Professional Soldiers ® - Two Views on the Detroit Bail-out

I received two different views of the auto industry bail-out in the last 1/2
hour.

Worth both a good read..

As my maternal mother was Attila the Hun and my pro-ported God-Father was
Uncle Bernard Madoff, you probably know my position.. I still think this is
worth sharing,, after all it is Christmas..

I have not verified the numbers quoted in these notes,
I don't think they need to be questioned,,
as it is the intent not the accuracy I wish to convey..

Be informed...

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Pro-Detroit Bail-out:

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Incredible editorial from one of our Dealers in the Pittsburgh
Region....Attached is a well written "Letter to the Editor" from Elkins
Fordland.

Editor: As I watch the coverage of the fate of the U.S. auto industry, one
alarming and frustrating fact hits me right between the eyes. The fate of
our nation's economic survival is in the hands of some congressmen who are
completely out of touch and act without knowledge of an industry that
affects almost every person in our nation. The same lack of knowledge is
shared with many journalists whom are irresponsible when influencing the
opinion of millions of viewers. Sen. Richard Shelby of Alabama has doomed
the industry, calling it a dinosaur. No Mr. Shelby, you are the dinosaur,
with ideas stuck in the '70s, '80s and '90s. You and the uninformed
journalist and senators that hold onto myths that are not relevant in
today's world d. When you say that the Big Three build vehicles nobody w
ants to buy, you must have overlooked that GM outsold Toyota by about 1.2
million vehicles in the U.S. and Ford outsold Honda by 850,000 and Nissan by
1.2 million in the U.S. GM was the world's No. 1 automaker beating Toyota by
3,000 units. When you claim inferior quality comes from the Big Three, did
you realize that Chevy makes the Malibu and Ford makes the Fusion that were
both rated over the Camry and Accord by J.D. Power independent survey on
initial quality? Did you bother to read the Consumer Report that rated Ford
on par with good Japanese automakers? Did you realize Big Three's gas
guzzlers include the 33 mpg Malibu that beats the Accord. And for '09 Ford
introduces the Hybrid Fusion whose 39 mpg is the best midsize, beating the
Camry Hybrid. Ford's Focus beats the Corolla and Chevy's Cobalt beats the
Civic.

When you ask how many times are we going to bail them out you must be r
referring to 1980. The only Big Three bailout was Chrysler, who paid back
$1 billion, plus interest. GM and Ford have never received government aid.
When you criticize the Big Three for building so many pickups, surely you've
noticed the attempts Toyota and Nissan have made spending billions to try to
get a piece of that pie. Perhaps it bothers you that for 31 straight years
Ford's F-Series has been the best selling vehicle. Ford and GM have
dominated this market and when you see the new '09 F-150 you'll agree this
won't change soon. Did you realize that both GM and Ford offer more hybrid
models than Nissan or Honda. Between 2005 and 2007, Ford alone has invested
more than $22 billion in research and development of technologies such as
Eco Boost, flex fuel, clean diesel, hybrids, plug in hybrids and hydrogen
cars. It's 2008 and the quality of the vehicles coming out of Detroit are
once again the best in the world. Perhaps Sen. Sh Shelby isn't really that
blind. Maybe he realizes the quality shift to American. Maybe it's the
fact that his state of Alabama has given so much to land factories from
Honda, Hyundai and Mercedes Benz that he is more concerned about their
continued growth than he is about the people of our country. Sen. Shelby's
disdain for "government subsidies" is very hypocritical.

In the early '90s he was the driving force behind a $253 million incentive
package to Mercedes. Plus, Alabama agreed to purchase 2,500 vehicles from
Mercedes. While the bridge loan the Big Three is requesting will be paid
back, Alabama 's $180,000 plus per job was pure incentive. Sen. Shelby, not
only are you out of touch, you are a self-serving hypocrite, who is prepared
to ruin our nation because of lack of knowledge and lack of due diligence in
making your opinions and decisions. After 9/11, the Detroit Three and
Harley Davidson gave $40 million-plus emergency vehicles to the recovery
efforts. What was given to the 9/11 relief effort by the Asian and European
Auto Manufactures? $0 Nada. Zip!

We live in a world of free trade, world economy and we have not been able to
produce products as cost efficiently. While the governments of other auto
producing nations subsidize their automakers, our government may be ready to
force its demise. While our automakers have paid union wages, benefits and
legacy debt, our Asian competitors employ cheap labor. We are at an extreme
disadvantage in production cost. Although many UAW concessions begin in
2010, many lawmakers think it's not enough. Some point the blame to
corporate management. I would like to speak of Ford Motor Co. The company
has streamlined by reducing our workforce by 51,000 since 2005, closing 17
plants and cutting expenses. Pro duct and future product is excellent and
the company is focused on one Ford. This is a company poised for
success.&nbs p; Ford product quality and corporate management have improved
light years since the nightmare of Jacques Nasser. Thank you Alan Mulally
and the best auto company management team in the business.

The financial collapse caused by the secondary mortgage fiasco and the greed
of Wall Street has led to a $700 billion bailout of the industry that
created the problem. AIG spent nearly $1 million on three company
excursions to lavish resorts and hunting destinations. Paulson is saying no
to $250 billion foreclosure relief and the whole thing is a mess. So when
the Big Three ask for 4 percent of that of the $700 billion, $25 billion to
save the country's largest industry, there is obviously oppositions. But
does it make sense to reward the culprits of the problem with $700 billion
unconditionally, and ignore the victims?& nbsp; As a Ford dealer, I feel our
portion of the $25 billion will never be touched and is not necessary. Ford
currently ha s $29 billion of liquidity. However, the effect of a
bankruptcy by GM will hurt the suppliers we all do business with. A Chapter
11 bankruptcy by any manufacture would cost retirees their health care and
retirements. Chances are GM would recover from Chapter 11 with a better
business plan with much less expense. So who foots the bill if GM or all
three go Chapter 11? All that extra health care, unemployment, loss of tax
base and some forgiven debt goes back to the taxpayer, us. With no chance
of repayment, this would be much worse than a loan with the intent of
repayment. So while it is debatable whether a loan or Chapter 11 is better
for the Big Three, a $25 billion loan is definitely better for the taxpayers
and the economy of our country.

So I'll end where I began on the quality of the products of Detroit it .
Before you, Mr. or Ms. Journalist continue to misinform the American public
and turn them against one of the great Industries tries that helped build
this nation, I must ask you one question. Before you, Mr. or Madam
Congressman vote to end health care and retirement benefits for 1 million
retirees, eliminate 2.5 million of our nation's jobs, lose the technology
that will lead us in the future and create an economic disaster including
hundreds of billions of tax dollars lost, I ask this question not in the
rhetorical sense. I ask it in the sincere, literal way. Can you tell me,
have you driven a Ford lately?

Jim Jackson Elkins

End part one: The "PRO"

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Abridged letter from Troy Clarke, President of General Motors - followed by
a response from Gregory Knox, President of Knox Machinery, a manufacturer of
precision machine tools which supplies the auto industry.

1. from GM

Dear Employee,

Next week, Congress and the current Administration will determine whether to
provide immediate support to the domestic auto industry to help it through
one of the most difficult economic times in our nation's history.

Your elected officials must hear from all of us now on why this support is
critical to our continuing the progress we began prior to the global
financial crisis......................As an employee, you have a lot at
stake and continue to be one of our most effective and passionate voices.

I know GM can count on you to have your voice heard. Thank you for your
urgent action and ongoing support.

Troy Clarke

President

General Motors North America

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Anti-Detroit "Let them eat cake"

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2. From Gregory Knox,

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In response to your request to call legislators and ask for a bailout for
the United States automakers please consider the following, and please also
pass this onto Troy Clark, the president of General Motors North America for
me.

You are both infected with the same entitlement mentality that has bred like
cancerous germs in UAW halls for the last countless decades, and whose
plague is now sweeping the nation, awaiting our new "messiah" to wave his
magical wand and make all our problems go away, while at the same time
allowing our once great nation to keep "living the dream".

The dream is over!

The dream that we can ignore the consumer for years while management
myopically focuses on its personal rewards packages at the same time that
our factories have been filled with the worlds most overpaid, arrogant,
ignorant and laziest entitlement minded "laborers" without paying the price
for these atrocities.and that still the masses will line up to buy our
products

Don't tell me I'm wrong. Don't accuse me of not knowing of what I speak.

I have called on Ford, GM , Chrysler,TRW, Delphi, Kelsey Hayes, American
Axle and countless other automotive OEM's and Tier ones for 3 decades now
throughout the Midwest and what I've seen over the years in these union
shops can only be described as disgusting.

Mr Clark, the president of General Motors, states: "There is widespread
sentiment in this country, our government and especially in the media that
the current crisis is completely the result of bad management. It is not."

You're right - it's not JUST management.how about the electricians who walk
around the plants like lords in feudal times, making people wait on them for
countless hours while they drag ass.so they can come in on the weekend and
make double and triple time.for a job they easily could have done within
their normal 40 hour week ?

How about the line workers who threaten newbies with all kinds of scare
tactics.for putting out too many parts on a shift.and for being too
productive (mustn't expose the lazy bums who have been getting overpaid for
decades for their horrific underproduction, must we?!?)

Do you really not know about this stuff?!?

How about this great sentiment abridged from Mr. Clarke's sad plea:

over the last few years .we have closed the quality and efficiency gaps with
our competitors.

What the hell has Detroit been doing for the last 40 years?!?

Did we really JUST wake up to the gaps in quality and efficiency between us
and them?

The K car vs. the Accord?

The Pinto vs. the Civic?!?

Do I need to go on? We are living through the inevitable outcome of the
actions of the United States auto industry for decades. Time to pay for your
sins, Detroit.

I attended an economic summit last week where a brilliant economist, Alan
Beaulieu surprised the crowd when he said he would not have given the banks
a penny of "bailout money".

Yes, he said, this would address short term problems, but despite what
people like George Bush and Troy Clark would have us believe, the sun would
in fact rise the next day. and something else would happen.where there had
been greedy and sloppy banks new efficient ones would pop up.that is how a
free market system works.it does work.if we would let it work.

But for some reason we are now deciding that the rest of the world is right
and that capitalism doesn't work - that we need the government to step in
and "save us".save us, hell - we're nationalizing.and unfortunately too many
of this once fine nations citizens don't even have a clue that this is
what's really happening.but they sure can tell you the stats on their
favorite sports teams.yeah - THAT'S important.

Does it occur to ANYONE that the "competition" has been producing vehicles,
EXTREMELY PROFITABLY, for decades now in this country?... How can that be???

Let's see. Fuel efficient. Listening to customers. Investing in the proper
tooling and automation for the long haul. Not being too complacent or
arrogant to listen to Dr W Edwards Deming 4 decades ago,,,

Ever increased productivity through quality, lean and six sigma plans.
Treating vendors like strategic partners, rather than like "the enemy".
Efficient front and back offices. Non union environment.

Again, I could go on and on, but I really wouldn't be telling anyone
anything they really don't already know in their hearts
I have six children, so I am not unfamiliar with the concept of wanting
someone to bail you out of a mess that you have gotten yourself into - my
children do this on a weekly, if not daily basis, as I did at their age.

I do for them what my parents did for me (one of their greatest gifts, by
the way) - I make them stand on their own two feet and accept the
consequences of their actions and work them through.

Radical concept, huh. Am I there for them in the wings? Of course - but only
until such time as they need to be fully on their own as adults

I don't want to oversimplify a complex situation, but there certainly are
unmistakable parallels here between the proper role of parenting and
government.

Detroit and the United States need to pay for their sins.

Bad news people - it's coming whether we like it or not The newly elected
Messiah really doesn't have a magic wand big enough to "make it all go away"

I laughed as I heard Obama "reeling it back in" almost immediately after the
vote count was tallied.

"we might not do it in a year.or in four." where was that kind of talk when
he was RUNNING for the office Stop trying to put off the inevitable . That
house in Florida really isn't worth $750,000. People who jump across a
border really don't deserve free health care benefits. That job driving that
forklift for the big 3 really isn't worth $85,000 a year. We really
shouldn't allow Wal-Mart to stock their shelves with products acquired from
a country that unfairly manipulates their currency and has the most
atrocious human rights infractions on the face of the globe.

That couple whose combined income is less than $50,000 really shouldn't be
living in that $485,000 home. Let the market correct itself people - it
will.

Yes it will be painful, but it's gonna be painful either way, and the bright
side of my proposal is that on the other side of it is a nation that
appreciates what is has.and doesn't live beyond its means.and gets back to
basics.and redevelops the work ethic that made it the greatest nation in the
history of the world.

Sorry - don't cut my head off, I'm just the messenger sharing with you the
"bad news"

Gregory J Knox
President Knox Machinery, Inc.
Franklin, Ohio 45005

Bada Bing...