiots.

      And also with those who think that if the Administration or Nardelli claimed no job losses, they lied.

      And this is interesting, given Granholm’s apparent candidacy for SCOTUS.

      Michigan Gov. Jennifer Granholm, a Democrat, is an especially interesting case. According to other participants, Granholm played a prominent role in a call between public officials and Chrysler executives at 1 p.m. on April 30, just after Obama made his announcement. In that call, she pressed Chrysler CEO Robert Nardelli after he spoke of maintaining 30,000 jobs at Chrysler’s domestic plants.

      Granholm, a Harvard law graduate and former federal prosecutor, quickly noted that Chrysler actually employs thousands more, and she wanted to discern if Nardelli was playing games with those numbers, according to call participants.

      But Nardelli glossed over the numbers and left the impression that his was a ballpark figure and that no cuts were planned. Granholm appeared to believe it. Visibly pleased, she told a news conference that afternoon that all Chrysler jobs would be saved, adding that there was even “the opportunity for more” jobs through the Fiat deal and restructuring.

      Soon enough, this would prove to be incorrect. Yet Granholm, a Democratic star, apparently has not complained publicly about being misled.

      • MadDog says:

        Sounded like Jennifer was more than a wee bit desirous of having the wool pulled over her eyes.

        I don’t know whether you Michiganeers are rooting for Jennifer’s departure, but SCOTUS might be a stretch for the rest of us. *g*

        Shorter Michigan Gov. Jennifer Granholm: “If you tell me you love me, I’m all yours!”

        • bmaz says:

          She isn’t ready for the Supremes, and she won’t get selected. And that was before Conyers started punking her.

  9. JTMinIA says:

    “…policy issue that still need resolved…”

    I’ve never seen you use Ohio Valley dialect before. Cool.

  10. pseudonymousinnc says:

    As long as they say Porsche and 911 on them.

    Or ‘Lotus’ and ‘Elise’.

    (… even in Europe, where you’ve got similar conditions, manufacturers opt to make these cars in cheap labor places like Poland)

    Of course, there’s greater stratification (and not just competition) at the low end: the Ka/500 platform is entry-level, and so you have it built out in Poland, but the Fiesta is made in Germany. VW have the Group A platform for the Golf/Rabbit, but they make SEATs in Spain and Skodas in the Czech Republic that are cheaper and less trimmy, but fundamentally the same car — or the Audi A3 if you have more money than sense.

    I’m surprised, though, that GM is prepared to go straight to China for its small cars instead of looking to Brazil for the low end. Easier to get speedy collision/CAFE approval? No difference? (I remember that the Top Gear crowd hated the Daewoo Matiz, which is the Spark out of its disguise…)

    • emptywheel says:

      That’s where they started assembling these cars.

      Plus, I’m not sure they own the car outright. It’s a subpartnership with SAIC, but SAIC has the majority stake (and Wulin, which I think is in charge of assembly, give the Chinese the biggest stake).

      Plus, if they can make $2000 profit on these things (using Chinese interior labor rates, which are unreal cheap), then they can sell the Volt cheaper. (Mind you, I’m not endorsing this view, just suggesting what their thinking might be).

      If I were UAW (which is rightfully squawking bc of this proposal) I’d push for Mexican assembly of the car, and then organize the hell out of those factories.

  11. timtimes says:

    My other Chrysler was a Fiat

    MY permanent records reflect my previous ownership of a Fiat 850 Spyder. It had a seven gallon gas tank and a 903cc engine. Two seats and a convertible top. I could almost stretch my arm out the window and touch the ground it was so low. Guess I won’t be the one complaining about how unsafe these latter day econoboxes are. At least they got airbags.


  12. perris says:

    The compromise deal, which has been under negotiation since the first days of the administration, includes the White House, the state of California, and the automobile industry, which has long sought a single national emissions standard and has waged an expensive legal battle against the California waiver. The industry will get its single national standard, but at the price of one that approximates California’s targets.

    this is a big mistake and talk about states rights, that is one of them by the wayside right there

    if a state wants to regulate higher efficiency and polution standards there’s no reason what so ever the government should stop them

    then if the auto manufacturer can’t accomodate those standards they simply don’t go into that market

    this is simple stuff and obama gave away the farm

    I remember playing monopoly, one day one of my friends said, “I’ll let you start with 9/10ths of the bank but I get all the property”

    of course nobody took him up on the deal because starting out with alot but not being able to negotiate more leaves you with nothing

  13. JohnLopresti says:

    Peru, single overhead cam 900 cc motor, $8,500. Spark as it was known in 2008 in VE. In our neighborhood, local hiway gendarme revenue drought in these constrained times has led to the purchase of the lucrative Lidar, an optical radar which sound frequencies scanners fail to detect. Watsa matta drive 90 mph to the airport, jeeshhhh, then they are gone. or was the name translated as Chevy Snark,

  14. dude says:

    The folks in auto-producing states are seeing the auto industry shrink in the same way the tobacco producing and processing industry shriveled. And yes, the cigarette retailers and wholesalers, the farmers, the political-bases, and the smokers, and black-marketers and all the rest. It is not a perfect parallel, but the auto industry is contracting and adjusting fitfully just like tobacco.

  15. marksb says:

    Grr. One part of our rebuilding America’s auto industry is to import a cheap car from China. We can Walmart GM. Build ‘em cheap in China, sell them to an American population struggling to live due to the loss of manufacturing jobs. Who end up working for cheap at Walmart. And this is supposed to rebuild our economic base. Forget swine flu. We are infected with Teh Stupid.

    • emptywheel says:

      True. But until you can solve the “build a small efficient car profitably” problem, that’s gonna happen. How would you solve that problem?

      • MadDog says:

        That is the essential nub of the problem!

        We’ve been living at the top of the heap for so long that nobody here can imagine wanting to take a lower seat, much less having to take a lower seat.

        And we seemingly are still unwilling to buy into the solutions that our European and Japanese peers have already discovered and implemented wrt to health care costs, more appropriate gas pricing/taxing, smaller, more efficient vehicles, etc.

        As I said earlier in this post, we be dinosaurs and don’t even know it.

      • marksb says:

        I dunno how to solve the problem of designing a good, solid, efficient, well-built car made in the US with competitive pricing to the imports.
        This is exactly our problem, same as socks: I can have socks made in China that will sell in Walmart for $2 less than if I make ‘em in North Carolina. What to do?

        1) Tariff everything until it’s priced to meet the cost of manufacturing in a union plant in the States. That’s protectionism and is absolutely forbidden to even talk about these days. Still…do radically challenging times call for radical steps?

        2) Create new technologies that allow for manufacturing so efficient that it brings us to a new price point that meets the challenges of cheap overseas labor. This is a huge challenge–Chinese manufacturing engineers are at least as good as ours. And their labor is cheap.

        3) Create innovative solutions through the active use of government that reduce the effective cost of domestic employment in manufacturing: single-payer health care, government support for bringing manufacturing back on-shore (sort of a reverse tariff), and…here’s where we have to get creative.

        4) All of the above. If we had a fully-engaged government-private sector partnership to solve the well-defined challenge of producing a superior product at a competitive price–to rebuild our manufacturing industries as our primary goal–could we do it? I don’t see why not. It’s worth a try.

        Idealism. Isn’t it great? But why not? Why couldn’t we throw our assumptions out the window and start fresh?

        • emptywheel says:

          So you’ve built small cars efficiently. But you’ve also put our last and biggest manufacturing industry out of work (see bullet #2).

          So now what do you do with those high school grads who just lost their middle class jobs?

          • marksb says:

            Damn. Good point. “Highly efficient” means less people.
            Which may mean higher-level jobs with retraining. Maybe not as many, but still a lot of good jobs that support the community far better than the situation in many towns and cities that are losing or have lost most of the local manufacturing plants to Chinese factories.

            On a side note, I believe our high school grads are lost in the weeds due to structured undereducation. Some how we’ve built a system that needs–and provides–underperformers with lower level of knowledge to allow the upper middle and ruling classes to keep their positions in our society. Nothing new, but still…it’s friggin 2009! We’re supposed to have rocket cars by now and a condo on Mars!

  16. orionATL says:

    i have no idea how to assess the problem, but higher efficiency standards, which invariably rely on small cars to meet those standards,

    mean more deaths and more injuries for families each year.

    neither the auto industry nor the obama administration have done away with the problem of superior mass moving thru space.

    i suspect, but don’t know for sure, that rapid rises in fuel standards mean someone will have to pay the price of death in a small auto – a random game essentially for all of us – and for our children and grandchildren.

    on the other hand, raising standards steadily over a relatively short time, say a decade, would leave time for technology to intervene in this certain but uncertain game.

    i would suggest that if the fuel efficiency standards are going to rise this rapidly, almost certainly requiring small cars to meet those standards), then the auto safety standards (if such even exist) should be required to rise just as rapidly – as should govt (and corporate) money for scientific and engineering research.

    the <3000 deaths in sept 11, 2001 got big press – is still getting big press.

    the 40K+ americans who die in autos each year (>3k per month) get none but local press. and as a collectivity of the dead, get no press at all.

    in public health terms, to this death toll must be added debilitating and hugely expensive injuries – spines, heads, legs/knees/ankles.

    american politics – it’s all about who pays, absent determinedly caring policy making?

  17. greenwarrior says:

    i’m not sure i understand why people are saying that fuel efficient cars need to be really small. i drive a prius and get 47-48 mpg without trying. it’s not really small.

    • MadDog says:

      You are correct, but only “relatively” so. *g*

      The “big is better” drunken passion that drove millions of Americans to buy those monster SUVs like the Yukon, Tahoe, Expedition, Excursion, etc. is where relativity went out the door.

  18. emptywheel says:


    We were talking about overall profitability and efficiency.

    The Prius counts as a C car–way smaller than the vast majority of cars in the US. So in fact it is small. And it has only been profitable for a few years, and that made not in the US. So your raising the Prius supports my point. It is 1) vastly smaller than the fleet average and 2) has been very long in turning a profit, even made outside of the US 3) much more expensive than all but 10% or so of consumers are willing to pay for efficiency.

    • greenwarrior says:

      okay. thanks. i believe i understand that better now.

      and, for the record, the then-boyfriend’s 911 porsche i drove while i was in college, was my favorite car evah. i dearly loved driving those s curves out of the city. new york city traffic not so much.

  19. fatster says:

    O/T, or mortgages update

    Mortgage fraud bill goes to Obama to sign
    By ANNE FLAHERTY, Associated Press Writer – 1 hr 29 mins ago
    “WASHINGTON – Congress on Monday sent the president a bill to clamp down on mortgage fraud and set up a $5 million independent commission to investigate the cause of the worldwide financial meltdown.

    “President Barack Obama is expected to sign the legislation, which received broad bipartisan support.
    . . .

    “The commission will focus on more than 20 areas, including how the government failed to protect investors and the role financial fraud may have played in the meltdown. The group would report its findings by Dec. 15, 2010.”…..meltdown_1

    • bobschacht says:

      The group would report its findings by Dec. 15, 2010.

      That would be, what, 5 weeks after a national election, and a week or so before Christmas? Hmmm.

      Bob in HI

      • fatster says:

        Well, hey, we get a report. You think we should get million dollar bonuses? Or maybe, even, just a break?

        It’s really disgusting, isn’t it?

    • MadDog says:

      …Congress on Monday sent the president a bill to clamp down on mortgage fraud and set up a $5 million independent commission to investigate the cause of the worldwide financial meltdown…

      (My Bold)

      $5 million sounds like chump change. The banksters regularly drop that much for a night out with the boyz.

  20. AitchD says:

    Any safe car can get 30-40 mpg and much better, and last and last for 20 years and half a million miles, and be fuel/energy-flexible, but it would cost more than $40K to buy. Since the Model T, cars have driven us crazy, and most of the worst auto issues are emotional and mental. It’s a free country, do what you want.

  21. MadDog says:

    And totally OT, but an interesting article in ConsortiumNews by Ray McGovern today:

    How Torture Trapped Colin Powell

    Four days before trying to sell the invasion of Iraq to the United Nations, Secretary of State Colin Powell was ready to scrap dubious allegations about Saddam Hussein’s ties to al-Qaeda but was dissuaded by top CIA officials who cited a new “bombshell” that now appears to have been derived from torture, a top Powell aide says…

    …“Powell and I had a one-on-one — no one else even in the room — about his angst over what was a rather dull recounting of several old stories about Al Qa’ida-Baghdad ties [in the draft speech],” Wilkerson said. “I agreed with him that what we had was bull___t, and Powell decided to eliminate all mention of terrorist contacts between AQ and Baghdad.

    “Within an hour, [CIA Director George] Tenet and [CIA Deputy Director John] McLaughlin dropped a bombshell on the table in the [CIA] director’s Conference Room: a high-level AQ detainee had just revealed under interrogation substantive contacts between AQ and Baghdad, including Iraqis training AQ operatives in the use of chemical and biological weapons.”

    Though Tenet and McLaughlin wouldn’t give Powell the identity of the al-Qaeda source, Wilkerson said he now understands that it was Ibn al-Sheikh al-Libi, an al-Qaeda operative who later claimed he gave the CIA false information in the face of actual and threatened torture…

    • greenwarrior says:

      under interrogation

      the operative words. how hard would it be for a man in powell’s position to figure out the worth of that “information”?

      • MadDog says:

        Given Powell’s own Vietnam War experiences as a junior officer, one would think he’d personally know the likely falsity of coercive wartime “interrogations” of prisoners.

        Should’ve known better than to buy that bs.

  22. ferrarimanf355 says:

    I better get my hands on a Mustang before the new standards make them unworkable.

    Bill Hicks was onto something, California should fall into the ocean…

  23. Esperanza says:

    With the economy that we have today some people chose to ride on their bicycle or walk on the way to their work. It is very economical if we are going to do so and this could help us to be physically fit. Because of the crisis that we are facing more and more people today are thinking of ways in where they could save their money. There are also some people who find it hard to meet their ends that’s why some of them would often rely for financial aids like credit card. Unfortunately some lending companies are luring their consumers to debt trap. At last, the CRL takes a stance with what resembles a common sense approach; a call to action regarding something to do with the problem. (Now we have to deal with the horsemen, the rain of fire, and the end of days.) The CRL, or Center for Responsible Lending, has taken aim at credit cards by sponsoring HR 627, or the Credit Card Accountability Responsibility and Disclosure Act of 2009. The Credit CARD Act, as it’s called, could ensure more fairness in how card companies deal with customers, and limit things like hidden fees and retroactive interest rate increases. President Obama is on board. The CRL not going after installment loans and targeting an actual predatory lender – it’s about time.

Comments are closed.