GM Gooses Sales With Incentives

Part 3: GM by the Numbersincentive chart

Famed investor Warren Buffett once said, “If you have to have a prayer session before raising prices by ten percent, then you’ve got a terrible business.” So, what does it mean if your business is slashing prices month over month through discounts and other incentives? Take a look at this graph.

From GM’s IPO last November through February, the incentives and discounts the company is offering to consumers have increased from 29.8% above the industry average to more than 50% above industry average according to Edmunds.com.

What this means is simple: Yes, GM can crow about its 46% sales surge in February, as it did last week.  But what they aren’t telling you is they are offering discounts and incentives 50% higher than the industry average helping to inflate their numbers, and that these discounts have grown by leaps and bounds every month … Read More ➡

GM Boosts Lobbying; Hires Bailout Specialists

GM lobbying chartPart 2: GM by the Numbers

From the 1st quarter through the 4th quarter of 2010, GM’s lobbying expenses more than doubled from $1.8 million to $3.89 million – a 113% increase.  After all, when the government is your largest shareholder, your company execs will inevitably be spending an inordinate amount of time cozying up to Washington politicians.

Moreover, GM’s lobbyist team reads like a who’s who of the government bailout business.  And why wouldn’t it? When you’re lobbying Washington to privatize gains for your clients and socialize their losses among taxpayers, you hire those firms with the most experience representing other notorious companies that received massive bailouts by U.S. taxpayers – Fannie Mae, Freddie Mac, Goldman Sachs, AIG and others.

GM’s Lobbying Bench – Reported income from other government bailout recipients

The Duberstein Group: $600,000 in lobbying for Fannie Mae and $2.3 million for Goldman Sachs

Dutko Worldwide: Read More ➡

GM Shares Will Likely Never Break Even for Taxpayers

Part 1: GM by the NumbersGM chart

News coverage of General Motors over the past few weeks has painted an increasingly glowing picture, but here’s a dose of reality:  GM still has not repaid taxpayers for the bailout and it’s looking less and less like taxpayers will ever be made whole.

Unlike much of the media, we actually spent a considerable amount of time looking behind the press releases to see what GM’s numbers really say about the health of a company taxpayers now own. This week, we will be sharing with readers a more realistic picture of the company’s health.  The bottom line:  The picture is far less rosy than GM would like you to believe.

GM’s Share Price:  Will taxpayers ever be made whole?

Remember these promises?

“Recent progress at GM gives reason for optimism that it may be possible for taxpayers to get every penny back.” Steve Read More ➡

Rangel Embarrasses Himself in Court Appearance on Behalf of Gang Member

According to a report by Irene Cornell of WCBS radio in New York City:

Congressman Charlie Rangel basically embarrassed himself by showing up in court plead for the release of 17 year-old Afrika Owes, a one-time student at the Deerfield Academy in Massachusetts.

Rangel kept popping up, standing at the rail, trying to interrupt the judge. Finally, a court officer told him to sit down three times when he popped up again.

Judge Edward McLaughlin responded by saying, “I see someone standing who should not be standing, unless you have a bad back like I do.” Rangel sat down.

Why was Rangel so passionate about springing Ms. Owes? According to a separate WCBS report:

Owes, 17, had been a student at the prestigious Deerfield Academy in Massachusetts. Prosecutors say she was also a member of a drug gang that terrorized 137th Street in Harlem.

Owes was one of fourteen

Read More ➡

Flaherty: Either Bust the Unions or Bust the Country

NPR logoA brief comment of mine was included today in a report by Peter Overby on National Public Radio’s All Things Considered. Here’s a transcript:

The fight over public employee unions has exploded into a high-stakes partisan war. In Wisconsin and several other states, Republicans want to end collective bargaining with many public employee unions. Two favorite proposals would disrupt the ability of unions to build their political funds. And that would deal a major blow to the Democratic Party.

In a fireside chat last month on television, Wisconsin’s Republican Gov. Scott Walker said his proposal is all about fiscal policy.

“It certainly isn’t a battle with unions,” he said. “If it was, we would have eliminated collective bargaining entirely, or we would have gone after the private sector unions.”

But on Wednesday, the Republican National Committee threw that argument out the window with a television ad airing in Wisconsin. According … Read More ➡

BP Co-Owns Gulf Well That Got Deepwater Permit

Deepwater HorizonEarlier today I accused Interior Secretary Ken Salazar of a “cynical” approach to issuing deepwater drilling permits for the Gulf of Mexico. I did not realize how right I was. According to Kristen Hays of Reuters:

BP Plc, whose Macondo well blowout in the Gulf of Mexico caused the worst offshore oil spill in U.S. history last year, co-owns the well that was granted the first deepwater drilling permit since the disaster.

BP is Noble Energy Inc’s partner in the well, holding a 46.5 percent interest, BP said.

Noble operates the Santiago well that received a permit from U.S. regulators on Monday to resume drilling in the Mississippi Canyon area of the Gulf, about 70 miles (110 km) south of the Louisiana coast.

I pointed out that the moratorium was a policy response by officials like Salazar who were hostile to deepwater drilling even before the BP disaster. His department’s … Read More ➡

Is Secretary Salazar Above the Law?

Ken SalazarInterior Secretary Ken Salazar appears today before the Senate Energy and Natural Resources Committee. He will hopefully answer questions about his refusal to allow deepwater drilling to resume in the Gulf of Mexico, despite a federal judge twice ruling that the moratorium is illegal.

The BP oil spill was a disaster, but not as big of a disaster as the moratorium that followed. The granting of exactly one drilling permit to Noble Energy this week underscores just how cynical and politicized Salazar’s response has been. Last week, Salazar said that he would not bow to “political pressure” to restart drilling, standing reality on its head.

It was “political pressure” that resulted in the moratorium. The administration happily acquiesced to activists who wanted to stop offshore drilling even before BP blowout. The presidential commission, stacked with such activists, attempted to indict the entire oil and gas exploration and production industry when … Read More ➡

Rangel Says Abolishing Collective Bargaining is Like ‘Slavery’

Rep. Charles Rangel (D-NY) yesterday claimed at a Congressional Black Caucus event:

Collective bargaining is something that is so close to slavery in terms of abolishing it, that it is not an American concept to tell people that they cannot discuss their economic position.

Rangel is apparently oblivious to other forms of servitude, like paying your taxes while he doesn’t pay his, and then have to listen to him express indignation when he is caught.

Its even worse for ordinary citizens who don’t pay theirs and get thrown in prison while the Public Integrity section of the Justice Department methodically closes criminal investigations of members of Congress of both parties. It is not known if Justice or the IRS even opened an investigation of Rangel’s tax evasion as we requested after we exposed it. Because Rangel admitted to it, it would not be a particularly hard case to prosecute, but … Read More ➡

Legislative Nullification is an Assault on Democracy

The Wisconsin and Indiana union protests, and the disappearance of union-allied legislators, is an assault on democracy. An election was held in November. There is no Constitutional or legal basis for the union bosses to substitute their decisions for those of elected officials.

We must do more than renegotiate contracts. We must end collective bargaining for public employees, which has warped the democratic system in the states. Right now, when the two sides sit down, it’s the union negotiating with the union-backed politicians. Taxpayers are not at the table. It’s the old story of a concentrated interest of the unions vs. the diffused interests of taxpayers at large.

We need paycheck protection for public employees, allowing them to opt out of paying union dues. My father was a public school teacher in Massachusetts for forty years. Not only did he not wish to be represented by the Massachusetts Teachers Association, … Read More ➡

Soros Should Stop Making ‘Nazi’ Accusation

On Sunday, billionaire George Soros seemed to accuse Fox News Channel of Nazi tactics. In an interview with Fareed Zakaria on CNN, Soros said:

Well, look, Fox News makes a habit – it has imported the methods of George Orwell, you know, newspeak, where you can tell the people falsehoods and deceive them. And you wouldn’t believe that an open society and a democracy, these methods can succeed. But, actually, they did succeed.  They succeeded in – in Germany, where the Weimar Republic collapsed and you had a Nazi regime follow it.

Soros went on:

Now, I — because I saw it as a child, I immediately react that way. But people in America, they are innocent. They — they haven’t had the experience. But having the experience now, and I hope they wake up and they realize that they are being deceived.

This is not the first time … Read More ➡