WP: Bush Adviser Is Against Auto Bailout

Bush Adviser Is Against Auto Bailout
By Sholnn Freeman
Washington Post Staff Writer
Tuesday, December 6, 2005; Page D03


President Bush's top economic adviser reacted coolly yesterday to the idea of providing substantial federal assistance to beleaguered U.S. automakers, saying their problems have more to do with their vehicle lineups than with anything the government could fix.

"They don't need a bailout," said Allan B. Hubbard, in response to a reporter's question during the president's trip to North Carolina. "All they need is the time to restructure, and we're confident they'll be very successful."

Automakers have been asking for federal help on several fronts, including health costs, pension liabilities and currency policy. They are also seeking subsidies for developing fuel-efficient "hybrid" vehicles. At the same time, they have studiously avoiding using the word "bailout" because they believe the appetite in Washington for a major government intervention has waned since the federal rescue of Chrysler Corp. in the late 1970s.

Hubbard, director of the White House National Economic Council, attributed the problems of General Motors Corp. to the declining consumer appeal of its vehicles that get poor gas mileage during a time of high fuel prices. Large sport-utility vehicles and other trucks have been a big source of profit for GM and Ford Motor Co.

"Obviously, GM has some big challenges right now, primarily because they make automobiles that are less fuel-efficient," he said. "And with higher energy prices, the American people are interested in more fuel-efficient cars."...


http://www.washingtonpost.com/wp-dyn/content/article/2005/12/05/AR2005120501967.html

who could have seen that coming?

they mean totally eviscerate the unions. Perhaps they should take a page from the steel industry: declare bankruptcy, shed all pension and health insurance liabilities, start fresh on union contracts with deep cuts, pay the CEOs millions of dollars, and start celebrating your newfound profitability.

Who cares if the retiree who risked his life for years in dangerous, unhealthy and stressful conditions with the promise of a pension and health insurance now has nothing. It's the corporate way!

Let's not get too far ahead of the narrative we've all seen about as many times as we've seen the Charlie Brown Christmas special. First, the soul-searching and self-flagellation. Don't worry, our corporate robber baron heroes will all come out right in the end with enormous salary and benefits packages while the workers get screwed over again, but let the story unfold, okay? Lil George always sleeps so much more soundly when you go through the whole rigamarole.

so that our domestic manufacturers could have stayed competitive.

(Is there an irony smiley? The argument used by Detroit against cafe standards is that it would make them uncompetitive.)

But this is all par for the course. The vile shitheads are still going fullbore with their hollowing out of america. They won't be done until every last decent job is outsourced to some emerging industrial shithole.

After all, there's an election coming up.

That is part of their strategy. They want to prohibit Japanese imports and open the market more to American car sales in Japan.
Bottom line, they can't compete. But not for the reasons they are giving such as tax and other advantages afforded to Japanese manufacturers in their own country.

One obvious problem....the U.S. doesn't have a good, competitive product. Why would Japan want their silly inefficient autos when their own country as well as some European countries produce a better product?

The U.S. auto industry is like a leaky boat. Bailing them out won't solve the underlying problems.

Unfortunately, I know that in reality, managment would sooner gut their labor force than make some hard choices and reconfigure their engineering and manufacturing to reflect the need for better mileage. It'd risk some short-term profit loss, but in the long term it'd be better all-around.

I'd rather see this than see another billion-dollar bailout for them to keep business as usual, building more useless SUV's for the masses, whether they want them or not.

In Free-Market Fantasy World, the Big Three would knuckle down and make this happen, they'd come out ahead in the long run, and everyone would get a flying pink pony. In Greedy Capitalist Real World, every blue-collar worker will get a pink slip.

EDIT

PNGV is best known for its long term objective: developing the technologies required to enable the production of environmentally friendly cars with up to three times the fuel efficiency of cars in production at the start of the program (1994). This objective specifically would increase the fuel efficiency of mid-size family sedans from 27 mpg to 80 mpg. However, the technologies being developed by the program are not limited to application in just mid-size sedans, but instead are applicable across the entire range of light duty vehicles. This objective is expected to be accomplished without sacrificing affordability, performance, or safety. PNGV's other goals are: (1) to significantly improve national competitiveness in automotive manufacturing across all components, sub-systems and vehicle lines; and (2) to apply commercially viable innovations developed under the PNGV research effort to conventional vehicles as quickly as possible.

The level of effort among the participating agencies varies, based on the specific technical activities under active R&D at any point in time, and based on the missions and current core competences of the agency and its laboratories. In FY 2001, total government support for PNGV-related research is $234 million, of which $162 million is for R&D activities directly focused on PNGV goals and coordinated by the PNGV technical teams. Currently, the U.S. Department of Energy and EPA provide approximately one-half of direct Federal funding for PNGV, with DoE being the largest, and EPA second. The National Research Council estimated the industry's contribution to PNGV research and development to be $980 million in 1999, which includes major efforts on the part of the industry partners to develop the year 2000 concept cars.

STATUS: The initial PNGV R&D program consisted of an extremely wide range of technical areas which might be combined at the vehicle level to achieve the program goals. In 1997 the first major program milestone was achieved when these technical areas were reduced to focus on those that appeared to have the highest potential in terms of technical feasibility and affordability. In 2000 the program achieved its second major program milestone with the unveiling of the PNGV Concept cars. Although these cars all were based on the R&D activities of the program, each manufacturer selected from among them in ways which best met their corporate competitive strategy.

· The DaimlerChrysler concept car, the Dodge ESX3, was a diesel-electric hybrid with an estimated fuel economy of 72 mpg.

· The Ford Prodigy was a diesel-electric hybrid with fuel economy estimated at more than 70 mpg.

· Two versions of the GM Precept were unveiled. The diesel-electric hybrid version of the Precept had a projected fuel economy of 80 mpg. GM estimated the fuel cell version of the Precept might achieve 108 mpg.

EDIT

Additionally, each of the USCAR partners has announced it will begin volume production of new generation hybrid-electric vehicles in 2003-2004 timeframe. Each of these products is in the light truck/sport utility vehicle segments where hybrid technology provides greater fuel saving opportunities.

DaimlerChrysler

§ 2003 Hybrid Dodge Durango

§ 2004 Hybrid Dodge Ram

Ford

§ 2003 Hybrid Escape

§ 2004 Ford Focus Fuel Cell Vehicle


General Motors

§ 2004 Hybrid Chevrolet Silverado/GMC Sierra

§ 2004 ParadiGM Propulsion

EDIT

Editorial note: Congress heard this testimony on September 6th, 2001. Since then, the Hybrid Ford Escape and its twin, the hybrid Marine, are indeed now in production. All other vehicles listed here are either still concepts, prototypes or at best in limited fleet releases.

http://www.ogc.doc.gov/ogc/legreg/testimon/107f/gravatt1206.htm

Then there's this take on the process from 2000:

EDIT

The PNGV initiative has served as a smoke screen behind which the automakers have hidden for nearly a decade to protect themselves from more stringent CAFE (Corporate Average Fuel Efficiency) standards.

It is hard to imagine an industry less in need of government support for research than the auto industry given that they raked in nearly $20 billion in profits in 1999. Through PNGV, the government is supporting research that the industry would or should do on its own in response to market competition, and should be mandated to undertake to meet tougher environmental standards. Instead, automakers insist that CAFE standards should not be raised since they are voluntarily participating in the PNGV initiative and are pursuing its long-term goal of developing a supercar capable of achieving up to three times the fuel efficiency of today's vehicles. In the meantime, the automakers choose not to deploy existing technologies that could dramatically enhance auto fuel efficiency and reduce greenhouse-gas emissions.

It is unconscionable that to date the cost of PNGV is larger than the yearly combined budgets of the National Highway Traffic Safety Administration and the Consumer Product Safety Commission. More than a billion dollars in taxpayer money has been thrown at the highly capitalized auto industry through PNGV. Furthermore, there is virtually nothing to show for this expenditure – except a lost decade in the quest for heightened fuel efficiency. The PNGV program does not even require the deployment in mass production of the technologies it seeks to develop. In March 2000 the General Accounting Office concluded that "although PNGV has made progress toward building production prototypes that meet many of the PNGV objectives, at this point it does not appear likely that such a car will be manufactured and sold to consumers." Congress and the public should demand a much fuller accounting of what the auto industry has produced, than that which was provided by the GAO in its March 2000 report on the PNGV.

EDIT

Why should the government waive antitrust laws and pay the highly profitable auto industry to collude on research that it could and should undertake on its own? What is the rationale for failing to extract guarantees that newly developed technologies will be deployed? Where are the procedural mechanisms to allow citizens to challenge this government-authorized and -funded corporate welfare collusion? What are the paybacks to taxpayers for this program? Seven years and $1.25 billion have gone into the program, and there is nothing to show for such taxpayer largesse. PNGV is corporate welfare at its worst.

EDIT/END

http://www.commondreams.org/views/061900-104.htm

Or, to cut to the chase, we've pissed away more than $1 billion in PNGV subsidies sinc 1993 for Detroit to produce cars that remain only prototypes as the Japanese ate (and continue to eat) their lunch, and now they want MORE MONEY to respond to the market forces they deify?

Fuck that.

:eyes: This coming from the same group that goaded (not that they needed it in the grand scheme) US auto manufacturers into producing as many SUV lines as they could. Hypocrisy, thy name is Republicanism.

Jay