by Rob Kellogg on December 5, 2008
Last week, my colleague John Richardson wrote an article titled “5 Reasons to Save the Big Three.” While I do not necessarily believe that a bailout in some form should be ruled out altogether by lawmakers, I do think there are a number of solid reasons to oppose government intervention at this time. So I thought I would offer a contrasting perspective.
Most Republicans are against any bailout based on their doctrinal “free-market” ideology (yes, the same philosophy that got us into this mess with the deregulation of Wall Street investment banks under Phil Gramm during the Clinton Administration). So we know we shouldn’t be looking to that side of the aisle for the moral high ground in this debate. The Democrats, under the leadership of Pelosi in the House and Reid in the Senate, are in a very precarious spot. On the one hand, the Democrats have been given a clear economic mandate by voters to clean up the mess caused by “eight failed years of Bush economic policies.” On the other, the Democrats have some very powerful interests to consider, namely the UAW and its thousands of blue collar voting members in Michigan and the Midwest. This balancing act has caused most Democrats, including Obama, to lean cautiously in favor of some type of federal intervention.
Following the first round of hearings, House Speaker Pelosi said: “Until they show us the plan, we cannot show them the money.” President-elect Obama also agreed that taxpayers can’t be expected to “pony up more money for an auto industry that has been resistant to change.” This week, the Big 3 are getting their second – and likely final – chance to convince lawmakers.
Bankruptcy or bailout? Here are 5 reasons why Congress should think twice before dolling out the money to the auto industry.
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by Rob Kellogg on November 25, 2008
Executives of the U.S. auto industry – flanked by their cadre of lobbyists – are now busy begging lawmakers for handouts. So far, GM, Ford and Chrysler have failed to present a strong case for using taxpa
yer money in their resuscitation. We know that Wagoner (GM), Mulally (Ford) and Nardelli (on behalf of Cerberus Capital, owner of Chrysler ) will get one more chance to prove their case once Obama takes office, if not sooner. And regardless of whether the “big 3″ automakers end up filling their golden chalices with federal money, a mandate stipulating an increase in the production of plug-in electric cars will emerge. This much is sure.
So it seems that this is an opportune time to consider what the next era of America’s auto industry might usher in. Let’s start by taking a quick trip back to high school chemistry class since the future of the auto industry and the new fleet of next generation cars starts with the letters “Li” on the periodic table.
The element lithium is one of nature’s more flexible atoms. Lithium salts were used during the 19th century to treat various ailments and millions of people around the world today rely on it to treat psychosis and manic-depression. Lithium is also used as an industrial agent to kill algae and to filter carbon dioxide from the air in spaceships.
Lithium is the lightest metal and the least dense solid element and because of this it is very effective in heat transfer applications used in rechargeable and primary batteries because of its high electrochemical potential, light weight, and high current density. A lithium-ion battery is the “engine” (non-combustion of course) of today’s electric cars and will likely remain so in the foreseeable future.
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by John Richardson on November 24, 2008
During the past week, the media has railed about the performance by the CEOs from Chrysler, General Motors and Ford. Like beggars in mink coats, Mssrs. Wagoner, Nardelli and Mulally marched to Washington DC last week to plead for $25 billion in financial aid from the government to an incredulous audience. Ill prepared for the onslaught by Congressional inquisitors, the Big Three CEOs looked like angry zebras ready to face down a brood of lions. What was obvious to everybody but the “zebras” was the fact that that the even angrier public and Congress have lost patience for these business leaders who expect financial aid, no questions asked. Lions 1, Zebras 0. [click to continue...]
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