Tennesee VW Workers Vote to Reject UAW Representation

The United Auto Workers designs on expanding their reach into southern Right to Work states was dealt a blow last week when workers at Volkswagen's Chattanooga, TN plant decided to reject UAW representation in a close vote.

What made this vote unusual was that Volkswagen didn't oppose the UAW's efforts to organize, allowing the union to distribute flyers and talk to workers inside the factory while locking out groups opposed to the UAW setting up shop in the Volunteer state. The final vote tally was 712 against and 626 in favor.

The UAW's attempt to set up shop in Chattanooga was opposed by Republican officials like governor Bill Haslam and US Senator Bob Corker- a former Chattanooga mayor who was in office when VW opened up the Tennessee facility. A number of right-to-work groups set up billboards on highways adjacent to the plant reminding workers in the predominantly Republican state that the UAW funnels union dues into the campaign coffers of liberal politicians who support 0bamacare, gun control and abortion.

Meanwhile, the UAW has accused Corker, Haslam and groups like the National Right to Work Legal Defense Foundation of influencing the decision with public comments opposing UAW expansion before the vote. However, a number of the anti-union activists who hosted townhall meetings and Q&A sessions offsite included current and former employees of the VW Chattanooga plant.

Republican officials and right to work supporters were concerned that a UAW local in Chattanooga would be used as a beachhead to unionize additional foreign automaker's facilities in the predominantly Right to Work southeast. Other right-to-work proponents point to Detroit and US automakers' declining fortunes that the UAW played a role in as well as widespread corruption within the United Auto Workers itself. A recent Associated Press reports that although membership in the UAW is slightly up, dues have declined sharply- making the union's attempts at expansion out of its traditional rust-belt stronghold a financial necessity. This reportedly has US automakers worried- setting up a 'devil you don't know' since a declining UAW could end up being absorbed by a more hostile labor union.

German corporate management practices includes something called 'co-determination', which allows employee representation a seat on the board of directors through the labor union. This explains in part why VW didn't object to UAW's attempt to organize in Chattanooga and why the UAW has been concentrating their efforts on German automakers in the south such as the Mercedes Benz plant in Vance, AL or the BMW facility in Spartanburg, SC.

While the UAW has taken their accusations of political meddling to the NLRB, Bernd Osterloh- Volkswagen's top labor representative- implied that the outcome of last week's UAW vote would adversely affect the company's decision to expand operations in the US Southeast. Osterloh himself had openly expressed support for unionization in a 2013 visit to the Chattanooga facility.

Paul Harvey- "God Made A Farmer"

I know I'm about a week late with this, but this without a doubt had to be the highlight of the much ballyhooed Super Bowl Sunday TV advertisements. The two minute spot from Dodge featured a monologue from the late radio personality Paul Harvey called "God Made a Farmer". While the product did make an appearence, the emphasis was firmly placed on the individual likely to use the Dodge [or Ford or Chevy].

But now that some time has passed I figured it was worth revisiting- I did plan on waiting a few days after the Super Bowl to revisit this, but not an entire week.

Despite the expensive nature of advertising during the big game, Dodge's 2-minute ad is actually a slightly abbreviated version of a 1978 speech that Harvey gave to the Future Farmers of America. My first reaction upon seeing the ad in its entirety was "That was money well spent on Dodge's part".

The full text is below.

And on the 8th day, God looked down on his planned paradise and said, "I need a caretaker." So God made a farmer.

"God said, "I need somebody willing to get up before dawn, milk cows, work all day in the fields, milk cows again, eat supper and then go to town and stay past midnight at a meeting of the school board." So God made a farmer.

"I need somebody with arms strong enough to rustle a calf and yet gentle enough to deliver his own grandchild. Somebody to call hogs, tame cantankerous machinery, come home hungry, have to wait lunch until his wife's done feeding visiting ladies and tell the ladies to be sure and come back real soon -- and mean it." So God made a farmer.

"God said, "I need somebody willing to sit up all night with a newborn colt. And watch it die. Then dry his eyes and say, 'Maybe next year.' I need somebody who can shape an ax handle from a persimmon sprout, shoe a horse with a hunk of car tire, who can make harness out of haywire, feed sacks and shoe scraps. And who, planting time and harvest season, will finish his forty-hour week by Tuesday noon, then, pain'n from 'tractor back,' put in another seventy-two hours." So God made a farmer.

"God had to have somebody willing to ride the ruts at double speed to get the hay in ahead of the rain clouds and yet stop in mid-field and race to help when he sees the first smoke from a neighbor's place. So God made a farmer.

"God said, "I need somebody strong enough to clear trees and heave bails, yet gentle enough to tame lambs and wean pigs and tend the pink-combed pullets, who will stop his mower for an hour to splint the broken leg of a meadow lark. It had to be somebody who'd plow deep and straight and not cut corners. Somebody to seed, weed, feed, breed and rake and disc and plow and plant and tie the fleece and strain the milk and replenish the self-feeder and finish a hard week's work with a five-mile drive to church.

"Somebody who'd bale a family together with the soft strong bonds of sharing, who would laugh and then sigh, and then reply, with smiling eyes, when his son says he wants to spend his life 'doing what dad does.'" So God made a farmer."

Taxpayers Take a Hit as Uncle Sam Prepares to Unload General Motors Shares.

Worth the paper it's printed on?

General Motors [NYSE: GM] announced earlier this week that it was purchasing back some 200 shares of their stock from the United States government. Although the deal is worth an estimated $5 billion, taxpayers are going to end up taking a loss on the auto bailout from nearly four yearsago that also saw Chrysler end up in an arranged marriage with Italian automaker Fiat.

The government got its shares as part of a $49.5 billion bailout of GM that began nearly four years ago. It saved GM from collapsing into financial ruin.

GM said it will pay $27.50 each for the 200 million shares, and it expects to close the deal by the end of the year. GM stock closed Tuesday at $25.49, and it shot up 7.1 percent in premarket trading Wednesday to $27.30.

However, the 'break even' price is said to be near $53 per share, meaning that the shares of General Motors would have to nearly double in order for the government to recoup their losses from General Motor's post-bailout IPO. As part of the initial terms of the bailout, Uncle Sam initially owned more than 60% of GM. General Motor officals said that part of the reason for the stock buyback from the Feds was to rid themselves of th 'Government Motors' stigma.

Canada and the province of Ontario also became stakeholders in GM during the 2009 bailout and officials announced they had no plans to divest their shares of GM in the short-term.

"We've always been clear about two things. One, that we will not have a fire sale - we will not sell the shares without getting the best value we can for Canadian taxpayers - and secondly, that we are a Conservative government. We are not interested in the long term in being shareholders in private corporations," [Finance Minister] Flaherty told reporters in Burlington, Ontario.

"Over time we do intend to divest. On the timing, I'll have to get back to
you."
Canada's federal government and the province of Ontario became shareholders of GM in 2009, when they contributed a combined C$10.8 billion ($10.89 billion) to a bailout to keep GM afloat. The U.S. government provided about US$50 billion.

Canada and Ontario's combined stake in General Motors is about 9%.

Obama Rips Right-to-Work States in Speech to Big Labor, Ignores Recent Jobs Created in Those Very States

Speaking before Union leaders in Washington DC for the AFL-CIO's Building and Construction Trades Department Legislative Conference, President Obama took the time to attack right-to-work states before his Big Labor audience.

"I believe when folks try and take collective bargaining rights away by passing so-called 'right to work' laws that might also be called 'right to work for less,' laws, that’s not about economics, that’s about politics," Obama told the AFL-CIO today. "That’s about politics." He then credited the AFL-CIO for creating American prosperity, saying "unions like yours made sure that everybody had a fair shake, everybody had a fair shot."

The speech comes about a year after the National Labor Relations Board blocked Boeing [NYSE- BA] from shifting production of components for their 787 Dreamliner from Washington state to a facility outside of Charleston, SC. The NLRB's move was applauded by AFL-CIO president Richard Trumka along with the Obama Administration and senior Democrats even though such actions would stifle further development.

While it might play well for an audience that includes Trumka or Jimmy Hoffa Jr, it seems to ignore the harsh reality for unions and the Obama Administration that the new industrial and manufactuing jobs that have been cropping up recently have done so in right-to-work states.

For instance, with international demand skyrocketing, American locomotive manufatcurers Caterpillar [NYSE- CAT] and General Electric [NYSE- GE] have either retrenched or expanded to right-to-work states. Caterpillar subsidiary EMD recently shuttered their London, Ontario plant in Canada after a protracted labor dispute with the Canadian Auto Workers union, shifting production to their recently opened Muncie, IN facility earlier this year. In 2011, General Electric announced that they would expand production to a 500,000 sqare foot facility outside of Ft Worth, TX slated to open up later on this year. This is in addition to their current facility in Erie, PA- although curiously this move by General Electric's Jeffery Immelt [as well as the Obama Administration's jobs czar- NANESB!] was not challenged by the NLRB like Boeing's similar expansion from Washington State to South Carolina.

And locomotives aren't the only thing General Electric will be manufacturing in a right-to-work state. In late October 2011, GE Aviation broke ground on an Auburn, AL plant that will make jet aircraft components. Production scheduled to begin in 2013 and the Auburn plant is expected to employ anywhere from 300 to 400 people. Meanwhile, Volkswagen continued a recently-established tradition of foreign automakers setting up shop in the deep south with the 2011 opening of their Chattanooga, TN plant which will primarily make Passats for the North American market. Right up the I-24 and outside of Nashville is Nissan's Smyrna, TN plant which was among the first foreign automaker to set up shop in the USA nearly 30 years ago.

Although construction was halted due to the international economic crisis in 2008, Toyota resumed work on a massive new facility in Blue Springs, MS in 2010 that is expected to go into full production later on this year, rolling out an estimated 150,000 Corollas annually. In 2009, KIA begain rolling out cars from a newly-opened factory in West Point, GA- a down on its luck former textile mill town.

Some enterprising individuals in right to work states like Georiga have even begun marketing chopsticks to overseas markets in Asia, where there is a shortage of wood to manufacture them locally in any significant numbers.
And these are some of the most recent examples I can cite- since the late 1990s, foreign automakers like BMW, Hyundai, Mercedes-Benz and Honda have set up shop throughout Dixie- all right to work states. I just figured I would point out some of the jobs created by manufacturers setting up facilities in right-to-work states since President Obama has been in office, since he made it clear in his speech to big labor this week that he washes his hands of anything having to do with right-to-work. However, I have absolutely no doubt that Obama would try to take credit for every last job created in a right to work state over the last 3 years while he's campaigning.
However, perhaps the biggest headache for Democrats in right-to-work states doesn't come from the industrial or manufacturing sector, but rather the upcoming 2012 Democrat Party Convention in Charoltte, NC. Apparently to be awarded the convention, Obama ally and Charlotte's Democrat mayor reportedly had to agree to terms that union workers would be brought in from out of state, leaving local businesses in the lurch after Foxx promised his constituents the convention would be an economic boom. Although Foxx denied steering contracts to out-of-state union businesses, a number of local companies were told by the DNC to look elsewhere for business if they were non-union while as many as 3000 union workers from a Maryland company called Hargove were expected to show up in Charlotte this summer in prepeartion for the convention.

Electric Car Company Building Vehicles in Finland After Obtaining US Gov't Loan From Obama Administration

The Obama Administration and Department of Energy are defending a $529 Million loan to Anaheim, CA-based electric car manufacturer Fisker after a report from ABC News on Thursday highlighted the fact that two years ago, the Administration approved the company shifting production overseas to Finland.

Vice President Joseph Biden heralded the Energy Department's $529 million loan to the start-up electric car company called Fisker as a bright new path to thousands of American manufacturing jobs. But two years after the loan was announced, the company's manufacturing jobs are still limited to the assembly of the flashy electric Fisker Karma sports car in Finland.

"There was no contract manufacturer in the U.S. that could actually produce our vehicle," the car company's founder and namesake told ABC News. "They don't exist here."

Henrik Fisker said the U.S. money has been spent on engineering and design work that stayed in the U.S., not on the 500 manufacturing jobs that went to a rural Finnish firm, Valmet Automotive.

The loan to Fisker is part of a $1 billion bet the Energy Department has made in two politically connected California-based electric carmakers producing sporty -- and pricey -- cutting-edge autos. Fisker Automotive, backed by a powerhouse venture capital firm whose partners include former Vice President Al Gore, predicts it will eventually be churning out tens of thousands of electric sports sedans at the shuttered GM factory it bought in Delaware. And Tesla Motors, whose prime backers include PayPal mogul Elon Musk and Google co-founders Larry Page and Sergey Brin, says it will do the same in a massive facility tooling up in Silicon Valley.

Fisker is more than a year behind rolling out its $97,000 luxury vehicle bankrolled in part with DOE money. While more are promised soon, just 40 of its Karma cars (below) have been manufactured and only two delivered to customers' driveways, including one to movie star Leonardo DiCaprio.

A department of Energy spokesman defended the loan to Fisker, saying that the company also plans on producing a $50,000 hybrid called the Nina at a shuttered General Motors plant in Delaware.

"The Department's funding was only used for the U.S. operations," Energy Department spokesman Dan Leistikow wrote. "The money could not be, and was not, spent on overseas operations. The Karma also relies on an extensive network of hundreds of suppliers in more than a dozen U.S. states."

He said the first part of the loan, $169 million, supported engineering work at Fisker's U.S. facilities as the company "developed the tools, equipment and manufacturing processes for Fisker's first vehicle" -- though that work so far has not contributed to a production line in the U.S.

But Leistikow said the rest of the loan is still supporting U.S. production of another vehicle line called the Nina.

"Fisker is using this funding to bring a shuttered General Motors plant in Delaware back to life and employing more than 2,500 workers. Fisker was attracted to this site in part by the opportunity to rehire some of the trained, dedicated workers who lost their jobs when that plant closed," Leistikow said.

However, industry sources are claiming that Fisker's production of the Nina at the Delaware site has been pushed back to mid-2013. Fisker claims that the car has been designed and built, but remains under wraps to maintain a competitive edge.

Moreover, according to a recent Forbes article, once off its electric motor (reportedly good for 32 miles) the Fisker's Karma hybrid actually gets worse gas mileage than a late model Ford Explorer SUV

Does anybody else remember the various factory and workshop tours that President Obama embarked upon during 'Recovery Summer' last year? All of them seemed to pivot around so called 'Green Jobs'- factories that made electric vehicle components, solar panels or batteries for hybrids. And it seems that this wasn't really by accident, either.

Subsidized California Electric Car Company Folds, Leaves City of Salinas on the Hook for $500,000

Hmm....who didn't see this coming?

A Salinas car manufacturing company that was expected to build environmentally friendly electric cars and create new jobs folded before almost any vehicles could run off the assembly line.

The city of Salinas had invested more than half a million dollars in Green Vehicles, an electric car start-up company.

All of that money is now gone, according to Green Vehicles President and Co-Founder Mike Ryan.

The start-up company set up shop in Salinas in the summer of 2009, after the city gave Ryan a $300,000 community development grant.

When the company still ran into financial trouble last year, the city of Salinas handed Ryan an additional $240,000. Green Vehicles also received $187,000 from the California Energy Commission.

Salinas Mayor Dennis Donohue said he was "surprised and disappointed" by the news. City officials were equally irked that Ryan notified them through an email that his company had crashed and burned.

I suppose I shouldn't laugh, but as the ruling party is attempting to shut down oil platforms, coal-fired power plants or natural gas drilling through regulatory fiat or executive orders, they continue doling out subsidies and grants for electric cars or 56 MPG vehicles all in the name of 'green jobs'.

And poorly thought-out ventures like Green Vehicles, heavily subsidized by governments in the name of 'going green', will continue to fall flat on their face as long as the ruling party assumes that they can pick winners and losers in the private sector.

[Hat tip: Labor Union Report; The Lonely Conservative]

General Electric, General Motors Avoid Paying Taxes for 2010

While taxpayers and small business owners are poring over their IRS 1040 forms, I'm sure this bit of news from a pair of corporations that have benefitted from government bailouts and lagresse will bring a bit of joy and wrmth to their weary hearts.

A little over two months ago, GE Chairman Jeffery Immelt was appointed to an economic panel by the Obama Administration. This was the same conglomerate who lobbied for cap & trade back in 2009 and who's subsidiary TV networks of NBC and MSNBC acted as unabashed cheerleaders for Obama during his 2008 Presidential campaign. Now it's been learned that General Electric will pay nothing in taxes for 2010 and will in fact be getting $3.2 billion in tax breaks from the US government thanks in part to concentrating most of its $14.2 billion in profits offshore. More than half of GE's current workforce is outside the United States as well.

Back in November the Wall Street Journal reporteda few weeks before GM's stock was set to be re-listed in the NYSE that General Motors could wind up with tax breaks worth an estimated $45 billion thanks in part to lossesincurred prior to the bailout.

GM, which plans to begin promoting its relisting on the stock exchange to investors this week, wiped out billions of dollars in debt, laid off thousands of employees and jettisoned money-losing brands during its U.S.-funded reorganization last year.

Now it turns out, according to documents filed with federal regulators, the revamping left the car maker with another boost as it prepares to return to the stock market. It won't have to pay $45.4 billion in taxes on future profits.

The tax benefit stems from so-called tax-loss carry-forwards and other provisions, which allow companies to use losses in prior years and costs related to pensions and other expenses to shield profits from U.S. taxes for up to 20 years. In GM's case, the losses stem from years prior to when GM entered bankruptcy.

Usually, companies that undergo a significant change in ownership risk having major restrictions put on their tax benefits. The U.S. bailout of GM, in which the Treasury took a 61% stake in the company, ordinarily would have resulted in GM having such limits put on its tax benefits, according to tax experts.
"The Internal Revenue Service has decided that the government's involvement with these companies, both its acquisitions plus its disposals of their stock, means they should be exempt" from the rule, said Robert Willens, a New York tax consultant who advises investment banks and hedge funds.

The government's rationale, said people familiar with the situation, is that the profit-shielding tax credit makes the bailed-out companies more attractive to investors, and that the value of the benefit is greater than the lost tax payments, especially since the tax payments would not exist if the companies fail.

The pricetag for the GM bailout was thought to have reached at least $30 billion. The fact that the government was still a stakeholder in General Motors at the time could help explain the DOT's aggressive pursuit of Toyota Motors for a number of safety issues last year.

'Cash For Clunkers' Costlier Than Advertised- Edmonds.com; Also, NANESB! Digs up the Railway Equivalent for $$ for Clunkers

The publishers of the Blue Book guide to used-car prices determined that the earlier Cash for Clunkers program actually cost the American taxpayer approximately $24,000 per new car sold during that time frame. According to the Edmunds.com study, out of the estimated 690,000 cars that were sold while Cash for Clunkers was in effect all but 125,000 of them went to people who were had decided to purchase a new car anyway.

[Edmunds] crunched the numbers. A valid way to evaluate the program economically, it says, is to look at how many people purchased cars that otherwise wouldn’t have been bought. The firm says that number is about 125,000 cars. By that measure, the government spent $24,000 to generate each sale of a new car.

For comparison, the average price for a new vehicle in August 2009 was $26,915, minus an average cash rebate of $1,667.

In all, the government spent $3 billion on a program that provided cash toward 690,000 car purchases – about $4,348 per car. That makes 565,000 people who got as much as $4,500 to buy a car they would have bought anyway, according to the Edmunds analysis.

While the White House took exception to the Edmunds.com claim, the Obama Administration's 'New Media' Chief Macon Phillips decided to quietly take the high road.

/Just kidding!

“In other words,” writes Macon Phillips, the White House’s “new media” chief, “all the other cars were being sold on Mars while the rest of the country was caught up in the excitement of the Cash for Clunkers program. The CEA’s analysis is transparent and comprehensive … Edmunds.com, on the other hand, is promoting a bombastic press release without any public access to their underlying analysis. So put on your space suit and compare the two approaches yourself.”


You'll also be pleased to know that the rail industry has what could be considered a long-running predecesor to Cash for Clunkers for the past few years. Straight from National Railway Equipment's website is this PDF file explaining that the purchase of some of the Genset locomotives manufactured by companies like NRE or Railpower International are eligible for state, local and federal subsidies of up to 80%. When these gensets were first introduced, I assumed that Class I Railways like BNSF or Union Pacific were interested in them because they were effective. Instead, it's because of an artificial demand created by a patchwork of emissons laws across various states, matching funds and various subsidies that have the railroad paying only 20% of the purchase price. If I'm not mistaken, I believe for every Genset a railroad purchases, an older locomotive has to be stricken from the roster to qualify. However, unlike this years' Cash for Clunkers, there is no provision for scrapping the retired locomotive and in a few cases, the recently retired locomotives are sold off to a leasing company and promptly leased back by the same railroad.