Auto Rescue Plan – $17.4 Billion

December 22, 2008

The White House decision to honor and acknowledge the plight of American workforce is praiseworthy.

During tough economic times, important decisions made to protect national interest is the best action for a nation dealing with crisis in all fronts.

Failure to avert the collapse of the huge manufacturing sector would have led to dire consequences with ripple effect on national and subsequently global markets.

For all those concerned about the erosion of free market system,

They must realize that the free market system with no oversight or regulations was heading towards a free fall denting the economic infrastructure with respect to financial and manufacturing sector.

The revival of sluggish economy is dependent on stabilizing the commercial sector providing millions of jobs that are in steady decline due to mismanagement, lack of accountability and corporate greed in many instances.

Therefore, the recent governmental intervention is necessary to restore investor and consumer confidence at all levels which in turn would contribute to the anticipated economic stimulus.

However, it is disappointing to note that the White House has unfairly targeted the United Auto workers (UAW) union with disproportionate demands such as,

Ref: Various news reports…

1.“The UAW union asked to rework contracts to make wages and work rules comparable with those at nonunion plants in the United States owned by foreign automakers by December 31, 2009.

2. The UAW asked to accept stock rather than cash for the billions of dollars of pension and retiree health care liabilities shifted from the companies to the union.”

The success and failure of any organization lies with management of capital and resources available to the head of the company responsible for the entire workforce.

Stock performance is dependent on the viability of the company based on executive decisions leading productivity to profitability.

Hence, shifting the entire burden of liabilities to labor rather than management reflects cohesion with the corporate executives primarily responsible for the precipitous losses suffered by the manufacturing sector.

With the loan granted to GM and Chrysler, it is imperative for not only these two automakers but also the entire auto industry to move towards energy efficient preferably environment friendly automobiles to free the nation from energy dependence and environmental hazards.

Overall, the rescue plan is the step in the right direction to protect nearly a million jobs in the auto industry.

Such action to salvage the American workforce will pay off through consumer spending, an essential catalyst for economic recovery.

As for the bailout precedence, it is noteworthy that the grim reality of accelerating unemployment and liquidity freeze in the credit market prompted similar action.

Finally, it is incumbent on the financial institutions to respond to the urgency of the economic revival by reinstating responsible lending practices to businesses with sound management focused on profitable ventures.

Thank you.

Padmini Arhant

Time for Action on Auto Rescue Plan

December 16, 2008

Once again, partisan politics prevails over national interest in the backdrop of the economic crisis due to skyrocketing foreclosures, credit crunch and now,

Record unemployment at 6.7%, expected to rise further from the lack of action by the legislators, leaving the fate of the million workers in our nation hanging in balance.

The extreme demands by the legislators voting against the rescue plan to,

The United Auto Workers (UAW) union to agree to steep wage cuts to bring their pay equivalent to the Japanese auto industry is preposterous and poses the legitimate question to them in return.

Have these legislators made similar demands to the CEO’s of the auto industry prior to urging UAW to agree to such double standards?

Further, the following question from a wise representative of democracy to the so-called lawmakers otherwise the boulders contributing to the roadblock or failure of any important legislation is praiseworthy.

Even though the question is in context with the California State of affairs, it is still relevant as the Californian legislators particularly the Republican Party representatives have sworn to mimic their federal counterparts in escalating the economic recession.

Ref: Mercury news, December 12, 2008 – Thank you.

"What sacrifices are our leaders making?

Considering the latest estimates of the financial crisis facing California, I think we should all be asking our elected officials what sacrifices they plan to make during these hard times.

We the taxpayers are bracing for increases in taxes and fees, decreases in services, huge layoffs of public and private sector employees.

I have yet to hear anything about cuts being considered to the compensation, pension plans, health care, car allowances, per diem, etc., that our representatives enjoy.

The fact is that these so-called leaders are at the helm of this shipwreck.

Ultimately, it is their responsibility to run this state in a fiscally responsible manner.

They have failed miserably.

We should demand that any plan to bridge this budget gap start with cuts to those who failed us. "

Ken Kramasz


The demand is fair and justified.

More grinding facts on the consequences of bailout failure:


Article: Suppliers see their demise if Big 3 become insolvent

By Bill Vlasic and Leslie Wayne, New York Times.

Ref: Mercury News, December 12, 2008 – Thank you.

The excerpt from the article deserves attention.

“The hypotheticals about the domino effect of the companies’ troubles through the vast network of auto supplier firms – which employ more than twice as many workers as the carmakers – are becoming real.

Top of Pyramid

The Big Three, and their foreign competitors, are what most people think make up the entire auto industry.
But the car manufacturers are just the top of the pyramid.

While GM, Ford and Chrysler employ 239,000 people in the United States, the country’s 3,000 or so auto suppliers have more than 600,000 workers.

Most of the suppliers are not highly waged; they have no big pensions,…

Washington has a myopic view of the auto industry.

They just think of the Big Three and don’t think of us,” i.e. the suppliers.


Challenge the Opponents:

What strategy or proposal the White House and the opposing legislators have in mind about the economy?

So far, they have been highly successful with their dogmatic policies that have led the economy towards recession.

With the lack of action in this matter, the collapse of other industries is imminent worsening the situation comparable to a black hole.

Aren’t they satisfied with the calamities they have brought upon this nation, that they are further determined to see through the peril before their much-awaited departure from the White House?

All these legislators including Senate Democrats in opposition to saving jobs and helping families through this rescue plan ought to think wisely, as they might be inadvertently putting themselves on notice in 2010.

For some, it might happen even sooner as there is a process called recall in a democratic system.

The people of the United States have learned a harsh lesson through Bush administration.

Conventional wisdom dictates that when something is of no value, it is best to discard and replace it with one of use that serves the purpose.

In the case of the incumbent administration, the notion might be what harm any inaction might do now as the term is nearing end.

History will do its part with judgment on the performance of any administration regardless of the cosmetic presentation by the representatives of the outgoing administration.

Notwithstanding the impending justice to be delivered for crime against humanity specifically violation of constitution thus far by oligarchy and their members.

In addition, the repercussions of the failures of any administration or individuals representing a political party cannot be ignored, especially if they are encouraging their clan (as it appears to be the norm in contemporary politics including democracy ) to retain Power further down the road.

No matter, how one circumvents the situation leading to the downfall of the once prosperous economy, the fact remains that willful negligence or malevolent policy to settle scores with opponents will result in their own ouster from the positions as legislators.

The elimination of the namesake lawmakers aka troublemakers will be the result of illogical conduct and abuse of power against the people and nation they falsely pledge to serve at all times and diligently during crisis.

Options for the White House to salvage the demise of the political party they represent in the coming elections is to act in the best interests of the people who are the electorate with the ability to entrust Power through electoral process.

Up until recently, the serious backlash suffered by the Republican Party represented by the incumbent administration in 2006 and 2008 is ominous that those who fail to deliver their commitments to democracy will share similar outcome reaching the point of no return to power.


Action Required:

It is incumbent on the Treasury department and the White House to come forward and immediately release the unused $15 billion from the $350 billion financial bailout draw down currently held in cash to rescue the autoworkers and millions of jobs at stake.

Failing to avert the inevitable collapse of the industries providing food and livelihood for the electorate with power to elect officials to serve the public will be detrimental to the success and approval of the final bailout $350 billion defending the finance industry.

The authorization of the $15 billion from the current $350 billion is imperative barring any mandatory demand for wage cuts and benefits to the workers and UAW.

Any conditions to the rescue plan will apply to the CEO’s of the industry from cashing in bonuses and extravagant remuneration including kickbacks and shady Washington deals with the lobbyists by the legislators elected to protect national interest rather than self-interest.

Urgency of this auto rescue measure will prove the effectiveness of democracy in action.

Therefore, it is the responsibility of the Treasury department along with the White House to act promptly by releasing the cash held $15billion from the previously approved taxpayers’ $350 billion for the financial bailout and save the American workforce as well as the economy.

Procrastination rather than action in this matter will lead to the unrequested irrelevance and perhaps the end of a major political party in the coming elections by making way for the emergence of new political faction in the near future.

Thank you.

Padmini Arhant

P.S. The suggested plan of action also applies to the California legislators, currently engaged in threatening democracy and progress in all fronts of the legislation.