Senator Schumer was in town earlier this week, salivaning over the oppurtunity to put the auto industry under the control of the federal government… though he called it “oversight,” it actually looks and smells an awful lot like socialism.
The proposition of a bailout of the auto industry isn’t really about bailing the industry as it is about bailing out the autoworkers unions. With above market wages and ridiculous benefits packages, they drive up the costs of assembling cars the same way union contractors drive up the costs up construction.
The Buffalo News looks at the options:
If the government doesn’t bail out GM, the cash-strapped company will likely be forced into bankruptcy. Many experts say that this would prompt a cascading collapse that would deeply damage parts suppliers, dealers and other automakers - adding millions to the unemployment rolls.
But others argue that a government bailout of the American auto industry would amount to throwing good money after bad and that bankruptcy is GM’s best option.
“Spending billions of additional federal tax dollars with no promises to reform the root causes crippling automakers’ competitiveness around the world is neither fair to taxpayers nor sound fiscal policy,” House Minority Leader John A. Boehner, R-Ohio, said Thursday.
The debate over a proposed $25 billion bailout of America’s Big Three automakers is likely to culminate next week, when Congress tackles the issue in a special session.
Of all the bailouts the federal government has considered in these troubled times, this one cuts especially close to home. GM employs 1,389 at its Tonawanda Engine Plant, part of a grand total of 8,200 Western New Yorkers who work for the Big Three or their suppliers.
Add to that countless GM retirees, and it’s clear that the Buffalo-area economy would suffer deeply if GM were to fail.
And I am not interested in taxpayers bailing out the unions. Let them fail. The unions need a reality check, and bankruptcy is the best option in the long term. It might be tough in the short term, especially for WNY, but we to think of long term solvency, not a quick fix that will only empower the government and the unions… that doesn’t solve a thing.
Meanwhile, labor union officials worry that if GM or another automaker were to go bankrupt, it would give a judge freedom to nullify labor contracts, creating more doubt for workers and retirees.
“We already experienced this with Delphi,” said Kevin Donovan, assistant director of UAW Region 9. “We don’t want to experience it with GM or Ford or Chrysler.”
Yet to critics of the Big Three, the shredding of union contracts would be one of the advantages of a GM bankruptcy. “Private equity or strategic investors would buy the assets, shut down some plants, fire some union and exempt workers, and probably use the leverage of Bankruptcy Court to get a better deal from the unions,” conservative blogger Jim Manzi wrote on the National Review’s Web site Thursday.
In contrast, “a bailout of GM would be a pure exercise of political power to deliver taxpayer funds to one organized group of citizens at the expense of the country as a whole,” Manzi wrote. “It should be avoided.”
On Capitol Hill, grave doubts have been expressed about an auto bailout.
“I have automobile plants in my district. They pay $25 to $35 per employee per hour,” said Rep. Spencer Bachus of Alabama, ranking Republican on the House Financial Services Committee. “I am sure that I am going to be asked, ‘Congressman, I work at Honda or Mercedes, I make $40 an hour; why are you going to take my taxpayer dollars and pay it to a company who pays their employees $75 an hour?’
Bailing out the auto industry sends the wrong message to the unions. It tells them they can just continue doing business as usual because the taxpayers can just pull them out of the hole the unions dug themselves into.
Christian Menn’s winning design for the new Peace Bridge appears to be doomed after environmentalists have conjured up fears of dangers to birds. The jury that selected the design back in 2005 
Will environmentalists kill Menn’s bridge design for good? The concern over birds is ludicrous, and there’s no evidence that the concerns over dangers to birds is based on reality. Menn’s design is similar to an earlier bridge he designed: the Zakim Bridge in Boston, MA. As a former Boston resident, I can tell you that the bridge has yet to cause any bird fatalities. So, unless the birds in Boston are a significantly smarter than the the birds in Western New York, there really is no reason to scrap Menn’s design.
