Of Arrogance, Bailouts and the Big Three
Just as I was about to give up on Congress, BAM, POW, a California Congressman decked the auto executives with a one-two punch. As these august gentlemen were sitting before a House Committee telling the Congressmen how bad it was, and that they needed money badly, Brad Sherman asked the group of beggars to raise their hand if any of them flew by commercial airline to the hearings in Washington.
“Let the record show,” the Congressman said, “that no one raised their hand,” the Congressman said.
Then came the right hook. “Raise your hand if any of you plan to sell your private jet.”
No response. They looked at each other, then at the Committee members, most likely sensing they had lost that round by points.
“Let the record show,” Congressman Sherman said, “that no one raised their hand.”
The lack of response was hardly surprising, but what was surprising is that a member of Congress finally earned his paycheck for that day. Fear of the 30 second spot television commercial has silenced many a member of Congress. None of them want to have their words replayed during the next campaign, so they are generally silent when it comes to challenging the corporate world—oil companies and auto executives included.
But even more outrageous is the arrogance of the Big Three executives coming to the taxpayers with their hands outstretched, waiting for a bailout. And why not? You ask. Didn’t this same bunch hand over $700 billion to Henry Paulson so his banking and Wall Street friends could continue their plush lifestyle? And didn’t Henry Paulson suddenly discover that the bankers and Wall Street money men didn’t need it all, causing him to shift gears and aim the bailout at mortgage foreclosures?
As Senator Everett Dirksen used to say, “A few hundred million here and a few hundred million there—pretty soon you’re talking about real money.” Nowadays the word billion has replaced million, but, you get the idea. For the well-connected it’s Monopoly money anyway. It’s not real unless your company can’t pay a $25 or $50 million dollar bonus.
The arrogance of these fellows is being rewarded by the fearmongering of George W. Bush and others who predicted dark consequences if the money wasn’t handed over. So most everyone fell into line and voted it in.
When I was a member of the Senate Energy Committee in the 1970s I attached an amendment onto a piece of legislation that would have required the automobile manufacturers to make new cars that delivered a minimum of 26 miles to the gallon. That was in the 1970s when we all thought that mileage level would be a great victory. Nowadays, Toyota doesn’t make a car, I don’t believe, that delivers less than that. But back then, 26 miles to the gallon was revolutionary, even radical. So the Big Three came in and lobbied against it and defeated it. And they steadily moved into making and selling real he-man cars and trucks, such as the Hummers, the big pickups and the SUVs that more resemble a battleship than a car. At the same time, in Europe, taxes levied on gasoline made it so high that if one bought an American gas-guzzler, he would be thought of as crazy. So the Europeans made smaller cars that ate much less gas, and the Japanese began to move into the American market, selling high gas mileage cars to those of us who felt guilt at driving a four-wheeled monster.
The Europeans and Japanese also built high speed rail transportation that moved people so efficiently that cars became sort of redundant for longer trips. Meanwhile we Americans have spent ourselves into bankruptcy fighting wars, consuming more gasoline than we should, and telling ourselves that single payer health care and a national rail transportation system was socialistic. We listened to the lobbyists for the pharmaceutical companies and the airline and automobile industries, and said to ourselves: “We don’t need no stinking socialism.”
What this all means is that socialism is good for the Big Three automobile manufacturers and for Wall Street and for the big banks, but bad for the rest of us.
Back when I was working my way through Engineering School, I tended bar to make a living for my family of a wife and three kids. I had a customer–we’ll call him Chet—who was constantly broke, and who was always in need of a drink. Despite his bad circumstances, Chet dressed in a white shirt, his black hair greased and pulled straight back, and wore a thin, black mustache. For a drunk, he was well dressed. Chet would sit up to the bar with his head down, not feeling very good about himself, order a drink, pour it down, order another, and drink it down just as quickly. As I wondered if he had enough money on him to pay, his third drink served to bring his drooping head and body upright, and he would demand that I bring out the dice cup, demanding to roll double or nothing for the drinks.
I tell that story because the Big Three remind me of Chet. The difference between them is several hundred million dollars in each of their pockets, but their story is very similar. Instead of a shot or two of cheap rotgut, they are drinking the fine wine of telling the Congress, as they are accustomed to doing, that they need help.
The worst part of this saga is that the people in the industry—the workers—those who did not make the decisions about the kinds of cars to market, will be severely hurt, as will the communities that rely on the industry for their living. When GM decided to market Hummers, there was nothing the working people could do about the decision. They had to do the manufacturing or lose their jobs. And the arrogant executives, the ones who made the decisions, will walk away from the bankrupt companies with millions in their bank accounts, caring not one whit about those they are leaving out in the street.
Perhaps Congressmen should keep a grip on their newly found courage, and go beyond embarrassing these fellows about their private jets. They should consider handing over the bailout money only if the top decision makers in the industry resign, leaving their golden parachutes and their private jets with the company, the proceeds to be distributed to the working people who are being made to live with the results of their arrogance.
James G. Abourezk is a lawyer practicing in South Dakota. He is a former United States senator and the author of two books, Advise and Dissent, and a co-author of Through Different Eyes. Abourezk can be reached at email@example.com.