Allison Kilkenny: Unreported

GM: Twittering ‘Til The Bitter End

Posted in Economy by allisonkilkenny on February 19, 2009

General Motors and Chrysler’s requests for $21.6 billion in federal loans have a lot of citizens up in arms. GM has already asked for (and received) $13.4 billion in loans under the auto industry bailout, and the company claims it would need another $100 billion in government financing if it goes bankrupt.

But the good news is that the auto giant has a comprehensive, full-proof business model to confront the worsening recession:

1. Cut 47,000 American jobs

2. Close five North American plants

3. Drop several brands, including the lightweight, more fuel-efficient Saturn, and to counterbalance that, the “Why Jesus?!” Hummer brand

4. Hope the UAW doesn’t raise too much hell over GM’s inability to pay retirees’ health care costs

5. Twitter

I learned of step five in GM’s Vision of the Future when I twittered the following innocuous (or so I thought) comment:

allisonkilkenny: sees GM is phasing out the small, fuel efficient Saturn. Oil companies: 1, Earth: 0.

Seconds later, I received a reply tweet from something called GMBlogs:

@allisonkilkenny we don’t have indiv trash cans at ofc cubes at hq, just an ex, not sure total $ saved from small ideas, but likely large

picture-1In other words, GM is still environmentally-friendly because interns have to share trash cans. Shaky reasoning aside, I was surprised that I had popped onto the radar of GM with my casual mention of their brand, especially when the company should theoretically be preoccupied with, ya know’, going out of business.

I contacted Christopher Barger, GM Director of Global Communications Technology, about this weird prioritizing. Barger quickly responded to my questions, and he explained that GM is using TweetDeck to just search for mentions of GM, as well as interacting with the people who were already following the company. It’s not unusual for a corporation to use Twitter to monitor customer reactions to its products, and Barger equated the practice to customer service, though he seemed to take offense when I pointed out the slim differences between corporate acts of “good will” and propaganda.

I responded that, unlike customer service, I didn’t approach GM with a question or complaint. They specifically searched Twitter for mention of their product and then sent a messenger my way to post some talking points about The Corporation. 

An entire department devoted to the cause of Tweeting and blogging may seem like a strange choice for budget allocation considering their economic turmoil, but GM has burst onto the technological scene with great gusto. GM is quick to rationalize, claiming this is totally 100% normal because corporations need to keep their fingers on the pulses of clients and customers, and GM is hardly the only corporation to engage in the magic world of Twitter.

“We knew that when [the loan request] was submitted last night, there would be a lot of people reacting to it — on Twitter, on Facebook, in the blogs.  We wanted to be out there answering as many questions as possible about the viability plan itself, the progress we’ve made in its execution since December 2, the impact of the restructuring on our brands and upcoming vehicles, trying to let people know that Saturn still may have life after GM, trying to gauge how people were reacting to the plan,” said Berger.

Of course, gauging customer reaction shouldn’t take a back seat to providing actual products and services, say cars and health care. If GM is looking for a reaction from American citizens about their billions of dollars in requested loans and mistreatment of their employees, I can save them a lot of time and Tweeting:

It’s not good. It’s very bad. Less people want to buy your heavy, fuel-inefficient cars, and almost no one is thrilled that taxpayers are paying you billions of dollars to close domestic plants and ship jobs across our borders. Few people like that you mistreat unions. No one likes that in your rush to modernize and embrace the technology of the internet (complete with Twitter experts,) you forgot how to compete with foreign car companies.

It is possible to make tweets private and avoid the watchful eye of corporations, though that protection has already been hacked. For now, know that while you may never again own a good American car, you’re sure to get a prompt reply whenever you Twitter about GM.

Bush OKs $17.4B Bailout of the Auto Industry

Posted in Economy by allisonkilkenny on December 19, 2008

Yahoo!

vlcsnap-7821080WASHINGTON – Citing danger to the national economy, President Bush approved an emergency bailout of the U.S. auto industry Friday, offering $17.4 billion in rescue loans in exchange for tough concessions from the deeply troubled carmakers and their workers.

Allowing the massive auto industry to collapse in the middle of what is already a severe recession “would worsen a weak job market and exacerbate the financial crisis,” Bush said. “It could send our suffering economy into a deeper and longer recession. And it would leave the next president to confront the demise of a major American industry in his first days of office.”

President-elect Barack Obama, who takes office a month from Saturday, praised the White House action but also warned, “The auto companies must not squander this chance to reform bad management practices and begin the long-term restructuring that is absolutely necessary to save this critical industry and the millions of American jobs that depend on it, while also creating the fuel efficient cars of tomorrow.”

Stock prices rallied on Wall Street as investors cheered the government’s action. Republicans on Capitol Hill, though, expressed disdain for the bailout. And while the United Auto Workers said the plan would keep factories running, the union said it was upset by loan conditions “singling out workers.”

“We will work with the Obama administration and the new Congress to ensure that these unfair conditions are removed,” said Ron Gettelfinger, president of the UAW.

Obama will be free to reopen the arrangement from the government’s side if he chooses, an administration official said.

Bush said, “The time to make hard decisions to become viable is now, or the only option will be bankruptcy. The automakers and unions must understand what is at stake and make hard decisions necessary to reform.”

Some $13.4 billion of the money would be available this month and next — $9.4 billion of it for General Motors and $4 billion for Chrysler LLC. GM is slated to receive the remaining $4 billion in loans after more money is released from the financial rescue account.

Under terms of the loans, the government will have the option of becoming a stockholder in the companies, much as it has with major banks, in effect partially nationalizing the industry. Bush said the companies’ workers should agree to wage and work rules that are competitive with foreign automakers by the end of next year.

And he called for elimination of a “jobs bank” program — negotiated by the United Auto Workers and the companies — under which laid-off workers can receive about 95 percent of their pay and benefits for years. Early this month, the UAW agreed to suspend the program.

Treasury Secretary Henry Paulson said Congress should release the second $350 billion from the financial rescue fund that it approved in October to bail out huge financial institutions. Tapping the fund for the auto industry basically exhausts the first half of the $700 billion total, he said.

If the carmakers fail to prove viability by March 31, they will be required to repay the loans, which they would find all but impossible. A firm will be deemed viable only if it can show positive cash flow and can fully repay the government loans.

General Motors CorpCEO Rick Wagoner said in Detroit that GM had much work ahead but he was confident it could reinvent itself with the government help and even lead an economic recovery in America.

House Republican leader John Boehner called the administration’s plan “regrettable.” He said that granting loans for automakers was never the intention when Congress passed the $700 billion plan to rescue financial institutions and that the new plan “has failed both autoworkers and taxpayers.”

Rep. Jeb Hensarling, R-Texas, chairman of the congressional oversight panel for the Wall Street rescueprogram, decried the decision, saying a Chapter 11 reorganization, not loans rewarding decades of mismanagement, would have been a better decision.

“Unless union contracts are renegotiated, and unless demand picks up for domestic autos, $14 billion, $34 billion, $74 billion — even $104 billion — will not solve the problem,” Hensarling said. “I fear that a devastating precedent has been set that the federal government will now be pressured to bail out every failing company in America — something that taxpayers and future generations cannot afford.”

Under terms of the loan, GM and Chrysler must provide the government with stock warrants giving it the option to buy GM and Chrysler stock at a specific price. In addition, the automakers would be required to agree to limits on executive pay and eliminate some perks such as corporate jets.

Paulson, who plans to discuss the deal with congressional leaders and Obama’s transition team in the near future, said he was confident that the Treasury DepartmentFederal Reserve and Federal Deposit Insurance Corp. have the resources to address a significant market crisis if one should occur before Congress approves the use of the second half of the rescue fund.

Friday’s rescue plan retains the idea of a “car czar” to make sure the auto companies are keeping their promises and moving toward long-term viability.

The short-term overseer will be Paulson. But the White House deputy chief of staffJoel Kaplan, said that if the Obama team wants someone else installed to bridge the administrations, Bush is open to that. Kaplan said there have been discussions with Obama’s aides throughout the process and the White House believes Obama’s view of the problem and the solution tracks with theirs.

The White House package is the lifeline desperately sought by U.S. automakers, who warned they were running out of money as the economy fell deeper into recession, car loans became scarce and consumers stopped shopping for cars.

The carmakers have announced extended holiday shutdowns. Chrysler is closing all 30 of its North American manufacturing plants for four weeks because of slumping sales; Ford will shut 10 North American assembly plants for an extra week in January, and General Motors will temporarily close 20 factories — many for the entire month of January — to cut vehicle production.

Chrysler CEO Bob Nardelli thanked the administration for its help.

In a statement Friday morning, Nardelli said the initial injection of capital will help the company get through its cash crisis and help eventually return to profitability. He said Chrysler was committed to meeting the conditions set by Bush in exchange for the money.

Ford President and CEO Alan Mulally said his company would not seek the short-term financial assistance but predicted the aid would stabilize the industry.

“The U.S. auto industry is highly interdependent, and a failure of one of our competitors would have a ripple effect that could jeopardize millions of jobs and further damage the already weakened U.S. economy,” Mulally said.

Is David Brooks Insane?

Posted in politics by allisonkilkenny on December 12, 2008
Crazy? Or just bitchy?

Crazy, or just bitchy?

In today’s New York Times, David Brooks disguised himself in the persona of a conservative ambassador (a long stretch from his actual form, a conservative columnist,) and addressed a fictitious foreign king about the state of the United States. This kind of theoretical, farcical gallivanting is always a disaster when manipulated by skilled, funny people, but left in the incapable hands of unfunny man David Brooks, the disaster quickly mutated into a fiery train wreck.

Your Excellency, 

Your humble ambassador requests the honor of your time so that he may apprise you of the mood and conditions in Washington. Seeking nothing for himself, but only seeking to serve your most Serene Majesty, your ambassador has been working tirelessly to understand the spirit of the American capital.

Uh-huh. This is like when you walk into the room of a senile grandparent and they’re dancing around with underwear on their head, saying something about being late for tea with the Queen of England. Sure, Grandpa David. Whatever you say.

I guess this is supposed to be whimsical farce, or other euphemisms for intellectuals trying (and failing) to be funny. David uses the persona of upscale tour guide to regurgitate the Conservative position that the auto bailout couldn’t go through because — ya’ know — that would lead to FISCAL INSANITY!!!!111

Once a $100 billion stimulus package was large, but now the stimulus proposals have passed through $300 billion to $500 billion on their way to infinity. Some Americans believe the automakers should be bailed out even without the reforms proposed by Senator Bob Corker. But without those reforms, which were shot down in the Senate Thursday night, the bailouts would go on and on into infinity.

It’s a fair question: where would the cap be if the Senate had given the auto industry $30 billion? Of course, the government just hurled over $700 billion at a handful of shifty-eyed Wall Street gargoyles, but that’s besides the point. Our right-wing compatriots are suddenly and inexplicably conservative with the nation’s wallet, and they want answers, damnit! Well, maybe not answers, but they at least want to blame the unions for everything.

My only explanation for David’s behavior is that he is so appalled by his own ideologies that he has regressed into a child-like state, and he’s playing a game of Make Believe. That, or he’s completely off his rocker, and he’s killed Paul Krugman (who suspiciously has a “day off” today,) skinned him, and he’s currently wearing his skin as he speaks in a shrill, effeminate voice: “I’m Paul Krugman. I believe in a fair tax system and investing aggressively in the nation’s infrastructure.”

The Gray Lady Bitchslaps Auto Workers

Posted in Economy by allisonkilkenny on December 4, 2008

UAW president, Ron Gettelfinger

UAW president, Ron Gettelfinger

The New York Times lead story is U.A.W. Makes Concessions to Help Automakers. The article is pretty aptly titled because the NYT chose to focus entirely on the evil UAW parasites that are sucking the poor, helpless automakers dry through ludicrous demands such as job security and pension/health care payments.

The Big Three claim their industry is tanking not because of refusing to change their big, heavy, gas-guzzling car designs, but because evil workers are demanding their contractually promised benefits. The Big Three are failing not because the rest of the world is building fuel-efficient cars, but because the UAW demands that CEOs pay their salaries between the time their jobs get shipped to Mexico, and they find new sources of employment.

You see, all the blame can (and should) be pinned on the workers. At least, that’s what the Big Three claim, and the NYT seems to agree, which explains why so many horrifying facts are splayed across the Gray Lady’s pages without examination, analysis, or comment from workers themselves.

Ford’s chief executive, Alan R. Mulally, said in an interview Wednesday that Detroit needed the union’s help to speed its transformation, particularly in replacing current workers with entry-level employees who will be making $14 an hour in wages under the terms of the 2007 labor agreement.

That’s a pay cut of almost half for the Big Three. In addition, union members aren’t guaranteed their old job security or health benefits. Now that they’ve made concession after concession, there are still no strings attached to the automakers to stop them from closing their plants and shipping jobs to Mexico after everything has been said and done.

The UAW’s president, Ron Gettelfinger, has slowly cut the strings from the UAW’s parachute, and now hundreds of thousands of workers will plummet toward the Earth because a handful of corporate executives figured out it’s easier to suspend worker pension plans than trim their own fat salaries.

However, the sin of abusing poor autoworkers can be shared with the media that refuses to focus on them.

The NYT did not interview one UAW worker. The NYT did not interview one person who will lose their health care coverage through this new deal, which is tantamount to the automakers putting a giant boot up the ass of the UAW.

Other media made the effort to balance the story and interview actual workers affected by these gross policy decisions. Mlive.com, an on-line Michigan news website, interviewed Michigan workers who stand to lose their health coverage under changing auto industry policies.

With General Motors Corp.’s stock tanking and the automaker possibly running out of cash before the end of the year, 73-year-old Kenneth Rathje and other retirees posed questions about pensions and health benefits.
UAW Local 668 president Matthew Ebenhoeh has spent part of last week in Detroit, learning where General Motors is headed.

Industry analysts speculate that GM could file for bankruptcy to seek protection from its creditors. Several hundred retirees wanted Ebenhoeh to tell them the consequences.

“My job is to make sure my membership is safe,” Ebenhoeh said. “I don’t want to see anybody lose anything.”

Rathje retired from Grey Iron in 1995 after a 40-plus-year career that included a stint as a labor liaison, aiding workers on layoff with new jobs or training.

Losing his pension would cost him about $12,000 per year; his insurance much more. An independent federal agency designed to protect the protect the retirement funds and benefits for people such as Rathje.

 

Seems fairly painless, right? It’s fine to explain the corporate side of a story, but any reputable source of media should then step back and offer the counter-argument, where the workers and poor people live.

It’s obvious why these types of stories tend to be so one-sided. Poor autoworkers can’t buy New York Times advertising space and subscriptions.