The Associated Press gives evidence today to how desperate General Motors is to give the appearance that the company is firing on all cylinders. GM pulled out all the stops to ensure that June sales would not disappoint when sales were slowing as a result of the company’s loss of credibility during its seemingly never-ending recall saga.
At mid-June, sales for the month at GM were lagging the previous year’s. The political minds at GM could not have this, and according to the piece:
In mid-June, however, the automaker was headed for a year-over-year monthly sales decline, according to data compiled by automotive research firms. Then, on June 20, GM asked dealers to buy more cars, and it threw in another $1,000 in discounts per vehicle, five dealership representatives told The Associated Press. The company finished the month with a 1 percent gain.
The dealers said they were asked to
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The Houston Chronicle yesterday published an account of a 2013 trip by 10 members of the House of Representatives to Azerbaijan that violates a House rule that prohibits the acceptance of overnight travel from corporations that employ lobbyists. The trip was indirectly paid for by companies doing business in Azerbaijan through nonprofit groups.
The fact set is similar to the 2008 case involving a trip to the Caribbean by then-Ways and Means Chairman Charles Rangel (D-NY), exposed by NLPC, and investigated by the Office of Congressional Ethics (OCE). OCE referred the matter to the House Ethics Committee, which “admonished” Rangel, prompting his resignation as House Ways and Means Chairman. The head of the nonprofit that sponsored the event was eventually convicted of lying to Congress.
According to the story by Will Tucker and Lise Olsen, 10 House members and 35 staffers enjoyed an all expenses paid trip to Baku, which … Read More ➡
The burden carried by the holders of stock in mortgage giants Fannie Mae and Freddie Mac, each operating for nearly six years under federal conservatorship, just got lighter. On July 16, U.S. Court of Federal Claims Judge Margaret Sweeney, in a procedural ruling, held that shareholder-plaintiffs in Fairholme Funds Inc. et al. v. United States are entitled to know material facts that the government wants to keep secret. The shareholders are seeking compensation for foregone income resulting from the Treasury Department’s “sweep” rule of August 2012, which forced the companies to forward all dividends to the department in perpetuity. Government lawyers had filed a motion for a protective order on May 30 to inhibit discovery. The outcome of this case will have major implications for the future of property rights in this country.
National Legal and Policy Center has been following the situation at the Washington, D.C.-based Federal National Mortgage … Read More ➡
On Wednesday the New York Times published an account of how New York Governor Andrew Cuomo and his staff derailed the workings of an anti-corruption commission that Cuomo had established with great fanfare just months earlier. A New York state law from 1907 named for its sponsor, Sherman Moreland, allows the governor to appoint investigators with subpoena power to seek out corruption in state government.
Cuomo appointed the commission in July 2013 in response to newspaper headlines generated by NLPC and the subsequent arrests of three New York State Senators. We were encouraged by the creation of the commission although we were dubious that Cuomo was sincere about reform. As we pointed out in May 2013 when Cuomo used the term “scandalmania” and made several modest anti-corruption proposals:
While we welcome these proposals, they should not be used by Cuomo to construct a narrative that it is himself against the
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General Motors reported earnings today for the 2nd quarter of 2014. The early prognosis is not good with share price falling after the report. While it is difficult for the Mom and Pop investor to sort through GM’s myriad of charges, special items and various smoke and mirrors, there are some key take-aways that give a glimpse of GM’s financial health. Primarily, debt continues to grow at the company, now exceeding $40 billion while earnings are propped up by special items.
Analyzing the levels of cash compared to debt at GM is probably the easiest way to get to the truth behind the many numbers thrown about in the earnings report. In just the past three months at GM, short and long term debt has grown from a hefty $37.8 billion to an even heftier $40 billion. This key fact gives a contrarian view to what the media and … Read More ➡
It has now been over two months since we requested that General Motors recall vehicles that are prone to brake line corrosion. The vehicles in question, GM truck model years 1999 through 2003, have been under investigation by the National Highway Traffic Safety Administration (NHTSA) since 2010. The government agency has done nothing noteworthy regarding the existing GM safety concern over the four year span of the investigation.
NHTSA has also proven its ineffectiveness when it comes to safeguarding American motorists by ignoring multiple complaints for newer model GM vehicles. Why hasn’t NHTSA expanded the GM brake line investigation to include model years 2004 through 2007, which also have hundreds of complaints involving failed braking as a result of brake line rust?
Owners of GM vehicles with corroded brake lines have been frustratingly trying to bring to light an issue which plagues GM vehicles more so than any other manufacturer.… Read More ➡
On Thursday, July 17, General Motors CEO Mary Barra will be back as a witness on Capitol Hill, this time before the Senate Subcommittee on Consumer Protection, Product Safety and Insurance.
Senator Claire McCaskill (D-MO), who has been an outspoken critic of GM’s response to the deadly ignition switch defect, chairs the Subcommittee. Indeed, the hearing is titled, “Examining Accountability and Corporate Culture in Wake of the GM Recalls.” Another subcommittee member, Senator Richard Blumenthal (D-CT), has been even more outspoken. Both deserve credit for seeking to make GM accountable, especially since some members on both House and Senate committees have pulled their punches on Barra and GM.
The hearing is expected to focus on the deadly ignition switch fiasco. It is imperative, however, that McCaskill and Blumenthal press Barra on a separate issue, the necessity of a recall of pickups and SUVs with a brake corrosion defect. On May … Read More ➡
NLPC Associate Fellow Fred N. Sauer, in photo, filed a lawsuit on June 6 against the Missouri Public Service Commission to make it disclose what is happening to all the money being paid in artificially-high renewable electricity prices. The suit is an outgrowth of his 2013 Special Report titled, The Carnahan Wind Deal: Crony Capitalism is Missouri.
Here’s the background on the lawsuit as explained by Fred:
On May 4, 2008, Missourians For Cleaner, Cheaper Energy filed a petition with the Missouri Secretary of State, Robin Carnahan, to put Proposition C, the Clean Energy Initiative on the November 2008 ballot in Missouri. This proposition created a renewable electricity standard in the state. The standard requires utility companies to gradually increase their usage of renewable energy annually until 15% of the energy used in the state is renewable.
This proposition does not result in a trivial sum of money. In … Read More ➡
Should perpetuating racial grievance be the defining mission of a U.S. Attorney General? Eric Holder, who has held the office for the past five and a half years, really believes it is – and acts accordingly. A new book, Obama’s Enforcer: Eric Holder’s Justice Department (Broadside), presents a strong case for removing Holder from office as a corrective to his many abuses of power related to racial and other issues. In 256 pages, authors John Fund and Hans von Spakovsky pull no punches in revealing how Holder and other department officials routinely have subordinated rule of law to radical politics, all the while stonewalling Congress and punishing internal dissenters. They also, properly, point a finger at Holder’s boss, President Obama.
There is an old saying in the world of bureaucracy: “Personnel is policy.” This is certainly true of the U.S. Department of Justice (DOJ), a $27 billion cabinet-level agency with … Read More ➡
Is General Motors trying to make lemonade out of lemons? In the case of the company’s recent string of lemon recalls, there seems to be a strategy to increase showroom traffic by issuing recalls for only those vehicles which do not require high costs to repair. GM CEO, Mary Barra, gave a hint at this strategy during last quarter’s earnings conference call.
Following is an excerpt from a transcript of GM’s April conference call Q & A session:
Adam Jonas – Morgan Stanley
Thanks. Good morning, everybody. First question is a two-part question. First, on the recall, 7 million units (recalled) obviously creates an enormous amount of showroom traffic and an opportunity to convert that traffic into new sales. So could you outline, perhaps, how successful have you been so far in getting folks coming in and holding the hand and obviously helping them with a real issue, but also
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