Cynical Synapse

Tue, 31 Mar 2009

Obama Disses Detroit, Coddles Wall Street

Filed under: Bailout, Business, Cars, Detroit, Economy, Justice, Michigan, Politics, Rants — cynicalsynapse @ 9:26 pm

No longer on speaking terms.

Congressman Thaddeus McCotter (R-MI), during an interview with Fox Business Happy Hour, made several key points.

  • So-called legacy costs are people who played by the rules
  • Cutting worker wages to save their jobs is not ideal
  • Geithner needs to get $137 billion out to the financial industry, but there’s no firm plan
  • Disparate treatment between Wall Street and auto makers

McCotter notes the Obama administration forced GM CEO Rick Wagoner out, but Wall Street CEOs continue in their jobs and get bonuses. It’s pretty clear to anyone that Wagoner was a sacraficial lamb.

The Congressman is confused about what the administration expects. That’s not particularly surprising, since Wall Street got $700 billion, no questions asked, with Senate plus-ups of $100 billion for earmarks. Yet, the automakers, who make tangible products compared to the ephemeral likes of credit default swaps (CDS) and such, have to approach in sackcloth and ashes and beg and grovle.

GM CEO Rick Wagoner gets sacked by Obama even though he renegotiated contracts with the UAW. Meanwhile, Wall Street CEOs continue to receive bonuses, along with their subordinates, because the bonuses were “contractual obligations”. I’m sorry; Wall Street contracts are fixed and firm but blue-collar UAW contracts have to be re-negotiated? None of the UAw members ever received a million-dollar bonus!

Obama told Sunday’s Face the Nation, “We think we can have a successful U.S. auto industry. But it’s got to be one that’s realistically designed to weather this storm and to emerge… much more lean, mean and competitive than it currently is.” Excuse me? Has anyone considered the auto industry is in the financial straits that it is because Wall Street imploded? Has anyone realized banks have not been giving any loans since last year? The auto industry is in trouble because they made the vehicles people wanted and now banks won’t loan money. Penalizing them further is uncalled for and unhelpful.

In a statement, McCotter said:

Detroit is a last bastion of honor. Earlier this week, the President and the Treasury Secretary met with the Wall Street Chieftains who crashed our credit markets and dragged us to the precipice of a global depression. The White house pledged to work with these Wall Street CEOs who, even now, defend their bonus packages.

Now, Mr. Wagoner has been asked to resign as a political offering despite his having led GM’s painful restructuring to date. Mr. Wagoner has honorably resigned for the sake of his company’s working families. When will the Wall Street CEO’s receiving TARP funds summon the honor to resign? Will this White House ever bother to raise the issue? I doubt it.

Democratic Gov. Granholm saw it the same way. So, Michigan and the auto workers get shat on while the bankers and Wall Street get more money. This just adds insult to injury, considering Michigan’s 12.0% unemployment compared to New York’s 7.8%. Bankers have jobs and bonuses; production workers have neither. Those who created the financial crisis get rewarded and the last vestiges of American manufacturing get squeezed. Seem equitable to you?

Sun, 29 Mar 2009

Three Strikes for Chavez and the Tigers

Filed under: Business, Detroit, Economy, Hugo Chavez, Life, Oppression, Paradoxes, Politics, Rants, Sports — cynicalsynapse @ 1:38 pm

Hugo Chavez at bat.Since oil prices are on the rise, I decided to check on the latest antics of Hugo Chavez. Like the big, bad wolf, he’s always huffing and puffing. The challenge is in picking which three gaffes to cite rather than trying to find them.

Let’s start with that president for life thing. He’s not the only one, but he’s probably the most dangerous one. Remember, the Soviet Constitution guaranteed free and fair elections, too. And Idi Amin also styled himself president for life. While not a specific instance, a significant Chavez strike is his ongoing repression of the Venezuelan people. Chavez’ questionably legal consolidation of power bears an uncanny similarity to Hitler’s seizure of power.* Just like a leopard can’t change his spots, Chavez continues to insult the US President. Funny how Chavez has so quickly decided Obama’s not so different from Bush.

As for the Tigers? The connection to Chavez is Venezuelan-born Magglio Ordonez. The star right-fielder is certainly entitled to his political views and to express them. He’s set up a charitable foundation that annually provides a $2,500 scholarship to a southwest Detroit high school grad and he participates in other Tigers-sponsored charitable events. But a $2,500 scholarship pales in comparison to Ordonez’ $75 million 5-year contract (if the Tigers exercise the two one-year options). The problem is, Ordonez actively supports Chavez. But, Ordonez neither lives in Venezuela nor is he subject to Chavez’ oppressive regime.

Now for the second strike. It came on a foul ball to right field in 2000 when they replaced Tiger Stadium. Besides being a fan of the venerable stadium, including its location at Michigan and Trumbull, the insult to injury was naming the new venue Comerica Park. Ten years after buying the naming rights for 30 years, Comerica Bank moved its headquarters from Detroit to Dallas. Take the naming rights with you! I realize Comerica Park is fan friendly, but I used to buy tickets to Tiger Stadium for under 10 bucks and park for $5. Comerica’s a pricier venture. The straw that broke the camel’s back, though, was the Tigers’ pathetic 2003 season. That year, they lost more games than any team in American League history and came within one game of tieing the 1962 Mets’ record for most losses in modern Major League Baseball history. Finishing the season at 43-119, the Tigers were 47 games out of first that year. Baseball used to be the one sport I followed. Not any more.

*A point of historical clarification regarding this link: Hitler was not elected to office nor did his party enjoy a majority in the Reichstag. The NSDAP had formed a coalition, however, and following a series of Chancellors unable to govern, Germany’s president finally acquiesced to appointing Hitler as Chancellor.

Sat, 28 Mar 2009

Signs of Spring: Rising Gas Prices

With the appearance of consistently warmer weather, gas prices are inching up. Its as if Big Oil thinks springtime means money time. We hear a lot of different reasons. Demand is going up. Refineries are shut down for maintenance before the summer driving season. We have to switch over to summer formula. (Which really costs more to produce: summer or winter formula? Seems the price goes up with both switchovers.)

Take away the refineries being shut down argument. The vast majority of refineries are operating. What’s shut down accounts for a little over 1.1 million barrels per day. That’s about 7% of capacity.

I was a little surprised to see gas prices in Lansing jump up 20 cents between Tuesday morning and afternoon. Unfortunately, I still had a half-tank and decided to wait a day to fill up. Had I thought to look at the latest gas price predictions, I would have filled up anyway. Right now, the prices are the same in my metro Deroit neighborhood as they are in Lansing.

Conventional thought has it that gas prices will continue to rise into the so-called summer driving season. I’m not convinced folks will want to do that much extra driving this summer, with the economy being what it is. But, we’ll still be told the increased prices are due to supply and demand. While I understand that formula, it’s just hard to accept when oil companies represent 7 of the highest 10 profit makers. Another reason why I’d like to see an end to oil company tax subsidies and loopholes. Seems many of the speculators who had a hand in last year’s outrageous gas prices must have lost their shirts in Wall Street’s implosion, or maybe they were Bernie Madoff customers. Let’s hope the oil market continues its cautious behavior. If you want to sign the petition linked to on Utah Amicus, fine. If not, how about sending your US Senators and Representative a message telling them to end corporate welfare to companies obviously not in need of such entitlements.

Thu, 26 Mar 2009

Little Cuts and Big Spending Don’t Equal Out

Filed under: Economy, Life, Michigan, Politics — cynicalsynapse @ 6:38 pm

On the way into work Tuesday, I heard 3 stories that didn’t add up. Must be that new math thing.

First, Michigan, in it’s dire economic condition, is giving back asbestos inspections to the Federal government. This will save the state $250,000 annually. The state will also forgo $100,000 in yearly federal subsidies. Seems like this adds up to $350,000 less spent in Michigan each year.

Second, the state plans to spend $10 million on tourism advertising. Now, while I understand tourism is important to the state’s economy, I’m not quite following the fuzzy math on how $250,000 is unaffordable but $10 million is. Am I missing something? Don’t misunderstand. I’m leaning toward giving back to the Feds everything Michigan can, like MIOSHA and DEQ. No need to spend state dollars on federal programs. But, I’m opposed to the state “nickle and dime-ing” on some things and going overboard on others.

Third, State House Republicans proposed cutting state employee wages by 5%. How do you suppose that sits with the workers at the same time the state announces a $10 million ad campaign? I suspect some don’t appreciate the direct, if perhaps unintended, implication they have to fund tourism advertising.

Fourth, today, the State Senate approved elected official pay cuts recommended by Gov. Granholm, who already gives 10% of her salary back to the state. The Senate approved the State Officers Compensation Commission plan which delays pay cuts until 2011. I’m sure the 52,000 state workers targeted for a 5% cut now think that’s fair. Why didn’t the Senate vote to give up 10% now? They can decide their own pay regardless of the SOCC. Let’s not forget, Michigan’s legislature is the second-highest paid, exceeded only by California. And, since 39 states get by with a part-time legislature, I’m sure our state employees have no issue with deferring legislative salary cuts for 2 years. The 10% cut in 2011 will certainly balance out with their 5% cut now, won’t it?

Michigan’s economy is in a severe crisis. Gov. Granholm and the legislature need to get beyond politics and do what’s right for the state and it’s citizens. The fiasco of the 2007 government shutdown should still be of concern to all of us.

As for balancing Michigan’s budget? I’ve already given my ideas.

Mon, 23 Mar 2009

Michigan Roads: “The Pits”

Filed under: Driving, Economy, Gas Prices, Life, Michigan, Rants, Take action — cynicalsynapse @ 8:48 pm

That’s what Gov. Jennifer Granholm said while proposing a change to Michigan’s gas tax from 19 cents per gallon to a percentage. While few will disagree Michigan roads are in sad shape, changing the gas tax isn’t really the answer. And Granholm’s proposal will adversely impact those who have to drive some distance for work. In Michigan’s economy, anyone who has a job deserves any break they can get.

In addition to the 19 cents per gallon, consumers also pay the 6% sales tax. Diesel, however, is only taxed at 15 cents per gallon plus the sales tax. Yet, Michigan permits 82-ton trucks on its roads, about double of other states. Hmmm. The vehicles that do the most road damage pay less in road taxes. Am I missing the logic?

There are other solutions. Besides the obvious allocating the sales tax to transportation, how about a review of MDOT’s staffing? We pay $6 million to staff the so-called Intelligent Traffic System, never mind the cost of the stupid variable message signs that rarely have anything relevant to say. Around metro-Detroit, they’ve all said “Buzzed Driving is Drunk Driving” for the last two weeks. How about current road conditions? Europe gets this; why is the US and MDOt so clueless?

Excessive detail mile marker sign.

MDOT’s budget includes almost $285 million for repairing guardrails, mowing, and snow removal. Seems to me, the snow removal piece comes after rush hour, a bit late for most of us. As for the mowing, that’s probably just busy work for the folks that don’t really do well with the snow removal piece. And, if the snow removal got done right, there’d be less guardrail replacement needed. Has anybody looked at this? Another troubling issue for me is the money being spent to replace perfectly good Big Green Signs with new Big Green Signs. I’ve asked MDOT about how this is funded, but they’ve not been responsive.

And what about the stupid replacement mile marker signs that display the highway and direction in addition to the mile (or even tenth or two-tenths)? Personally, I think anyone who needs to be reminded what highway they are on, and what direction they are going, as often as every tenth or even two-tenths of a mile doesn’t deserve a driver license in the first place.

There are other issues with the road maintenace situation in Michigan. These include the antiquated county road commision system and competetively bidding trunkline work. That makes a lot of sense. State highways don’t start and stop at the 83 county lines. It’s time to take a holistic approach. Let your State Representative and State Senato know you do not support Gov. Granholm’s proposal to change the state gas tax.

Tue, 17 Mar 2009

Conyers and Reeves: Taking on the “Hostile Suburbs”

Filed under: Behavior, Detroit, Economy, Life, Michigan, Politics, Racism — cynicalsynapse @ 9:39 pm

First, Monica Conyers–Detroit City Council’s newly annointed president–led the opposition to a regional board investing $288 million in the Cobo Hall convention center. The venue has served Detroit well, but needs renovation and expansion. With all the lawsuits the city incurs, not to mention dwindling population, the city can’t afford to do the work itself. Never mind the scandals surrounding former mayor and convicted felon Kwami Kilpatrick, son of amazingly overwhelmingly re-elected US Representative Carolyn Cheeks Kilpatrick, the Feds are still investigating some Council members and city officials about some questionable contracts.

Conyers has been confrontational throughout. Her attitude and language clearly demonstrates a desire for the good old days of Coleman Young and a city surrounded by “hostile suburbs“. Clearly Young did some good things for Detroit as mayor, but make no mistake, he was running a political machine no less than the Daley machine in Chicago. But Young’s political capital was built on the premise of devisiveness. To put things in perspective, Young took office just 7 years after the 1967 Detroit riots. But 35 years later, the region is still divided into city and suburbs and east and west. There are two bus systems, D-DOT, and SMART (Suburban Mobility Authority for Rapit Transit), both of which go downtown, but only one of which leaves the city. It’s not uncommon to see one following the other on major streets like Woodward Ave. Makes no sense to me. But I digress.

I’m not a fan of L. Brooks Paterson, either. The Oakland County Executive’s attitude gives credence to Coleman Young’s hostile suburbs concept. And money is as big a barrier as 8 Mile Road. Either the city doesn’t want to share an asset or the suburban communities or counties don’t want to put money into the region if they think Detroit will unfairly benefit. Like Rodney King said, “Can’t we all just get along?” Southeast Michigan needs to pull together as a region if it truly hopes to survive today’s economic reality. There’s no more time for “we-they” between city and suburbs or suburbs and city.

After the Council voted 5-3 to turn down the Cobo authority deal, at least in part because Conyers claimed the Arena could get Stimulus money, the City Council president claimed a leaking roof was a conspiracy. That was after Michigan’s Gov. Granholm said there’s no Stimulus money for Cobo. And this follows on the heals of Mayor Cockrel’s veto of Council’s turning down the transfer of Cobo to the regional authority, which Conyers had launched a lawsuit over. The mayor’s veto raised such bile to result in the infamous “Onward Christian Soldiers” council meeting. So, let’s see if I’ve got this straight. No money for Cobo. No expansion. No fixing the roof. City of Detroit suing itself and defending itself from its own lawsuit. Detroit and the region suffer from reduced convention business. Begins to make the Wall Street bailout look like a good investment.

Throughout, Conyers has been confrontational with any not marching in lock-step with her. It’s real easy to make this into a race issue or a city vs. suburbs issue, but it’s really about Monica Conyers making a name for herself. She could care less about citizens of Detroit or the region. Make no mistake. Just take a look at the “At Home with Monica Conyers” to see if her lifestyle matches yours.

Unfortunately, the rest of the country doesn’t get that “Detroit” refers to a much larger geographic area when it comes to the automotive industry. The Big 3 need to wear sackcloth and ashes to get a mere $30 billion in loans, but AIG and the rest of the banks and Wall Street have access to $700 billion or more on a whim and a fancy. Southeast Michigan’s economy is heavily invested in automotive. Michigan’s unemployment leads the nation. So, when comedian Jay Leno offerred to do a free show for our laid off workers, Conyers and Co. were upset it wasn’t being held in Detroit. And, despite the imbecility of Detroit Council members like Martha Reeves, Leno has added a second free show.

What we need to do is thank Jay Leno for caring about Michigan when no one else does. And next election, vote out all the politicians that let us down, including at the local, state, and federal levels. Our representatives need to understand they represent us, not themselves or special interests.

Sun, 15 Mar 2009

World’s Biggest Ponzi Scheme: AIG and Treasury

Filed under: Bailout, Business, Economy, Politics, Take action — cynicalsynapse @ 2:37 pm

American International Group (AIG) has received at least $170 billion in Federal bailout. That includes the lastest $30 billion in taxpayer dollars. The problem is, there’s no transparency. Neither AIG nor Treasury will disclose how the money is being spent.

Bits and pieces come out from time to time. We know AIG’s spending $170 million on bonuses. They justify this on the need to keep talented people so they can fix the remaining $1.6 trillion of toxic assets still on their books. Excuse me, but aren’t these the same guys who are responsible for the bad assets being on their books in the first place? Treasury scolded AIG and AIG Chairman Edward Liddy promised to work on restructuring their bonus system. Liddy says AIG is legally obligated to pay the bonuses, which were set last year before Wall Street melted down. We should all be happy AIG’s chairman finds the situation “distasteful”. Did he accept his bonus?

Some of the money went to European banks—about $50 billion of it. Then there’s the suspicion that lots of it flowed through AIG to Goldman Sachs.

Just like Madoff stayed in his luxury penthouse until the day he pled guilty, AIG and its executives continue their greedy, ruinous behavior. In a 21-page presenation, AIG warned Treasury they needed more just as they were getting that last $30 billion. There’s no end in sight. At least one economist estimates AIG will need another $200 billion.

Seems to me AIG and Treasury are in cahoots to run their own Ponzi scheme. And they’re making Madoff look like an amateur. Tell your Senators and representative enough is enough.

Thu, 12 Mar 2009

A “Must Read” article – “The Looting of America’s Coffers”

Filed under: Bailout, Blogroll, Economy, Politics, Profiteering — cynicalsynapse @ 8:25 pm

My friend, the Old Man, over at the Common Peoples Source for News, made me aware of David Leonhardt’s New York Times article about economist George Akerlof, a Nobel Prize winner, and Paul Romer. They wrote a research paper that was published sixteen years ago. The paper was about how the financial crisis in the 1980’s was the result of private investors taking advantage of the government. Striking resemblance to today, eh?

read more | digg story

Wed, 11 Mar 2009

Obama Sold His Soul

Filed under: Michigan, Paradoxes, Politics — cynicalsynapse @ 9:49 pm

No matter how you look at it, President Obama took the easy road today. He signed the “imperfect” Omnibus Appropriations Act, 2009 into law.

We’ve all heard the faulty logic about the bill. It’s last year’s business. It’s needed to keep the government working. Ok; shield the kiddies’ eyes. Bullshit! The bill includes $7.7 billion in earmarks, a key point candidate Obama campaigned against. Nonetheless, he signed the pork-laden bill into law.

The Senate passed the bill by voice vote. They can do this because they already had a roll call vote on cloture, with 60 or more preventing a filibuster. Take a seat now, but Michigan’s two Democratic Senators, with their names on about 70% of the earmarks for Michigan, both voted…you guessed it, in favor! So, Michigan’s Senators can pat themselves on the back for adding 4.8% of pork to the Omnibus bill. And Michigan garnered about 6.8% of the total pork compared to generally being a donor state. Did our Senators do a good job? In my opinion, no! See how your Senators voted. You should check how your representative voted as well.

Yes, I appreciate Michigan sees a benefit. But the process is broke to begin with and we all pay for that. And $7.7 billion in earmarks is nearly 2% of the total bill! Legitimate projects should be part of the basic budget, not an add-on. Isn’t that the logic of President Obama’s issue with funding the Global War on Terror with supplemental spending bills?

So, let me see if I understand this. Earmarks are verboten. But President signed the bill. The Democratic President campaigned on controlling earmarks. But my Democratic Senators are in the thick of it and voted yes. It’s last year’s business. But it was signed into law this year. The government would stop working without passage. But, without passage, why hadn’t it stopped alreaedy?

I guess change is a lot like business as usual.

Sun, 08 Mar 2009

Road Pigs

Filed under: Behavior, Driving, Life, People, Rants, Safety — cynicalsynapse @ 7:16 pm

I spend a lot of time on the road and I’ve come to the conclusion there are four basic types of people on the road. The most obnoxious are the Road Pigs—you know, the ones who are more important and whose destination is better than anyone else out there. I had to deal with one of them today. There are the lemmings, who just follow the car in front of them, usually in the left lane. Then there are the clueless, who don’t seem to know where they’re going, how they’ll get there, and, oh my gosh, that’s my exit! These are the ones who drive at least 10 mph slower than they need to. Had some some of them today, too. The rest of us are just trying to use the roads as they were intended and in a manner consistent with our democratic ideals and common decency.

Today, the driver of the silver Dodge minivan wins my ire. This person just had to move into the left lane in front of me right after the left lane went through a “hit the brakes” drill. Apparently, the minivan driver was more special than me, or his/her destination was more important than mine. That’s the only reason I can see for the minivan’s moving into the lane in front of me with not more than a few feet of clearance. The minivan could have moved in behind me or a car or two back, but that wasn’t good enough. The fact I had more than a car’s length between me and vehicle in front of me was all this person needed to speed up and move in there. Never mind that this close call, if it had resulted in contact, would have rippled to at least a half-dozen cars in both lanes.

After laying on the horn and giving the one-finger salute, I really hoped the minivan would get off at the next exit. I figured I’d
follow so I could ask what was so special about the driver or his destination that warranted such disregard for others’ safety. Next, I figured I’d ask about the driver’s religious beliefs and faith, with the intent of pointing out the behavior exhibited is not consistent with biblical admonitions (assuming a Christian religion is the case). You see, I’m rather tired of the number of jerks there are on the roads in a country that professes a belief in God and Christian ideals. There’s very little “turn the other cheek” on the roads. Oh, and for the record, a car’s length or two at 70 mph is not enough room for reaction time and braking, especially on wet roads.

So, yeah, it was raining today. Ok, that warrants extra care; I got that. But it doesn’t mean we have to drive 60 mph on a 70 mph freeway. Those folks need to move to the right and not plug up the passing lane(s). Being overly cautious can be just as much a hazard as driving too fast for conditions. Why is it there doesn’t seem to be any in between?

Older Posts »

%d bloggers like this: