VIDEO CLIP: Discussing the Bailout Double Standard With Rachel Maddow

by: David Sirota

Tue Mar 31, 2009 at 17:35


I appeared on Rachel Maddow's MSNBC show last night to discuss the seeming double standard between the Obama administration's treatment of car companies and Wall Street firms. You can watch it here.

There is clearly a double standard at work: Just a few days ago, Wall Street executives were hosted at the White House for a cheery photo op and reassurance that they will be getting hundreds of billions more in no-strings-attached bailout cash. Then this week, Obama demanded the firing of GM's CEO, and said he may withhold the mere $30 billion or so that the automakers are requesting.

I'm not saying that automakers don't deserve to be pushed around, nor am I saying even that GM's CEO shouldn't have been fired. What I am saying, however, is that there are two different standards at work here - and we need to know why.

David Sirota :: VIDEO CLIP: Discussing the Bailout Double Standard With Rachel Maddow

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maybe (0.00 / 0)
the administration, after analyzing each situation, thought it prudent to take course A with the banks and course B with the automakers.

why don't you explain situation A and situation B for those of us (4.00 / 9)
who are too dumb to understand and too smart not to ask ;)

[ Parent ]
Double standards abound... (0.00 / 1)
Why is Gettlefinger still the head of the UAW? He's just as responsible as Wagoner for GM's situation.  Ah, but he delivered the votes so he stays.

Unionbusting isn't taken kindly here... (4.00 / 7)
The UAW is not responsible for GM's failures...

REID: Voting against us was never part of our arrangement!
SPECTER: I am altering the deal! Pray I don't alter it any further!
REID: This deal keeps getting worse all the time!


[ Parent ]
Gettelfinger will be gone next year. (4.00 / 3)
The UAW has a sort of "65 and out" policy, so they can maintain robust leadership.

[ Parent ]
How (4.00 / 5)
Is he "just as" responsible as the CEO?  The CEO has far more power over the fate of the corporation.

[ Parent ]
here's another double standard; (0.00 / 0)
How come when union's expect certain laws and rights from their hard work in getting Obama elected -- EFCA -- it's fine if Obama repays them?  But, Obama is knocked for implementing policies which, supposedly, benefit wall street, that's wrong?

Well, right now, Obama's busting the union hard... (4.00 / 1)
Harder than even Reagan.... so, I don't see your point...

REID: Voting against us was never part of our arrangement!
SPECTER: I am altering the deal! Pray I don't alter it any further!
REID: This deal keeps getting worse all the time!


[ Parent ]
again with the union busting? (0.00 / 0)
That's nutty talk.

[ Parent ]
Really? (4.00 / 1)
Has Obama lifted a single finger to get EFCA passed? No? Well, WTF not?

"More than any other time in history, mankind faces a crossroads. One path leads to despair and utter hopelessness. The other, to total extinction. Let us pray we have the wisdom to choose correctly." -Woody Allen, My Speech to the Graduates

[ Parent ]
huh? (4.00 / 7)
your argument is that whoever has more political clout should have political power?  listen, thrasymachus, this is a progressive blog and there are people here who care about the disempowered - including some of us who start with ourselves!!!

[ Parent ]
Great Republic reference! (0.00 / 0)
Always nice to see acknowledgement this sort of view wasn't created by Rand.

[ Parent ]
yes, what a "double" standard (4.00 / 5)
Whereby the people who fucked the economy by playing zero-sum destructive games with other people's money and are walking away filthy rich are morally equivalent to their economic victims.  Both should be rewarded equally or this would be unfair!

[ Parent ]
Because (4.00 / 5)
Unions improve working conditions for all workers - which is a progressive cause.  This is a website dedicated to progressive politics.

Whereas Wall Street, as the embodiment of the interests of Capital, seeks to spend as little as possible on labor so that it might make a profit - which necessarily harms the working conditions for all workers.  That would be a counter-progressive cause.  This is a website dedicated to progressive politics.

Therefore, within the general discourse of this website, Obama's support of counter-progressive causes over progressive ones is "wrong".


[ Parent ]
Yeah, David (0.00 / 0)
It can't possibly be because they're two completely different industries failing for two completely different reasons?

That said, you seem to be forgetting that AIG's CEO got forced out September of last year.


AIG was not forced into bankruptcy... (4.00 / 6)
...and their employees' contracts were sacrosanct, but the UAW's are toilet paper...

REID: Voting against us was never part of our arrangement!
SPECTER: I am altering the deal! Pray I don't alter it any further!
REID: This deal keeps getting worse all the time!


[ Parent ]
the situations (4.00 / 1)
are not even remotely the same, yet, you treat them as if they are.

[ Parent ]
In what way are they not (4.00 / 1)
"remotely the same"?  Please provide more to clarify this claim.

[ Parent ]
It's the difference (0.00 / 0)
between a drunk driver dying after plowing his BMW into a crowd of school children and a hospital patient succumbing to cancer because they put off treatment for decades.

[ Parent ]
what (0.00 / 0)
the hell did you want Obama to do? Give the auto company's more money? IS that what you wanted?

[ Parent ]
Quite simply (4.00 / 5)
Yes.

When Michigan and Ohio delivered their votes to Obama, it was under the implicit agreement that Obama would protect GM.

That's all we wanted.  One thing.  GM is life here. Period.  We knew it would be unpopular, but we thought that Obama would have our back, since we were the ones who delivered the election for him.  He'd have our backs, even though it was unpopular.  He understood.

Then came the surprise, yesterday... with uncaring callousness atypical for a democrat he told us our  respective states, and the manufacturing industry of the united states, would be left to die, while we continued to funnel money into wall street.  We felt taken for a ride.  What the hell did we vote for?  We voted to protect GM, not to destroy it!  Shock is hardly the word we all feel here...

I'm not going to say that we were betrayed just yet... We have to see how this all plays out... but, we certainly were misled by the administration, who never warned us that they might let the midwestern economy whither and die.... especially, when they were pushing manufacturing recovery in November.

REID: Voting against us was never part of our arrangement!
SPECTER: I am altering the deal! Pray I don't alter it any further!
REID: This deal keeps getting worse all the time!


[ Parent ]
How Do You Protect GM (4.00 / 1)
It is not viable as currently structured with too many brands, high debt load and too many dealers.  I think the UAW has done more than its share to help but the company needs concessions from bond holders and dealers to survive.  

The only way to save GM at all is to get it to a size that resembles its market share.  Does it need 8 brands when it has less than 20% market share?  The whole buy-up from Chevy to Pontiac to Buick to Cadillac idea created by Alfred Sloan doesn't make sense today and yet that is how the organization is structured.  That doesn't even count Hummer, GMC, Saturn and Saab.

There seem to be 3 options from what I can see.

1 - Give GM $30 billion a year in taxpayer dollars until whenever it turns around which could be never under its current structure.

2 - Force GM to right size itself to reflect the market share it holds today.

3 - Let it go under.

It is important to remember Obama did not create the problems with GM.  He is trying to figure out how to save some semblence of a US auto industry.  I think his only choice is number 2 - right size GM to reflect today's market share.  I am open to other ideas but I don't think anyone outside of Michigan is likely to go with option 1.


[ Parent ]
Why do you hate unions? (0.00 / 0)
Seriously though, people here (David included) seem utterly incapable of realizing that GM's problems are not new and not really related to the current economic crisis at all.

[ Parent ]
I do want to state... (4.00 / 3)
...that I'm not an anti-Obama zealot, and if you read my comment history you'll find that I'm WAY more supportive of Obama than most here.  I still support him, and will continue to do so.  I realize that saving Michigan is politically unpopular outside of Michigan, Indiana, and Ohio...  I had hoped, though, that Obama would still stick with us... I don't think he's totally abandoning us... He is sending out a huge task force to help deal with the transition, and in the long run things may be better than I predict... but, we had hoped for more from him.  He was supposed to be one of us...  He was supposed to save GM.

Right now, we are mainly upset and hurt... There's not much hope for us here anymore... We really did look upon Obama as our savior.  He seemed to be the only politician who cared...

REID: Voting against us was never part of our arrangement!
SPECTER: I am altering the deal! Pray I don't alter it any further!
REID: This deal keeps getting worse all the time!


[ Parent ]
A task force to deal with the transition? (4.00 / 2)
Transition to what?

I admire your point of view, lord_mike, and many of your comments, but still...

For a 55-year old union auto worker...

Transition to what?


[ Parent ]
I don't know... (4.00 / 2)
It's the classic "retraining" crap that republicans would pull 10 years ago...  It's BS for the most part... retraining for Wal Mart, mostly...

But, this one is at least a bit different.  This guy is part of a team that will not only direct aid and education to affected regions, but also direct stimulus money and investment to affected regions as well.  Theoretically, that could mean investments in advanced manufacturing or green manufacturing like Granholm has proposed... new jobs that actually pay well and an autoworker could do...  Of course, it's all pie in the sky at the moment, but any aid at this point is welcome...

Still, we've seen it all before... I hear that Michiganders are calling this guy the Misery Czar... There's only so much misery that can be eased...

At least it's something...  but, that's not saying much!

REID: Voting against us was never part of our arrangement!
SPECTER: I am altering the deal! Pray I don't alter it any further!
REID: This deal keeps getting worse all the time!


[ Parent ]
Neither is GM (0.00 / 0)
In fact, the entire point of Obama's move is to avoid GM going into bankruptcy and the attendant mess that would entail.

[ Parent ]
After years of intellectual discourse at Open Left (4.00 / 2)
you're still asking why?!?

Good God Man!


Apples, Oranges and Clout (4.00 / 3)
This is never simple, but I will be silly and make it that way, anyway. The US auto industry, one small third of which had already commited manufacturing suicide anyway, amounts to nothing more than a very large producer network of widgets: they make appples and oranges. Obama &Co. have more money than they do and control the ultimate purse strings of commerce and enterprise in the US. He can tell them what to do, and hire and fire and control the supply of apples and oranges. Widgets and those who make them are seen as disposable and recyclable (we hope). It has not helped that many of the widgets were junk, their business model was antiquated and their long-term vision did not extend beyond the end of their nose: we should have had a Chevy Volt 12 years ago, side by side with a Honda or Toyota electric upstart. And the widget makers have little or no lasting effect on the banks around the world. At least not in the grand scheme of things. Most people believe that the world-wide auto undustry can and will "absorb" the US contingent, just as Japan, Korea and China have absorbed the production of TV's, refrigerators and air conditioners. Maybe.

The banking guys, on the other hand,  OWN the land and the apple and orange trees. They hold the mortgages on the land and the long terms leases on the machinery (the trees). THEY have more money than Obama and control the purse strings on the big purse of general commerce. Obama cannot hire and fire those guys because they can buy and sell him. All he can do is Geithnerize them and make threatening noises. And they are inextricably intertwined with the rest of the big banks of the world. When they sneeze, the whole world gets a cold.Why do you suppose there are so many rich, ex-pat bankers living in London, Zurich and Moscow?

We need a world-wide revolution in banking procedures, but the "good ole boys" of old money and old banking don't care for that idea much and will fight it, tooth and nail...with their checkbooks. If MI and OH turn to dust, rust and ghettos tomorrow, nobody in the banking sector will care much, because there will still be penthouses near Wall St. and places to hide money and yachts in the Caymans.  


GM had the electric car in 1996 and they murdered it (4.00 / 1)
So I have no sympathy for them. the car was popular, had owners driving them, 2 years of back orders for them and they recalled every fucking one of them from owners ( I guess they were leased only) who didn't want to give them up, who organized to keep them, who protested around the fenced in sites where they were taken before they were crunched.

Yes, goddamn it crunched! And Clinton and Gore were at its unveiling clapping and smiling but they did absolutely nothing to save it. It would have started putting a lot of auto mechanics out of business. It is a different animal and you don't get dirty and oily fixing it. The new batteries were in place but now the patent has been taken over by those who want to buy them too. It would have thrown the auto supply businesses out, the auto repair businesses out and so they had to get California to retract their strict emission laws for the near future and relax them. When they got that they killed the car. They fucking deserve to go into bankruptcy for that. And Mr. Environment and Mr. Planet Health, Al Gore, never spoke a word in its favor to save it.

Why? See the movie Who Killed the Electric Car?

Well we all know American cars are made to start self destructing after 100K miles. And we don't want to lose all those hefty repair bills at the dealership do we? The only reason they last longer is that the Japanese cars do and so we had to compete with them on that score.

But in their favor, the Honda, Toyota and Nissan were lured to the south by tax remissions (over 100K per worker) and cheap labor. The Big Three could not compete with those goodies.


In fairness to GM... (4.00 / 1)
...the movie's creator says he was too hard on GM, and praises their new hig-MPG and electric initiatives.

There's a lot of urban legend and romanticism about the EV-1, but the truth is, it would be considered a lemon today.  The windshield leaked, the batteries constantly overheated, and suffered no less than a dozen major recalls on major parts.  It was desirable 'cos it was different... but, being only a two-seater... not very useful.

GM had to take them back after their lease for liability reasons... The batteries had a nasty habit of exploding sometimes, and essentially a prototype car with no support for parts from production became a huge legal liability for them.  California played as large of a role in getting them crushed as GM did.

Toyota also had a popular battery-powered Rav4 at the time.  They also stopped making them.  They haven't made anything similar since.  Where is the hate for Toyota.  The prius still guzzles gas.

REID: Voting against us was never part of our arrangement!
SPECTER: I am altering the deal! Pray I don't alter it any further!
REID: This deal keeps getting worse all the time!


[ Parent ]
I'd like to add... (0.00 / 0)
...that the movie's creator has been planning a sequel in which he praises GM and puts them in a positive light...

REID: Voting against us was never part of our arrangement!
SPECTER: I am altering the deal! Pray I don't alter it any further!
REID: This deal keeps getting worse all the time!


[ Parent ]
GMs biggest problem is when they became a finance company (4.00 / 4)
There's so much stuff out there about SUVs and whatnot, most of such criticism is entirely valid by the way, but what put GM out of business was finance.

GM, like every other finance company, made bullshit loans, bundled them and sold them to idiot "investors." They hedged those with Credit Default Swaps (a Trillion in them) and a bunch of banks "own" that bogus paper. GM also got into the Sub-Prime mortgage business. All this, of course, was because Clinton and Shrub took all the limits off of finance. So GM was killed by fraud at least as much by what kind of cars they made. Just like everybody else.

That, of course, gets absolutely NO discussion in the establishment media.

Fact is, GM was souring when the price of gas exploded and made those awful suburban assault vehicles worth less than the metal they contain, but that's not what killed them--they actually made a ton of money on those. Financial fraud killed them, just like the banks.

The only difference here is that GM has a lot of working class people working for them that are represented by a union. Bank of America does not, eh? Could the double standard possibly be more stark here? David is totally right.

Likewise, General Electric also became a finance company when that industry was deregulated. They also got into the subprime game and lost big time. They also are insolvent just from the carnage in their financial division.

But GE is a defense manufacturer and has so many pols in their hip pocket I doubt anyone will resist their bailout. I'm sure they're getting money from AIG too, having made their own derivative bets.

It's all in Who You Buy, eh?

PS: to the semi-trollish people-oids above  who seem to think the UAW is to blame for GM going under, since when is the UAW involved with making bogus home loans?



"More than any other time in history, mankind faces a crossroads. One path leads to despair and utter hopelessness. The other, to total extinction. Let us pray we have the wisdom to choose correctly." -Woody Allen, My Speech to the Graduates


[ Parent ]
YES! YES! YES!! (0.00 / 0)
GMAC killed GM, and when they needed GMAC to save it, they had already sold off the majority of it to Cerebrus and Chrysler...

GMAC's entry into the home loan business was its downfall.  Ford and Chrysler did not.  Chrysler got burned on a bad merger.  Ford is still in business!

REID: Voting against us was never part of our arrangement!
SPECTER: I am altering the deal! Pray I don't alter it any further!
REID: This deal keeps getting worse all the time!


[ Parent ]
. (2.67 / 3)
I'm not being Drudge-ishly sensationalistic here

Never that, you guys aren't tacky enough to use sirens.


My take is Rachel Maddow did not like Mr. Sirota's... (0.00 / 0)
...question on "Why?" the double standard.  Body language can be tricky, but it looked like she didn't like that, especially when he went back there a 2nd time.  I hope he gets invited back.

Regards,


Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me-and I welcome their hatred. - FDR


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