The GM bailout was really a bailout for the United Auto Workers and their pensioners. A solid pro-Obama constituency the unions were given a colossal gift courtesy of the American taxpayer. A company which made terrible products for decades and which paid its workers much too much, got to live another day because Obama knew he needed to win the northern Midwest in 2012.
But it doesn’t make sense to build cars in the union heavy Midwest. At least not in the way GM, Ford, and Chrysler do it. Subaru has a plant in Indiana which by some accounts is the best plant in America in Indiana, but it’s not unionized.
What is happening is the older guys at the GM factories, the guys who run the UAW show, are secure in their pensions now and are not raising a fuss as GM quietly slips out the back door. The GM pensioners want GM to be profitable too, it means their pensions, even if the company continues to shift operations to China.
They got theirs.
(From The Washington Examiner)
It is not just selling Chinese-made cars to the Chinese, either. GM is nearly doubling its export production capacity there from 77,000 units to 130,000. It doesn’t take a Ph.D. in economics to see what is really going on. GM cannot make the domestic production targets and still turn a profit. It wants to be spared the embarrassment of having everyone know that. Obama, who is in this as deep as anyone can be, doesn’t want the embarrassment, either. So both buried the news.
Moody's Puts Puerto Rico on Downgrade to Junk Review Citing Very High Debt, Pension Obligations, Chronic Deficits; Exodus Underway | Mike Shedlock
Radical Capitalism: A remote Indonesian village runs its own telecommunications company. (From a laptop and a tree) | Nick Sorrentino
Open Letter to Obama and Congress From Internet Giants Calls For Reining In Government Surveillance | Nick Sorrentino
(An important interview) Saving the Net from the surveillance state (And Crony Media): Glenn Greenwald speaks up (Q&A) | Nick Sorrentino