By Nancy Thorner & Ed Ingold -
The GM announced closing affects one of the last industrial anchors in what was once Ohio’s manufacturing core, the city of Youngstown. Youngstown is now on life support as Youngstown is one of the five plants GM wants to close just a little over a year after President Donald Trump told people not to leave and promised jobs would return to the area. The assembly plant near Youngstown is for small car production. In a sense, GM is a victim of success, only not their own.
Thanks to pipelines, fracking and expanded exploration areas encouraged by President Trump, the price of gasoline at the pumps is at pre-Obama levels. A repeat of the Carter-era oil embargo would have little effect in 2018, other than to re-open wells shuttered due to predatory oil pricing by the Saudis.
At the same time, people have soundly rejected all-electric cars like the Chevy Volt, which limit drivers' mobility to a twenty-mile radius of their homes. It matters not that electric cars were prescribed by Obama as a “solution” to Global Warming (the only religion Obama practices openly). Other small cars, including hybrids, have fallen out of favor compared to SUV’s, light trucks and mini-vans. People feel safer in larger vehicles (born out by traffic statistics, including single-car accidents), and more comfortable in general.
Despite news that should signal the opposite, GM announced last week that it would be closing four US plants and one in Canada, laying off 15,000 workers due to a decrease in demand for small cars. Approximately 60 percent of GM’s large cars and light trucks are made in China.
Trump all but demanded that GM find a use for the current plant or open a new one in an interview with Wall Street Journal.
- “They better damn well open a new plant there very quickly,” Mr. Trump said Monday, noting that he talked to Ms. Barra Sunday night.
- “I love Ohio,” Mr. Trump said. ‘I told them, ‘You’re playing around with the wrong person.’”
- “If GM doesn’t want to keep their jobs in the United States, they should pay back the $11.2 billion bailout that was funded by the American taxpayer,” tweeted President Donald Trump.
Ironically, the announced laying off of 15 percent of its workforce and closing five plants in Michigan, Ohio, Maryland and Ontario by GM has brought liberals and conservatives together. “The corporate greed of General Motors is destroying the social fabric of America,” so said Sen. Bernie Sanders, D-Vt., via a Facebook post.
According to an article by Josh Siegel in the Washington Examiner on 12/01/2018:
Trump’s threats toward General Motors Co. over its move to shutter plants, threaten to undermine the advancement of electric vehicles and stymie congressional efforts to help the industry.
Dylan Reed, head of congressional affairs for Advanced Energy Economy, further advised the Washington Examiner: “We are at a pretty critical point in the development and sales of electric vehicles. Trump’s meddling could disrupt that.”
How have past bailouts fared?
Chrysler was bailed out for political reasons in the early 1990's. The worst bailout, however, was Goldman Sachs in 2008. It was allowed to become a "bank" instead of being allowed to go bankrupt, so the big boys wouldn't need to share the pain the rest of us felt then and ever since in a debt-ridden economy. It was during the same 2008 economic crisis in the Obama administration when GM received special treatment from the Democrats.
In contradiction to the reporting by CNN and other leftist networks at the time, GM didn't actually declare bankruptcy but was allowed to transfer its assets to a shell company, thereby leaving few assets at risk to creditors. If any of us did that, we would be charged with fraud. The federal government also bought huge blocks of GM stocks which were later sold back to GM at a fraction of their cost
Electric cars still receive a subsidy and tax write-off for purchases, but hopefully this will end under President Trump’s administration, when on Monday, December 3rd, White House economic adviser Larry Kudlow spoke of plans that were in the works to scrap subsidies for electric cars and other renewable energy items as soon as 2020, as part of the administration’s response to General Motors closing plants and cutting jobs in the U.S. Consider that Ford declined any special treatment, yet it continues to thrive. Might it be because Ford appeals to working people rather than suburban elites?
The truth is that GM never mattered to Obama. It was the UAW members which benefited along with huge contributions to the Democratic election campaigns. The UAW also provided thousands of “foot soldiers” to go door-to-door to get out the vote.
Now that the economy has improved to the point of full employment, people have jobs and can afford better transportation, and the fuel they use. That’s the price of success.
What does the public have to say about the proposed GM bailout?
According to a National Survey by Rasmussen Reports conducted November 28-29, 2018 of 1,000 American Adults when asking the following two question:
1* Looking back, was it a good idea or a bad idea for the federal government to provide bailout funding for General Motors?
2* General Motors has just announced that it is closing several U.S. production plants and laying off 15% of its salaried employees. Knowing this, was it a good idea or a bad idea for the federal government to provide bailout funding for General Motors?
NOTE: Margin of Sampling Error, +/- 3 percentage points with a 95% level of confidence.
32% of American Adults say, looking back, it was a good idea for the federal government to provide bailout funding for General Motors. Forty percent (40%) think it was a bad idea, while 28% are not sure.
