Friday, December 12, 2008

Republicans cut off our nose to spite unions and clean air

In case you didn’t notice, the loan package that GM and Chrysler requested from the Government collapsed in negotiations last night. The reason: Republicans in the Senate objected to Union workers not immediately taking pay cuts more than they wanted to (ahead of contract negotiations) and because there were requirements to clean up tailpipe emissions. Even the current President was in favor of this loan package.

And no, I won’t call it a “bailout package.” This was a loan package. What the financial sector got was a bailout package—money without strings attached or a need to repay any of it. I am against a bailout of the auto companies. I am not against a loan to them. There is a big difference.

As a devotee of Paul Krugman (economics editorial columnist at The New York Times,) when he mentioned an article at The New Republic titled “Panic in Detroit,” I went over there and read it. Here is (to me) the most important section of that article:

One reason for the casual support for letting GM fail is the assumption that bankruptcy would be no big deal: As USA Today editorialized recently, "Bankruptcy need not mean that the company disappears." But, while it's worked out that way for the airlines, among others, it's unlikely a GM business failure would play out in the same fashion. In order to seek so-called Chapter 11 status, a distressed company must find some way to operate while the bankruptcy court keeps creditors at bay. But GM can't build cars without parts, and it can't get parts without credit. Chapter 11 companies typically get that sort of credit from something called Debtor-in-Possession (DIP) loans. But the same Wall Street meltdown that has dragged down the economy and GM sales has also dried up the DIP money GM would need to operate.

That's why many analysts and scholars believe GM would likely end up in Chapter 7 bankruptcy, which would entail total liquidation. The company would close its doors, immediately throwing more than 100,000 people out of work. And, according to experts, the damage would spread quickly. Automobile parts suppliers in the United States rely disproportionately on GM's business to stay afloat. If GM shut down, many if not all of the suppliers would soon follow. Without parts, Chrysler, Ford, and eventually foreign-owned factories in the United States would have to cease operations. From Toledo to Tuscaloosa, the nation's assembly lines could go silent, sending a chill through their local economies as the idled workers stopped spending money.

Now do you understand why it is such a bad idea to let GM and Chrysler go bankrupt? Local economies would also feel the pinch of this kind of bankruptcy as auto dealerships immediately went out of business. Other, related industries would also feel the pinch, as local auto parts stores become unable to replenish their stores of parts, restaurants and entertainment venues start seeing fewer customers, stores and shopping malls make fewer sales, and all of them start going bankrupt. Some estimates for unemployment go as high as 5 million people just for the big three going out of business.

Why? Because Republicans want to crush the Unions, and you bloody well don’t have the right to breathe clean air, dammit! Nothing personal, it’s just business if you can’t work or breathe.

The Republicans keep saying that it’s to get the pay of the Union Auto Workers at domestic manufacturers here in the U.S. down to the same level that they are being paid at foreign owned plants in the U.S., but they aren’t mentioning the massive subsidies that they gave those foreign companies to locate those plants here.

Now that I’ve made all of that clear, do you feel any better about Republicans? I sure don’t. All they’re doing is making sure I never vote for a Republican again. It’s clear that you can’t trust them to make the right decision—even if the right choice is very clear.

And last night, was a very clear night.


“Panic in Detroit”, by Jonathan Cohn, published by The New Republic, 11-14-2008.

“$14B auto bailout dies in Senate”, by Julie Hirschfeld Davis and Ken Thomas, published by Associated Press, 12-12-2008.


Wednesday, December 10, 2008

Media Opportunity in Disaster

By Ed Smallwood

This is an expanded version of a comment I made in an Openthread on The Daily Kos recently. Even if you read that posting, you may want to read this blog entry to see what I’ve added and reorganized.

Editor and Publisher predicts that several cities will be without a daily newspaper by 2010. The Miami Herald may be the first to go, but papers owned by the Tribune Company could beat it to the punch with their bankruptcy filing this week.

Some of the problems that the media are having are due to the current economic situation—many companies do not have as much to spend on advertising. Some of it is due to lost viewership. This is especially true for daily newspapers, but also local nightly newscasts are feeling the pinch as well. My feeling is that much of the lost readership of newspapers and lost viewership of local news is not because of shifting media habits—that’s just the symptom. Media habits are shifting because people feel that they are not getting the information they want from traditional sources. When you put on a TV news program that gives give both sides of an issue equal time and equal say in order to seem fair and balanced (yes, I typed it), even when one side is clearly wrong, people lose respect for you. They wonder why you are wasting their time on some loony. The main stream news organizations have, to a large extent, been cowed by pressure from these loonies (not always Republicans, but often enough) to give them equal or even more access by using the argument that the media (often called “the liberal media”) is not being fair in their presentation. We need news organizations that are strong enough to actually BE fair. Being fair doesn’t mean that the person with one poorly-done study gets equal say to someone who has 500 well done studies saying the opposite thing. Sometimes being fair involves telling someone that they are a batshit loony (ask any judge).

Right now we are in the time of the biggest economic upheaval that anyone has seen since the Great Depression. I can only hope that my last statement will be proved wrong in a positive way. But, with this historic economic disaster looming, there is a historic opportunity. Remember the overused saying that the Chinese symbol for disaster combines the symbols for danger and opportunity.

For virtually my entire life (40 years next month) the main stream media has been consolidating into the hands of just a few people. Now is the first time that this can change. Many of the holding companies for these media sources are going to go bankrupt in the next year because of dropping revenue from advertising, and because they borrowed heavily against now non-existent equity in those holdings. This means that they cannot refinance their debt to meet their obligations.

This may be an opportunity for those of us who would like to see reporting of the truth in the media. I'm guessing that with expanding problems for newspapers, CNN laying off their science and tech reporting staff, the Tribune Co. filing for bankruptcy, and Sumner Redstone's problems being just examples of what will be coming, there are likely to be main stream media (MSM) outlets in many markets that will become available to buy at firesale prices, certainly the lowest prices adjusted for inflation since the rules of media ownership were relaxed.

Right now everyone is facing an economic calamity. However, the rich can find themselves at a bigger disadvantage than the rest of us in this situation. The rich are trained to leverage other people’s money, mostly banks money, by investing a little bit of their own money and borrowing the rest. We have numbers going for us. Even in a depression, there will be more people making a living wage than there are rich people. Many of those wage earners will have a little bit to give for something like this. That is a whole different kind of leverage where the rich don’t have an advantage over us.

Yes, I know that there are people reading this who will say "it can't be done" and come up with all kinds of excuses why it won't work. The advantage goes to those who can organize better, and that’s something we CAN do. You just have to pool together enough people and their money to do it. Organization skills are more important in this case than being rich, and we do have some of those organizations in place—think Unions, political groups, and liberal churches. If you are reading this than you are witnessing one way to organize this kind of media take over. It will take hard work, but I am not willing to say that the conservatives can do something we cannot. The conservative elite didn't buy all of the media outlets overnight, and I'm willing to work at it over time as well. But if we are to do it, there has probably never been a better time to start than now.

It's well past time for the mainstream media to do it's job. This may be the only opportunity in our lifetimes to wrest some of these outlets from the hands of the corporate/conservative powers that be. I would love to be watching the news on KKOS in my area instead of the fast-food preprocessed pap we're getting now. I'd love to get involved in this kind of venture. We are going to need all kinds of people to help with something like this. Who would like to join me?

-Ed “Edly” Smallwood


Editor and Publisher Article: “’Several Cities’ Could Have No Daily Paper As Soon As 2010, Credit Rater Says” by Mark Fitzgerald, Published Dec. 3, 2008.

Columbia Journalism Review Article: “CNN Cuts Entire Science, Tech Team” by Curtis Brainard, Published Dec. 4, 2008.

AP Article: “Tribune files for bankruptcy protection” by The Associated Press, Published Dec. 8, 2008.

Sunday, December 7, 2008

Article Update

I've got a bunch of articles you should read.

I'm sure you've heard that the U.S. posted a much higher than expected 533,000 jobs lost last month, bringing the unemployment rate to 6.7%. Now, if you count those who have left the workforce (willingly or not) the underemployment rate is 12.5%. That includes people who only have part-time jobs but want full-time jobs, as well as those who can't find jobs. More at the New York Times.

The Columbia Journalism Review notes how CNN just added to those unemployment figures by canning their entire Science and Tech reporting staff. Guess I won't be going to them for cutting edge science news.

Keeping that information in mind, the Boston Globe has a great article on what the next Great Depression might look like. People huddled around the TV's, long lines at the ER, soup kitchens getting hit hard (like they are already), Detroit a Ghost Town, and nobody willing to call it a Depression because nobody wants to define just what a Depression is. Another fact from the article: At the worst point of the Great Depression the unemployment figures (which were much more like our underemployment figures because there was no Unemployment Insurance then) was at 25%--roughly double our underemployment figures today. We may be getting there folks, even if the Boston Globe doesn't want to call it.

And with all of that, Mark Fitzgerald over at Editor and Publisher notes figures that show that many cities may be without a daily newspaper by 2010.

Randi Rhodes pointed out on her show a few days ago that druggie Limbaugh and other hot-air-wave conservatives are calling this "Obama's Recession." Yep, it's all Obama's fault for going out and getting elected. The Recession, which I might add was recently said to have started a year ago, is entirely Obama's fault, even before he's had a chance to take office. Just goes to show you how reality doesn't have any affect on them. It's always the liberal's fault.


Friday, December 5, 2008

A Fable for Hillary

I’ve been sitting on this story for about 6 years. I came up with it before the last recession, but never thought to publish it because the people who really need to hear it would have ignored it. We have a new administration getting ready to take the White House, and this fable is especially for Hillary. I hope she honestly takes it to heart and listens to the moral at the end.

There was an elegant party held in New York, and pretty much all of the ambassadors from the United Nations were in attendance. While the ambassadors were conversing in small groups, the United States ambassador spotted the ambassador of a smaller country that had been causing some trouble to U.S. interests.

The U.S. Ambassador strode right over to the ambassador of the small country, and virtually shouted out: “I’m watching you! You make one dumb move, cause any trouble here or anywhere, I’ll blow your head clean off of your neck! You do anything and I’ll make sure your country suffers for generations!” The entire room fell into an embarrassed silence. “Remember,” said the U.S. Ambassador, “I’m keeping an eye on you!”

While the room started milling about and talking about the U.S. Ambassador’s actions, the ambassador of a European country spots the ambassador of a small country causing problems for the interests of his country. Using the ruckus started by the American as cover, he sidled up next to the ambassador of the troubling country and said: “That was quite an outburst!” Pointing to an ambassador of a country neighboring the country causing trouble, he adds: “By the way, did you hear what that ambassador over there said about your mother?”

The moral of the story is that there is more than one way to skin a cat. America needs to learn how to take care of business without being forced to invade other countries.

-Ed Smallwood